Cepheid Reports 2009 Second Quart...(thousands): ...),Health

                                             Quarter Ended
                                             -------------
                                              (Unaudited)
                                   March 31 June 30  Sept 30 Dec 31    Total
                                   -------- -------  ------- ------    -----
    Quarter Ended June 30,
     2009 Beginning
         Balance Adjustment:                                          $(3,320)
                                                                      =======

    Increase in loss from operations, net loss, and increase in cost of
     product sales:

    Year Ended 2009                $(179)     $-       $-      $-       $(179)
    Year Ended 2008                 (168)   (169)    (169)   (168)       (674)
    Year Ended 2007                 (171)   (168)    (169)   (169)       (677)
    Prior to Year Ended 2007           -       -        -       -      (1,790)
                                                                       ------
                                                                      $(3,320)
                                                                      =======

Net loss per share did not change for the three and six months ended June 30, 2008 due to the patent license amortization error. In addition, net cash provided by operations in the condensed consolidated statement of cash flows for the six months ended June 30, 2008 did not change because the increase in the net loss of $338,000 was offset by the increase of $338,000 in the amortization of intangible assets.

As the errors were not material to prior years' financial statements when evaluated under the "rollover" approach but were material to the 2009 condensed consolidated financial statements when evaluated under the "iron curtain" method, the company will correct the previously issued financial statements referenc
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