919722--3/16/2006--SUPERGEN

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{product, candidate, development}

{product, liability, claim}

{operation, natural, condition}

{property, intellectual, protect}

{product, market, service}

{control, financial, internal}

{cost, operation, labor}

{tax, income, asset}

{customer, product, revenue}

{cost, regulation, environmental}

{interest, director, officer}

{personnel, key, retain}

{provision, law, control}

{regulation, government, change}

{condition, economic, financial}

The following section lists some, but not all, of the risks and uncertainties that may have a material adverse effect on our business, financial condition and results of operations. You should carefully consider these risks in evaluating our company and business. Our business operations may be impaired if any of the following risks actually occur, and by additional risks and uncertainties that we do not know of or that we currently consider immaterial. In such case, the trading price of our common stock could decline. This report also contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in the forward-looking statements as a result of certain factors, including the risks described below and elsewhere in this report. Risks Related to Dacogen, Orathecin and Nipent If we do not receive regulatory approval for Dacogen, our future revenues may be limited and our business would be harmed. Even if we receive regulatory approval of Dacogen for the treatment of patients with myelodysplastic syndromes, Dacogen may not be commercially successful. We are currently conducting clinical trials with Orathecin as a combination therapy. If these clinical trials do not support regulatory approval, our business may be harmed. Even if we receive regulatory approval of Orathecin as a combination therapy, Orathecin may not be commercially successful. If we are unable to expand our clinical support for use of Nipent to treat additional diseases our revenues will not expand as planned. Risks Related to Our Financial Condition and Common Stock We have a history of operating losses and we expect to continue to incur losses for the foreseeable future. We will require additional funding to expand our product pipeline, strengthen our commercialization efforts and expand our European operations, and if we are unable to raise the necessary capital or to do so on acceptable terms, our planned expansion and continued chances of survival could be harmed. Our collaborative relationship with MGI may not produce the financial benefits that we are anticipating, which could cause our business to suffer. Our equity investment in AVI exposes us to equity price risk and any impairment charge would affect our results of operations. Product Development and Regulatory Risks Before we can seek regulatory approval of any of our product candidates, we must complete clinical trials, which are expensive and have uncertain outcomes. Our clinical trials may be delayed or terminated, which would prevent us from seeking necessary regulatory approvals. We may be required to suspend, repeat or terminate our clinical trials if they are not conducted in compliance with regulatory requirements. We may be required to suspend, repeat or terminate our clinical trials if later trial results fail to demonstrate safety and efficacy, or if the results are negative, inconclusive or if they fail to demonstrate safety or efficacy. Our failure to obtain regulatory approvals to market our product candidates in foreign countries would adversely affect our anticipated revenues. Even if we obtain regulatory approval, we will continue to be subject to extensive government regulation that may cause us to delay the introduction of our products or withdraw our products from the market. The continuing efforts of government and third-party payers to contain or reduce the costs of healthcare may adversely affect our revenues. If we are unable to comply with environmental laws and regulations, our business may be harmed. Additional Risks Associated with Our Business We recently announced our intent to acquire Montigen Pharmaceuticals, Inc. This transaction could disrupt our business and harm our financial condition if we are not able to successfully close the acquisition or successfully integrate Montigen s business and technology into ours, and if we do close the acquisition, the expected benefits of the combination may not materialize. If the third-party manufacturers upon whom we rely fail to produce our products in the volumes that we require on a timely basis, or fail to comply with stringent regulations applicable to pharmaceutical drug manufacturers, we may face delays in the delivery of, or be unable to meet demand for, our products. Our business may be harmed if the manufacture of our products is interrupted or discontinued. If our suppliers cannot provide the components we require, our product sales and revenue could be harmed. We have limited sales and marketing capabilities and may not be able to successfully commercialize our products. If we are not able to maintain and successfully establish new collaborative and licensing arrangements with third parties, our product development and business will be harmed. Our collaborative relationships with third parties could cause us to expend significant funds on development costs with no assurance of financial return. Our ability to protect our intellectual property rights will be critically important to the success of our business, and we may not be able to protect these rights in the United States or abroad. If we fail to compete effectively against other pharmaceutical companies, our business will suffer. The pharmaceutical industry in general and the oncology sector in particular is subject to significant and rapid technological change. Developments by competitors may render our product candidates or technologies obsolete or non-competitive. We are developing products based upon compounds that may be covered by patents held by third parties that are expected to expire or already expired. These compounds may also be the subject of method, formulation, and manufacturing process patents held by third parties. If these patents do not expire as anticipated or are expanded in scope, we will not be able to develop our products as planned. We may be subject to product liability lawsuits and our insurance may be inadequate to cover damages. If we are unable to attract and retain additional, highly skilled personnel required for the expansion of our activities, our business will suffer. Earthquake or other natural or man-made disasters and business interruptions could adversely affect our business. Provisions in our certificate of incorporation, bylaws and applicable Delaware law may prevent or discourage third parties or stockholders from attempting to replace our management.

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919722--3/16/2006--SUPERGEN_INC