RICHMOND, Calif., July 23 /EMWNews/ -- Sangamo

BioSciences, Inc. (Nasdaq: SGMO) today reported second quarter 2008

financial results and accomplishments.



    For the second quarter ended June 30, 2008, Sangamo reported a

consolidated net loss of $7.4 million, or $0.18 per share, compared to a

net loss of $5.2 million, or $0.15 per share, for the same period in 2007.

As of June 30, 2008, the company had cash, cash equivalents and investments

of $64.3 million.



    Revenues for the second quarter of 2008 were $2.8 million, compared to

$2.6 million for the second quarter of 2007. Second quarter 2008 revenues

were primarily comprised of revenue recognition from the Company's

collaboration agreements with Dow AgroSciences (DAS) and Sigma-Aldrich,

enabling technology agreements in protein production and research grants.

The revenue recognized for the second quarter of 2008 consisted of $2.4

million in collaboration agreements and $464,000 in research grants.



    Research and development expenses were $8.3 million for the second

quarter of 2008, compared to $6.3 million for the same period in 2007. The

increase in research and development expenses for the second quarter of

2008 was primarily due to advancing the Company's clinical development

programs in diabetic neuropathy and pre-IND programs to develop ZFP

Therapeutics for the treatment of HIV/AIDS and glioblastoma, as well as

increased research and development personnel costs. Non-cash employee

stock-based compensation included in research and development expenses

totaled $0.7 million and $0.3 million in the second quarter of 2008 and

2007, respectively.



    General and administrative expenses were $2.5 million for the second

quarter of 2008, compared to $2.1 million for the same period in 2007. The

increase in general and administrative expenses was primarily due to

increased personnel costs, including non-cash employee stock-based

compensation which totaled $0.6 million in the second quarter of 2008

compared to $0.2 million in the same period in 2007.



    Total operating expenses for the second quarter of 2008 were $10.8

million, compared to $8.4 million for the same period in 2007.



    Net interest and other income was $570,000 for the second quarter of

2008, compared to $657,000 for the same period in 2007.



    Six Month Results



    For the six months ended June 30, 2008, the consolidated net loss was

$15.4 million, or $0.38 per share, compared to a net loss of $10.5 million,

or $0.30 per share, for the period ended June 30, 2007. Revenues were $5.6

million for the first half of 2008, compared to $4.0 million in the same

period in 2007. Total operating expenses were $22.4 million for the first

half of 2008 and $15.9 million in the first half of 2007. The increase in

operating expenses for 2008 was primarily associated with Sangamo's

clinical development programs in diabetic neuropathy and pre-IND programs

to develop ZFP Therapeutics for the treatment of HIV/AIDS and glioblastoma,

as well as increased research and development personnel costs and lab

supply expenses.



    Recent Highlights



    -- Dow AgroSciences announces early exercise of commercial license for

ZFP technology. Four months earlier than expected Dow AgroSciences (DAS)

announced during the BIO International Convention in June that they had

exercised their option, under and existing agreement with Sangamo, for a

commercial license to Sangamo's zinc finger DNA-binding protein (ZFP)

technology for use in plant agriculture. DAS will use the technology to

generate products itself and plans to sublicense the technology to other

companies under the trademark of ExZact Precision Traits(TM). As part of

the agreement, Sangamo will receive a license fee payment of $6.0 million

and the balance of the outstanding milestone payments of approximately $2.3

million. In addition, Sangamo is eligible to receive development and

commercial milestone payments and royalties on product sales for any

product that DAS develops, as well as 25% of any cash consideration

received by DAS under such sublicenses. A webcast replay of the press

conference that DAS hosted is available on Sangamo's website on the

Investor page under Events and Presentations.



    -- Presentation of complete 180 day follow-up data from Phase 1b study

of SB-509 in subjects with diabetic neuropathy (DN). Data from the Phase 1b

clinical trial were presented at the American Diabetes Association Meeting

in June. The data demonstrate statistically significant improvement in

quantitative sensory testing and Neuropathy Impairment Score-Lower Limbs

(NIS-LL), a quantitative measure of the neurologic exam, as well as

clinically relevant trends toward improvement in nerve conduction

velocities. The trial was conducted in subjects with mild to moderate

diabetic neuropathy over a six month period after a single administration

of SB-509. SB-509 is an injectable formulation of plasmid DNA that encodes

a ZFP transcription factor (ZFP TF(TM)), designed to upregulate the

vascular endothelial growth factor-A (VEGF-A) gene.



    -- Phase 2 clinical trial, SB-509-701 fully enrolled and expanded. A

Phase 2 study of SB-509 is being undertaken in subjects with moderate to

severe diabetic neuropathy with at least one "blocked nerve". In addition

to the announcement of the completion of accrual of the first part of the

trial, Sangamo announced plans to expand and broaden the trial to test an

additional dosing regimen.



    -- Data from critical limb ischemia Phase 1 trial presented at the

International Society for Cellular Therapy Meeting. Sangamo's collaborators

from Duke University presented data from the completed Phase 1 trial of the

company's ZFP TF activator of VEGF-A for the treatment of critical limb

ischemia. The data from this trial demonstrated that administration of the

ZFP transcription factor resulted in a statistically significant increase

in circulating stem cells in the peripheral blood. In addition, within a

subgroup in which bone marrow cells were examined before and after

treatment, the data suggests that subjects who showed the most marked

clinical improvements, as judged by limb salvage, ulcer healing, reduction

in pain and increased oxygen concentrations in the tissues of the lower

limbs, also showed the greatest increase in bone marrow stem cells. This

observation of stem cell mobilization after treatment with Sangamo's ZFP TF

activator of VEGF-A, is being further investigated in an ongoing Phase 2

trial of SB-509, SB-509-703.



    -- Announcement of research and license agreement with F. Hoffmann-La

Roche Ltd. and Hoffmann-La Roche Inc. (Roche) for the use of ZFP technology

to develop transgenic animals. In July, Sangamo and Sigma-Aldrich

Corporation jointly announced a research and license agreement to provide

Roche with non-exclusive, worldwide rights for the use of Sangamo's ZFP

nuclease (ZFN(TM)) technology to develop cell-lines and transgenic animals

with targeted modifications in a specified gene in a specified species.

Roche also has an option for an exclusive, worldwide license from Sangamo

for the commercial use of such ZFN-generated transgenic animals in the

production of therapeutic and diagnostic products.



    -- Publication of preclinical data in Nature Biotechnology. Papers

highlighting therapeutic and research applications of Sangamo's ZFN

technology were published in the scientific journal, Nature Biotechnology.

The first paper demonstrated the use of ZFNs to efficiently generate

transgenic animals, in this case zebrafish, a widely recognized system for

human disease modeling and in vivo drug discovery. A second publication

described the successful ZFN-mediated disruption of the CCR5 gene in human

T-cells and the positive effects on HIV resistance and reduction in viral

load in an animal model of HIV infection.



    Conference Call



    Sangamo will host a conference call today, July 23, 2008 at 5:00 p.m.

ET, which will be open to the public. The call will also be webcast live

and can be accessed via a link on the Sangamo BioSciences website in the

Investor Relations section under "Events and Presentations"

http://investor.sangamo.com/events.cfm. The webcast replay will also be

available for two weeks after the call. During the conference call, the

company will review these results, discuss other business matters, and

provide forward-looking guidance with respect to the remainder of 2008.



    The conference call dial-in numbers are 877-627-6562 for domestic

callers and 719-325-4874 for international callers. The passcode for the

call is 8762164. For those unable to listen in at the designated time, a

conference call replay will be available for one week following the

conference call, from approximately 8:00 p.m. ET on July 23, 2008 to

midnight ET on July 30, 2008. The conference call replay numbers for

domestic and international callers are 888-203-1112 and 719-457-0820

respectively. The conference ID number for the replay is 8762164.

    About Sangamo



    Sangamo BioSciences, Inc. is focused on the research and development of

novel DNA-binding proteins for therapeutic gene regulation and

modification. The most advanced ZFP Therapeutic(TM) development program is

currently in Phase 2 clinical trials for evaluation of safety and clinical

effect in patients with diabetic neuropathy. Other therapeutic development

programs are focused on stem cell mobilization, ALS, cancer, HIV/AIDS,

neuropathic pain, nerve regeneration, Parkinson's disease and monogenic

diseases. Sangamo's core competencies enable the engineering of a class of

DNA-binding proteins known as zinc finger DNA-binding proteins (ZFPs). By

engineering ZFPs that recognize a specific DNA sequence Sangamo has created

ZFP transcription factors (ZFP TF(TM)) that can control gene expression

and, consequently, cell function. Sangamo is also developing

sequence-specific ZFP Nucleases (ZFN(TM)) for gene modification. Sangamo

has established strategic partnerships with companies outside of the human

therapeutic space including Dow AgroSciences, Sigma-Aldrich Corporation and

several companies applying its ZFP Technology to enhance the production of

protein pharmaceuticals. For more information about Sangamo, visit the

company's web site at http://www.sangamo.com.



    This press release contains forward-looking statements regarding

Sangamo's current expectations. These forward looking statements include,

without limitation, references to the research and development of ZFP TFs

and ZFNs, clinical trials and therapeutic applications of Sangamo's ZFP

technology platform, achievement of research milestones and objectives,

strategic partnership with collaborators and anticipated amount of cash and

cash equivalents. These statements are not guarantees of future performance

and are subject to certain risks, uncertainties and assumptions that are

difficult to predict. Factors that could cause actual results to differ

include, but are not limited to, the early stage of ZFP Therapeutic

development, uncertainties related to the timing of initiation and

completion of clinical trials, whether clinical trial results will validate

and support the safety and efficacy of ZFP Therapeutics, and the ability to

establish strategic partnerships. Further, there can be no assurance that

the necessary regulatory approvals will be obtained or that Sangamo will be

able to develop commercially viable ZFP-based therapeutics. Actual results

may differ from those projected in forward-looking statements due to risks

and uncertainties that exist in the company's operations and business

environments. These risks and uncertainties are described more fully in

Sangamo's Annual Report on Form 10-K and Quarterly Reports on Form 10-Q as

filed with the Securities and Exchange Commission. Forward-looking

statements contained in this announcement are made as of this date and will

not be updated.










    SELECTED FINANCIAL DATA

    (in thousands, except per share data)

    (unaudited)



                                         Three Months Ended  Six Months Ended

                                              June 30,           June 30,

                                           2008     2007      2008      2007

    Consolidated Statement of

     Operations Data:

    Revenues

      Collaboration agreements            $2,378   $1,461    $4,462    $2,611

      Research grants                        464    1,123     1,145     1,395

        Total revenues                     2,842    2,584     5,607     4,006

    Operating expenses:

      Research and development             8,286    6,309    16,929    11,739

      General and administrative           2,545    2,113     5,472     4,112

        Total operating expenses          10,831    8,422    22,401    15,851

    Loss from operations                  (7,989)  (5,838)  (16,794)  (11,845)

    Interest income, net                     570      657     1,406     1,305

    Net loss                             $(7,419) $(5,181) $(15,388) $(10,540)



    Basic and diluted net loss per

     common share                         $(0.18)  $(0.15)   $(0.38)   $(0.30)



    Shares used in computing basic and

     diluted net loss per common share    40,858   35,136    40,673    35,097









    CONSOLIDATED CONDENSED BALANCE SHEET

     DATA

                                        June 30, 2008       December 31, 2007

    Cash, cash equivalents, and

     investments                              $64,295                 $81,412

    Total assets                               75,934                  83,900

    Total stockholders' equity                 60,613                  72,122