NTII Neurobiological Technologies (MM)

EMERYVILLE, Calif., Sept. 29 /PRNewswire-FirstCall/ -- Neurobiological Technologies, Inc. (NASDAQ:NTII), (NTI), a biotechnology company engaged in the business of acquiring and developing drug candidates to treat diseases affecting the brain, today provided an update on the status of its planned restatement of its financial statements for fiscal 2005 and the first three quarters of fiscal 2006. As previously announced, NTI will restate its financial statements for these periods to correct an error relating to the capitalization of certain tangible and intangible assets acquired in July 2004 in connection with the acquisition of Empire Pharmaceuticals. NTI reported that the restated financial statements were under review by Ernst & Young ("E&Y"), NTI's former audit firm that had previously audited the NTI financial statements for fiscal 2005. This review by E&Y and the resulting modifications, if any, the Company may need to incorporate into the Form 10-K was not expected to be complete until the week of October 9, 2006. Because the audit opinion of E&Y will be included in the report containing NTI's restated financial statements, the filing of these financial statements cannot be made until E&Y has completed its review. NTI intends to file the restated financial statements and its annual report on Form 10-K for the year ended June 30, 2006 promptly after E&Y's review is complete. NTI has notified the NASDAQ Stock Market of the delay in the filing of its annual report for fiscal 2006 and has subsequently received a Staff Determination Letter from NASDAQ on September 28, 2006 notifying NTI of its noncompliance with Nasdaq Marketplace Rule 4310(c)(14). This type of notice is automatically generated by Nasdaq in circumstances where a listed company has failed to timely file a required annual or quarterly report. If the failure to file the report is not resolved in a timely fashion, the listed company will be subject to delisting. NTI intends to request an appeal of the Staff determination and expects to be able to resolve the filing delay before Nasdaq would take any delisting action. About Neurobiological Technologies NTI is a drug development company focused on the clinical evaluation and regulatory approval of drugs for the treatment of diseases affecting the brain. The company's strategy is to in-license and develop early- and later- stage drug candidates that target major medical needs and which can be rapidly commercialized. NTI's experienced management team oversees the human clinical trials necessary to establish preliminary evidence of efficacy. We anticipate that we will continue to acquire and develop late-stage neurologic drug candidates and will develop the resources to market these drugs in selected world regions. Our goal is to develop and market drug candidates in the United States, Europe and Asia, and we may seek partnerships with pharmaceutical and biotechnology companies to assist us. Forward-Looking Statements Except for the historical information contained herein, the matters discussed in this press release are forward-looking statements that involve risks and uncertainties, including risks relating to the untimely filing of SEC reports and risks relating to continued compliance with Nasdaq listing standards, as well other risks detailed from time to time in our Securities and Exchange Commission filings. Actual results may differ materially from those projected. These forward-looking statements represent our judgment as of the date of the release. We disclaim, however, any intent to update these forward-looking statements. DATASOURCE: Neurobiological Technologies, Inc. CONTACT: Craig Carlson, CFO of Neurobiological Technologies, Inc., +1-510-595-6000; or Marlon Nurse, VP-Investor Relations of Porter LeVay & Inc., +1-212-564-4700, for Neurobiological Technologies, Inc. Web site: http://www.ntii.com/

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