FOR IMMEDIATE RELEASE

February 28, 2006.

Atiprimod Clinical Trial in Advanced Cancer Patients Uncovers Clear Response Against Carcinoid Tumors.

Company Plans New Clinical Trial, New Results May Accelerate Atiprimod's Path to Approval

NEW YORK--(BUSINESS WIRE)—Feb. 28, 2006--Callisto Pharmaceuticals, Inc. (AMEX:KAL - News; FWB:CA4), a developer of new drug treatments in the fight against cancer and other major health threats, today announced plans to launch an additional indication for clinical development of its drug candidate Atiprimod based on encouraging clinical results that showed a clear response in a patient with advanced carcinoid cancer plus additional encouraging clinical data on other carcinoid patients.

The encouraging data provides an additional development path for Atiprimod that has the potential to give Callisto its first approved drug considerably earlier than the Company previously expected.

Based on these new clinical data, the Company announced its commitment to initiate a new Phase I/II clinical trial of Atiprimod in carcinoid cancer patients with advanced tumors that it plans to open at several new sites in the next few months.

Callisto believes there exists an “unmet medical need” for new treatments for advanced and metastatic carcinoid tumors because there are no FDA approved drugs for these types of tumors.

Carcinoid tumors, or carcinoids, originate in hormone-producing cells of the gastrointestinal (GI) tract, the respiratory tract, the hepatobiliary (liver) system and the reproductive glands. The most common site of origin is the GI tract, with tumors often developing in the rectum, and other sections of the small intestine.

“The exciting results from the Phase I/IIa trial of Atiprimod in advanced cancer patients have transformed our Atiprimod development program,” said Dr. Gary S. Jacob, CEO of Callisto. “The study uncovered a patient population with carcinoid tumors that could potentially benefit from our drug, and our intention is to move aggressively forward with further clinical evaluation of Atiprimod in a larger population of carcinoid patients.”

In particular, Atiprimod may provide new hope for patients with advanced carcinoid tumors of the liver and GI tract. Common sites of carcinoid metastases include liver, lungs, bone and lymph nodes. Carcinoid tumors that metastasize to the liver have a poor prognosis. Traditionally, chemotherapy relieves symptoms in less than 30% of cases of metastatic carcinoid tumors, usually for less than 1 year.

“Atiprimod is a drug that we know from tissue distribution studies accumulates at highest concentrations in liver and the gastrointestinal tract,” noted Dr. Donald Picker, Executive VP of Research & Development. “Because of this response, we are now focusing on a range of other liver cancers and other metastatic diseases in addition to carcinoids. We are very excited to initiate a formal separate carcinoid clinical trial for this serious disease, where there are no currently approved drugs for these liver metastatic patients.”

The earlier Atiprimod trial in advanced cancer patients at the University of Texas M. D. Anderson Cancer Center entitled: “An Open Label Study of the Safety and Efficacy of Atiprimod Treatment for Patients with Advanced Cancer” which was begun in March, 2005, originally was designed to assess Atiprimod’s activity in solid tumors and hematologic malignancies.

About Callisto Pharmaceuticals, Inc.
Callisto is a biopharmaceutical company focused on the development of new drugs to treat various forms of cancer and other serious afflictions. Callisto's drug candidates in development currently include anti-cancer agents in clinical development, in addition to drugs for a range of other significant health care market segments, including biodefense. One of the Company's lead drug candidates, L-Annamycin, is being developed as a treatment for forms of relapsed leukemia, a currently incurable blood cancer. Callisto initiated a clinical trial of L-Annamycin in adult relapsed acute lymphocytic leukemia patients in 4Q 2005. L-Annamycin, a new compound from the anthracycline family of proven anti-cancer drugs, has a novel therapeutic profile, including activity against resistant diseases and significantly reduced cardiotoxicity, or damage to the heart, compared to currently available drug alternatives. Another anti-cancer drug, Atiprimod, is in development to treat relapsed multiple myeloma, a blood cancer. Atiprimod has entered Phase I/IIa human clinical trials in relapsed multiple myeloma patients. Callisto also has drugs in preclinical development for gastro-intestinal inflammation, and a program focused on the development of a drug to protect against Staphylococcus and Streptococcus biowarfare agents. Callisto has exclusive worldwide licenses from AnorMED Inc. and M.D. Anderson Cancer Center to develop, manufacture, use and sell Atiprimod and L-Annamycin, respectively.

For investor-specific information about Callisto, including recent news and stock price data, please visit http://www.trilogy-capital.com/tcp/callisto/.

For an Investor Fact Sheet about Callisto, please visit http://www.trilogy-capital.com/tcp/callisto/factsheet.html.

To view an informational presentation of the Company's development pipeline of drug candidates, visit http://www.trilogy-capital.com/tcp/callisto/powerpoint.html.

Callisto is also listed on the Frankfurt Stock Exchange under the ticker symbol CA4. For additional information, visit www.callistopharma.com.

Forward-Looking Statements
Certain statements made in this press release are forward-looking. Such statements are indicated by words such as "expect," "should," "anticipate" and similar words indicating uncertainty in facts and figures. Although Callisto believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations reflected in such forward-looking statements will prove to be correct. As discussed in the Callisto Pharmaceuticals Annual Report on Form 10-K/A for the year ended December 31, 2004, and other periodic reports, as filed with the Securities and Exchange Commission, actual results could differ materially from those projected in the forward-looking statements as a result of the following factors, among others: uncertainties associated with product development, the risk that products that appeared promising in early clinical trials do not demonstrate efficacy in larger-scale clinical trials, the risk that Callisto will not obtain approval to market its products, the risks associated with dependence upon key personnel and the need for additional financing.

CONTACTS:

Callisto Pharmaceuticals, Inc. Dan D'Agostino, 212-297-0010 ext. 227 dagostino@callistopharma.com

Trilogy Capital Partners, Inc. (Financial Communications) Paul Karon, 800-592-6067 paul@trilogy-capital.com