Steven H. Rouhandeh, Chairman of SmallCaps stated, "We are excited to be launching coverage of Access Pharmaceuticals, as we believe it fits our profile of undervalued, under-followed companies well. We are also extremely pleased with the feedback on and the traffic logging into our newly launched web site. Following our BUY recommendations on AMBI Inc. (Nasdaq: AMBI) and Cypress Bioscience, Inc. (Nasdaq: CYPB), those stocks are up approximately 25% and 10%, respectively, both on increased volume. We believe this validates our thesis that individual investors are increasingly looking to the Internet as a source for investment ideas and research."

Excerpts from the report on Access follow:

Access Pharmaceuticals
Access Pharmaceuticals, Inc. ("AXCS") is an emerging pharmaceutical company developing a portfolio of drugs and advanced drug delivery systems. We characterize AXCS as an emerging pharmaceutical company, rather than a traditional biotech company, as we believe its business model has components that are less risky than the typical one-compound, or one-technology-platform, biotech company. These components include: one FDA-approved product on the market (amlexanox), a unique cancer drug candidate (Polymer Platinate AP5070), one delivery technology (ResiDerm() with multiple products in development and a corporate partner, and a strategy of generating revenues from licensing and royalties, rather than manufacturing in-house. AXCS has stated that it intends to continue to partner its technology to defray the high costs and spread the risks associated with clinical development of pharmaceuticals, and to take advantage of partners' expertise in clinical trial progression, manufacturing and marketing. We believe AXCS shares, which currently trade OTC, are undervalued, and we recommend purchase of AXCS common stock by investors tolerant of the risks associated with micro-cap, OTC equity investments. AXCS intends to apply for listing on Nasdaq or the AMEX upon meeting listing requirements.

Diverse Product and Technology Portfolio

• Amlexanox: AXCS has partnered with Block Drug Company on amlexanox, the only FDA-approved product for the treatment of canker sores. AXCS is actively licensing the product internationally, exploring alternative indications, and developing alternative delivery vehicles that should grow licensing fees and royalty revenues.
  
  
• Polymer Platinate AP5070: AXCS is developing Polymer Platinate for the treatment of cancer (current world wide market for platinates exceeds $800 million). Polymer Platinate provides for greater levels of platinum to be delivered to the tumor, for longer periods of time, translating into greater efficacy and lower toxicity.
  
  
• ResiDerm: In collaboration with Strakan Ltd., AXCS is developing a zinc-based topical delivery system, which provides for rapid delivery of a drug into the skin, with limited systemic absorption.
  

• By aggressive out-licensing and partnering, we believe AXCS can accelerate the time-to-market for its products, access manufacturing and marketing expertise of more established partners, while maintaining a lower head-count and managing its cash resources.
  
  
• We believe AXCS offers a lower-risk business model when compared to traditional biotech investments.
  

• We believe AXCS' amlexanox program is fairly valued at $5 to $7 per share, or two to three times current price levels; AXCS' other products and technologies at least double that fair value estimate.
  
  
• We believe AXCS' products and technologies would be extremely attractive to many other biotechnology companies searching to back-fill product pipelines in this very difficult market.