Cell Pathways, Inc. Reports First Quarter 2001 Financial Results.

Business Editors/Health & Medical Writers

HORSHAM, Pa.--(BW HealthWire)--April 19, 2001

Cell Pathways, Inc. (Nasdaq:CLPA) today reported financial results for the three months ended March 31, 2001.

The Company reported a net loss in the first quarter ended March 31, 2001 of $4.8 million or $1.8 million less than the same period in 2000. For the first quarter of 2001, net loss per share was $0.15 on 31.1 million common shares outstanding versus a net loss per share of $0.24 on 26.7 million common shares outstanding for the first quarter of 2000. The Company ended the quarter with $44.2 million in cash, cash equivalents and short-term investments, a reduction of $5.4 million from the balance at December 31, 2000.

In the first quarter of 2001, the Company recognized revenue of $317,000, from its agreement with Aventis Pharmaceuticals Inc. to promote Nilandron(R) (nilutamide) for prostate cancer. Revenues from this agreement commenced in the fourth quarter of 2000. Research and development expenses were $3.8 million for the three months ended March 31, 2001, a decrease of $1.6 million or 30% from the same period in 2000. This decrease was primarily the result of purchases of raw materials made in the first quarter of 2000 to produce Aptosyn(TM) (exisulind), the Company's lead drug, for clinical and commercial purposes. Also, clinical trial expenses were lower in the first quarter of 2001 versus the same period in 2000. During the first quarter of 2000, the Company recorded a non-cash charge of approximately $621,000, related to compensation expense for stock options granted to scientific advisory board members due to an increase in the Company's stock price. Selling, general and administrative expenses were $1.9 million for the three months ended March 31, 2001, an increase of $311,000 or 19% from the same period of 2000. This increase was due principally to sales and marketing expenses related to the promotion of Nilandron(R) in the first quarter of 2001. Interest income, net of expense, was $641,000 in the first quarter of 2001, an increase of $167,000 from the same period in 2000 due to higher average cash balances.

Robert Towarnicki, chairman and chief executive officer, said "during the first quarter of 2001, we took several important steps towards advancing the company's goal to become a leading cancer therapeutic company:

-- initiated a Phase III, double-blinded clinical trial in non-small cell lung
cancer using Aptosyn(TM) in combination with Taxotere(R) (docetaxel) to
evaluate this combination in 600 patients. Patient accrual is currently
underway through our primary investigational site, US Oncology, a nationwide
group of 825 physicians and 56 centers specializing in the treatment of cancer
patients;

-- presented a number of important scientific papers that relate to the
company's research and the mechanism of action for the company's SAANDs
technology at the annual meeting of the American Association for Cancer
Research. (AACR);

-- continued the development of the company's second drug candidate, CP461;

-- filed a shelf registration statement with the Securities and Exchange
Commission (SEC) that registers $25 million worth of common stock of the
company. The filing of the registration statement positions the company to sell
securities under market conditions at prices deemed in the Company's business
interest."

Cell Pathways, Inc., headquartered in Horsham, Pennsylvania, is a development stage pharmaceutical company focused on the research, development and commercialization of novel and unique medications to prevent and treat cancer. For additional information on Cell Pathways, Inc., visit the Company's web-site at http:www.cellpathways.com.

Certain statements in this release, and oral statements made in respect of this release, constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are those which express plan, anticipation, intent, contingency or future development and/or otherwise are not statements of historical fact. These statements are subject to risks and uncertainties, known and unknown, which could cause actual results and developments to differ materially from those expressed or implied in such statements. Such risks and uncertainties relate to, among other factors, the absence of approved products; history of operating losses and the need for further financing; early stage of development; the costs, delays and uncertainties inherent in science, basic pharmaceutical research, drug development, clinical trials and the regulatory approval process, with respect to both our current product candidates and our future product candidates, if any; dependence on the development and market acceptance of Aptosyn(TM) (exisulind) for one or more significant disease indications; limitations on, or absence of, the predictive value of data obtained in laboratory tests, animal models and human clinical trials when planning additional steps in product development; uncertainty of obtaining regulatory approval of any compound for any disease indication; uncertainty and adversity arising from the action of the U.S. Food and Drug Administration, or FDA, in issuing a "not approvable" letter with respect to the New Drug Application, or NDA, submitted for Aptosyn(TM) (exisulind) for the orphan drug condition of familial adenomatous polyposis, or FAP, a rare disease that puts those afflicted at high risk of developing colon cancer; the timing and scope of any approval which might be received, or any failure to receive approval, for any compound for any indication in the future; the volatility of the market price of our common stock; our ability to sell securities registered under the shelf registration statement; acceptance of any product candidates by physicians and providers of healthcare reimbursement; the actions of competitors; the pace of technological changes in the biopharmaceutical industry; dependence upon third parties; the validity, scope and enforceability of patents; the risk of our pending class action securities litigations; potential product liability claims; and availability of insurance.

These and other risks are detailed in our reports filed from time to time under the Securities Act and/or the Securities Exchange Act, including the sections entitled "Business," "Risk Factors," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Other Events" in our annual reports on Form 10-K, quarterly reports on Form 10-Q and periodic reports on Form 8-K and in such registration statements on Form S-3 as we may file from time to time. You are encouraged to read these filings as they are made. They are available over the Internet from the SEC in its EDGAR database at http://www.sec.gov and from the Company.

Given the uncertainties affecting pharmaceutical companies in the development stage, you are cautioned not to place undue reliance on any such forward-looking statements, any of which may turn out to be wrong due to inaccurate assumptions, unknown risks, uncertainties or other factors. No forward-looking statement can be guaranteed; actual future results may vary materially.

Both forward-looking statements and statements of historic fact must be understood in the context of the risks referred to above which characterize our development-stage business. We undertake no obligation to update or revise the statements made herein or the risk factors that may relate thereto.

Note to Editors: Aptosyn(TM) is a trademark of Cell Pathways, Inc., Taxotere(R)is a registered trademark of Aventis Pharmaceutical, Inc.

                          CELL PATHWAYS, INC.
                     (A development stage company)
                 CONDENSED CONSOLIDATED BALANCE SHEETS
                              (Unaudited)

                                       March 31,       December 31,
                                         2001             2000
                                    ---------------  ---------------
                  ASSETS
CURRENT ASSETS
   Cash, cash equivalents and
    short term investments          $    44,150,898  $    49,528,407
   Accounts receivable                      316,973          329,694
   Other current assets                   2,094,404        1,328,535
                                    ---------------  ---------------
         Total current assets            46,562,275       51,186,636

   OTHER ASSETS
                                          2,870,220        2,894,957
                                    ---------------  ---------------
                                    $    49,432,495  $    54,081,593
                                    ===============  ===============

    LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES                 $     5,083,068  $     4,994,883

LONG TERM LIABILITIES                       391,960          457,800

STOCKHOLDERS' EQUITY
   Common Stock                             311,009          310,734
   Additional paid-in capital           140,330,627      140,235,478
   Stock subscription receivable
    from issuance of Common Stock           (37,000)         (37,000)
   Deficit accumulated during the
    development stage                   (96,647,169)     (91,880,302)
                                    ---------------  ---------------
        Total stockholders' equity       43,957,467       48,628,910

                                    $    49,432,495  $    54,081,593
                                    ===============  ===============


            CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                              (Unaudited)

                                       For the three months ended
                                                March 31,
                                    --------------------------------
                                          2001            2000
                                    ---------------  ---------------
REVENUES                            $       316,973  $            --
EXPENSES:
   Research and development               3,782,214        5,379,962
   Selling, general and
    administrative                        1,942,632        1,631,211
                                    ---------------  ---------------
         Operating loss                  (5,407,873)      (7,011,173)

INTEREST INCOME, net                        641,006          474,201
                                    ---------------  ---------------
NET LOSS                            $    (4,766,867) $    (6,536,972)
                                    ===============  ===============
Basic and diluted net loss per
 Common share                       $         (0.15) $         (0.24)

Shares used in computing basic and
 diluted net loss per Common share       31,089,838       26,682,240
                                    ===============  ===============