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New York, NY, June 1, 1999 — SmallCaps Online LLC (formerly SmallCaps Online LLC) commented today on Cell Therapeutics (Nasdaq: CTIC) following news that it had halted a Phase II/III trial. The full text of this report can be accessed at SmallCaps Online’s web site, at www.SmallCapsOnline.com.

Excerpts from the report follow:

Cell Therapeutics announced Friday that the Data Safety and Monitoring Board appointed by the National Heart, Lung and Blood Institute (NHLBI) recommended that CTIC discontinue enrollment in the NHLBI-sponsored Phase II/III trial using Lisofylline (LSF) as a treatment for Acute Lung Injury/Acute Respiratory Distress Syndrome (ALI/ARDS). Based on a preliminary look at the data in early March of this year, we were surprised at this outcome. After speaking with management, we believe the significant drop in CTIC stock on Friday was a reaction to the news and has created a BUYing opportunity for the stock. We are therefore reiterating our BUY recommendation on CTIC for those investors tolerant of the risks associated with small-cap equity investments.

Today’s News: CTIC has not yet received the data from the NHLBI. They anticipate receiving the data promptly and will spend the next few weeks analyzing the results. We would expect a follow-on announcement pertaining to this analysis upon completion. It is the Company’s hope that it will be able to develop a Phase III protocol that can take into account any of the anomalies seen within certain subsets of the data, if any.

Implications of Today’s News: First, investors should keep in mind that the ALI/ARDS indication represented an opportunistic play for CTIC — funded by the NHLBI — outside of CTIC’s core oncology strategy. As such, a positive outcome was "upside" potential, and we believe results (which we won’t have a complete picture of until the data is analyzed) that are negative represent little "downside." Second, we don’t believe investors should assume that a failure of LSF in ALI/ARDS means the drug will not be efficacious in the ongoing oncology trials (investors should also note that the NHLBI board reported no safety issues in the ALI/ARDS trial). CTIC announced today that it had completed enrollment in its Phase III trial for LSF to prevent serious infection in patients undergoing high-dose chemotherapy for acute myeloid leukemia (AML). These patients will be followed for a 90-day period and data analysis should be available sometime in September 1999. Third, we suspect that investors may believe that negative news concerning the ALI/ARDS trial may affect Johnson & Johnson’s (JNJ) decision of whether or not to exercise its option to continue its partnership with CTIC. While it may, this decision should not be made until JNJ has analyzed the data from the AML trial this fall. We believe it is premature to make assumptions concerning the JNJ relationship.

It is possible that further analysis of the data will provide no helpful information and the ALI/ARDS program will end. If this were the case, removing LSF for the ALI/ARDS indication from our model would reduce our 12-18 month price target ($14 to $17 per share) by roughly 20%.

Product Pipeline and Valuation Discussion: At the end of 1Q99, CTIC had over $2.50 per share in cash. In addition, CTIC recently announced positive news on its Apra product, an anti-cancer product that is currently involved in two efficacy studies. CTIC is also developing PG-TXL, (polyglutamate paclitaxel) a novel, site-specific version of the anti-cancer drug Taxol, which is expected to enter human trials later this year following very promising animal studies (investors should note that Taxol is one of the most successful chemotherapy drugs on the market). A product called SC-7 is also being developed by CTIC. SC-7 is an anti-angiogenesis drug in preclinical development. We believe both Apra and PG-TXL will provide CTIC with multiple partnering opportunities over the next year. And, while neither PG-TXL nor SC-7 are included in our earnings model, we believe their potential adds great depth to the CTIC product portfolio. With such a strong oncology pipeline, the potential for partnerships and the stock currently trading at roughly cash value, we are reiterating our BUY recommendation on CTIC.

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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.

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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 and/or any of its affiliates has performed investment banking, consulting or other services for CTIC and may solicit investment banking, consulting or other business from, any company mentioned in this release. SmallCaps Online LLC or any of its affiliates 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.