Net loss for the quarter ended June 30, 2009 was $32.1 million or $0.35 per share, compared to net loss of $33.4 million or $0.36 per share in the second quarter of 2008.

Nektar made improvements to its operating efficiencies as compared to a year ago. Total operating costs and expenses were down 19% to $43.5 million in the second quarter of 2009 as compared to $53.8 million in the second quarter of 2008. For the first half of 2009, total operating costs and expenses were down 28% to $83.5 million as compared to $115.6 million in the first half of 2008.

"In the first half of 2009, we made a strong commitment to advancing our clinical pipeline," stated Howard W. Robin, President and Chief Executive Officer of Nektar. "We completed our Phase 2 clinical program for NKTR-118, and we are poised to report Phase 2 data for NKTR-102 and Phase 1 data for NKTR-105 by year-end. These achievements underscore the strength of Nektar's drug development organization and our successful strategy to focus on developing proprietary drugs with our advanced polymer conjugate technology."

Research and development expense was $24.2 million in the second quarter of 2009 as compared to $33.5 million for the same quarter in 2008. For the first half of 2009, research and development expense was $48.0 million as compared to $70.9 million for the first half of 2008. Included in the $48.0 million of overall research and development expense in the first half of 2009 is approximately $27.4 million of investment in Nektar preclinical and clinical development programs.

Revenue for the three month period ended June 30, 2009 was $13.0 million compared to revenue of $20.4 million in the second quarter of 2008. Revenue for the first half of 2009 was $22.7 million as compared to revenue of $40.4 million in the first half of 2008. This decrease in revenue is primarily the result of lower contract research and manufacturing revenues resulting from the sale of certain of the company's pulmonary assets to Novartis which occurred on December 31, 2008.

Cash, cash equivalents, and short-term investments at June 30, 2009 were $294.3 million.

Conference Call to Discuss Second Quarter 2009 Financial Results

A conference call to review results will be held on August 4, 2009 at 2 PM Pacific Time.

Details are below:

Howard Robin, president and chief executive officer, and John Nicholson, chief financial officer, will host a conference call beginning at 5:00 p.m. Eastern Time (ET)/2:00 p.m. Pacific Time (PT) on Tuesday, August 4, 2009.

       To access the conference call, follow these instructions:        Dial: (866) 831-6270 (U.S.); (617) 213-8858 (international)       Passcode: 25099763 (Howard Robin is the host)   

An audio replay will also be available shortly following the call through Wednesday, August 19, 2009 and can be accessed by dialing (888) 286-8010 (U.S.); or (617) 801-6888 (international) with a passcode of 26851386.

About Nektar

Nektar Therapeutics is a biopharmaceutical company developing novel therapeutics based on its PEGylation and advanced polymer conjugation technology platforms. Nektar's technology and drug development expertise have enabled nine approved products for partners, which include leading biopharmaceutical companies. Nektar is also developing a robust pipeline of its own potentially high-value therapeutics to address unmet medical needs by leveraging and expanding its technology platforms to improve and enable molecules.

The company recently announced positive Phase 2 results for Oral NKTR-118, its proprietary novel peripheral opioid antagonist that combines Nektar's advanced small molecule polymer conjugate technology platform with naloxol, a derivative of the opioid-antagonist drug, naloxone. Nektar's technology has been shown to increase oral bioavailability and inhibit penetration across the blood-brain barrier, an important potential advance for small molecule therapies. The product is being developed to treat opioid-induced constipation (OIC).

NKTR-102, PEGylated irinotecan, is currently in Phase 2 clinical studies in ovarian, breast and colorectal cancer. NKTR-105, PEGylated docetaxel, is currently in a Phase 1 study in patients with refractory solid tumors.

Nektar technology is used in nine approved partnered products in the U.S. or Europe today, including UCB's Cimzia(R), Roche's PEGASYS(R) for hepatitis C and Amgen's Neulasta(R) for neutropenia.

Nektar is headquartered in San Carlos, California, with additional R&D operations in Huntsville, Alabama and Hyderabad, India.

This press release contains forward-looking statements that reflect management's current views regarding the progress and potential of the company's pipeline of proprietary drug candidates, the value and potential of the company's technology platform, and the company's position to enter into new strategic collaborations with third parties. These forward-looking statements involve numerous risks and uncertainties, including but not limited to: (i) the company's proprietary product candidates and those of its collaboration partners are in various stages of clinical development and the risk of failure is high and can unexpectedly occur at any stage of development prior to regulatory approval for numerous reasons including, without limitation, safety and efficacy findings; (ii) the timing or success of the commencement or end of clinical trials and commercial launch of partnered products may be delayed or unsuccessful due to slower than anticipated patient enrollment, drug manufacturing challenges, changing standards of care, clinical trial design, clinical outcomes, or delay or failure in obtaining regulatory approval in one or more important markets; (iii) the company's patent applications for its proprietary or partner product candidates may not issue, patents that have issued may not be enforceable, or intellectual property licenses from third parties may be required in the future; (iv) the outcome of any future intellectual property or other litigation related to the company's proprietary product candidates or complex commercial agreements; (v) if the company is unable to establish and maintain collaboration partnerships on attractive commercial terms, or that cover all major markets, our business, results of operations and financial condition could suffer; (vi) advances by competitors, particularly if unanticipated; and (vii) certain other important risks and uncertainties set forth in the company's Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 6, 2009, the company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2009 filed with the Securities and Exchange Commission on May 8, 2009, and the company's most recent Quarterly Report on Form 10-Q to be filed on or about August 5, 2009. Actual results could differ materially from the forward-looking statements contained in this press release. The company undertakes no obligation to update forward-looking statements, whether as a result of new information, future events or otherwise.

   Contacts:   Jennifer Ruddock   Nektar Therapeutics   650-631-4954    Susan Noonan   The SAN Group   212-966-3650                         NEKTAR THERAPEUTICS        CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS          (In thousands, except per share information)                          (unaudited)                      Three Months Ended   Six Months Ended                          June 30,            June 30,                          ---------           --------                        2009      2008      2009      2008                        ----      ----      ----      ----   Revenue:     Product sales      and royalties   $10,525    $9,010   $16,995   $19,381     Collaboration      and other         2,463    11,391     5,704    21,012                        -----    ------     -----    ------   Total revenue       12,988    20,401    22,699    40,393    Operating costs and expenses:     Cost of goods      sold             10,231     5,444    15,330    12,671     Other cost of      revenue               -     1,487         -     6,821     Research and      development      24,150    33,500    48,040    70,873     General and      administrative    9,087    13,328    20,107    25,275                        -----    ------    ------    ------   Total operating    costs and    expenses           43,468    53,759    83,477   115,640                       ------    ------    ------   -------    Loss from    operations        (30,480)  (33,358)  (60,778)  (75,247)    Non-operating    income (expense):     Interest      income              950     3,190     2,600     8,203     Interest      expense          (2,948)   (3,929)   (6,285)   (7,847)     Other income,      net                 203       769       248     1,071                          ---       ---       ---     -----   Total non-    operating income    (expense)          (1,795)       30    (3,437)    1,427    Loss before    provision for    income taxes      (32,275)  (33,328)  (64,215)  (73,820)    (Benefit)    provision for    income taxes         (206)       47      (339)      260                         ----       ---      ----       ---    Net loss          $(32,069) $(33,375) $(63,876) $(74,080)                     ========  ========  ========  ========    Basic and    diluted net loss    per share          $(0.35)   $(0.36)   $(0.69)   $(0.80)    Shares used in    computing basic    and diluted    net loss per    share              92,556    92,400    92,536    92,365                             NEKTAR THERAPEUTICS                  CONDENSED CONSOLIDATED BALANCE SHEETS                              (In thousands)                               (unaudited)                ASSETS              June 30, 2009    December 31, 2008(1)                                   -------------    -----------------   Current assets:     Cash and cash equivalents        $114,992           $155,584     Short-term investments            179,311            223,410     Accounts receivable, net      of allowance                       8,473             11,161     Inventory                          10,110              9,319     Other current assets                5,317              6,746                                         -----              -----       Total current assets           $318,203           $406,220    Property and equipment, net          75,024             73,578   Goodwill                             76,501             76,501   Other assets                          3,270              4,237                                         -----              -----     Total  assets                    $472,998           $560,536                                      ========           ========           LIABILITIES AND        STOCKHOLDERS' EQUITY    Current liabilities:     Accounts payable                   $4,931            $13,832     Accrued compensation                6,883             11,570     Accrued clinical trial      expenses                          12,110             17,622     Accrued expenses                    7,201              9,923     Deferred revenue, current      portion                            8,770             10,010     Other current liabilities           5,421              5,417                                         -----              -----       Total current liabilities       $45,316            $68,374    Convertible subordinated    notes                              214,955            214,955   Capital lease obligations            19,616             20,347   Deferred revenue                     52,696             55,567   Deferred gain                         5,463              5,901   Other long-term liabilities           4,354              5,238                                         -----              -----       Total liabilities              $342,400           $370,382    Commitments and contingencies    Stockholders' equity:     Preferred stock                        $-                 $-     Common stock                            9                  9     Capital in excess of par      value                          1,317,577          1,312,796     Accumulated other      comprehensive income                 978              1,439     Accumulated deficit            (1,187,966)        (1,124,090)                                    ----------         ----------       Total stockholders'        equity                        $130,598           $190,154                                      --------           --------     Total liabilities and      stockholders' equity            $472,998           $560,536                                      ========           ========    (1) The consolidated balance sheet at December 31, 2008 has been derived       from the audited financial statements at that date but does not       include all of the information and notes required by generally       accepted accounting principles in the United States for complete       financial statements.                                NEKTAR THERAPEUTICS               CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS                               (In thousands)                                 (unaudited)                                                        Six Months Ended                                                            June 30,                                                       ----------------                                                          2009      2008                                                          ----      ----   Cash flows from operating activities:     Net loss                                         $(63,876) $(74,080)     Adjustments to reconcile net loss to net cash      used in operating activities:         Depreciation and amortization                   7,359    11,820         Stock-based compensation                        4,691     3,863         Other non-cash transactions                        56      (309)     Changes in assets and liabilities:         Decrease (increase) in trade accounts          receivable                                     2,362     9,570         Decrease (increase) in inventory                 (791)    2,021         Decrease (increase) in other assets             1,284    (6,026)         Increase (decrease) in accounts payable        (5,513)   (1,727)         Increase (decrease) in accrued compensation    (4,687)   (3,676)         Increase (decrease) in accrued clinical          trial expenses                                (5,512)   10,160         Increase (decrease) in accrued expenses        (1,344)   (1,061)         Increase (decrease) in accrued expenses to          contract manufacturers                             -   (40,444)         Increase (decrease) in deferred revenue        (4,111)   (5,321)         Increase (decrease) in other liabilities         (995)   (1,215)                                                          ----    ------     Net cash used in operating activities            $(71,077) $(96,425)    Cash flows from investing activities:         Purchases of investments                     (186,016) (334,685)         Sales of investments                            7,627    28,590         Maturities of investments                     221,948   369,337         Transaction costs from Novartis pulmonary          asset sale                                    (4,440)         Purchases of property and equipment            (7,999)  (10,349)                                                        ------   -------     Net cash provided by investing activities         $31,120   $52,893    Cash flows from financing activities:         Payments of loan and capital lease          obligations                                     (616)   (1,151)         Proceeds from issuances of common stock            90       383                                                           ---       ---     Net cash used in financing activities               $(526)    $(768)                                                         -----     -----     Effect of exchange rates on cash and cash      equivalents                                         (109)     (164)                                                          ----      ----     Net decrease in cash and cash equivalents        $(40,592) $(44,464)     Cash and cash equivalents at beginning of period  155,584    76,293                                                       -------    ------     Cash and cash equivalents at end of period       $114,992   $31,829                                                      ========   =======  

Nektar Therapeutics

CONTACT: Jennifer Ruddock of Nektar Therapeutics, +1-650-631-4954; orSusan Noonan of The SAN Group, +1-212-966-3650, for Nektar Therapeutics

Web Site: http://www.nektar.com/

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