NeoPharm Announces Precise Trial Update

NeoPharm (Nasdaq:NEOL) today announced that it has receivednotification that the Company's cintredekin besudotox (IL13-PE38QQR)Pivotal Phase III PRECISE trial for the treatment of GlioblastomaMultiforme (GBM), the most aggressive form of brain cancer, hasreached the criterion for the second futility statistical analysis(100 deaths). As a result, the PRECISE trial's independent DataMonitoring Committee (iDMC), at its next periodic clinical safetyreview meeting currently expected to be scheduled for December, willreview the second futility analysis, assess the study data to date,and thereafter provide its recommendation to the Company.

"The timing for notification of meeting the PRECISE trialcriterion for the second futility analysis is beyond our originalprojections and may be evident of greater extended survival thanoriginally assumed for patients receiving cintredekin besudotoxcompared to GLIADEL(R) Wafer in the study," said Guillermo A. Herrera,NeoPharm's President and CEO. "Our confidence in the study continuesand we remain cautiously optimistic regarding the potential for afavorable outcome. In the meantime, we continue to anticipate fullenrollment in the trial by the end of this year."

The Company had previously reported in May of this year that ithad been notified by the iDMC that the study had reached the criterionfor the first futility analysis (50 deaths) and later in June that theiDMC recommended, after analysis of the data, that the study continueas planned. The iDMC will apply the same statistical methods toanalyze the data at the second futility analysis as were used in June.

Futility analyses are used by the iDMC, along with other studyinformation that is only available to the iDMC, to assess the currentstatus of the study in terms of comparative treatment efficacy. Basedon its review of this information, there are currently three potentialrecommendations that the iDMC can make to the Company:
(1) Continue the trial as-is with no interruption or changes,

(2) Continue the trial as-is with no interruption, but add up to
25% (75) more patients to account for data variability, or

(3) Stop the trial.

Even in the event of a recommendation to increase the number ofpatients in the trial, the interim efficacy statistical analysis forthe trial would continue to be triggered at 160 deaths, with finalefficacy at 215 deaths, as per the Company's amended Special ProtocolAssessment (SPA), setting up the potential for a Biologic LicenseApplication (BLA) filing as early as the second half of 2006.

Enrollment in the PRECISE trial will continue uninterrupted untilthe iDMC makes its recommendation to the Company. Enrollment inPRECISE was 277 patients at October 31, 2005, and full enrollment inthe trial is expected to be completed by year end 2005. The PRECISETrial protocol allows for enrollment of up to 300 patients in order toobtain 270 patients with confirmed GBM at first recurrence at studyentry surgical resection for the intent to treat patient population.As of October 31, 2005, only 18 patients have not met this criterion.The Company provides monthly enrollment data on the PRECISE trial atwww.precisetrial.com.

About Cintredekin Besudotox (IL13-PE38QQR)

Cintredekin besudotox is a recombinant protein consisting of asingle molecule composed of two parts: a tumor-targeting molecule(Interleukin-13, or IL13) and a cytotoxic agent (Pseudomonas Exotoxin,or PE). The drug is delivered via Convection Enhanced Delivery (CED),a novel drug delivery system using catheters placed following tumorresection (removal), in areas with microscopic tumor spread or at riskof tumor spread around the tumor resection cavity. IL13 receptors arepresent in appreciable numbers on malignant glioma cells, but only toa minimal amount if at all on healthy brain cells. The IL13 portionbinds to receptors on tumor cells like a key fits into a lock. Thecancer cell latches onto and absorbs the IL13 and the attached PE,causing destruction of the cancer cell. Healthy brain cells appear tobe unharmed because they do not internalize the PE.

Promising data for this potential therapeutic advance in thetreatment of GBM was observed in Phase I/II studies. In addition, theimportance of adequate catheter positioning in order to achieveoptimal distribution of cintredekin besudotox in brain tissue wasassessed, leading to the specific guidelines for catheter positioningand deferred catheter placement used in the PRECISE Trial. Thistranslated into a better patient outcome for the 45 recurrent GBMpatients treated post-tumor resection in the Phase I/II studies, withan overall median survival of 44.0 weeks (95% CI: 36.1-52.4) including42% of patients with less than 2 adequately positioned catheters,while patients with greater than or equal to 2 catheters adequatelypositioned surviving with a median of 51.7 weeks (95% CI: 36.1-78.0).Separately, 1-year and 2-year survival rates for recurrent GBMpatients were 40% and 20% respectively.

Cintredekin besudotox has received orphan drug designation inEurope and the U.S., and fast track drug development program statusfrom the U.S. Food and Drug Administration (FDA). NeoPharm'scintredekin besudotox development program was also selected toparticipate in the FDA Continuous Marketing Application Pilot 2Program.

About GLIADEL(R) Wafers

A GLIADEL(R) Wafer delivers BCNU (or carmustine), a commonly usedchemotherapeutic anti-tumor agent for GBM, directly to the brain tumorresection cavity. Up to eight dime-sized wafers are placed in thespace once occupied by the tumor at the time of resection. The wafersslowly dissolve over the next two to three weeks, bathing thesurrounding cells with BCNU. GLIADEL(R) Wafer has been approved by theFDA for the treatment of recurrent and newly diagnosed GBM. By design,the wafers can only kill cells that the released carmustine comes incontact with and the drug is limited by diffusion in reaching viabletumor cells outside the tumor resection cavity.

In a Phase III clinical trial, median survival of 28 weeks wasobtained with the GLIADEL(R) Wafer compared to 20 weeks for placebo in145 recurrent GBM patients, a 40% difference. Separately, 1-year and2-year survival rates for recurrent GBM patients were 20% and 10%,respectively. A post hoc analysis of the GLIADEL(R) Wafer data forfavorable prognostic factors did not measurably change the differencein median survival between the GLIADEL(R) Wafer and the placebo groups(from 8 weeks to 9 weeks). However, the difference in overall mediansurvival between the two arms decreased to 29% from 40%.

About PRECISE

PRECISE, an acronym for Phase III Randomized Evaluation ofConvection Enhanced Delivery of IL13-PE38QQR with Survival Endpoint,www.precisetrial.com, is a randomized, controlled Phase III clinicaltrial. It is designed to enroll up to 300 patients, and compareoverall survival, drug safety and quality of life of patientsreceiving cintredekin besudotox with patients receiving GLIADEL(R)Wafer in the treatment of first recurrent GBM following surgical tumorresection. Patients are randomized so that up to 200 patients receivecintredekin besudotox via CED and up to 100 patients receiveGLIADEL(R) Wafer placed in the resection cavity at the time ofresection.

The study sample size was determined based on whether there is animprovement of at least 50% in median survival of patients with GBMresulting from treatment with the Company's cintredekin besudotox (42weeks) over treatment with GLIADEL(R) Wafer (28 weeks). The primaryefficacy analysis of the study will be based on the comparison of theoverall patient survival curves of the two treatment groups. If theprimary efficacy analysis at the 160 patient death interim efficacyanalysis shows that comparison of the overall survival curves of thetwo treatment groups is statistically significant (p-value less thanor equal to 0.005) in favor of cintredekin besudotox, then the resultof the interim analysis may be used to support a BLA submission. Thesurvival data from patients with optimal catheter placement (51.7weeks) in the cintredekin besudotox Phase I/II studies was used toestablish the p-value target for the interim efficacy analysis. Thefinal efficacy analysis will be conducted from a locked database afternotification of 215 deaths. If the study is continued until theplanned end, subsequent to the interim efficacy analysis, the finalefficacy analysis for the comparison of the overall survival curvesbetween the two treatment groups will be considered statisticallysignificant if the p-value from the log-rank test is less than orequal to 0.048. This final p-value reflects accepted statisticalmethodology so that the overall study type 1 error rate of 5% (0.05)is maintained.

About the iDMC

The iDMC is responsible for, among other things, assuring thatstudy participants are not exposed to unnecessary or unreasonablerisks. In addition, the iDMC provides recommendations regarding studyconduct intended to maintain high ethical, regulatory, and scientificstandards. The iDMC will recommend that the study protocol be stopped,temporarily suspended or amended, as appropriate, if a result of datamonitoring determines that a trial is futile or will not be able toreach a positive conclusion or poses an unreasonable or unnecessaryrisk to study participants in either treatment arm of the PRECISETrial.

About NeoPharm, Inc.

NeoPharm, Inc., based in Lake Forest, Illinois, is a publiclytraded biopharmaceutical company dedicated to the research,development and commercialization of new and innovative cancer drugsfor therapeutic applications. The Company has a portfolio of cancercompounds in various stages of development. Additional information canbe obtained by visiting NeoPharm's Website at www.neophrm.com.

Forward Looking Statements - This press release contains"forward-looking statements" within the meaning of Section 27A of theSecurities Act of 1933 and Section 21E of the Securities Exchange Actof 1934. The Company has tried to identify such forward-lookingstatements by use of such words as "expects," "intends," "hopes,""anticipates," "believes," "could," "may," "evidences" and"estimates," and other similar expressions, but these words are notthe exclusive means of identifying such statements. Such statementsinclude, but are not limited to, any statements relating to theCompany's drug development program, including, but not limited toclinical trials including cintredekin besudotox, future patientsurvival in and the Company's ongoing Phase I/II studies and PRECISEtrial, and any other statements that are not historical facts. Suchstatements involve risks and uncertainties, including, but not limitedto, those risks and uncertainties relating to difficulties or delaysin financing, development, testing, obtaining regulatory approval,production and marketing of the Company's drug and non-drug compounds,including, but not limited to, cintredekin besudotox, uncertaintyregarding the availability of third party production capacity,unexpected adverse side effects or inadequate therapeutic efficacy ofthe Company's drug and non-drug compounds, including, but not limitedto, cintredekin besudotox, that could slow or prevent products comingto market, uncertainty regarding the Company's ability to market itsdrug and non-drug products, including, but not limited to, cintredekinbesudotox, directly or through independent distributors, theuncertainty of patent protection for the Company's intellectualproperty or trade secrets, including, but not limited to, cintredekinbesudotox, and other risks detailed from time to time in filings theCompany makes with the Securities and Exchange Commission includingits annual reports on Form 10-K and quarterly reports on Forms 10-Q.Such statements are based on management's current expectations, butactual results may differ materially due to various factors, includingthose risks and uncertainties mentioned or referred to in this pressrelease. Accordingly, you should not rely on these forward-lookingstatements as a prediction of actual future results.