Nektar Therapeutics Reports Financial Results for the First Quarter of 2016

Nektar Therapeutics Reports Financial

Results for the First Quarter of 2016

SAN FRANCISCO, May 3, 2016 /PRNewswire/ - Nektar

Therapeutics (Nasdaq: NKTR) today reported its financial results for the first quarter ended March 31, 2016.

Cash and investments in marketable securities at March 31, 2016

were $288.3 million as compared to $308.9 million at December 31, 2015. This balance at March 31, 2016 does not include $28.0 million

received from AstraZeneca in April of 2016 for the sublicense of MOVENTIG to ProStrakan in Europe.

"I am very pleased with the progress of both our proprietary

pipeline and partner programs," said Howard W. Robin, President and Chief Executive Officer of Nektar. "MOVANTIK

has performed well in its first year with positive feedback from physicians and patients. ADYNOVATE , which was launched

in the U.S. in December 2015 by Baxalta, recently received approval in Japan and has now been filed for approval

in Europe. The NKTR-181 Phase 3 efficacy study in patients with chronic low back pain is on track to provide top-line results

in early 2017. Finally, NKTR-214, our immuno-oncology candidate, is advancing in its first-in-human trial evaluating

its safety and efficacy in cancer patients with solid tumors. We expect to report initial top-line data from the dose-escalation

stage of the NKTR-214 study in the second half of 2016."

Revenue for the first quarter of 2016 was $58.9 million as compared

to $108.8 million in the first quarter of 2015. Revenue for the first quarter of 2016 includes the recognition of $28.0 million

received from AstraZeneca in April of 2016 for the sublicense of MOVENTIG to ProStrakan in Europe which occurred in the first quarter.

Revenue in the first quarter of 2015 was higher primarily because of the one-time recognition of $90 million related to the U.S.

commercial launch of MOVANTIK . Product sales and royalty revenue increased to $18.2 million in the first quarter of

2016 as compared to $8.1 million in the first quarter of 2015.

Revenue also included non-cash royalty revenue, related to our

2012 royalty monetization, of $6.5 million and $4.0 million for the three months ended March 31, 2016 and 2015, respectively. This

non-cash royalty revenue is partially offset by non-cash interest expense also incurred in connection with the 2012 royalty monetization.

Non-cash interest expense was $5.0 million in the first quarter 2016 as compared to $5.1 million in the first quarter 2015.

Total operating costs and expenses for the first quarter of

2016 were $68.4 million as compared to $65.8 million in the first quarter of 2015. Total operating costs and expenses increased

primarily as a result of higher research and development (R&D) expense in the first quarter of 2016. R&D expense

in the first quarter of 2016 was $49.3 million as compared to $47.0 million for the first quarter of 2015 and was higher in the

first quarter of 2016 primarily due to expenses for the NKTR-181 Phase 3 studies and for initiation of the Phase 1/2 study of NKTR-214.

General and administrative expense was $10.2 million in the

first quarter of 2016 as compared to $10.3 million in the first quarter of 2015.

In Q1 2016, net loss was $19.5 million, or $0.14 loss per share

as compared to net income of $33.8 million, or $0.26 basic earnings per share in the first quarter of 2015. This decrease

is primarily because of the one-time recognition of $90 million related to the U.S. commercial launch of MOVANTIK in the

first quarter of 2015.

The company also announced upcoming presentations at the following

scientific congresses during the first half of 2016:

SMI 16th Annual Pain Therapeutics Conference,

ASCO Annual Meeting, Chicago, IL:

Conference Call to Discuss First Quarter 2016 Financial Results

Nektar management will host a conference call to review the

results beginning at 4:30 p.m. Eastern Time/1:30 p.m. Pacific Time today, Tuesday, May 3, 2016.

This press release and a live audio-only

Webcast of the conference call can be accessed through a link that is posted on the home page and Investor Relations section of

the Nektar website: http://www.nektar.com.

The web broadcast of the conference call will be available for replay through Friday, June 3, 2016.

To access the conference call, follow these instructions:

Dial: (877) 881.2183 (U.S.); (970) 315.0453 (international)

Passcode: 96031147 (Nektar Therapeutics is the host)

In the event that any non-GAAP financial measure is discussed

on the conference call that is not described in the press release, or explained on the conference call, related information will

be made available on the Investor Relations page at the Nektar website as soon as practical after the conclusion of the conference

Nektar Therapeutics has a robust R&D pipeline in pain, oncology,

hemophilia and other therapeutic areas. In the area of pain, Nektar has an exclusive worldwide license agreement with AstraZeneca

for MOVANTIK (naloxegol), the first FDA-approved once-daily oral peripherally-acting mu-opioid receptor antagonist (PAMORA)

medication for the treatment of opioid-induced constipation (OIC), in adult patients with chronic, non-cancer pain. The product

is also approved in the European Union as MOVENTIG (naloxegol) and is indicated for adult patients with OIC who have had an

inadequate response to laxatives. The AstraZeneca agreement also includes NKTR-119, an earlier stage development program that is

a co-formulation of MOVANTIK and an opioid. NKTR-181, a wholly-owned mu-opioid analgesic molecule for chronic pain conditions,

is in Phase 3 development. In hemophilia, Nektar has a collaboration agreement with Baxalta for ADYNOVATE [Antihemophilic

Factor (Recombinant)], a longer-acting PEGylated Factor VIII therapeutic approved in the U.S. in patients over 12 with hemophilia

A. In anti-infectives, Amikacin Inhale is in Phase 3 studies conducted by Bayer Healthcare as an adjunctive treatment for intubated

and mechanically ventilated patients with Gram-negative pneumonia.

Nektar's technology has enabled nine approved products in the

U.S. or Europe through partnerships with leading biopharmaceutical companies, including AstraZeneca's MOVANTIK , Baxalta's

ADYNOVATE , UCB's CIMZIA for Crohn's disease and rheumatoid arthritis, Roche's PEGASYS for hepatitis C and Amgen's

NEULASTA for neutropenia.

Nektar is headquartered in San Francisco,

California, with additional operations in Huntsville, Alabama and Hyderabad, India. Further information about the company and

its drug development programs and capabilities may be found online at http://www.nektar.com.

MOVANTIK is a trademark and MOVENTIG is a registered

trademark of the AstraZeneca group of companies.

ADYNOVATE is a trademark of Baxalta Inc.

Cautionary Note Regarding Forward-Looking Statements

This press release contains "forward-looking statements"

within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words

such as: "anticipate," "intend," "plan," "expect," "believe," "should,"

"may," "will" and similar references to future periods. Examples of forward-looking statements include, among

others, statements we make regarding the advancement of our pipeline, the potential of MOVANTIK and ADYNOVATE, target time

frames for availability of future clinical results, and the value and potential of our polymer conjugate technology and research

and development pipeline. Forward-looking statements are neither historical facts nor assurances of future performance. Instead,

they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and

strategies, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to

the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many

of which are outside of our control. Our actual results may differ materially from those indicated in the forward-looking statements.

Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results

to differ materially from those indicated in the forward-looking statements include, among others, (i) the commercial potential

of a new drug at the early stages of commercial launch, such as MOVANTIK and ADYNOVATE, is difficult to predict and will have a

significant impact on our future results of operation and financial condition; (ii) the timing of the commencement or end of clinical

trials and the commercial launch of our drug candidates and those of our partners may be delayed or unsuccessful due to regulatory

delays, institutional review board review and approvals, slower than anticipated patient enrollment, manufacturing challenges,

changing standards of care, evolving regulatory requirements, clinical trial design, clinical outcomes, competitive factors, or

delay or failure in ultimately obtaining regulatory approval in one or more important markets; (iii) scientific discovery of new

medical breakthroughs is an inherently uncertain process and the future success of the application of our technology platform to

potential new drug candidates is therefore highly uncertain and unpredictable and one or more research and development programs

could fail; (iv) patents may not issue from our patent applications for our drugs (including MOVANTIK and ADYNOVATE) and drug candidates,

patents that have issued may not be enforceable, or additional intellectual property licenses from third parties may be required;

and (v) the outcome of any existing or future intellectual property or other litigation related to our drugs and drug candidates

and those of our collaboration partners including MOVANTIK and ADYNOVATE. Other important risks and uncertainties set forth in