Northfield Laboratories Inc. Reports Third Quarter Fiscal Year 2006 Financial Results

Northfield reported a loss of $6.4 million or $ 0.24 cents pershare for the third quarter, compared with a loss of $4.9 million or$0.21 cents per share for the corresponding period last year. Asexpected, increases in operating expenses were incurred to conduct,expand, and support our pivotal Phase III trial.

At the close of the quarter, the Company reported shareholders'equity of $77.4 million, with $80.3 million in cash and marketablesecurities.

As a development stage company, Northfield does not generaterevenues.

Clinical Trial

-- Enrollment continues in the Company's pivotal Phase III study designed to evaluate the safety and efficacy of PolyHeme(R), Northfield's human hemoglobin-based oxygen-carrying resuscitative fluid, when administered to patients in hemorrhagic shock following traumatic injury. The primary endpoint is survival at 30 days. 27 Level I trauma centers throughout the United States are currently enrolling patients in the trial, which has a target enrollment of 720 patients.

-- As of March 31, 2006, approximately 655 patients had been enrolled in the study, passing the 90% mark of the planned enrollment.

-- During the quarter, the Independent Data Monitoring Committee responsible for reviewing the safety data from the study reiterated its recommendation to complete the trial based on four separate reviews of mortality and adverse event data from the first 500 patients enrolled, stating:

"As has been reported to Northfield Laboratories regarding the final assessment of the interim data, including 500 randomized patients, there were no statistically significant trends or safety issues identified to warrant modification or other changes in the current protocol and patient recruitment. The IDMC conclusion is that completion of the trial is appropriate with completion of datasets and final analysis indicated."

Commercialization Activities

-- The Company has completed its review of multiple proposals for the planned expansion of its manufacturing capacity in Mt. Prospect, IL, and is finalizing negotiations on a contract with the Jacobs Engineering Group Inc.

Other Recent and Upcoming Events

-- The Company announced that it will receive $3.5 million in designated funding for the continued development of PolyHeme(R), the Company's human hemoglobin-based oxygen carrier, as part of the Fiscal 2006 Defense Appropriations Bill. This brings the total Defense appropriations to $4.9 million.

-- The Company announced in February the appointment of Alan L. Heller, a healthcare industry veteran, to its Board of Directors.

-- As previously announced, Northfield is cooperating with the staff of the SEC and the Senate Finance Committee with respect to their requests to voluntarily provide certain information regarding our prior elective surgery trial. The Company will also be defending a number of purported class action lawsuits filed following the recent media attention. These matters are described further in our quarterly report filed today with the SEC.

-- The Company participated in the BIO CEO & Investor Conference in February. More recently, presentations were given at the 25th Annual SG Cowen Healthcare Conference and the BioCentury Future Leaders in the Biotechnology Industry Conference in March.

-- The Company will be presenting at the UBS Global Pharmaceuticals Conference in New York in April. This presentation will be webcast; details will be available one week prior to the date.

Conference Call and Webcast Information

Northfield will host a conference call to discuss third quarterfinancial results on Tuesday, April 11, 2006 at 11:00 a.m. ET/10:00a.m. CT. To access the conference call, investors may dial1.866.800.8652. The participant passcode is 28793528. A replay of thecall will be available after 1:00 p.m. on April 11 through April 25,2006, at 1.888.286.8010. The replay passcode number is 83238803.

The webcast is being distributed through the Thomson StreetEventsNetwork to both institutional and individual investors. Individualinvestors may listen to the call at http://www.fulldisclosure.com,Thomson/CCBN's individual investor portal, powered by StreetEvents.Institutional investors may access the call via Thomson'spassword-protected event management site, StreetEvents(http://www.streetevents.com). Interested investors may also accessthe live webcast through the Company's Web site, located atwww.northfieldlabs.com.

About Northfield Laboratories

Northfield Laboratories Inc. is a leader in developing anoxygen-carrying resuscitative fluid for the treatment of urgent, largevolume blood loss in trauma and resultant surgical settings.PolyHeme(R) is a solution of chemically modified human hemoglobin thatrequires no cross matching and is therefore compatible with all bloodtypes. It has a shelf life in excess of 12 months. Enrollment iscurrently underway in a pivotal Phase III trial of PolyHeme(R)beginning in the pre-hospital setting. 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, theavailability of capital to finance our clinical trials and ongoingbusiness operations, our ability to obtain adequate supplies of rawmaterials and to manufacture PolyHeme in commercial quantities, ourability to market PolyHeme successfully, the possibility thatcompetitors will develop products that will render PolyHeme obsoleteor non-competitive, our ability to protect our intellectual propertyrights, the outcome of certain governmental inquires and purportedclass action lawsuits as described in our most recently filedquarterly report on Form 10-Q, the possibility that we may be subjectto product liability claims and other legal actions, our dependency ona limited number of key personnel, the uncertainty of third partyreimbursement for our product and other risks and uncertaintiesdescribed from time to time in our periodic reports filed with theSecurities and Exchange Commission, including our most recently filedquarterly report on Form 10-Q and annual report on Form 10-K. Theseforward-looking statements speak only as of the date of this pressrelease. We do not undertake any obligation to update or publiclyrelease any revisions to forward-looking statements to reflect events,circumstances or changes in expectations after the time such statementis made. All subsequent written and oral forward-looking statementsattributable to Northfield or any person acting on our behalf arequalified by this cautionary statement.

(Tables to follow)

NORTHFIELD LABORATORIES INC.
(a company in the development stage)

Balance Sheets
February 28, 2006 and May 31, 2005
(In thousands)

Feb 28, May 31,
2006 2005
Assets (unaudited)
Current assets:
Cash $49,503 $6,800
Short-term marketable securities 30,810 91,330
Prepaid expenses 281 827
Other current assets 0 140
Total current assets 80,594 99,097

Plant and equipment, net 1,115 835
Other assets 69 69
Total assets $81,778 $100,001


Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable $3,197 $3,325
Accrued expenses 80 111
Accrued compensation and benefits 620 540
Total current liabilities 3,897 3,976

Other liabilities 239 252
Total liabilities 4,136 4,228

Shareholders' equity:
Capital stock 268 267
Additional paid-in capital 241,198 240,972
Deficit accumulated during the -163,806 -145,361
development stage
Deferred compensation -18 -105
Total shareholders' equity 77,642 95,773

Total liabilities and
shareholders' equity $81,778 $100,001






NORTHFIELD LABORATORIES INC.
(a company in the development stage)

Statements of Operations
Three and nine months ended February 28, 2006 and February 28, 2005
(In thousands except per share data)


Three Months Ended Nine months Ended
Feb 28, Feb 28, Feb 28, Feb 28,
2006 2005 2006 2005
(unaudited) (unaudited) (unaudited) (unaudited)

Revenues - license
income $ - $ - $ - $ -

Costs and expenses:
Research and development 5,786 3,818 16,453 12,033
General and
administrative 1,454 1,311 4,303 3,170
7,240 5,129 20,756 15,203


Other income and expense:
Interest income 845 281 2,311 557
Interest expense - - - -
845 281 2,311 557

Cumulative effect
of change in
accounting principle 0

Net loss $ -6,395 $ -4,848 $-18,445 $-14,646

Net loss per
basic share $ -0.24 $ -0.21 $ -0.69 $ -0.67

Shares used in
calculation of
per share data 26,769 22,658 26,764 21,830