Alfacell Corporation Reports Second Quarter 2006 Financial Results and Key Developments

Alfacell Corporation(Nasdaq: ACEL), today reported financial results and key developments from thesecond quarter of the Company's fiscal year, which ended on January 31, 2006. "We made significant progress during the second quarter of 2006," statedKuslima Shogen, Chief Executive Officer of Alfacell. "As a result, wecontinue to track on or ahead of schedule on key sections of the rolling NDA.We also remain confident that we will successfully complete all regulatoryrequirements necessary to gain marketing approval of ONCONASE in the U.S.,E.U. and other markets." Financial Results During the second quarter, Alfacell recorded a net loss of $2,286,000 or$(0.06) per common share, as compared to a net loss of $1,955,000 or $(0.06)per common share for the same period in FY 2005. The net loss for the secondquarter includes a non-cash charge of $436,000 which reflects the accountingfor share based payment as required by SFAS 123(R). The share-basedcompensation expense is expected to continue as a result of the adoption ofSFAS 123(R), which requires the Company to charge a non-cash compensationexpense for all employee stock options. Research and development expenses for the three months ended January 31,2006 totaled $1,430,000 compared to $1,554,000 for the same period last year,a decrease of $124,000, or 8%. The spending decrease reflects the near-completion of key requirements for the Chemistry, Manufacturing and Controls(CMC) section of the ONCONASE NDA for UMM, including toxicology studies, theregistration batch stability program and a reduction in clinical trial costsas a result of reaching full patient enrollment. General and administrative (G&A) expenses for the three months endedJanuary 31, 2006 were $880,000 compared to $422,000 for the same period lastyear, an increase of $458,000, or 109%. This increase was primarily due to anincrease in non-cash expense related to share-based compensation, higher legalfees, ongoing cost of Sarbanes-Oxley compliance and auditing fees. Alfacell ended the second quarter of 2006 with cash, cash equivalents, andinvestments of $2,917,000. Total shares outstanding were 37,390,062 million. Key Developments * Announced that Tommy G. Thompson, former Secretary of the U.S. Department of Health and Human Services and four-term Governor of Wisconsin, joined the Company as Chairman of the Alfacell Business Policy Committee, which will focus on advancing and executing strategies in areas such as finance, government relations, and regulatory affairs. * Announced expectation to reach the full patient enrollment target for the ONCONASE Phase IIIb trial ahead of the previously announced timeframe of end of first quarter 2006. * Formed a new Thoracic Cancer Advisory Board (TCAB) to support the development of ONCONASE and other novel ribonuclease (RNase) therapies for diseases such as mesothelioma and non-small cell lung cancer (NSCLC). * Initiated the manufacturing stability program for registration batches of ONCONASE. About Alfacell Corporation Alfacell Corporation is a biopharmaceutical company focused on thediscovery, development and commercialization of novel therapeutics for cancerand other diseases, using its ribonuclease (RNase) technology platform.ONCONASE(R) (ranpirnase), Alfacell's lead investigational drug candidate, iscurrently being evaluated in several studies, including a Phase IIIbregistration study for malignant mesothelioma (MM) and a Phase I / II trial inNon-Small Cell Lung Cancer (NSCLC). For more information, please visithttp://www.alfacell.com. This press release includes statements that may constitute "forward-looking" statements, usually containing the words "believe," "estimate,""project," "expect" or similar expressions. Forward-looking statements involverisks and uncertainties that could cause actual results to differ materiallyfrom the forward-looking statements. Factors that would cause or contribute tosuch differences include, but are not limited to, uncertainties involved intransitioning from concept to product, uncertainties involving the ability ofthe Company to finance research and development activities, potentialchallenges to or violations of patents, uncertainties regarding the outcome ofclinical trials, the Company's ability to secure necessary approvals fromregulatory agencies, dependence upon third-party vendors, and other risksdiscussed in the Company's periodic filings with the Securities and ExchangeCommission. By making these forward-looking statements, the Company undertakesno obligation to update these statements for revisions or changes after thedate of this release.