SmallCaps Online LLC Reiterates BUY Recommendation on CytRx Corp. Following Positive Results of an Independent Data and Safety Monitoring Board

Please Visit SmallCaps' Web Site at www.SmallCapsOnline.com for Detailed Report

New York, NY, May 4, 1999 - SmallCaps Online LLC announced today that it has reiterated its BUY recommendation on CytRx Corporation (NASDAQ: CYTR). The full text of this report can be accessed at SmallCaps' web site, at www.SmallCapsOnline.com.

Excerpts from the report follow:

CYTR announced yesterday that its independent Data and Safety Monitoring Board (DSMB) had examined the efficacy and safety results from the first 112 patients enrolled in the Pivotal Phase III clinical trial of FLOCOR for the treatment of acute sickle cell crisis. As we anticipated, the DSMB recommended that CYTR continue with enrolling the remainder of the patients in the trial as planned. The Company also announced that 147 patients, out of a planned 224, had been enrolled as of yesterday, which puts them on track to complete the trial and the statistical analysis by year end 1999.

We view this interim result as very positive from a few perspectives:

• First, enrollment is on schedule, which is particularly important in this clinical trial, as it has been difficult in other sickle cell trials to encourage patients to enroll in trials of new treatments.
• Second, we believe this puts the safety concerns associated with prior trials to rest.
• Third, we continue to believe that FLOCOR is the most promising drug in development for the treatment of sickle cell crisis, and believe that it could be first-to-market based on its current clinical timetable. Investors should note that CYTR applied for fast track approval status at the FDA for FLOCOR, approval for which is expected sometime in the third quarter.
• Fourth, we believe this positive interim analysis will allow CYTR to push into other indications for FLOCOR, including the initiation in the near future of a Phase II clinical trial of FLOCOR in Acute Lung Injury/Acute Respiratory Distress Syndrome (ALI/ARDS).
• Lastly, we believe that this positive development will be beneficial in CYTR's ongoing discussions with potential corporate partners for the commercialization of FLOCOR.

Conclusion: We continue to believe that CYTR trades at a significant discount to valuation levels typical for biotechnology companies with promising products in pivotal Phase III clinical trials. We also believe the investment case for CYTR, and the opportunity for FLOCOR, is not widely understood or appreciated by the investment community. In addition, CYTR is actively pursuing partnerships with large pharmaceutical companies on additional indications for FLOCOR and other pipeline technologies, which we believe are not currently reflected in the stock valuation. For these reasons, we are reiterating our BUY recommendation on CYTR and raising our 12-month price target of $8 to $10 per share.

###

SmallCaps Online LLC is a registered investment advisor focused on identifying emerging growth companies in the healthcare and information technology sectors that offer compelling investment opportunities over the long term. By providing comprehensive financial services, including corporate finance, M&A advisory, strategic partnering and communications consulting, the company positions itself to provide a fully integrated package of value-added services to emerging growth companies.

###

The information in this press release has been obtained from sources that SmallCaps Online LLC believes to be reliable, but the Company does not guarantee its accuracy or completeness. Neither the information nor any opinion expressed constitutes a solicitation by SmallCaps Online LLC for the purchase or sale of any securities. SmallCaps Online LLC may solicit investment banking, consulting or other business from, any company mentioned in this release. SmallCaps Online LLC or persons associated with SmallCaps Online LLC may at anytime be long or short any of the securities referred to herein and may make purchases or sales thereof while the Company's reports are in circulation or posted on the SmallCaps Online LLC web site at www.SmallCapsOnline.com. This material, or any portion thereof, may not be reproduced without prior permission from SmallCaps Online LLC. SmallCaps Online LLC is not responsible for the contents of this document that is intended for electronic transmission and could be thus subjected to tampering or alteration. Copyright © 1999 by SmallCaps Online LLC. All rights reserved.