New York, New York – October 7, 2003 – Callisto Pharmaceuticals, Inc. (OTCBB: CLSP - News) announced that it has received a $265,000 Small Business Technology Transfer Research grant from the National Institutes of Health for studies on Atiprimod, Callisto’s lead drug candidate for multiple myeloma. The Principal and Co-Principal Investigators of the grant entitled “Atiprimod to Treat Multiple Myeloma and Bone Resorption” are Dr. Gary S. Jacob, Chief Executive Officer, Callisto Pharmaceuticals, and Dr. Kenneth C. Anderson, Director of the Jerome Lipper Multiple Myeloma Center of the Dana-Farber Cancer Institute, respectively. Studies will utilize unique in vitro and in-vivo methods and animal models at Dana-Farber Cancer Institute and at Callisto to explore Atiprimod’s pharmacological activity and mechanism of action. “We are pleased to be collaborating with Dr. Anderson and his team on this project which will help us to better define the biological activity of Atiprimod,” says Dr. Gary S. Jacob, CEO of Callisto Pharmaceuticals, Inc.

About Callisto Pharmaceuticals, Inc.

Callisto is a biopharmaceutical company focused on the development of drugs to treat multiple myeloma, other cancers and osteolytic bone disease. Callisto’s lead drug candidate, Atiprimod, is a small-molecule, orally available drug with antiproliferative and antiangiogenic activity. Atiprimod successfully completed Phase I clinical trials in rheumatoid arthritis patients and Callisto filed an IND on September 23, 2003 with the U.S. Food and Drug Administration on Atiprimod to enter a Phase I/IIa clinical trial in multiple myeloma patients. The drug is also being explored as an agent to treat osteolytic bone disease. In addition, Callisto has programs focused on the development of an analog of the human intestinal hormone, uroguanylin, to treat colon cancer, and drugs to protect against staphylococcal and streptococcal bioweapons, as a protection against the devastating effects of toxic shock syndrome. Callisto has two operating subsidiaries, Callisto Research Labs, LLC and Synergy Pharmaceuticals Inc.

About Dana-Farber Cancer Institute

Dana-Farber Cancer Institute is a principal teaching affiliate of the Harvard Medical School and is among the leading cancer research and care centers in the United States. It is a founding member of the Dana-Farber/Harvard Cancer Center (DF/HCC), designated a comprehensive cancer center by the National Cancer Institute.

Included in this release are “forward-looking: statements. 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 have been correct. Callisto’s actual results could differ materially from those anticipated in the forward-looking statements as a result of various factors.