Northfield Laboratories Inc. Reports Fiscal 2006 Fourth Quarter and Year-End Financial Results; Major Milestones Achieved

For the fiscal year, Northfield reported a net loss of $26.8million, or $1.00 per share, compared with a net loss of $20.3million, or $0.88 per share, for the prior fiscal year. The Companyreported shareholders' equity of $69.4 million, with $73.9 million incash and marketable securities.

Northfield reported a loss of $8.3 million, or $0.31 cents pershare, for the fiscal fourth quarter, compared with a loss of $5.7million, or $0.21 cents per share, for the corresponding period lastyear.

"Northfield made significant progress this year toward bringingPolyHeme(R) to market," said Steven A. Gould, M.D., Chairman and ChiefExecutive Officer. "Most importantly, we completed enrollment in ourpivotal Phase III trial. Subsequently, we applied for Fast-Trackdesignation for PolyHeme based on its life-sustaining potential, andwe hope to be eligible for priority review when we submit our BLA nextyear."

Fiscal Year Highlights

Clinical

-- Enrollment in Northfield's pivotal Phase III trial with PolyHeme is complete.

-- 720 patients were enrolled in the study, as planned.

-- Subsequent to the end of the fiscal year, Northfield applied for Fast-Track designation for PolyHeme for the treatment of life-threatening blood loss when an oxygen-carrying fluid is required and red blood cells are not available.

-- Northfield announced the results of the fourth and final planned interim analysis of the data from the trial. An Independent Data Monitoring Committee (IDMC) recommended that the trial continue to completion without modification after its review of blinded data from the first 500 patients enrolled in the study.

Financial

-- Northfield received an appropriation of $3.5 million in the 2006 Defense Appropriations budget. This brings the total of Congressional appropriations to $4.9 million.

Commercialization Activities

-- Northfield announced its plan to upsize the planned capacity of the first commercial facility from 75,000 units to 100,000 units or more.

-- Northfield engaged the Jacobs Engineering Group Inc. and began the first phase of activities related to the planned expansion: size optimization and updating of engineering of the facility.

-- After the close of the fiscal year, Northfield purchased the building it previously occupied as lessee in order to assure flexibility with regard to expansion activities.

-- Northfield initiated pharmacoeconomic research to support policy and reimbursement strategies for the commercialization of PolyHeme.

Investor and Media Relations

-- Northfield participated in seven institutional investor conferences during the past twelve months and has already received numerous invitations to forthcoming conferences.

-- Northfield hosted its second meeting for financial analysts and institutional investors. The program, Delivering Trauma Care Today and Tomorrow, included presentations by leading experts in trauma and in addition an update on the company's activities by Dr. Gould.

-- Northfield continued its dedicated outreach program to institutional investors and securities analysts.

Annual Meeting of Stockholders

Northfield will hold its 2006 annual meeting of stockholders onWednesday, September 20, 2006, at 10:00 a.m., local time, at the DeerPath Inn, Lake Forest, Illinois. The entire meeting, including theofficial proceedings, the annual business update, and the question andanswer session will be broadcast live on the Internet. Details will beprovided approximately two weeks before the meeting date.

For additional information about Northfield Laboratories Inc.please refer to the Company's 2005 10-K and annual report filed withthe SEC. The Company's Annual Report and Proxy Statement will bemailed to shareholders and be available electronically atwww.northfieldlabs.com.

About Northfield Laboratories

Northfield Laboratories Inc. is a leader in developing anoxygen-carrying red blood cell substitute for the treatment oflife-threatening blood loss, when an oxygen-carrying fluid is requiredand red blood cells are not available. PolyHeme(R) is a solution ofchemically modified human hemoglobin that requires no cross matchingand is therefore compatible with all blood types. It has a shelf lifein excess of 12 months. For further information, visitwww.northfieldlabs.com.

This press release may contain forward-looking statementsconcerning, among other things, Northfield's future business plans andstrategies and clinical and regulatory developments affecting ourPolyHeme(R) red blood cell substitute product. These forward-lookingstatements are identified by the use of such terms as "intends,""expects," "plans," "estimates," "anticipates," "should," "believes"and similar terms. These forward-looking statements involve inherentrisks and uncertainties. Our actual results may therefore differmaterially from those predicted by the forward-looking statementsbecause of various factors and possible events, including our abilityto obtain FDA approval to market PolyHeme commercially, our ability toobtain Fast Track designation and priority review, the availability ofcapital to finance our clinical trials and ongoing businessoperations, our ability to obtain adequate supplies of raw materialsand to manufacture PolyHeme in commercial quantities, our ability tomarket PolyHeme successfully, the possibility that competitors willdevelop products that will render PolyHeme obsolete ornon-competitive, our ability to protect our intellectual propertyrights, the outcome of certain governmental inquiries and purportedclass action lawsuit as described in our most recently filed quarterlyreport on Form 10-Q, the possibility that we may be subject to productliability claims and other legal actions, our dependency on a limitednumber of key personnel, the uncertainty of third party reimbursementfor our product and other risks and uncertainties described from timeto time in our periodic reports filed with the Securities and ExchangeCommission, including our most recently filed quarterly report on Form10-Q and annual report on Form 10-K. These forward-looking statementsspeak only as of the date of this press release. We do not undertakeany obligation to update or publicly release any revisions toforward-looking statements to reflect events, circumstances or changesin expectations after the time such statement is made. All subsequentwritten and oral forward-looking statements attributable to Northfieldor any person acting on our behalf are qualified by this cautionarystatement.