ZIOPHARM Reports Fourth Quarter and Full Year 2011 Financial Results --Significant Progress for Lead Programs

ZIOPHARM Reports Fourth Quarter and Full

Year 2011 Financial Results

--Significant Progress for Lead Programs--

NEW YORK, NY - February 29, 2012 -

ZIOPHARM Oncology, Inc. (Nasdaq: ZIOP) announced today its financial results for the fourth quarter and full year ending December

31, 2011, and the filing of its Annual Report on Form 10-K with the Securities and Exchange Commission.

Fourth Quarter Results

The Company's cash used in operations

during the fourth quarter was $13.8 million, an increase of $8.0 million from $5.8 million for the same period of 2010. The increase

in spending is attributable primarily to research and development activities for the palifosfamide pivotal Phase 3 trial (PICASSO

3), additional activities supporting palifosfamide development, and expenditures supporting the Company's synthetic biology

therapeutics development program established early in 2011. The Company reported a net loss of $13.2 million for the fourth quarter,

or $(0.19) per share, compared to a net loss of $11.9 million, or $(0.25) per share, in the fourth quarter of 2010. Excluding recognition

of a non-cash gain of $3.2 million attributable to the change in liability-classified warrants, there was a net loss of $16.4 million,

or $(0.24) per share, for the fourth quarter ended December 31, 2011.

Net loss for the year was $63.8 million, or

$(0.97) per share, compared to a net loss of $32.7 million, or $(0.71) per share, for 2010. The increase in net loss of $31.1 million

included a one-time, non-cash charge of $17.5 million for in process research and development expense related to the Company's

issuance of stock in conjunction with entering into the Company's Exclusive Channel Partnership with Intrexon Corporation.

The remaining increase is primarily attributable to the ongoing pivotal Phase 3 palifosfamide trial as well as related support

activity and the Company's synthetic biology program. Total operating expenses for 2011 were $72.1 million, compared to $24.5

million for 2010, or an increase of $47.6 million. The difference between 2011 full year operating expenses and net loss is primarily

attributable to a non-cash gain of $7.6 million related to the change in fair value of liability-classified warrants.

The Company ended the year with $104.7 million

in cash and cash equivalents which, along with net proceeds of approximately $49.1 million from a financing transaction completed

in January of 2012, is currently expected to support operations into the second half of 2013.

Progress and Milestones within Lead Programs

Palifosfamide (Zymafos or ZIO-201):

ZIOPHARM recently announced positive

preliminary overall survival (OS) data from the multicenter, randomized, Phase 2 trial of palifosfamide plus doxorubicin vs. doxorubicin

alone (PICASSO) in patients with unresectable or metastatic soft tissue sarcoma. The hazard ratio for OS was 0.78 favoring the

palifosfamide arm (with 2-year survival of 40% compared to 30%). These OS data correlate with the previously announced progression-free

survival (PFS) results from the study, which demonstrated a hazard ratio of 0.43. The control arm included cross-over, in that

subjects in this arm - who were measured for OS in the most recent analysis - could receive palifosfamide once they

progressed on control therapy. Before and after cross-over, safety outcomes were similar between both arms, and the study was well

balanced for the stratification criteria -- the same criteria used in the Phase 3 trial, the PICASSO 3 study, which has no cross-over.

These OS data, together with PFS and safety data from the randomized Phase 2 study, demonstrate that the ongoing, randomized Phase

3 trial of palifosfamide in front-line metastatic soft tissue sarcoma is optimally modeled and powered for PFS and OS.

recently underwent a third review by the Independent Data Monitoring Committee (IDMC), which recommended continuation of the study

with no change. Targeted completion of enrollment for PICASSO 3 is expected by the end of the first quarter of 2012. The outcome

in PFS, the study's primary endpoint for accelerated approval, is anticipated in the second half of 2012.

ZIOPHARM also announced, in the fourth

quarter, encouraging clinical results from an ongoing multicenter Phase 1b, open-label, dose escalation study of palifosfamide

in combination with etoposide and carboplatin in patients with small cell lung cancer (SCLC) and other selected cancers. These

data, presented at the AACR-NCI-EORTC International Conference on Molecular Targets and Cancer Therapeutics, demonstrated good

tolerability and clinical activity in subjects with SCLC, germ cell tumor and ovarian cancer.

Synthetic Biology, IL-12 DNA Therapeutics:

In January of 2011, the Company announced

a global, exclusive channel partnership in oncology with Intrexon Corporation, a next-generation synthetic biology company. Under

the partnership, ZIOPHARM acquired rights to Intrexon's entire human in vivo effector platform within the field of oncology, which

the Company will use to develop and commercialize DNA-based therapeutics.

The partnership includes two lead

clinical-stage product candidates targeting the tightly controlled, intra-tumoral expression of a potent anti-cancer cytokine,

Interleukin-12 (IL-12). In June, ZIOPHARM announced initial positive clinical results from the first-ever treatment demonstrating

in vivo control over transgene encoding of a therapeutic anticancer protein in humans using a small molecule activator ligand

at the 2011 Annual Meeting of the American Society of Clinical Oncology (ASCO). Data showed a correlation between T-cell immune

responses and clinical outcome, a desired outcome with the highly focused use of IL-12, with limited adverse events and one significant

adverse event that completely resolved.

The Company also announced the submission

and acceptance of an Investigation New Drug application with the FDA, and subsequent dosing of patients with advanced melanoma

in a Phase 1 clinical study of Ad-RTS-IL-12, a DNA therapy employing an adenoviral vector to deliver, directly into the patient's

own cells, a gene which expresses Interleukin-12 (IL-12). The multi-center, single-arm, open-label, dose-escalation study, treating

patients with unresectable Stage III or IV melanoma, will assess the safety and tolerability of intratumoral injections of Ad-RTS-IL-12.

Secondary endpoints include a determination of the recommended Phase 2 dose, an evaluation of T cell immunity markers, and preliminary

anti-tumor activity. The Company expects additional Phase 1 results from its IL-12 DNA program in 2012, with a pivotal Phase 2

study to commence in the second half of 2012. In addition to clinical-stage synthetic biology candidates, extensive ongoing preclinical

and discovery development is continuing.

2011 and Recent Financing Highlights:

About ZIOPHARM Oncology, Inc.:

ZIOPHARM Oncology is a biopharmaceutical

company engaged in the development and commercialization of small molecule and synthetic biology approaches to new cancer therapies.

The Company's clinical programs include:

Palifosfamide (Zymafos or ZIO-201)

is a novel DNA cross-linker that in preclinical study has been shown to bypass resistance mediated by aldehyde dehydrogenase (ALDH),

in addition to conferring a favorable toxicity profile compared to other in-class agents. Palifosfamide, administered intravenously,

is currently in a randomized, double-blinded, placebo-controlled Phase 3 trial for the treatment of

metastatic soft tissue sarcoma in the front-line setting. A Phase 1 trial is also nearing completion with palifosfamide

in combination with etoposide and carboplatin to determine appropriate safety for initiating a potentially pivotal, adaptive Phase

3 trial in front-line, extensive SCLC expected to initiate in the second half of 2012. Additionally, an investigational new drug

application has been accepted for the oral form of palifosfamide.

DNA-based therapeutics (synthetic biology),

in partnership with Intrexon Corporation, include two clinical-stage product candidates, both of which are DNA IL-12 using the

RheoSwitch Therapeutic System to be turned on/off by an oral activator ligand and are currently in Phase

1. Additionally, multiple INDs are expected in the next 12-24 months resulting from preclinical and discovery work underway to

advance multiple antibody, immunotoxin, and protein decoy candidates, systemic delivery and a next generation RheoSwitch Therapeutic

Indibulin (Zybulin or ZIO-301) is a

novel, oral tubulin binding agent that is expected to have several potential benefits including oral dosing, application in multi-drug

resistant tumors, no neuropathy and a quite tolerable toxicity profile. It is currently being studied in Phase 1/2 in metastatic

Darinaparsin (Zinapar or ZIO-101)

is a novel mitochondrial- and hedgehog-targeted agent (organic arsenic) currently in a solid tumor Phase 1 study with oral administration

and has been developed intravenously for the treatment of relapsed peripheral T-cell lymphoma.

ZIOPHARM's operations are located in Boston,

MA, Germantown, MD and New York City. Further information about ZIOPHARM may be found at www.ziopharm.com.

Forward-Looking Safe Harbor Statement:

This press release contains certain forward-looking

information about ZIOPHARM Oncology that is intended to be covered by the safe harbor for "forward-looking statements"

provided by the Private Securities Litigation Reform Act of 1995, as amended. Forward-looking statements are statements that are

not historical facts. Words such as "expect(s)," "feel(s)," "believe(s)," "will," "may,"

"anticipate(s)" and similar expressions are intended to identify forward-looking statements. These statements include,

but are not limited to, statements regarding our ability to successfully develop and commercialize our therapeutic products; our