Barbara Lindheim – Investor Relations Steven King – President and Chief Executive Officer, Director Paul Lytle – Chief Financial Officer

Stephen Dunn - Dawson James Securities Richard Siragusa - Merrill Lynch Michael Shiztwek - Private Investor Sheldon Traube - W Equities

Good morning and thank you for joining us on today’s call with the management of Peregrine Pharmaceuticals. We’re here today with Steven King, President and CEO, and Paul Lytle, CFO of Peregrine to discuss the company’s results for the second quarter of fiscal year 2008 reported this morning.

Before I turn the call over to Steve, I would like to read the cautionary note regarding forward looking statements. This conference call may include statements that are not historical facts and are considered forward looking within the meaning of the Private Securities Litigation Reform Act of 1995.

These forward looking statements reflect Peregrine Pharmaceuticals current views about future events and financial performance. These forward looking statements are identified by the use of terms and phrases such as believes, expects, plans, anticipates, on target, and similar expressions identifying forward looking statements.

These factors include, but are not limited to the risk factors detailed from time to time in Peregrine Pharmaceuticals filings with the SEC, including but not limited to the annual report on Form 10-K for the year ended April 30, 2007. Investors should not rely on forward looking statements because they are subject to a variety of risks, uncertainties, and other factors that could cause actual results to differ materially from Peregrine Pharmaceuticals expectations and Peregrine Pharmaceuticals expressly does not undertake any duty to update forward looking statements, whether as a result of new information, future events, or otherwise.

I’d like now to turn the call over to Steven King. Steve, you may begin.

Thank you Barbara and everyone for joining us today for our Q2 conference call. I would first like to highlight some of the key accomplishments since the last conference call.

I will then go over the financial highlights for the quarter, and I will conclude with a status update of our product development efforts in greater detail. In the Q2, we have continued to advance a number of programs that are strategic priorities for the company.

We believe these advancements have set the stage for significant progress in 2008. Specifically, we have continued to advance each of our three clinical programs.

First, we initiated patient enrollment and dosing in a Phase II trial of Cotara in patients with glioblastoma. Second, we began dosing patients in a Phase I trial of Bavituximab in patients co-infected with HCV and HIV at St.

Michaels Hospital in Newark. In addition, we recently added the prestigious AIDS clinical unit at the Johns Hopkins Medical Center, and a third site just down the road from our Newport Beach, California (inaudible) trial.

We believe these three sites will be adequate to enroll the trial in a timely fashion. Third, in our Bavituximab cancer program, we received clearance to open patient enrollment in a Phase II trial on patients with metastatic breast cancer.

In addition, we have submitted two additional Phase II protocols that we expect to be approved shortly. In addition to these clinical developments, we also obtained further scientific validation for our product pipeline through several peer reviewed publications and presentations, in addition to making good progress with the Defense Threat Reduction Agency to finalize a substantial contract award to study Bavituximab and human anti-PS antibodies for the treatment of viral hemorrhagic fevers.

Paul will speak more about this process during his update. As you can see, this quarter was very productive.

Before going into more detail of these advancements, I would like to hand the conference call over to our CFO, Paul Lytle, for a financial summary, Paul.

Thank you Steve, thank you Barbara, and thank you everyone for joining us. This morning, you may have seen our Q2 earnings release.

This release outlines the financial results in greater detail and includes financial tables, so I encourage everyone to read the entire release for additional information. We also plan to file our Form 10-Q later today, and both of these documents will be on our website.

Now during the next few minutes, I will take you through our financial results for the Q2 of fiscal year 2008; I’ll then briefly discuss our current financial position, and will conclude with a discussion of several other important topics. Now let me begin with the financial results for the Q2 of fiscal year 2008, starting with revenues.

Total revenues for the quarter ended October 31, 2007, were up 177% to $1.9 million, compared to total revenues of $0.7 million reported in the same prior year period. This increase was mostly driven by increased revenues coming from third party customers of Avid Bioservices, our wholly owned contract manufacturing business.

I believe it’s noteworthy to mention that the revenues generated by Avid in the past six months of $3.4 million were just slightly less than the total Avid revenues generated for the entire twelve months of fiscal year 2007. Based on the six month numbers, at our current projections we remain on track to achieve record revenues in fiscal year 2008.

Now let me turn to expenses. Total cost and expenses increased to $8.4 million for the quarter, this compares to total cost and expenses of $6.1 million reported in the same prior year quarter.

This increase was primarily related to an expected increase in the cost of contract manufacturing, directly related to higher reported revenues reported from Avid, in addition to an increase in research and development costs, as we continue to advance our product pipeline. Steve King will discuss our R&D progress in more detail in a few minutes.

In addition, we saw a modest increase in SG&A expenses in the current quarter of $273,000. This increase partly reflects our increased investments in business development, including the expansion of our business development team and licensing efforts.

In addition, we recorded an increase in the costs associated with our enhanced participation in non-deal road shows and investor conferences during the quarter. We also had higher costs as a result of greater marketing and business development efforts by Avid, which is reaching out to more potential customers and becoming a known player in the contract manufacturing industry through its enhanced participation in trade shows and conferences.

The impact of these efforts is evidenced in Avid’s growing revenues, and by its success in attracting new customers such as the recent contract signed with ARIUS Research. Now let me turn to the bottom line.

For the Q2 of fiscal year 2008, Peregrine reported a net lost of approximately $6.2 million, or $0.03 per basic undiluted share, compared to a new loss of approximately $5.1 million, or $0.03 per basic undiluted share in the same prior year period. The increase in our net loss of approximately $1.1 million was primarily related to the increased investment in research and development, as previously discussed.

Let me shift your attention to the balance sheet. We ended the quarter with approximately $26.1 million in cash and cash equivalent, compared to $16 million in cash at our fiscal year end April 30, 2007.

While our current CAP position is good, we also are actively pursuing opportunities to monetize our rich asset base. Our significantly expanded business and corporate development team is leading the charge on this campaign, and we are optimistic their efforts will help to further enhance our past position.

Now let me turn to a few additional points. We have previously announced that we were selected to negotiate for a five year contract with the Defense Threat Reduction Agency, or DTRA, which is an agency of the Department of Defense.

This potential contract was initially valued at up to $44.5 million to study our antiviral agent Bavituximab, and other anti-PS antibodies as potential therapies for hemorrhagic fever virus, a deadly virus that potentially can be weaponized. We are actively working with the DTRA and its audit agency DCAA, or Defense Contract Audit Agency on various steps in the process.

Now what have we accomplished so far? We have submitted a revised cost proposal now valued at more than the initial amount per the request of the DTRA.

We have also passed two separate internal audits performed by DCAA and a third audit, and hopefully final pre-award audit is scheduled for this week. As Steve has previously mentioned, there are a number of steps in the government contract award process and we have continued to successfully check them off.

Now let me discuss some of the opportunities from this potential contract as we know them today. First, this proposed contract allows the company to request a profit on the contract as a percentage of the contract fees.

This would potentially provide non-dilutive capital to the company. Second, the proposed contract allows us to recover a percentage of our G&A expenses, potentially reducing our G&A burden.

And third, the proposed contract would fund manufacturing scaled expenses, product formulation expenses, as well as drug supply needed for these efforts, costs that we would otherwise incur for these activities, in essence potentially lowering our capital requirements for these activities. All of these financial opportunities, of course, is pending successful conclusion of negotiations with the DTRA and we will update everyone as soon as we have more definitive information in hand.

At this point, we are anticipating that the process could be complete within the next couple of months. The next topic I would like to address pertains to our NASDAQ listing.

Let me first state the facts as we know them today. In July 2007, we received a letter from the NASDAQ stock market stating that we did not meet the $1.00 minimum bid price requirement.

In that same letter we were automatically given an initial 180 calendar days to regain compliance with the minimum bid price requirement, and that initial period ends on January 22, 2008. It is important to reiterate that the only listing standard that we have not complied with is the $1.00 bid price.

Now what do we need to do to regain compliance? Under the rules, in order to regain compliance, the closing bid price of our stock must be $1.00 or more for at least ten consecutive trading days, and NASDAQ can request to increase the number of days, but generally not for more than 20 days in total.

I know a number of shareholders are concerned with the approaching January 22 date, so I wanted to explain future potential steps under the NASDAQ listing regulations. In the event we do not meet the $1.00 minimum bid price requirement by January 22, 2008, we are eligible to be afforded an additional 180 calendar days to regain compliance.

This would take us into late July 2008. For our discussions with NASDAQ and our listings qualifications analyst, the day after our first 180 day period expires, or January 23, NASDAQ will commence a review to determine whether we are compliant with all other initial listing requirements in order to determine whether to grant us the additional 180 day compliance period.

As of today, I can say that we meet all the other listing requirements. The initial listing requirements include the following; a company must have stockholders equity of at least $5 million.

At October 31, 2007, our stockholders equity balance was over $27 million, so we do not anticipate not meeting this requirement. In addition, the market value of our publicly held shares must be $15 million or more, a requirement we meet.

We must have at least two years of operating history, a requirement we meet. We must have at least one million shares that are publicly held, again, a requirement we meet.

We must have at least 300 stockholders, a requirement we meet. We must have at least 300 market makes, a requirement we meet, and we must have corporate governance policy in place and operation, another requirement we meet.

As you can see, we currently meet all initial listing standards other than the minimum bid price requirement. We therefore believe we are currently in a good position to be afforded the additional 180 calendar days to regain compliance.

And let me assure you that maintaining our NASDAQ listing is extremely important to us and we will do everything in our power to maintain our listing. Let me conclude now with our investor outreach objectives.

We have made a lot of progress in product development and we are making a difference in people’s lives. And while we are happy with those efforts, we are not happy with the price of our stock.

We are all shareholders and we want nothing more than a higher stock price. This is one of the main reasons we have brought an investment bank onboard.

Our first investment bank, Rodman & Renshaw and Rodman is proving to be an effective vehicle to help drive our investor outreach program. In the past quarter we have been on four separate non-deal road shows covering the West Coast, the East Coast and the Midwest.

We have met with a number of analysts, institutional investors and fund managers, and they all like the story. In addition, we have recently presented at two investor conferences; the BIO Investor forum in October and the Rodman & Renshaw Healthcare Conference in November.

And our goal is to raise our profile with institutional investors in order to ultimately increase our institutional shareholder base. And another important service that an investment bank can provide and also to raise our profile is independent research or analyst coverage.

I can tell you that we are actively working with Rodman’s analyst team on almost a daily basis and that we are hopeful that an analyst report on Peregrine is near. I would like to thank you for your time and support of the company.

This concludes our discussions of the financial results. Steve will now continue to update everyone on the company’s recent achievements and our major objectives for the upcoming months.

Steve.

Thank you Paul. The major focus of our product development activities in the Q2 was advancing our three clinical programs and I will now discuss these efforts in more detail starting with out Cotara brain cancer program.

From taking over the Phase I dose symmetry and dose confirmation clinical study from NABTT a few months ago, we have been able to make significant progress in the trial. We were able to complete the cohort of patients that had been underway for some time.

We have also now completed the review period between cohorts of patients and have been able to escalate to the next dose level. As a reminder, all three dose levels in this study are considered to be within the potential therapeutic dose range for Cotara.

Our clinical group has been working on a more formal update of these studies, which we plan to release over the next few weeks. I can say however, that we are very pleased with the results of the study so far and that all of the patients in the study say they’re still surviving.

As we move forward, we are planning to add new sites to the trial that have had previous experience with Cotara. This should allow us to move the trial along at a better pace so that we can advance to Phase II studies in the US.

Again, we will give more details on this study in an upcoming update. Now let me provide an update of our Phase II Cotara trial.

We initiated patient dosing in the study during the quarter. We expected to have up to seven clinical sites involved in the trial to meet our enrollment goals.

While we were able to get two sites running in the trial quickly, the remainder of the sites were delayed in joining the trial because of internal political challenges, personnel changes, as well as coordination hurdles between departments within the institutions. While this has taken a toll on our enrollment rates the sites that have been opened have been treating patients and we have made good progress in the study.

In order to get the trial on track, our clinical affairs team and our CRO in India assisted the sites in overcoming their internal hurdles. I am happy to report that we now have expanded the number of potential clinical sites to eight and now have seven of the eight sites up and running with the eighth site expected to be online shortly.

As a result, patient screening has significantly increased over the past month or so. With the trial now running at full strength we still expect to meet our new initial goal of completing patient enrolment in the study by mid year and to provide an interim update on the study results early in 2008.

We recently had the chance to meet almost all of the investigators in person during a recent medical conference in India and I was very pleased to hear their continued enthusiasm to be involved in the trial and that their internal issues have all been resolved. We will provide periodic updates as the trial progresses.

Now let me shift gears and talk about Bavituximab clinical programs starting with the Bavituximab antiviral program. Our Bavituximab HCV program has progressed nicely since our last teleconference with initiation of patient enrollment in a Phase I trial assessing Bavituximab in patients co-infected with HCV and HIV at St.

Michael’s Hospital in Newark. Thus far the trial is progressing as planned and we are very happy with the activity level and interaction coming from St.

Michael’s. But, because this is a challenging patient population, we have added two additional clinical sites to the Phase I trial to ensure we can screen an adequate number of patients to meet our enrollment goals.

We were very pleased to add the prestigious AIDS clinical unit at the Johns Hopkins medical center as a second study site for this trial. The trial will be conducted under the direction of Dr.

Mark Sulkowski, a recognized leader in the treatment of HCV- HIV co-infected patients. And his expertise in this patient population will be a great asset to the program.

Additionally, we recently added a third study site to this trial, a private clinic located just down the road from us in Newport Beach California. With three study sites treating patients, we expect to see steady enrollment over the coming months and look forward to providing an update on this trial next spring.

In another development for the HCV program we were invited to give an oral presentation of the final results from our Phase I-B repeat dose trial to a large audience of liver disease experts at the prestigious AASLD Liver Meeting in November. The presentation was well received and highlighted the positive dose dependent signs of antiviral activity, a positive safety profile, as well as initial positive trends in immune response markers.

In addition to the clinical study, we are continuing a significant amount of preclinical work in the antiviral area. Our leading collaboration is with researchers at Duke University and a number of other institutions, including Harvard.

This collaboration is progressing very nicely and we are highly encouraged by the results we have seen. As a reminder, we are exploring the potential of Bavituximab in several other anti-PS antibodies for their potential in the treatment and prevention of HIV infections.

This collaboration is particularly important because without the collaboration we would not be able to conduct this informative research into the potential of our anti-PS platform for the treatment of HIV. Both we and our collaborators believe we are getting close to being able to share results of these studies either through publications or presentations in the upcoming months.

Next, I would like to update you on our Bavituximab anti-cancer program. As we announced last month, we achieved an important milestone by receiving regulatory clearance to begin a Phase II trial of Bavituximab in combination with chemotherapy in up to 46 patients with metastatic breast cancer.

The primary objective of this trial is to assess the overall response rate of Bavituximab in combination with Docetaxel, a chemotherapy drug commonly used in the treatment of metastatic breast cancer. We are currently focused on getting this trial underway and we are currently in the process of finalizing study documents, building our database, preparing study drugs, procuring chemotherapy and training study sites.

All of these activities are well underway and we expect to begin patient enrollment in very early 2008. Based on historical enrollment rates, we expect the trial to ramp up quickly and then enrollment will proceed well.

During the quarter, we also submitted two additional clinical protocols to study Bavituximab in combination with chemotherapy in patients with lung cancer and with metastatic breast cancer. Both of these studies are currently in review by the office of the Drug Controller General of India, the equivalent to the FDA in the US.

Although we expected to have approval to initiate these trials by now, new regulatory procedures that were implemented earlier in this year, ironically to accommodate the increased number of clinical protocols being submitted in India, inadvertently led to delays in review of our protocol. We have been in constant communication with our representatives and consultants in India, who have been working directly with the regulatory reviewers through this process.

We recently provided additional information to the DCGI office that we believe adequate to allow them to complete the review process. Our agents have assured us that the delays were logistical in nature and that they now expect the approval process to proceed smoothly.

Although we are frustrated by this slow pace of the regulatory review process, we remain confident that we are nearing completion of the process and that once the trials are running, that enrollment rates will proceed quickly. We recently had an opportunity to visit with some of the investigators that will be involved in the study and they are enthusiastic to begin the trial.

Now, moving to the Phase I Bavituximab trial in the US, we finally seem to be gathering momentum in this trial. Now that we have reached dosing levels, we expect to have anti-cancer activity based on preclinical studies.

As a result, we have seen increased patient screening activity at the current sites. In addition, we are looking at the possibility of adding new sites to the trial just to ensure that we will be able to complete the trial in a timely fashion.

Another positive development for this program recently occurred when one of our clinical investigators was invited to present interim results from this study at the prestigious 10th Annual International Symposium on Anti-Angiogenesis Agents in San Diego in February. Dr Alison Stopeck of the Arizona Cancer Center in Tucson, Arizona will present data gathered from the US Phase I trial and our other clinical experience with Bavituximab.

This is an excellent opportunity to raise the profile of our Bavituximab program with influential scientists and clinicians. It will also give us the opportunity to provide an update to the investment community on progress in the Bavituximab cancer program.

As you can see, we are extremely active on all fronts with our clinical programs. We are very happy with the results obtained so far from each of the clinical programs and look forward to the upcoming clinical updates for our Cotara and Bavituximab cancer programs.

Turning to partnering and business development, during the quarter we ramped up our proactive partnering activities. Our expanded business development team has been very active in meeting with a wide variety of prospective partners, not only for our clinical programs, but also for our preclinical programs and our other strategic assets.

We are in active discussions with a variety of potential partners and expect to make progress on monetizing a number of our assets. This is part of our overall goal to reduce our dependence on the capital markets for funding while serving to further validate the inherent value of our intellectual property, our product pipeline and other strategic assets.

As Paul noted, we were very active during the quarter in reaching out to the investment community, presenting at several major investor conferences and meeting with institutional investors on road trips organized by our bankers at Rodman. We anticipate continued active outreach in the coming months.

With that, I would now like to open the floor to questions.

Good morning Steven.

I guess as I only have one question, I’ll make it a big question. I guess on, kind of the news flow going into calendar year 2008 you indicated we’d have interim data for Cotara and then the other Bavituximab and HCV and oncology you kind of indicated you’ll have updates let’s say in spring or whatever.

Will that be interim data when you say updates? Or, what do you mean?

Yes, I think that could be interim updates as well as updates on overall patient enrollment. Certainly, I think, on the antiviral front as a whole, again, we do feel like, our collaborators that do feel like we will have some news flow coming from our collaboration in the HIV area, but on a clinical front it would primarily will be an update on overall patient enrollment as well as some interim results of how the trial is progressing and on how the drug is looking in this patient population.

Will we have any interim results on the Phase II's in oncology?

We do anticipate, again, there’s two separate Phase II programs, so there is the Cotara Phase II program. We've previously said we do plan on making a kind of update on the Phase II Cotara program when we've treated 20 to 25% of the patients.

Because it is a single - armed study we can do that without taking any hits on the overall trial design. In the Bavituximab programs, each of the trials that have been submitted are two-phased programs.

So, in the initial phase there is 15 to 21 patients depending on the trial, so after that set of patients we will be able to provide an update on how the trial is progressing, how patients are doing, safety profiles, so on and so forth. So we certainly will provide interim looks into the data from those trials as well.

Thanks very much.

Congratulations. Listen, the first is a clarification; so don't count this as a question.

In the release it states that you dosed your first co-infected patient and some people have called me and said, "Is that all they did, one patient?" And I said, "No, you've done multiple patients," is that correct?

That is correct.

Okay, my question now is I would imagine when you discuss with your potential partners you sign non-disclosure agreements, is that correct?

Well in general it’s a multi-step process so the initial step is sort of a general non-confidential overview and then if they have an interest it progresses under a confidentiality agreement to more information being able to be provided by the company. So when we're talking about active discussions in general, I don't consider it an active discussion until you’ve put a confidentiality agreement and you are in that level of discussion.

So my question is, how many confidentiality agreements do you have in place?

I don't have that number at hand, but it's lots.

Okay, than you very much.

Hi guys, thanks for taking my question. I guess my question is since R & R has been on board with us, it seems that our stock price instead of going up, I guess it has been mentioned we've done four road shows already.

But instead of our stock price going up with all these new investors it seems to be going down, do you have any comment on that?

I think our goal with Rodman & Renshaw is really to get the story out there, to get the story in front of existing and potential investors. What we can do is we can get out and tell the story to as many people as possible, but unfortunately we can’t control the stock price.

Our goal is really to tell the story, to make progress internally, and make progress with events that can potentially influence the stock price. Our real goal with Rodman & Renshaw is to tell a story to as many people as possible to make sure they know the story and that we’re on their radar screen.

I think the markets in general have taken a hit, especially in the small-cap and micro-cap companies, and we have spoken to many fund managers who believe that biotech will be coming in favor in the near term.

Do you think that people are really interested in looking at stock at $0.50. I mean, I thought most managers are looking at stocks that are above $5.00.

Absolutely, I think the potential behind the company and then the pipeline that we are developing has tremendous potential and I think anyone is interested in hearing that story. And everyone we have spoken to really likes the story, likes the technology, it's the first in class technology that no one else is developing, and that makes us very unique.

Thank you

Congratulations guys on all the progress you've made to date. Question regarding the Defense Department proposals, you mentioned that the size of that proposal is now larger than the initial proposal, could you give some color to that perhaps?

Sure, yeah, we've been working with the DTRA or Defense Threat Reduction Agency for a number of months now and we're going back and forth with them. They have actually asked us to do some more work up front than previously planned, so there’s additional experiments, additional studies that are being planned sooner rather than later.

In addition we have modified some of our assumptions and cost reimbursement assumptions, where we could potentially recover more from a profit standpoint and more from a G&A standpoint. A number of those things have driven the proposal at a higher level than previously submitted.

Next question.

Despite turmoil in the capital markets in the past month, which we believe has adversely affected our stock price, we remain very positive about the company's future. We have important clinical studies underway for each of our three clinical programs.

We are in active discussions with a wide variety of potential partners concerning our clinical programs, pre - clinical programs, intellectual property, and other strategic assets. We are making good progress in concluding a large contract award with the DTRA and continue to see positive results for our pre - clinical collaborations.

We believe these efforts represent multiple opportunities to create significant value for the company. We intend to continue to work closely with our bankers and analyst team to promote our story to institutional investors and are optimistic that the combination of delivering on our product development milestones, executing our business development initiatives, and continuing to ramp up our investor outreach efforts should result in significant value creation for our stockholders going forward.

Thank you again for your support, this concludes the prepared remarks.