comprehensive income is unrealized gains and losses on  our marketable securities. Comprehensive loss for the years ended December 31, 2001, 2000 and 1999 were $16.3 million, $18.1 million and $11.3 million, respectively. Comprehensive loss has been disclosed in the Statement of Stockholders’ Equity for all periods presented. in Molecular Medicine LLC for 714,286 shares of Series A Preferred stock, representing 13.6% of total equity in the  company. These investments are intended to strengthen our relationships with companies that provide contracted services and resources that are important to our operations. Contract revenue for research and development is recorded  as earned based on the performance requirements of the  contract. Non-refundable contract fees or non-refundable upfront license fees for which no further performance obli- gations exist, and there is no continuing involvement by  Titan, are recognized on the earlier of when the payments are received or when collection is assured. Revenue associated with performance milestones, considered “at-risk” until the milestones are completed, is recognized based on the achievement of the milestones as defined in the respective agreements. Advance payments received prior  to the achievement of milestones are classified as deferred  revenue until earned. Government grants, which support our research effort in  specific projects, generally provide for reimbursement of approved costs as defined in the grant documents, and rev- enue is recognized when subsidized project costs are incurred. In July 2001, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards No. 141, “Business Combinations”(SFAS 141). SFAS 141 addresses finan- cial accounting and reporting for business combinations,  and supersedes APB Opinion No. 16, “Business Combinations” and a number of interpretations of that opinion. SFAS 141 requires that the purchase method of accounting be used for all business combinations initiated after June 30, 2001 and also specifies the criteria for the recognition of intangible assets separately from goodwill. When the amounts of goodwill and intangible assets acquired are significant in relation to the  purchase price paid, disclosure of the amount of goodwill  by reportable segment and the amount of purchase price assigned to each major intangible asset class is required. Our adoption of SFAS 141 on January 1, 2002 is not expected  to have a material impact on our financial position and results of operations. In July 2001, the FASB issued Statement of Financial Account- ing Standards No. 142, “Goodwill and Other Intangibles” (SFAS 142). Under SFAS 142, goodwill and indefinite-lived intangible assets are no longer amortized but are reviewed annually for impairment (or more frequently if impairment indicators arise). Separable intangible assets that are not deemed to have an indefinite life will continue to be amortized over their estimated useful lives. We have not recorded  any goodwill or indefinite-lived intangible assets prior to December 31, 2001. Our adoption of SFAS 142 on January 1, 2002 is not expected to have a material impact on our financial position and results of operations. Research and development expenses include internal and external costs. Internal costs include salaries and employment related expenses, facility costs, administrative expenses and allocations of corporate costs. External expenses consist of costs associated with outsourced clinical research organization activities, sponsored research studies, product registration, patent application and prosecution, and investigator spon- sored trials. All such costs are charged to expense as incurred. In October 2001, the FASB issued Statement of Financial Accounting Standards No. 144, “Accounting for the Impair- ment or Disposal of Long-Lived Assets” (SFAS 144), which addresses financial accounting and reporting for the  impairment or disposal of long-lived assets and supersedes Statement 121, “Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of,” and the accounting and reporting provisions of APB Opinion No. 30, “Reporting the Results of Operations for a Disposal of a Seg- ment of a Business.” Our adoption of SFAS 144 on January 1, 2002 is not expected to have a material impact on our financial position and results of operations. We calculate basic net loss per share using the weighted- average common shares outstanding for the period. Diluted net income per share includes the impact of other dilutive equity instruments, primarily our preferred stock, options  and warrants. For the years ended December 31, 2001, 2000 and 1999, outstanding preferred stock, options and war- rants totaled 4.4 million, 3.9 million and 4.3 million shares, respectively. We reported net losses for all years presented and, therefore, preferred stock, options and warrants were  excluded from the calculation of diluted net loss per share as they were anti-dilutive. Comprehensive income is comprised of net loss and  other comprehensive income. The only component of other Comprehensive Income Twenty-Three Net Loss Per Share Sponsored Research and Development Costs Revenue Recognition and Deferred Revenue Recent Accounting Pronouncements