SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C.  20549

                                  ____________



                                    FORM 8-K



                                 CURRENT REPORT



                     PURSUANT TO SECTION 13 OR 15(D) OF THE
                         SECURITIES EXCHANGE ACT OF 1934



                        DATE OF REPORT: FEBRUARY 23, 2001
                        (Date of earliest event reported)



                              INCYTE GENOMICS, INC.
             (Exact name of registrant as specified in its charter)


                  DELAWARE                0-27488       94-3136539
         (State or other jurisdiction  (Commission    (IRS Employer
              of incorporation)        File Number) Identification No.)

              3160 PORTER DRIVE, PALO ALTO, CALIFORNIA        94304
              (Address of principal executive offices)       (Zip Code)

       Registrant's telephone number, including area code:  (650) 855-0555





ITEM  5.     OTHER  EVENTS.
             -------------

     Set  forth below are updated risk factors affecting an investment in Incyte
Genomics,  Inc. (the "Company").  In the descriptions of the risk factors below,
all  references  to "Incyte," "we," "us" or "our" mean Incyte Genomics, Inc. and
its  subsidiaries,  except  where  it is made clear that the term means only the
parent  company.

     As  used  in  this  current  report  on  Form  8-K,  the  words  "expects,"
"anticipates,"  "estimates,"  "plans,"  and  similar expressions are intended to
identify  forward-looking statements. These are statements that relate to future
periods  and include statements as to our expected net losses, the percentage of
revenues  generated  by  custom genomic products and services, our expected cash
flows, growth in our operations, our ability to commercialize products developed
under  collaborations  and  alliances,  our  ability to complete the sequence of
full-length  genes  in  areas  of therapeutic interest and file patents on these
potential  drug  targets, our ability to integrate companies and operations that
we  have  acquired  or will acquire, our ability to implement online delivery of
our database and software products, the scheduling and timing of our litigation,
our  strategy  with regard to protecting our proprietary technology, our ability
to  compete  and  respond  to  rapid  technological  change, the performance and
utility of our products and services and expectations as to growth in the number
of  our  employees  and  scope of our operations. Forward-looking statements are
subject  to  risks  and  uncertainties that could cause actual results to differ
materially  from those projected. These risks and uncertainties include, but are
not  limited  to,  the  extent  to  which  the pharmaceuticals and biotechnology
industries  use  genomic information in research and development, risks relating
to  development  of  new  products  and  services and their use by our potential
customers  and collaborators, our ability to work with our collaborators to meet
the  goals  of our collaborators and alliances, our ability to retain and obtain
customers,  the  cost  of  accessing  or  acquiring technologies or intellectual
property, the effectiveness of our sequencing efforts, the impact of alternative
technological advances and competition, uncertainties associated with changes in
patent laws, developments in and expenses related to litigation and interference
proceedings,  and  the  risks  set forth below under the caption "Risk Factors."

     Incyte and LifeSeq are our registered trademarks. GEM is our trademark.  We
also refer to trademarks of other corporations and organizations in this current
report  on  Form  8-K.

RISK  FACTORS

WE  HAVE HAD ONLY LIMITED PERIODS OF PROFITABILITY, WE EXPECT TO INCUR LOSSES IN
THE  FUTURE  AND  WE  MAY  NOT  RETURN  TO  PROFITABILITY

     We  had  net  losses from inception in 1991 through 1996 and again incurred
net  losses  in  1999  and  2000. Because of those losses, we had an accumulated
deficit  of  $  84.9  million  as of December 31, 2000. We intend to continue to
spend  significant  amounts on new product and technology development, including
therapeutic  drug  discovery  and  development  programs and making our products
available  online,  and  to  increase  our  investment  in  marketing, sales and
customer  service.  The amounts we intend to spend on new product and technology
development include spending for our efforts to determine the sequence of genes,
or  genomic  sequencing, determine gene functions, develop database and software
products  such  as  our gene expression database, discover SNPs, expand research
and  development  alliances,  and  develop  electronic  commerce products.  As a
result,  we  expect  to incur losses in 2001. We may report net losses in future
periods  as  well.  We  will  not return to profitability unless we increase our
revenues  or  reduce  our  expenses.

TO  GENERATE  SIGNIFICANT  REVENUES,  WE  MUST  OBTAIN  ADDITIONAL  DATABASE
COLLABORATORS  AND  RETAIN  EXISTING  COLLABORATORS

     As  of  September  30,  2000, we had over 20 database agreements. If we are
unable  to  enter  into  additional  agreements,  or  if  our  current  database
collaborators  choose  not to renew their agreements upon expiration, we may not
generate  additional  revenues  or  maintain our current revenues.  Our database
revenues  are also affected by the extent to which existing collaborators expand
their  agreements with us to include our new database products and the extent to
which existing collaborators reduce the number of products or services for which
they  subscribe,  the  impact of which will vary based upon our pricing of those
products  and  services.  Some  of  our  database  agreements require us to meet
performance  obligations,  some  or  all  of  which  we may not be successful in
attaining. A database collaborator can terminate its agreement before the end of
its scheduled term if we breach the agreement and fail to cure the breach within
a  specified  period.

OUR  LONGER-TERM  STRATEGY  FOR  PROFITABILITY  INCLUDES  LICENSES  UNDER  OUR
GENE-RELATED  INTELLECTUAL  PROPERTY,  BUT  THESE LICENSES MAY NOT CONTRIBUTE TO
REVENUES  FOR  SEVERAL  YEARS,  AND  MAY  NEVER  RESULT  IN  REVENUES

     Part of our strategy is to license to database collaborators and to some of
our  other  customers our know-how and patent rights associated with the genetic
information  in  our  proprietary  databases,  for  use  in  the  discovery  and
development  of  potential  pharmaceutical,  diagnostic  or  other products. Any
potential  product  that  is  the subject of such a license will require several
years  of  further  development, clinical testing and regulatory approval before
commercialization.  Therefore,  milestone  or  royalty  payments  from  these
collaborations  may  not  contribute  to  revenues for several years, if at all.

IF  WE  ARE  NOT  ABLE  TO GENERATE SIGNIFICANT REVENUES FROM OUR CUSTOM GENOMIC
PRODUCTS  AND  SERVICES,  WE  MAY  NOT  BE ABLE TO GENERATE SIGNIFICANT REVENUES

     We  expect  that  our  custom  genomic  products and services will become a
greater  percentage  of  our  revenues.  Whether  this occurs, and whether these
products and services will generate significant revenues, depends on our ability
to  increase  our  customer  base,  increase  sales  to  existing customers, and
increase  our production capacity in a timely manner and with consistent volumes
and  quality  to  meet  the  increased  demand.

OUR  OPERATING  RESULTS  ARE  UNPREDICTABLE,  WHICH MAY CAUSE OUR STOCK PRICE TO
DECLINE  AND  RESULT  IN  LOSSES  TO  INVESTORS

     Our  operating  results  are  unpredictable and may fluctuate significantly
from  period to period, which may cause our stock price to decline and result in
losses  to investors. Some of the factors that could cause our operating results
to  fluctuate  include:

- -     changes  in  the  demand  for  our  products  and  services, including our
database  business;

- -     the introduction of competitive databases or services, including databases
of  publicly  available,  or  public  domain,  genetic  information;

- -     the  nature,  pricing  and timing of products and services provided to our
collaborators;

- -     acquisition,  licensing  and  other  costs related to the expansion of our
operations,  including  operating  losses  of  acquired  businesses;

- -     losses  and  expenses  related  to  our  investments in joint ventures and
businesses;

- -     regulatory  developments  or changes in public perceptions relating to the
use  of  genetic information and the diagnosis and treatment of disease based on
genetic  information;

- -     changes  in  intellectual  property laws that affect our rights in genetic
information  that  we  sell;

- -     payments  of milestones, license fees or research payments under the terms
of  our  increasing  number  of  external  alliances;  and

- -     expenses  related to, and the results of, litigation and other proceedings
relating  to  intellectual  property  rights,  including  the  lawsuits filed by
Affymetrix  and  counterclaims  filed  by  Affymetrix.

     We  have significant fixed expenses, due in part to our need to continue to
invest  in  product  development  and  extensive  support  for  our  database
collaborators.  We  may  be  unable  to adjust our expenditures if revenues in a
particular  period fail to meet our expectations, which would harm our operating
results  for  that  period.  Forecasting  operating and integration expenses for
acquired businesses may be particularly difficult, especially where the acquired
business  focuses  on  technologies  that  do not have an established market. We
believe  that  period-to-period  comparisons  of  our financial results will not
necessarily  be  meaningful.  You  should  not  rely  on these comparisons as an
indication  of  our  future  performance. If our operating results in any future
period  fall  below  the  expectations of securities analysts and investors, our
stock  price  will  likely  fall,  possibly  by  a  significant  amount.

OUR INDUSTRY IS INTENSELY COMPETITIVE, AND IF WE DO NOT COMPETE EFFECTIVELY, OUR
REVENUES  MAY  DECLINE

     We  compete  in  markets  that  are  new,  intensely  competitive,  rapidly
changing,  and  fragmented.  Many  of our current and potential competitors have
greater  financial,  human  and other resources than we do. If we cannot respond
quickly  to  changing  customer  requirements,  secure  intellectual  property
positions,  or adapt quickly and obtain access to new and emerging technologies,
our  revenues  may  decline.  Our  competitors  include:

- -     Affymetrix,  Inc.,

- -     Celera  Genomics  Group  of  Applera  Corporation,

- -     CuraGen  Corporation,

- -     Gene  Logic  Inc.,

- -     Human  Genome  Sciences,  Inc.,

- -     major  pharmaceutical  companies,  and

- -     universities  and  other  research  institutions,  including  The  SNP
Consortium,  which  is funded by a number of pharmaceutical companies, and those
receiving  funding  from  the  federally  funded  Human  Genome  Project.

     The  human  genome  contains  a finite number of genes. Our competitors may
seek  to  identify,  sequence  and determine the biological function of numerous
genes  in  order  to  obtain  a  proprietary position with respect to new genes.

     In  addition, we face competition from companies who are developing and may
seek  to  develop  new technologies for discovering the functions of genes, gene
expression  information,  including  microarray  technologies,  discovery  of
variations  among  genes  and  related  technologies.  Also, if we are unable to
obtain  the technology we currently use or new advanced technology on acceptable
terms,  but  other  companies  are,  we  will  be  unable  to  compete.

     We  also face competition from providers of software. A number of companies
have  announced  their  intent  to  develop  and  market  software  to  assist
pharmaceutical  companies  and  academic  researchers  in managing and analyzing
their  own genomic data and publicly available data. If pharmaceutical companies
and  researchers  are  able  to  manage  their  own  genomic  data, they may not
subscribe  to  our  databases.

     Extensive  research  efforts  resulting  in  rapid  technological  progress
characterize  the  genomics industry. To remain competitive, we must continue to
expand  our databases, improve our software, and invest in new technologies. New
developments  will  probably  continue, and discoveries by others may render our
services  and  potential  products  noncompetitive.

OUR  NEW  INVESTMENTS IN VALIDATING DRUG TARGETS WILL LEAD TO INCREASED EXPENSES
AND  MAY  NOT  RESULT  IN  COMMERCIAL  PRODUCTS  OR  SERVICES

     We  have  recently  decided to invest in validating drug targets associated
with  diseases  that  may  be  linked  to  several  or  many  genes  working  in
combination.  The  process  of  discovering drugs based upon genomics is new and
evolving  rapidly,  and  we have limited experience in discovering or developing
drugs.  These  efforts  will  result in increased expenses and may not result in
commercial  products  or  services.  There  is  limited scientific understanding
generally  relating  to the role of genes in diseases, and few, if any, products
based  on  gene discoveries have been developed and commercialized. Accordingly,
even  if  we  are  successful  in identifying genes, biological pathways or drug
candidates associated with specific diseases, we or our collaborators may not be
able  to  develop  or  commercialize  products  to  improve  human health. Rapid
technological  development  by us or others may result in compounds, products or
processes  becoming  obsolete  before  we  recover  our  development  expenses.

OUR  REVENUES COULD DECLINE DUE TO PATENT POSITIONS BECOMING PUBLICLY AVAILABLE,
OR  DUE  TO  OUR  COMPETITORS  PUBLICLY  DISCLOSING  THEIR  DISCOVERIES

     Our competitors may discover and establish patent positions with respect to
the  genes  in  our  databases. Our competitors and other entities who engage in
discovering  the  location of genes within a DNA strand and may make the results
of their sequencing efforts publicly available. Currently, academic institutions
and other laboratories participating in the Human Genome Project make their gene
sequence information available through a number of publicly available databases,
including  the GenBank database. Also, Celera Genomics Group has publicly stated
that  it is committed to make available to the public basic human sequence data.
The  public  availability  of  these  discoveries  or resulting patent positions
covering  substantial  portions  of  the human genome could reduce the potential
value of our databases to our collaborators. It could also impair our ability to
realize  royalties  or  other  revenue from any commercialized products based on
this  genetic  information.

WE  ARE  INVOLVED  IN  PATENT  LITIGATION, WHICH IF NOT RESOLVED FAVORABLY COULD
REQUIRE  US  TO  PAY  DAMAGES  AND  STOP  SELLING  AND USING MICROARRAY PRODUCTS

     We  are currently involved in patent litigation. If we lose this litigation
we  could  be  prevented  from  producing  and  using  our  microarray products,
including  uses  of  those  products  for  purposes of providing gene expression
database products and gene expression services. We could also be required to pay
damages.  In  January 1998, Affymetrix filed a lawsuit in federal court alleging
infringement  of  U.S.  patent  number 5,445,934 by both Synteni and Incyte. The
complaint  alleges  that Synteni and Incyte infringed the '934 patent by making,
using, selling, importing, distributing or offering to sell in the United States
high  density  arrays and that this infringement was willful. Affymetrix seeks a
permanent  injunction  enjoining Synteni and Incyte from further infringement of
the  '934  patent  and,  in  addition, seeks damages, costs, attorneys' fees and
interest.  Affymetrix  also  requests  triple damages based on its allegation of
willful  infringement  by  Incyte  and  Synteni.

     In September 1998, Affymetrix filed an additional lawsuit in Federal Court,
alleging  Synteni  and  Incyte  infringed  U.S. patent number 5,800,992 and U.S.
patent number 5,744,305. The complaint alleges that Synteni and Incyte infringed
the  '305  patent by making, using, selling, importing, distributing or offering
to  sell  in the United States high density arrays. It also alleges that Synteni
and  Incyte  infringed the '992 patent by using their GEM  microarray technology
to  conduct  gene  expression  monitoring and other applications using two-color
labeling,  and  that this infringement was willful. Affymetrix seeks a permanent
injunction  enjoining  Synteni  and Incyte from further infringement of the '305
and  '992  patents.  In addition, Affymetrix had sought a preliminary injunction
enjoining  Incyte  and  Synteni from using Synteni's and Incyte's GEM microarray
technology  to  conduct  gene  expression monitoring using two-color labeling as
described  in the '992 patent. Affymetrix's request for a preliminary injunction
was  denied  in May 1999.  The court held a pretrial hearing in November 2000 to
determine how to construe the patent claims that will be litigated in trial.  In
January  2001,  the court issued a ruling describing how the claims in the '934,
'305  and  '992  patents  should  be  interpreted.

     In  April 1999, the Board of Patent Appeals and Interferences of the United
States Patent and Trademark Office declared interferences between pending patent
applications  licensed  exclusively  to  us  and  the  Affymetrix  '305 and '992
patents.  The  Board of Patent Appeals and Interferences invokes an interference
proceeding when more than one patent applicant claims the same invention. During
the  proceeding,  the  Board  of  Patent Appeals and Interferences evaluates all
relevant facts, including those bearing on first to invent, validity, enablement
and  scope  of  claims,  and then makes a determination as to who, if anyone, is
entitled  to  the patent on the disputed invention. In September 1999, the Board
of  Patent  Appeals  and  Interferences determined that we had not met our prima
facie  case,  and  ruled  that  the  patents licensed by Incyte and Synteni from
Stanford  University  were not entitled to priority over corresponding claims in
the  two  Affymetrix  patents.  We  are  seeking  de  novo review of the Board's
decisions  in  the  United  States  District  Court for the Northern District of
California.

     In  August  2000,  we  filed  a lawsuit against Affymetrix in federal court
alleging  infringement  of  U.S.  patent  numbers  5,716,785 and 5,891,636.  The
patents  relate  to  technologies  used  in  the  amplification  of  RNA and the
generation  of  gene expression information.  Affymetrix has filed counterclaims
in  this  lawsuit  that  allege,  among  other  things,  that Incyte and Synteni
infringe  U.S.  patent number 6,040,193 and U.S. patent number 5,871,928.  These
counterclaims  allege  that Incyte and Synteni infringe these patents by making,
using,  offering  to sell and/or selling within the United States the inventions
claimed  in  the patents, including, in the case of the '193 patent, methods for
forming  microarrays  and, in the case of the '928 patent, methods for analyzing
nucleic  acids. The counterclaims also allege that Incyte and Synteni engaged in
acts of unfair competition under California statutory and common law. Affymetrix
seeks  a  permanent  injunction  enjoining  Incyte  and  Synteni  from  further
infringement of the '193 patent and '928 patent and, in addition, seeks damages,
costs  and  attorneys'  fees  and  interest.  Affymetrix further requests triple
damages  from  the  infringement  claims  based  on  its  allegation  of willful
infringement  by  Incyte  and  Synteni.

     In December 1999 and August 2000, we filed lawsuits against Gene Logic Inc.
in  federal  court  alleging patent infringement. Gene Logic filed counterclaims
alleging, among other things, that we committed acts of unfair competition under
California  statutory  and  common  law.  Gene Logic sought, among other things,
damages,  costs  and  attorneys'  fees. In January 2001, we reached a litigation
settlement  with  Gene  Logic  pursuant to which the lawsuits were dismissed and
Gene  Logic  will  have  a  non-exclusive  license  to  practice  the technology
described  in  the  patents.

     On  July  24,  2000,  Affymax  Research Institute filed suit in state court
alleging  breach  of  contract  and  intentional  interference  with contractual
relations  by  Michael  C. Pirrung, Incyte and Does 1-10.  The complaint alleges
that Dr. Pirrung, a former employee and paid consultant of Affymax, breached the
confidential information secrecy and invention agreement and consultant services
agreement  he entered into with Affymax by working as our paid consultant on the
Affymetrix litigation.  The complaint further alleges that we and/or our counsel
were  aware  of  Dr.  Pirrung's  contractual  obligations  to  keep confidential
Affymax's  confidential,  proprietary and privileged information and intended by
engaging  Dr. Pirrung as an expert to interfere with his contracts with Affymax.
The complaint seeks compensatory and consequential damages, specific performance
of  the  contracts  and  a  preliminary  and  permanent injunction enjoining Dr.
Pirrung from divulging any confidential information.  Affymax also seeks to keep
us  from  retaining  Dr.  Pirrung  as a consultant in the Affymetrix litigation,
recover  costs  of  suit  and attorneys' fees and such other relief as the court
deems  just and proper.  Affymax's request for a temporary restraining order and
for  a  preliminary  injunction was denied.  A case management conference is set
for  February  27,  2001.

     We  believe we have meritorious defenses and intend to defend the suits and
counterclaims  brought  by  Affymetrix  and  Affymax  vigorously.  However,  our
defenses  may  be  unsuccessful. At this time, we cannot reasonably estimate the
possible  range  of any loss resulting from these suits and counterclaims due to
uncertainty  regarding  the  ultimate  outcome.  Regardless  of the outcome, the
Affymetrix  litigation  has  resulted  and  is expected to continue to result in
substantial  expenses  and  diversion  of  the  efforts  of  our  management and
technical  personnel.  Further,  there can be no assurance that any license that
may  be  required as a result of this litigation or the outcome thereof would be
made  available on commercially acceptable terms, if at all. This litigation may
also  affect our potential customers' willingness to use our microarray services
and  gene  expression  databases,  which  could  affect  our  revenue.

IF  WE  ARE SUBJECT TO ADDITIONAL LITIGATION AND INFRINGEMENT CLAIMS, THEY COULD
BE  COSTLY  AND  DISRUPT  OUR  BUSINESS

     The technology that we use to develop our products, and the technology that
we  incorporate in our products, may be subject to claims that they infringe the
patents or proprietary rights of others. The risk of this occurring will tend to
increase  as  the  genomics,  biotechnology and software industries expand, more
patents  are  issued  and other companies attempt to discover genes and SNPs and
engage  in  other  genomic-related  businesses.

     As  is  typical  in the genomics, biotechnology and software industries, we
have  received,  and  we will probably receive in the future, notices from third
parties  alleging patent infringement. We believe that we are not infringing the
patent  rights  of  any third parties. Except for Affymetrix, no third party has
filed  a  patent  lawsuit  against  us.

     We  may,  however,  be  involved  in  future  lawsuits  alleging  patent
infringement  or  other  intellectual  property  rights violations. In addition,
litigation  may  be  necessary  to:

- -     assert  claims  of  infringement;

- -     enforce  our  patents;

- -     protect  our  trade  secrets  or  know-how;  or

- -     determine the enforceability, scope and validity of the proprietary rights
of  others.

     We  may be unsuccessful in defending or pursuing these lawsuits. Regardless
of  the  outcome,  litigation  can  be  very  costly and can divert management's
efforts.  An  adverse determination may subject us to significant liabilities or
require  us to seek licenses to other parties' patents or proprietary rights. We
may  also  be restricted or prevented from manufacturing or selling our products
and  services.  Further,  we may not be able to obtain any necessary licenses on
acceptable  terms,  if  at  all.

WE MAY BE UNABLE TO PROTECT OUR PROPRIETARY INFORMATION, WHICH MAY RESULT IN ITS
UNAUTHORIZED  USE  AND  A  LOSS  OF  REVENUE

     Our  business  and  competitive position depend upon our ability to protect
our  proprietary  database  information  and  software  technology.  Despite our
efforts  to  protect  this  information and technology, unauthorized parties may
attempt  to  obtain  and use information that we regard as proprietary. Although
our  database  subscription agreements require our subscribers to control access
to our databases, policing unauthorized use of our databases and software may be
difficult.

     We  pursue  a  policy  of  having  our  employees, consultants and advisors
execute proprietary information and invention agreements when they begin working
for  us. However, these agreements may not provide meaningful protection for our
trade  secrets or other proprietary information in the event of unauthorized use
or  disclosure.

     Our means of protecting our proprietary rights may not be adequate, and our
competitors  may:

- -     independently develop substantially equivalent proprietary information and
techniques;

- -     otherwise  gain  access  to  our  proprietary  information;  or

- -     design  around  patents  issued  to us or our other intellectual property.

IF THE INVENTIONS DESCRIBED IN OUR PATENT APPLICATIONS ON FULL-LENGTH OR PARTIAL
GENES  ARE  FOUND TO BE UNPATENTABLE, OUR ISSUED PATENTS ARE NOT ENFORCED OR OUR
PATENT  APPLICATIONS  CONFLICT  WITH  PATENT  APPLICATIONS  FILED BY OTHERS, OUR
REVENUES  MAY  DECLINE

     One  of our strategies is to file patent applications on what we believe to
be  novel full-length and partial genes and SNPs obtained through our efforts to
discover  the  order, or sequence, of the molecules, or bases, of genes. We have
filed  U.S.  patent  applications  in which we claimed partial sequences of some
genes. We have also applied for patents in the U.S. and other countries claiming
full-length  gene  sequences  associated  with cells and tissues involved in our
gene  sequencing program. We hold a number of issued U.S. patents on full-length
genes and one issued U.S. patent claiming multiple partial gene sequences. While
the  United  States  Patent  and  Trademark  Office  has issued patents covering
full-length  genes,  partial  gene  sequences and SNPs, the Patent and Trademark
Office  may  choose to interpret new guidelines for the issuance of patents in a
more  restrictive  manner  in the future, which could impact the issuance of our
pending  patent  applications.  We  also  do  not know whether or how courts may
enforce  our  issued  patents, if that becomes necessary. If a court finds these
types  of  inventions to be unpatentable, or interprets them narrowly, the value
of  our  patent  portfolio  and  possibly  our  revenues  could  be  diminished.

     We  believe  that  some  of our patent applications claim genes and partial
sequences  of  genes  that  may  also be claimed in patent applications filed by
others.  In  some  or  all of these applications, a determination of priority of
inventorship  may need to be decided in an interference before the United States
Patent  and  Trademark  Office,  before  a patent is issued. If a full-length or
partial  length  sequence  for  which  we  seek a patent is issued to one of our
competitors,  we  may  be  unable  to include that full-length or partial length
sequence  on a microarray or in a library of bioreagents. This could result in a
loss  of  revenues.

IF  THE  EFFECTIVE  TERM  OF OUR PATENTS IS DECREASED DUE TO CHANGES IN THE U.S.
PATENT  LAWS  OR IF WE NEED TO REFILE SOME OF OUR PATENT APPLICATIONS, THE VALUE
OF  OUR  PATENT  PORTFOLIO  AND  THE REVENUES WE DERIVE FROM IT MAY BE DECREASED

     The  value  of  our  patents  depends  in part on their duration. A shorter
period  of  patent  protection  could  lessen  the value of our rights under any
patents that we obtain and may decrease the revenues we derive from our patents.
The  U.S.  patent  laws  were  amended  in  1995  to  change  the term of patent
protection  from  17  years  from  patent issuance to 20 years from the earliest
effective  filing  date of the application. Because the average time from filing
to  issuance  of biotechnology applications is at least one year and may be more
than three years depending on the subject matter, a 20-year patent term from the
filing  date may result in substantially shorter patent protection. Also, we may
need to refile some of our applications claiming large numbers of gene sequences
and,  in these situations, the patent term will be measured from the date of the
earliest  priority  application.  This  would  shorten  our  period  of  patent
exclusivity and may decrease the revenues that we might obtain from the patents.

INTERNATIONAL  PATENT  PROTECTION  IS  PARTICULARLY  UNCERTAIN,  AND  IF  WE ARE
INVOLVED  IN  OPPOSITION PROCEEDINGS IN FOREIGN COUNTRIES, WE MAY HAVE TO EXPEND
SUBSTANTIAL  SUMS  AND  MANAGEMENT  RESOURCES

     Biotechnology  patent  law outside the United States is even more uncertain
than  in  the  United  States and is currently undergoing review and revision in
many  countries. Further, the laws of some foreign countries may not protect our
intellectual property rights to the same extent as U.S. laws. We may participate
in  opposition  proceedings  to determine the validity of our foreign patents or
our  competitors  foreign  patents,  which could result in substantial costs and
diversion  of  our  efforts.

IF  OUR  PROGRAMS  RELATING TO THE ROLE OF GENETIC VARIATION IN DISEASE AND DRUG
RESPONSE  ARE  NOT  SUCCESSFUL,  THEY  MAY  NOT GENERATE SIGNIFICANT REVENUES OR
RESULT  IN  PROFITABLE  OPERATIONS

     Part  of  our business is focused on developing information-based and other
products  and  services to assist pharmaceutical companies in a new and unproven
area:  the identification and correlation of variation in genetic composition to
disease and drug response. We will incur significant costs over the next several
years  in  expanding our research and development in this area. These activities
may  never  generate  significant  revenues  or  profitable  operations.

     This  aspect  of our business focuses on single nucleotide polymorphisms or
SNPs,  one  type  of  genetic  variation.  The  role of SNPs in disease and drug
response  is  not  fully  understood, and relatively few, if any, therapeutic or
diagnostic  products based on SNPs have been developed and commercialized. Among
other  things,  demand  in  this  area  may be adversely affected by ethical and
social  concerns  about  the  confidentiality  of  patient-specific  genetic
information  and  about  the  use  of  genetic  testing for diagnostic purposes.

     Except  for  a few anecdotal examples, there is no proof that SNPs have any
correlation to diseases or a patient's response to a particular drug or class of
drug.  Identifying  statistically significant correlations is time-consuming and
could involve the collection and screening of a large number of patient samples.
We  do  not  know  if the SNPs we have discovered to date are suitable for these
correlation  studies  because  the  variations  we  discovered  may  not  occur
frequently  enough  to  justify  use  by  a  pharmaceutical  company.

     Our  success in this area will also depend upon our ability to develop, use
and  enhance  new  and  relatively unproven technologies. Among other things, we
will need to continue to improve the throughput of our SNP-discovery technology.
We  may  not  be able to achieve these necessary improvements, and other factors
may  impair our ability to develop our SNP-related products and services in time
to  be  competitively  available.

IF  OUR  STRATEGIC  INVESTMENTS  RESULT  IN  LOSSES,  OUR  EARNINGS  MAY DECLINE

     We  make  strategic  investments  in  joint  ventures  or  businesses  that
complement  our  business.  These  investments  may:

- -     often  be made in securities lacking a public trading market or subject to
trading  restrictions,  either  of  which  increases  our  risk  and reduces the
liquidity  of  our  investment;

- -     require  us  to  record  losses  and  expenses  related  to  our ownership
interest,  such  as  the  losses  we  reported in 1997, 1998, 1999 and the first
quarter  of  2000  related  to  our  investment  in  diaDexus,  LLC;

- -     require  us  to  record  charges  related to the acquisition of in-process
technologies or for the impairment in the value of the securities underlying our
investment;  and

- -     require  us  to  invest  greater  amounts  than  anticipated  or to devote
substantial  management  time  to  the  management  of  research and development
relationships  and  joint  ventures.

     The  market values of many of these investments fluctuate significantly. We
evaluate  our  long-term  equity investments for impairment of their values on a
quarterly  basis.  Impairment  could  result  in future charges to our earnings.
These  losses  and  expenses  may  exceed  the  amounts  that  we  anticipated.

BECAUSE  OUR SALES CYCLE IS LENGTHY, WE MAY SPEND A LOT OF TIME AND MONEY TRYING
TO  OBTAIN  NEW OR RENEWED SUBSCRIPTIONS TO OUR PRODUCTS AND SERVICES BUT MAY BE
UNSUCCESSFUL,  WHICH  COULD  HURT  OUR  PROFITABILITY

     Our ability to obtain new subscribers for our databases, software tools and
microarray  and  other  services  or to obtain renewals or additions to existing
subscriptions  depends  upon  prospective  subscribers'  perceptions  that  our
products  and  services can help accelerate drug discovery efforts. Our database
sales  cycle  is  typically  lengthy  because  we  need to educate our potential
subscribers  and  sell  the  benefits  of our tools and services to a variety of
constituencies within potential subscriber companies. In addition, each database
subscription  and  microarray  services  agreement  involves  the negotiation of
unique  terms.  We  may  expend  substantial funds and management effort with no
assurance  that  a  new,  renewed or expanded subscription or services agreement
will  result.  These  expenditures,  without increased revenues, will negatively
impact  our  profitability. Actual and proposed consolidations of pharmaceutical
companies  have affected the timing and progress of our sales efforts. We expect
that  future  proposed  consolidations  will  have  similar  effects.

IF  WE  ENCOUNTER  PROBLEMS  IN  MEETING CUSTOMERS' SOFTWARE NEEDS, OUR REVENUES
COULD  DECLINE  AND  WE  COULD  LOSE  OUR  CUSTOMERS'  GOODWILL

     Our  databases  require  software  support  and  will  need  to incorporate
features  determined  by  database  collaborators.  If  we  experience delays or
difficulties  in  implementing  our  database software or collaborator-requested
features, we may be unable to service our collaborators, which could result in a
loss  of  revenues  and  customer  goodwill.

WE  HAVE  ENCOUNTERED  DIFFICULTIES INTEGRATING COMPANIES WE ACQUIRED, AND IF IN
THE  FUTURE  WE  CANNOT SMOOTHLY INTEGRATE BUSINESSES WE ACQUIRE, OUR OPERATIONS
AND  FINANCIAL  RESULTS  COULD  BE  HARMED

     In  December  2000,  we  acquired  Proteome,  Inc.  As part of our business
strategy,  we  may  acquire  other assets, technologies and businesses. Our past
acquisitions have involved and our future acquisitions may involve risks such as
the  following:

- -     we  may  be  exposed  to  unknown  liabilities  of  acquired  companies;

- -     our  acquisition  and  integration costs may be higher than we anticipated
and  may  cause  our  quarterly  and  annual  operating  results  to  fluctuate;

- -     we  may  experience  difficulty and expense in assimilating the operations
and  personnel of the acquired businesses, disrupting our business and diverting
management's  time  and  attention;

- -     we  may be unable to integrate or complete the development and application
of  acquired  technology;

- -     we  may  experience  difficulties  in establishing and maintaining uniform
standards,  controls,  procedures  and  policies;

- -     our  relationships  with  key  customers  of  acquired  businesses  may be
impaired, due to changes in management and ownership of the acquired businesses;

- -     we  may  be  unable  to  retain  key employees of the acquired businesses;

- -     we  may  incur  amortization  expenses  if  an  acquisition  results  in
significant  goodwill  or  other  intangible  assets;  and

- -     our  stockholders may be diluted if we pay for the acquisition with equity
securities.

     In  addition, if we acquire additional businesses that are not located near
our  Palo  Alto,  California  headquarters,  we  may  experience more difficulty
integrating  and  managing  the  acquired  businesses'  operations.

IF WE ARE UNABLE TO MANAGE EFFECTIVELY OUR GROWTH, OUR OPERATIONS AND ABILITY TO
SUPPORT  OUR  CUSTOMERS  COULD  BE  AFFECTED,  WHICH  COULD  HARM  OUR  REVENUES

     We may continue to experience growth in the number of our employees and the
scope  of  our  operations. This growth has placed, and may continue to place, a
significant  strain on our management and operations. Our ability to manage this
growth  will  depend  upon  our  ability  to  attract,  hire  and retain skilled
employees.  Our  success will also depend on the ability of our officers and key
employees to continue to implement and improve our operational and other systems
and  to  hire,  train  and  manage  our  employees.

     In  addition,  we  must continue to invest in customer support resources as
the  number  of  database collaborators and their requests for support increase.
Our  database  collaborators typically have worldwide operations and may require
support at multiple U.S. and foreign sites. To provide this support, we may need
to  open  offices  in  additional  locations,  which  could result in additional
burdens  on  our  systems  and  resources.

WE  DEPEND  ON  KEY EMPLOYEES IN A COMPETITIVE MARKET FOR SKILLED PERSONNEL, AND
THE LOSS OF THE SERVICES OF ANY OF OUR KEY EMPLOYEES WOULD AFFECT OUR ABILITY TO
ACHIEVE  OUR  OBJECTIVES

     We  are  highly  dependent  on  the  principal  members  of our management,
operations  and  scientific  staff.  Our  product  development,  operations  and
marketing  efforts  would be delayed or curtailed if we lose the services of any
of  these  people.

     Our future success also will depend in part on the continued service of our
executive  management  team,  key  scientific,  software,  bioinformatics  and
management  personnel  and  our  ability  to  identify,  hire,  train and retain
additional  personnel, including customer service, marketing and sales staff. We
experience  intense  competition  for  qualified  personnel. If we are unable to
continue  to  attract,  train  and  retain  these personnel, we may be unable to
expand  our  business.

WE RELY ON A SMALL NUMBER OF SUPPLIERS OF PRODUCTS WE NEED FOR OUR BUSINESS, AND
IF  WE  ARE  UNABLE  TO OBTAIN SUFFICIENT SUPPLIES, WE WILL BE UNABLE TO COMPETE
EFFECTIVELY

     Currently,  we use gene sequencing machines supplied by Molecular Dynamics,
a  subsidiary  of  Amersham  Pharmacia  Biotech, Ltd., and chemicals used in the
sequencing process, called reagents, supplied by Sigma-Aldrich, Inc. in our gene
sequencing  operations.  If  we are not able to obtain additional machines or an
adequate supply of reagents or other materials at commercially reasonable rates,
our  ability  to  identify  genes or genetic variations would be slower and more
expensive.

IF  THE  INFORMATION  WE  OBTAIN  FROM  THIRD-PARTY  DATA  SOURCES IS CORRUPT OR
VIOLATES  THE  LAW,  OUR  REVENUES  AND  OPERATING  RESULTS  COULD  DECLINE

     We  rely on and include in our databases scientific and other data supplied
by  others,  including  publicly  available information from sources such as the
Human  Genome  Project.  This  data could contain errors or other defects, which
could  corrupt  our  databases.  In  addition, we cannot guarantee that our data
sources acquired this information in compliance with legal requirements. If this
data  caused  database  corruption  or  violated legal requirements, we would be
unable  to  sell subscriptions to our databases. These lost sales would harm our
revenue  and  operating  results.

SECURITY  RISKS  IN  ELECTRONIC COMMERCE OR UNFAVORABLE INTERNET REGULATIONS MAY
DETER  FUTURE  USE OF OUR PRODUCTS AND SERVICES, WHICH COULD RESULT IN A LOSS OF
REVENUES

     We offer several products through our website on the Internet and may offer
additional  products in the future.  Our ability to provide secure transmissions
of  confidential  information  over  the  Internet  may  limit online use of our
products  and services by our database collaborators as we may be limited by our
inability  to  provide secure transmissions of confidential information over the
Internet.  Advances in computer capabilities and new discoveries in the field of
cryptography  may  comprise the security measures we use to protect our website,
access  to  our  databases,  and  transmissions  to and from our website. If our
security  measures  are  breached,  our  proprietary information or confidential
information  about  our collaborators could be misappropriated. Also, a security
breach could result in interruptions in our operations. The security measures we
adopt may not be sufficient to prevent breaches, and we may be required to incur
significant  costs to protect against security breaches or to alleviate problems
caused  by  breaches. Further, if the security of our website, or the website of
another  company,  is breached, our collaborators may no longer use the Internet
when  the  transmission  of  confidential  information is involved. For example,
recent  attacks  by  computer  hackers  on  major  e-commerce websites and other
Internet  service  providers have heightened concerns regarding the security and
reliability  of  the  Internet.

     Because  of  the  growth in electronic commerce, the United States Congress
has  held  hearings  on  whether  to  further regulate providers of services and
transactions  in  the  electronic  commerce market. The federal government could
enact laws, rules and regulations that would affect our business and operations.
Individual  states  could also enact laws regulating the use of the Internet. If
enacted, these federal and state laws, rules and regulations could require us to
change  our online business and operations, which could limit our growth and our
development  of  our  online  products.

OUR  CUSTOMERS  MAY  NOT  CONSIDER  THE  INTERNET  AS  AN  ACCEPTABLE METHOD FOR
ACCESSING  OUR  PRODUCTS  AND  SERVICES

     We  have  expended  a  significant  amount  of  time  and money to made our
products  available  through  the  internet.  In 2000, we introduced our on-line
product  LifeSeq  Gene-by-Gene  and  make LifeSeq Gold and LifeExpress available
on-line.  If  only a few of our customers choose to use the internet as a method
for  accessing  our products and services, we may have to incur a charge against
earnings  to  write-off  internet  related  assets.

BECAUSE OUR ACTIVITIES INVOLVE THE USE OF HAZARDOUS MATERIALS, WE MAY BE SUBJECT
TO  COSTLY  ENVIRONMENTAL  LIABILITY  THAT  COULD  EXCEED  OUR  RESOURCES

     Our  research  and development involves the controlled use of hazardous and
radioactive materials and biological waste. We are subject to federal, state and
local laws and regulations governing the use, manufacture, storage, handling and
disposal  of  these  materials  and waste products. Although we believe that our
safety  procedures  for  handling  and  disposing of these materials comply with
legally  prescribed  standards,  the  risk of accidental contamination or injury
from  these  materials  cannot  be  completely  eliminated.  In  the event of an
accident,  we  could be held liable for damages, and this liability could exceed
our  resources.

     We  believe  that  we  are  in  compliance  in  all  material respects with
applicable  environmental  laws  and  regulations and currently do not expect to
make  material  additional  capital  expenditures  for  environmental  control
facilities in the near term.  However, we may have to incur significant costs to
comply  with  current  or  future  environmental  laws  and  regulations.

BECAUSE  OUR  REVENUES  ARE  DERIVED  PRIMARILY  FROM  THE  PHARMACEUTICAL  AND
BIOTECHNOLOGY  INDUSTRIES,  OUR  REVENUES  MAY  FLUCTUATE  SUBSTANTIALLY  DUE TO
REDUCTIONS  AND  DELAYS  IN  RESEARCH  AND  DEVELOPMENT  EXPENDITURES

     We  expect  that  our  revenues  in  the foreseeable future will be derived
primarily  from  products  and  services  provided  to  the  pharmaceutical  and
biotechnology  industries as well as to the academic community. Accordingly, our
success will depend in large part upon the success of the companies within these
industries and their demand for our products and services. Our operating results
may  fluctuate  substantially  due  to  reductions  and  delays  in research and
development  expenditures  by  companies  in these industries or by the academic
community.  These  reductions  and  delays  may  result  from  factors  such as:

- -     changes  in  economic  conditions;

- -     consolidation  in  the  pharmaceutical  industry;

- -     changes  in  the  regulatory  environment,  including governmental pricing
controls,  affecting  health  care  and  health  care  providers;

- -     pricing  pressures;

- -     market-driven  pressures on companies to consolidate and reduce costs; and

- -     other  factors  affecting  research  and  development  spending.

     These  factors  are  not  within  our  control.

IF  A  NATURAL  DISASTER  OCCURS,  WE  MAY  HAVE  TO CEASE OR LIMIT OUR BUSINESS
OPERATIONS

     We  conduct our database, sequencing and a significant portion of our other
activities  at  our  facilities  in  Palo  Alto,  California,  and  conduct  our
microarray-related  activities  at  our  facilities in Fremont, California. Both
locations  are  in  a  seismically  active  area.  Although we maintain business
interruption insurance, we do not have or plan to obtain earthquake insurance. A
major catastrophe, such as an earthquake or other natural disaster, could result
in  a  prolonged  interruption  of  our  business.

WE  MAY  EXPERIENCE POWER BLACKOUTS AND HIGHER ELECTRICITY PRICES AS A RESULT OF
CALIFORNIA'S  CURRENT  ENERGY  CRISIS,  WHICH  COULD  DISRUPT OUR OPERATIONS AND
INCREASE  OUR  EXPENSES

     California  is  in  the  midst  of  an energy crisis that could disrupt our
operations  and increase our expenses.  We rely on the major Northern California
public  utility,  Pacific  Gas  &  Electric Company, or PG&E, to supply electric
power to our facilities in Northern California.  Due to problems associated with
the de-regulation of the power industry in California and shortages in wholesale
electricity  supplies,  customers  of  PG&E  have  been  faced  with  increased
electricity  prices,  power shortages and, in some cases, rolling blackouts.  If
blackouts  interrupt  our power supply, we may be temporarily unable to continue
operations  at our facilities.  Any such interruption in our ability to continue
operations  at  our facilities could delay our ability to develop or provide our
products  and  services,  which  could  damage our reputation and result in lost
revenue,  either  of  which could substantially harm our business and results of
operations.

WE  HAVE  A LARGE AMOUNT OF DEBT AND OUR DEBT SERVICE OBLIGATIONS MAY PREVENT US
FROM TAKING ACTIONS THAT WE WOULD OTHERWISE CONSIDER TO BE IN OUR BEST INTERESTS

     As  of  December  31,  2000,  we  had

- -     total  consolidated  debt  of  approximately  $187.8  million,

- -     stockholders'  equity  of  approximately  $622.7  million,  and

- -     a deficiency of earnings available to cover fixed charges of $28.5 million
for  the  nine  months  ended  December  31,  2000.

     A  variety  of  uncertainties  and  contingencies  will  affect  our future
performance,  many  of  which  are  beyond  our  control.  We  may  not generate
sufficient  cash  flow  in the future to enable us to meet our anticipated fixed
charges,  including  our  debt  service  requirements  with  respect  to the our
convertible  subordinated  notes  due  2007  that we sold in February 2000. $185
million  of those notes were outstanding as of December 31, 2000.  The following
table  shows,  as  of  December  31,  2000, the aggregate amount of our interest

Year Aggregate Principal Aggregate Interest ---- ------------------- ------------------ 2001 -- 10,175,000 2002 -- 10,175,000 2003 -- 10,175,000 2004 -- 10,175,000 2005 -- 10,175,000
payments due in each of the next five years listed: Our substantial leverage could have significant negative consequences for our future operations, including: - - increasing our vulnerability to general adverse economic and industry conditions; - - limiting our ability to obtain additional financing; - - requiring the dedication of a substantial portion of our expected cash flow from operations to service our indebtedness, thereby reducing the amount of our expected cash flow available for other purposes, including working capital and capital expenditures; - - limiting our flexibility in planning for, or reacting to, changes in our business and the industry in which we compete; or - - placing us at a possible competitive disadvantage compared to less leveraged competitors and competitors that have better access to capital resources. SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Dated: February 23, 2001 INCYTE GENOMICS, INC. By /s/ John M. Vuko ------------------- Name: John M. Vuko Title: Executive Vice President and Chief Financial Officer