TUSTIN, Calif., Jul 1, 2003 /PRNewswire-FirstCall via COMTEX/ -- Peregrine Pharmaceuticals, Inc. (Nasdaq: PPHM) announced today its financial results for the year ended April 30, 2003 and its operational highlights. Revenues generated by Avid Bioservices, Inc., the company's wholly owned subsidiary, increased to $3,300,000 million, which reduced the company's net loss to $11,559,000 ($0.10 per basic and diluted share) compared to a net loss of $11,718,000 ($0.11 per basic and diluted share) for the prior year ended April 30, 2002. The net loss for fiscal year 2003 included a non-cash interest charge of $1,017,000 ($0.01 per share) related to the amortization of the company's convertible debt discount associated with the financing completed in August 2002.

Revenues for the year increased 4% to $3,921,000 compared to $3,766,000 in fiscal year 2002. The revenue improvement was due to an increase in contract manufacturing revenues to $3,346,000 from $46,000 in the prior year from services provided by the company's wholly owned subsidiary, Avid Bioservices, Inc. The company announced the formation and start-up of Avid in late fiscal year 2002 and therefore, minimal revenues were generated during the prior fiscal year. The increase in contract manufacturing revenues was offset by a decrease in licensing revenue of $3,145,000. The prior year license revenue included the recognition of $3,000,000 upon the conclusion of the Schering AG license agreement related the company's Oncolym rights.

Total cost and expenses decreased 9% or $1,393,000 from $15,984,000 for the year ended April 2002 to $14,591,000 for the 2003 fiscal year. The decrease in total costs and expenses was primarily due to a charge in the prior year of $2,000,000 related to the dissolution of the joint venture with Oxigene, Inc. whereby the company re-acquired all rights to its Vascular Targeting Agent platform technology. Excluding the $2,000,000 charge, total cost and expenses increased 4% or $607,000 for fiscal year 2003 compared to the prior year. Cost of sales increased $2,848,000 related to the increase in revenues generated by Avid and the additional personnel costs required to run a current Good Manufacturing Practices (GMP) facility. Research and development expenses decreased 24% or $2,750,000 primarily due to a reduction in clinical trial costs as the company suspended its clinical trial patient enrollment, other than its ongoing trial at Stanford University Medical Center, in order to focus its efforts on licensing its technologies. This current year decrease in research and development was supplemented with the allocation of labor and overhead expenses to cost of sales in relation to its contract manufacturing services provided by Avid to outside customers. General and administrative expenses increased 21% or $509,000 primarily related to increased business development activities associated with the formation and start-up of Avid combined with the company's effort to license its technologies under development.

Peregrine President and CEO Steven King said, "We made significant progress on a number of fronts during the year. In addition to receiving FDA approval to proceed with a product registration clinical study for our Cotara drug for brain cancer, we also realized our first important revenue from Avid. Our Cotara compound, which has orphan drug status in the United States, was granted orphan drug status in Europe. Other important events included our partnership with Schering, AG for the development of Vascular Targeting Agents for diagnostics and imaging and the granting of six new patents, which further strengthened our intellectual property position."

"During fiscal year 2003, we raised gross proceeds of $9 million under equity and debt financing arrangements to fund our activities. We are optimistic about Avid's potential based on our experience with our current client's and interest expressed by additional third party prospects. In addition, we are also encouraged by interest in our various technologies from potential licensing partners," King said.

"We will continue to focus on developing a robust pipeline of biopharmaceutical product candidates based on our extensive technology platforms. We look forward to the achievement of additional research, clinical, and licensing milestones throughout the upcoming year."

    Significant Peregrine Events in Fiscal 2003
     * The U.S. FDA granted approval to start a single registration study for
       Cotara™ in recurrent glioblastoma multiforme, a deadly form of
       brain cancer. The study is planned for the U.S., Europe and Canada.
       Peregrine intends to find a partner for Cotara to fund the
       registration study.



     * The first full year of Avid Bioservices operations ended with revenue
       of $3.35 million. Avid completed its initial contracts and delivered
       clinical product to those clients. Avid signed additional contracts for
       continued production and projected revenue growth.



     * Cotara received Orphan Drug Status in Europe.



     * Steven King was promoted from chief operating officer to chief
       executive officer.



     * The company signed a worldwide licensing agreement with Schering, AG
       for the development of Vascular Targeting Agents with radioactive
       isotopes for imaging and diagnostics.



     * The company was granted six new patents covering its Vascular Targeting
       Agent and Vasopermeation Enhancement Agent platform technologies,
       broadening and strengthening the company's patent position and
       intellectual property in these fields of research.



     * Pre-clinical progress continued during fiscal year 2003.  Researchers
       at the University of Texas Southwestern Medical Center at Dallas have
       published data detailing the anti-tumor effects of the 2C3 antibody.
       The study, which appears in the most recent issue of Angiogenesis,
       demonstrated that administration of 2C3 to tumor-bearing mice
       inhibited tumor growth by 75%, as compared to a control group.  The
       company has an exclusive license to the 2C3 antibody with University
       of Texas Southwestern Medical Center.



     * The year saw publication of radiolabeled Tumor Necrosis Therapy data
       from a Phase I/II inoperable lung cancer study from clinical research
       conducted in China. The study showed radiolabeled TNT demonstrated
       significant tumor regressions in late stage inoperable lung cancer.
       The Phase I/II study compared the efficacy of three different methods
       of administration of 131I-chTNT for patients with inoperable late
       stage lung cancer: intravenous, intratumoral, and a combination of
       intravenous plus intratumoral injection. The results demonstrated that
       the method of intratumoral injection alone achieved a 56% complete and
       partial tumor remission rate. The combined intravenous plus
       intratumoral injection method achieved 40% and the intravenous method
       alone achieved 9% tumor remission rate. The disease control rate for
       all three methods of treatment, including complete and partial
       remission and stable disease, was 88% for the 43 patients assessed in
       the study. The highest therapeutic effect was obtained by using common
       bronchoscopy and computer tomography (CT) scan instruments in a new
       technique to directly infuse the tumor with lethal doses of 131I-
       chTNT.



     * Company representatives presented at four major industry conferences
       including the American Society of Clinical Oncology (ASCO) Annual
       Meeting, the Society of Nuclear Medicine's Annual Meeting, the Bio2002
       Annual Conference, The 2002 World Antibody Summit, and the First
       International Conference on Vascular Targeting. These presentations
       showcased Peregrine's technologies and created enhanced exposure in
       the scientific and business communities.



     * Company technology was published in seven scientific peer review
       journals, including prestigious journals such as The Proceedings of
       the National Academy of Sciences and Cancer Research. These
       publications highlighted research on Peregrine's Tumor Necrosis
       Therapy, Vascular Targeting Agents, Anti-Angiogenesis Agents and Lym-1
       technologies.



     * The company raised $9 million under equity and debt financing
       arrangements.

About Peregrine Pharmaceuticals

Peregrine Pharmaceuticals is a biopharmaceutical company focused on the development, commercialization and licensing of unique technologies for the treatment of cancer, primarily based on three collateral targeting technologies. Peregrine's Tumor Necrosis Therapy (TNT), Vasopermeation Enhancement Agents (VEA), and Vascular Targeting Agents (VTA) technologies target cell structures and cell types that are common among solid tumor cancers, giving them broad applicability across various tumor types. The company has received approval from the FDA to start a Cotara™ Phase III clinical trial for brain cancer. Cotara is also being studied in a Phase I trial for colorectal, pancreas, soft tissue sarcoma and biliary cancers at Stanford University. The company is focused on licensing collaborations for all of its technologies under development. The company's Oncolym® technology to treat non-Hodgkin's B-cell lymphoma in Phase I/II of development is available for licensing. The company operates a cGMP contract manufacturing facility for monoclonal antibodies and recombinant proteins through its wholly-owned subsidiary Avid Bioservices, Inc. (www.avidbio.com). Copies of Peregrine press releases, SEC filings, current price quotes and other valuable information for investors may be found on the website www.peregrineinc.com.

Safe Harbor Statement: This release may contain certain forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Actual events or results may differ from the company's expectations as a result of risk factors discussed in Peregrine's reports on file with the U.S. Securities and Exchange Commission, including, but not limited to, the company's report on Form 10-K for the year ended April 30, 2002 and on Form 10-Q for the quarter ended January 31, 2003.

                       PEREGRINE PHARMACEUTICALS, INC.



                    CONDENSED CONSOLIDATED BALANCE SHEETS
                        AS OF APRIL 30, 2003 AND 2002



                                                     2003           2002
    ASSETS                                         unaudited



    CURRENT ASSETS:
    Cash and cash equivalents                     $3,137,000     $6,072,000
    Trade and other receivables, net                 245,000        328,000
    Short-term investments                           242,000             --
    Inventories                                      376,000          6,000
    Prepaid expenses and other current assets        257,000        384,000



      Total current assets                         4,257,000      6,790,000



    PROPERTY, net                                    836,000        915,000



    OTHER ASSETS, net                                306,000        161,000



    TOTAL ASSETS                                  $5,399,000     $7,866,000



    LIABILITIES AND STOCKHOLDERS' EQUITY



    CURRENT LIABILITIES:
    Accounts payable                                $560,000    $ 1,070,000
    Accrued clinical trial site fees                 260,000        607,000
    Accrued legal and accounting fees                194,000        303,000
    Accrued royalties and license fees               149,000        189,000
    Accrued payroll and related costs                314,000        374,000
    Notes payable, current portion                        --          2,000
    Other current liabilities                        300,000        208,000
    Deferred revenue                                 531,000         30,000



      Total current liabilities                    2,308,000      2,783,000



    CONVERTIBLE DEBT, net of discount                760,000             --
    DEFERRED LICENSE REVENUE                         200,000             --
    COMMITMENTS AND CONTINGENCIES                         --             --



    STOCKHOLDERS' EQUITY, net                      2,131,000      5,083,000



    TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY    $5,399,000     $7,866,000





                       PEREGRINE PHARMACEUTICALS, INC.



                    CONSOLIDATED STATEMENTS OF OPERATIONS
        FOR EACH OF THE THREE YEARS IN THE PERIOD ENDED APRIL 30, 2003



                                   2003             2002           2001
                                  unaudited
    REVENUES:
    Contract manufacturing
     revenue                     $3,346,000         $46,000           $--
    License revenue                 575,000       3,720,000       979,000



      Total revenues              3,921,000       3,766,000       979,000



    COSTS AND EXPENSES:
    Cost of contract
     manufacturing                2,860,000          12,000            --
    Research and development      8,744,000      11,494,000     7,749,000
    General and administrative    2,987,000       2,478,000     3,443,000
    Purchased in-process research
     and development                     --       2,000,000            --



      Total costs and
       expenses                  14,591,000      15,984,000    11,192,000



    LOSS FROM OPERATIONS       (10,670,000)    (12,218,000)  (10,213,000)



    OTHER INCOME (EXPENSE):
    Interest and other income       291,000         512,000       921,000
    Interest and other expense  (1,180,000)        (12,000)     (243,000)



    NET LOSS                  $(11,559,000)   $(11,718,000)  $(9,535,000)



    WEIGHTED AVERAGE SHARES
     OUTSTANDING                116,468,353     104,540,204    95,212,423



    BASIC AND DILUTED LOSS PER
     COMMON SHARE                   $(0.10)         $(0.11)       $(0.10)





    Investor Relations Contact
    Frank Hawkins and Julie Marshall
    Hawk Associates, Inc.
    (800) 987-8256 or
    infor@hawkassociates.com

SOURCE Peregrine Pharmaceuticals, Inc.

Frank Hawkins or Julie Marshall, both of Hawk Associates, Inc.,
+1-800-987-8256, or info@hawkassociates.com, for Peregrine Pharmaceuticals

http://www.peregrineinc.com