N@N

SAN MATEO, Calif.--([ BUSINESS WIRE ])--Deltagen, Inc. (Pink Sheets:DGEN), a leading provider of drug discovery tools and services to the biopharmaceutical industry, today reported unaudited consolidated financial results for the three months ended March 31, 2012.

"Managementas Discussion and Analysis of Financial Conditions and Results of Operations"

Revenues: The Companyas consolidated revenues for the three months ended March 31, 2012 totaled $0.508 million. The revenues in the first quarter of 2012 were attributable to license fees associated with the provision of knockout mice and related phenotypic data pursuant to orders placed by customers under the Companyas DeltaOne^TM program. The Companyas consolidated revenues for the three months ended March 31, 2012 included $0.035 million in revenues of Xenopharm, Inc. (aXenopharma), a wholly owned subsidiary of the Company. There was no revenue in the first quarter of 2011 from the Companyas wholly owned subsidiary, Benten BioServices, Inc. (aBenten BioServicesa).

Expenses: Total consolidated expenses for the three months ended March 31, 2012 were $1.583 million. The expenses in the first quarter of 2012 were attributable primarily to labor costs and other general and administrative expenses, including expenses of $1.232 million relating to the operation of its wholly owned subsidiary, Benten BioServices (aBenten Expensesa), $0.162 million in royalty and commission expenses, and non-recurring expenses of $0.020 million associated with the royalties and prosecution and issuance of patents licensed exclusively to Xenopharm. As of March 31, 2012, the Company had accrued aggregate total royalties to Lexicon Pharmaceuticals, Inc. (aLexicona) of $5.624 million in royalty payments pursuant to a March 2005 settlement agreement between Lexicon and the Company. Under the settlement, the maximum aggregate amount of royalty payments due to Lexicon is $6.00 million. Accordingly, up to $0.376 million in contingent royalty payments remained owed to Lexicon as of March 31, 2012. Commercial operations of Benten BioServices began in April 2012.

Net Income/Losses: Consolidated net losses before provision for income taxes for the three months ended March 31, 2012 were $1.074 million. Excluding Benten Expenses, net income before provision for income taxes for the three months ended March 31, 2012 would have been $0.157 million.

Cash, Cash Equivalents and Accounts Receivable: As of March 31, 2012, the Company had $0.715 million in consolidated cash and cash equivalents (compared to $1.409 million as of December 31, 2011) and $0.061 million in accounts receivable (compared to $0.076 million as of December 31, 2011).

Major Events during Q1 2012 and Subsequent Events:

Benten BioServices: Benten BioServices has commenced commercial operations and started invoicing its customers in April 2012. As of May 15, 2012, Benten BioServices had 17 full-time employees.

Bridge Funding of Benten BioServices: As part of its fund-raising efforts, Benten BioServices received $0.727 million in additional secured bridge loan financing on May 1, 2011. Benten BioServices had earlier received $1.275 million in secured bridge loan financing on December 22, 2011. The financing was led by Life Sciences Green House of Central Pennsylvania. Benten BioServices will require additional capital by June 2012 in order to continue to fund its operations in accordance with its business plan.

The unaudited consolidated financial statements for the fourth quarter and year of 2011, accompanying notes, and Managementas Discussion and Analysis of Financial Conditions and Results of Operations for such period will be posted on Deltagenas website ([ www.deltagen.com ]).

About Deltagen

Deltagen, Inc. is a leading provider of drug discovery tools to the biopharmaceutical industry. Deltagen offers access to its extensive inventory of knockout mouse lines and related phenotypic data, which enhance the efficiency of target validation and drug discovery. In addition, Deltagen offers target validation data in the areas of immunology and metabolic diseases. Deltagen's products and programs have been validated by customers and partners such as Eli Lilly & Co., GlaxoSmithKline, Merck & Co., Inc. and Pfizer Inc. Benten BioServices, Inc., a wholly-owned subsidiary of Deltagen based in Malvern, Pennsylvania, offers regulatory-compliant services to support the development and commercialization of biopharmaceutical products. Benten BioServices' services are designed to address specific requirements for critical stages in product development, including biosafety testing, raw materials testing, assay and process validation services, cell banking and characterization services, and technology platform-specific R&D support and consulting services. For more information on Deltagen, visit the Company's website at [ www.deltagen.com ]. For more information on Benten, visit Benten's website at [ www.bentenbio.com ].

Safe Harbor Statement

This press release contains aforward-looking statements,a including statements about Deltagenas future revenues, cash flows and operating results, first-party royalty obligations and first-party licenses and intellectual property, fund-raising efforts, Benten BioServices' business plans, as well as other matters that are not historical facts or information.These forward-looking statements are based on managementas current assumptions and expectations and involve risks, uncertainties and other important factors, specifically including those relating to Deltagenas ability to achieve its operational objectives and revenue projections, that may cause Deltagenas actual results to be materially different from any future results expressed or implied by such forward-looking statements. There are no assurances that the Company will declare any future dividends.Information identifying such important risk factors is contained in aManagementas Discussion and Analysis of Financial Conditions and Results of Operationsa, which can be found at Deltagenas website at [ www.deltagen.com ].Deltagen undertakes no obligation to update or revise any such forward-looking statements, whether as a result of new information, future events or otherwise.