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Isis Reports Financial Results and Highlights for Second Quarter of 2008
Date:8/7/2008

3 - 14,409

Loss attributed to noncontrolling

interest in Regulus Therapeutics LLC 965 - 1,848 -

Loss attributed to noncontrolling

interest in Ibis Biosciences, Inc. 791 - 896 -

Net loss applicable to common stock $(2,208) $(11,024) $(6,492) $(24,044)

Basic and diluted net loss per share $(0.02) $(0.13) $(0.07) $(0.29)

Shares used in computing basic and

diluted net loss per share 94,675 82,548 92,737 82,502

Isis Pharmaceuticals, Inc.

Reconciliation of GAAP to Pro Forma Basis:

Condensed Consolidated Operating Expenses and Loss From Operations

(In Thousands)

Three months ended, Six months ended,

June 30, June 30,

2008 2007 2008 2007

(unaudited) (unaudited)

As reported operating expenses

according to GAAP $36,094 $23,473 $66,277 $46,824

Excluding compensation

expense related to stock

options pursuant to SFAS 123(R) (4,006) (2,389) (7,765) (4,753)

Pro forma operating expenses $32,088 $21,084 $58,512 $42,071

As reported loss from operations

according to GAAP $(3,133) $(19,660) $(11,963) $(40,561)

Excluding compensation

expense related to stock

options pursuant to SFAS 123(R) (4,006) (2,389) (7,765) (4,753)

Pro forma income (loss) from

operations $873 $(17,271) $(4,198) $(35,808)

Reconciliation of GAAP to Pro Forma Basis

As illustrated in the Selected Financial Information in this press release, pro forma operating expenses and
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SOURCE Isis Pharmaceuticals, Inc.
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