UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549
                                   FORM 10-K/A
                                (Amendment No. 1)
(MARK ONE)

  |X|     ANNUAL  REPORT  PURSUANT  TO  SECTION  13 or 15(d)  OF THE  SECURITIES
          EXCHANGE ACT OF 1934

For the fiscal year ended July 31, 2006

                                       or

  |_|     TRANSITION  REPORT  PURSUANT TO SECTION 13 or 15(d) OF THE  SECURITIES
          EXCHANGE ACT OF 1934

For the transition period from ________________  to ___________________

                        Commission File Number 001-09974

                               ENZO BIOCHEM, INC.
                           --------------------------
             (Exact name of registrant as specified in its charter)

              New York                                            13-2866202
-------------------------------------                        --------------
       (State or other jurisdiction                          (I.R.S. Employer
   of incorporation or organization)                        Identification No.)

         527 Madison Avenue
         New York, New York                                      10022
-------------------------------------                           -------
 (Address of principal executive offices)                      (Zip Code)

                                 (212) 583-0100
                                 --------------
              (Registrant's telephone number, including area code)

           SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT:

  (TITLE OF EACH CLASS)             (NAME OF EACH EXCHANGE ON WHICH REGISTERED)
  ---------------------             -------------------------------------------
Common Stock, $.01 par value        The New York Stock Exchange

Indicate by check mark if the  registrant is a well-known  seasoned  issuer,  as
defined in Rule 405 of the Securities Act.
          Yes |_| No |X|

Indicate  by  check  mark if the  registrant  is not  required  to file  reports
pursuant to Section 13 or Section 15(d) of the Act.
          Yes |_|  No |X|

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days.
          Yes |X|  No |_|

Indicate by check mark if disclosure of delinquent  filers  pursuant to Item 405
of Regulation  S-K is not contained  herein,  and will not be contained,  to the
best of registrant's  knowledge,  in definitive proxy or information  statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. Yes |_| No |X|

Indicate by check mark whether the registrant is a large  accelerated  filer, an
accelerated  filer, or a  non-accelerated  filer. See definition of "accelerated
filer and large accelerated filer" in Rule 12b-2 of the Exchange Act.

Large accelerated filer |_|    Accelerated filer |X|   Non-accelerated filer |_|

Indicate by check mark whether the  registrant is a shell company (as defined in
Rule 12b-2 of the Securities Exchange Act of 1934).
Yes |_|  No |X|

The  aggregate   market  value  of  the   registrant's   voting  stock  held  by
non-affiliates  of the registrant was  approximately  $355,971,000 as of January
31, 2006.

The number of shares of the Company's common stock, $.01 par value,  outstanding
at September 30, 2006 was approximately 32,274,500.

                       DOCUMENTS INCORPORATED BY REFERENCE
         Portions of the definitive Proxy Statement delivered to shareholders in
connection with the Annual Meeting of Shareholders held on January 23, 2007 are
incorporated  by reference  into Part III of this annual report.


<PAGE>


                                EXPLANATORY NOTE

The purpose of this  Amendment  No. 1 on Form 10-K/A  (the  "Amendment")  to the
Annual  Report on Form 10-K for the  fiscal  year  ended  July 31,  2006 of Enzo
Biochem, Inc. (the "Company"),  which was filed with the Securities and Exchange
Commission  on  October  13,  2006 (the  "Original  Filing"),  is to  include an
explanatory paragraph in the Report of Independent  Registered Public Accounting
Firm  emphasizing  the Company's  adoption of Statement of Financial  Accounting
Standards No. 123(R), which was inadvertently  excluded from Ernst & Young LLP's
report  in  the  Original  Filing.  Other  than  including  such  paragraph  and
clarification,  there  have been no changes  made to the  Original  Filing.  The
Amendment  continues  to  speak as of the date of the  Original  Filing  and the
Company has not updated the  disclosure in this  Amendment to speak to any later
date.















<PAGE>

         PART IV

         Item 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS
                  ON FORM 8-K

         (a) (1)  Consolidated Financial Statements
                  Consolidated Balance Sheets - July 31, 2006 and 2005
                  Consolidated Statements of Operations- Years ended July 31,
                    2006, 2005 and 2004
                  Consolidated Statements of Stockholders' Equity and
                    Comprehensive (Loss) Income - Years ended July 31, 2006,
                    2005 and 2004
                  Consolidated Statements of Cash Flows - Years ended July 31,
                    2006, 2005 and 2004
                  Notes to Consolidated Financial Statements.

         (2)  Financial Statement Schedule

         Schedule II - Valuation and Qualifying Accounts

         All other schedules have been omitted because the required  information
is included in the  consolidated  financial  statements  or the notes thereto or
because they are not required.


<PAGE>

         (3)  Exhibits

         The following  documents are filed as Exhibits to this Annual Report on
Form 10-K:

  Exhibit
  No.        Description
  ---        -----------

  3(a)       Certificate of Incorporation, as amended March 17, 1980.(1)

  3(b)       June 16, 1981 Certificate of Amendment of the Certificate of
             Incorporation. (2)

  3(c)       Certificate of Amendment to the Certificate of Incorporation. (3)

  3(d)       Bylaws. (1)

  10(c)      Employment Agreements with Elazar Rabbani. (5)

  10(d)      Employment Agreement with Shahram Rabbani. (5)

  10(e)      Employment Agreement with Barry Weiner. (5)

  10(f)      1994 Stock Option Plan. (6)

  10(g)      Agreement with Corange International Limited (Boehringer
             Mannheim) effective April 1994. (19) (7)

  10(h)      Agreement with Amersham International effective February 1995. (7)

  10(i)      Agreement with Dako A/S effective May 1995. (7)

  10(j)      Agreement with Baxter Healthcare Corporation (VWR Scientific
             Products) effective September 1995. (7)

  10(k)      Agreement with Yale University and amendments thereto. (7)

  10(l)      Agreement with The Research Foundation of the State of New York
             effective May 1987. (7)

  10(m)      1999 Stock Option Plan filed. (8)

  10(n)      Amendment to Elazar Rabbani's employment agreement. (9)

  10(o)      Amendment to Shahram Rabbani's employment agreement. (9)

  10(p)      Amendment to Barry Weiner's employment agreement. (9)

  10(s)      Settlement and License Agreement with Digene Corporation effective
             as of September 30, 2004 (10) (12)

  10(t)      Joint Stipulation and Order of Dismissal with Prejudice dated
             October 14, 2004 (10) (12).

  10(u)      2005 Equity Compensation Incentive Plan (11)

  10(v)      Lease agreement with Pari Management (13)

  10(w)      Settlement and Release Agreement between the Company and
             Sigma Aldrich (14)

  14(a)      Code of Ethics (10)


<PAGE>



  21         Subsidiaries of the registrant:
                  Enzo Clinical Labs, Inc., a New York corporation.
                  Enzo Life Sciences, Inc., a New York corporation.
                  Enzo Therapeutics, Inc., a New York corporation.
                  Enzo Realty, LLC, a New York Corporation

  23         Consent of Independent Registered Public Accounting Firm filed
             herewith.

  31(a)      Certification of CEO Pursuant to Section 302 of the Sarbanes-Oxley
             Act of 2002 filed herewith.

  31(b)      Certification of CFO Pursuant to Section 302 of the Sarbanes-Oxley
             Act of 2002 filed herewith.

  32(a)      Certification of CEO Pursuant to Section 906 of the Sarbanes-Oxley
             Act of 2002 filed herewith.

  32(b)      Certification of CFO Pursuant to Section 906 of the Sarbanes-Oxley
             Act of 2002 filed herewith.

             Notes to exhibits

  (1)        The exhibits were filed as exhibits to the Company's Registration
             Statement on Form S-18 (File No. 2-67359) and are incorporated
             herein by reference.

  (2)        This exhibit was filed as an exhibit to the Company's Form 10-K for
             the year ended July 31, 1981 and is incorporated herein by
             reference.

  (3)        This exhibit was filed with the Company's Annual Report on Form
             10-K for the year ended July 31, 1989 and is incorporated herein by
             reference.

  (5)        This exhibit was filed with the Company's Annual Report on Form
             10-K for the year ended July 31, 1994 and is incorporated herein by
             reference.

  (6)        This exhibit was filed with the Company's Annual Report on Form
             10-K for the year ended July 31, 1995 and is incorporated herein by
             reference.

  (7)        This exhibit was filed with the Company's Annual Report on Form
             10-K for the year ended July 31, 1996 or previously filed amendment
             thereto and is incorporated herein by reference.

  (8)        This exhibit was filed with the Company's Registration Statement on
             Form S-8 (333-87153) and is incorporated herein by reference.

  (9)        This exhibit was filed with the Company's Annual Report on Form
             10-K for the year ended July 31, 2000 and is incorporated herein by
             reference.

  (10)       This exhibit was filed with the Company's Annual Report on Form
             10-K for the year ended July 31, 2004 and is incorporated herein by
             reference.

  (11)       This exhibit was filed as an exhibit to the Company's Proxy
             Statement of Schedule 14A filed on January 19, 2005 and is
             incorporated herein by reference.

  (12)       These exhibits are subject to a confidential treatment request
             pursuant to securities exchange act rules. (13) This exhibit was
             filed with the Company's Annual Report on Form 10-K for the year
             ended July 31, 2006 and is incorporated herein by reference.

  (14)       This exhibit was filed with the Company's current report on Form
             8-K on September 21, 2006 and is incorporated herein by reference.

  (b)        See Item 15(a) (3), above.

  (c)        See Item 15(a) (2), above.


<PAGE>


                                   SIGNATURES

                  Pursuant  to the  requirements  of  Section 13 or 15(d) of the
Securities  Exchange Act of 1934,  the registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.

                                      ENZO BIOCHEM, INC.


   Date: March 30, 2007               By:      /s/ Elazar Rabbani Ph.D.
                                               ------------------------
                                               Chairman of the Board


                  Pursuant to the requirements of the Securities Exchange Act of
1934,  this report has been signed below by the  following  persons on behalf of
the registrant and in the capacities and on the dates indicated.

   By: /s/  Elazar Rabbani Ph.D.                                March 30, 2007
   -----------------------------
   Elazar Rabbani
   Chairman of Board of Directors
   (Principal Executive Officer)

   By: /s/ Shahram K. Rabbani                                   March 30, 2007
   --------------------------
   Shahram K. Rabbani,
   Secretary, Treasurer and Director

   By: /s/ Barry W. Weiner                                      March 30, 2007
   -----------------------
   Barry W. Weiner,
   President, Chief Financial Officer, and Director

   By: /s/ John B. Sias                                         March 30, 2007
   --------------------
   John B. Sias, Director

   By: /s/ John J. Delucca                                      March 30, 2007
   -----------------------
   John J. Delucca, Director

   By: /s/ Irwin Gerson                                         March 30, 2007
   --------------------
   Irwin Gerson, Director

   By: /s/ Melvin F. Lazar                                      March 30, 2007
   -----------------------
   Melvin F. Lazar, Director

   By: /s/ Stephen B. H. Kent                                   March 30, 2007
   --------------------------
   Stephen B. H. Kent, Director



                                       52
<PAGE>
FORM 10-K, ITEM 15(a) (1) and (2)
ENZO BIOCHEM, INC.


                  LIST OF CONSOLIDATED FINANCIAL STATEMENTS AND
                          FINANCIAL STATEMENT SCHEDULE


The following consolidated financial statements and financial statement schedule
of Enzo Biochem, Inc. are included in Item 15(a):

Report of Independent Registered Public Accounting Firm                      F-2

Consolidated Balance Sheets -- July 31, 2006 and 2005                        F-3

Consolidated Statements of Operations --
         Years ended July 31, 2006, 2005 and 2004                            F-4

Consolidated Statements of Stockholders' Equity and Comprehensive
         (Loss) Income -- Years ended July 31, 2006, 2005 and 2004           F-5

Consolidated Statements of Cash Flows --
         Years ended July 31, 2006, 2005 and 2004                            F-6

Notes to Consolidated Financial Statements                                   F-7

Schedule II - Valuation and Qualifying Accounts --
         Years ended July 31, 2006, 2005 and 2004                            S-1


All other schedules for which provision is made in the applicable accounting
regulation of the Securities and Exchange Commission are not required under the
related instructions or are inapplicable, and therefore have been omitted.



                                      F-1
<PAGE>

             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


The Board of Directors and Stockholders of
Enzo Biochem, Inc

We have audited the  accompanying  consolidated  balance sheets of Enzo Biochem,
Inc. (the "Company") as of July 31, 2006, and 2005, and the related consolidated
statements of operations,  consolidated  statements of stockholders'  equity and
comprehensive  (loss) income and consolidated  statements of cash flows for each
of the three years in the period ended July 31, 2006.  Our audits also  included
the  financial  statement  schedule  listed  in the Index at Item  15(a).  These
financial  statements  and  schedule  are the  responsibility  of the  Company's
management.  Our  responsibility  is to express  an  opinion on these  financial
statements and schedule based on our audits.

We conducted our audits in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement.  An audit includes examining, on a
test basis,  evidence  supporting  the amounts and  disclosures in the financial
statements.  An audit also includes assessing the accounting principles used and
significant  estimates  made by  management,  as well as evaluating  the overall
financial  statement  presentation.   We  believe  that  our  audits  provide  a
reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects, the consolidated financial position of Enzo Biochem, Inc.
at July 31, 2006 and 2005, and the consolidated  results of their operations and
their cash flows for each of the three years in the period  ended July 31, 2006,
in conformity with U.S. generally accepted accounting  principles.  Also, in our
opinion,  the related financial statement schedule,  when considered in relation
to the  basic  financial  statements  taken as a whole,  present  fairly  in all
material respects the information set forth therein.

As  discussed  in Note 1 to the  consolidated  financial  statements,  effective
August 1, 2005, the Company adopted Statement of Financial  Accounting Standards
No. 123(R), "Share-Based Payment."

We also have  audited,  in accordance  with the standards of the Public  Company
Accounting  Oversight Board (United States),  the effectiveness of Enzo Biochem,
Inc.'s internal  control over financial  reporting as of July 31, 2006, based on
criteria  established  in Internal  Control-Integrated  Framework  issued by the
Committee of Sponsoring  Organizations of the Treadway Commission and our report
dated October 5, 2006, expressed an unqualified opinion thereon.

/s/ Ernst & Young LLP

Melville, New York
October 5, 2006


                                      F-2
<PAGE>

                               ENZO BIOCHEM, INC.
                           CONSOLIDATED BALANCE SHEETS
                 (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

<TABLE>
<CAPTION>
ASSETS
                                                                                                                July 31,
                                                                                                       -----------------------------
Current assets:                                                                                           2006               2005
                                                                                                       ---------          ---------
<S>                                                                                                    <C>                <C>
   Cash and cash equivalents .................................................................         $  69,854          $  76,981
   Marketable securities .....................................................................              --                6,714
   Accounts receivable, net of allowance for doubtful accounts of $1,033
      in 2006 and $2,292 in 2005 .............................................................            10,447             13,421
   Inventories ...............................................................................             2,401              2,876
   Prepaid expenses ..........................................................................             1,465              1,848
   Recoverable and prepaid income taxes ......................................................             1,931              1,329
   Deferred taxes ............................................................................              --                  900
                                                                                                       ---------          ---------
Total current assets .........................................................................            86,098            104,069

Property, plant, and equipment, net of accumulated depreciation
    and amortization of $8,247 in 2006 and $7,279 in 2005 ....................................             5,848              2,670
Goodwill .....................................................................................             7,452              7,452
Patent costs, net of accumulated amortization of $9,770 in 2006
   and $9,695 in 2005 ........................................................................             1,257              1,333
Other ........................................................................................               869                942
                                                                                                       ---------          ---------
Total assets .................................................................................         $ 101,524          $ 116,466
                                                                                                       =========          =========

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
   Accounts payable - trade ..................................................................             1,304              2,414
   Accrued liabilities .......................................................................             4,403              4,866
   Other current liabilities .................................................................               230                509
                                                                                                       ---------          ---------
Total current liabilities ....................................................................             5,937              7,789

Deferred taxes ...............................................................................              --                  260
Long term installment payable, net of current portion ........................................              --                  150

Commitments and contingencies

Stockholders' equity:
   Preferred Stock, $.01 par value; authorized 25,000,000 shares; no
       shares issued or outstanding ..........................................................              --                 --
   Common Stock, $.01 par value; authorized 75,000,000 shares; shares
       issued: 32,844,200 at July 31, 2006 and 32,526,800 at July 31, 2005 ...................               328                325
   Additional paid-in capital ................................................................           236,002            230,644
   Less treasury stock at cost: 569,700 shares at July 31, 2006
       and 384,400 shares at July 31, 2005 ...................................................            (8,499)            (5,994)
   Accumulated deficit .......................................................................          (132,244)          (116,577)
   Accumulated other comprehensive loss ......................................................              --                 (131)
                                                                                                       ---------          ---------
Total stockholders' equity ...................................................................            95,587            108,267
                                                                                                       ---------          ---------
Total liabilities and stockholders' equity ...................................................         $ 101,524          $ 116,466
                                                                                                       =========          =========

</TABLE>


                                       F-3

                 The accompanying notes are an integral part of
                     these consolidated financial statements



<PAGE>

                               ENZO BIOCHEM, INC.
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                      (IN THOUSANDS, EXCEPT PER SHARE DATA)

<TABLE>
<CAPTION>



                                                                                                 Years ended July 31,
                                                                                   ------------------------------------------------
                                                                                     2006                2005                2004
                                                                                   --------            --------            --------
Revenues:
<S>                                                                                <C>                 <C>                 <C>
   Product revenues and royalty income .................................           $  7,900            $ 10,546            $ 12,972
   Clinical laboratory services ........................................             31,926              32,857              28,672
                                                                                   --------            --------            --------
                                                                                     39,826              43,403              41,644

Costs and expenses and other (income):
   Cost of product revenues ............................................              2,174               2,197               2,518
   Cost of clinical laboratory services ................................             13,917              12,548              10,586
   Research and development expense ....................................              7,896               8,452               8,078
   Selling, general, and administrative expense ........................             24,971              20,069              14,367
   Provision for uncollectible accounts receivable .....................              3,633               4,967              11,987
   Legal expense .......................................................              7,388               5,476               6,340
   Interest income .....................................................             (3,144)             (1,523)             (1,152)
   Gain on patent litigation settlement ................................               --               (14,000)               --
                                                                                   --------            --------            --------
                                                                                     56,835              38,186              52,724

(Loss) income before income taxes ......................................            (17,009)              5,217             (11,080)
Benefit (provision) for income taxes ...................................              1,342              (2,213)              4,848
                                                                                   --------            --------            --------
Net (loss) income ......................................................           ($15,667)           $  3,004            ($ 6,232)
                                                                                   ========            ========            ========

Net (loss) income per common share:
   Basic ...............................................................           ($  0.49)           $   0.09            ($  0.20)
                                                                                   ========            ========            ========
   Diluted .............................................................           ($  0.49)           $   0.09            ($  0.20)
                                                                                   ========            ========            ========

Weighted average common shares outstanding:
   Basic ...............................................................             32,215              32,097              31,700
                                                                                   ========            ========            ========
   Diluted .............................................................             32,215              32,763              31,700
                                                                                   ========            ========            ========
</TABLE>






                                       F-4

                 The accompanying notes are an integral part of
                     these consolidated financial statements


<PAGE>
                                ENZO BIOCHEM, INC
                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                         AND COMPREHENSIVE (LOSS) INCOME
                    YEARS ENDED JULY 31, 2006, 2005 AND 2004
                        (IN THOUSANDS, EXCEPT SHARE DATA)


<TABLE>
<CAPTION>
                                                                   COMMON  TREASURY   COMMON    ADDITIONAL  TREASURY
                                                                    STOCK     STOCK    STOCK       PAID-IN     STOCK   ACCUMULATED
                                                                   SHARES    SHARES   AMOUNT       CAPITAL    AMOUNT       DEFICIT
                                                                   ------    ------   ------       -------    ------       -------
<S>                                                            <C>          <C>         <C>       <C>        <C>          <C>
Balance at July 31, 2003.................................      29,975,100       ---     $300      $199,082       ---      ($89,916)

Net (loss) for the year ended July 31, 2004..............             ---       ---      ---           ---       ---        (6,232)
Unrealized loss on available-for-sale
    securities, net of tax...............................             ---       ---      ---           ---       ---           ---
Surrender of common stock for exercise of stock options..             ---   349,900      ---           ---   ($5,669)          ---
Exercise of stock options (see Note 2)...................         873,900       ---        9         6,556       ---           ---
Issuance of stock for employee 401(k) plan match.........          15,800       ---      ---           282       ---           ---
Comprehensive (loss).....................................             ---       ---      ---           ---       ---           ---
                                                           -----------------------------------------------------------------------
Balance at July 31, 2004.................................      30,864,800   349,900      309       205,920    (5,669)      (96,148)

Net income for the year ended July 31, 2005..............             ---       ---      ---           ---       ---        $3,004
Unrealized gain on available-for-sale
    securities, net of tax...............................             ---       ---      ---           ---       ---           ---
Reclassification adjustment for net loss
realized and reported in net income......................             ---       ---      ---           ---       ---           ---
Valuation reserve........................................
5% stock dividend (fair value on date declared)..........       1,543,600    17,500       15        23,418       ---       (23,433)
Surrender of common stock for exercise of stock options..             ---    17,000      ---                    (325)          ---
Tax benefit for stock options exercised..................             ---       ---      ---           124       ---           ---
Exercise of stock options (see Note 2)...................         100,300       ---        1           830       ---           ---
Issuance of stock for employee 401(k) plan match.........          18,100       ---        0           352       ---           ---
Comprehensive income.....................................             ---       ---      ---           ---       ---           ---
                                                           -----------------------------------------------------------------------
Balance at July 31, 2005.................................      32,526,800   384,400      325       230,644    (5,994)     (116,577)

Net (loss) for the year ended July 31, 2006..............             ---       ---      ---           ---       ---       (15,667)
Realized loss on available-for-sale
    securities, net of tax...............................             ---       ---      ---           ---       ---           ---
Surrender of common stock for exercise of stock options..             ---   185,300      ---           ---    (2,505)          ---
Exercise of stock options (see Note 2)...................         285,030       ---        3         3,113       ---           ---
Issuance of stock for employee 401(k) plan match.........          32,370       ---      ---           402       ---           ---
Share based compensation charges.........................             ---       ---      ---         1,763       ---           ---
Stock options issued for consulting services.............             ---       ---      ---            80       ---           ---
Comprehensive (loss).....................................             ---       ---      ---           ---       ---           ---
                                                           ------------------------------------------------------------------------
Balance at July 31, 2006.................................      32,844,200   569,700     $328      $236,002   ($8,499)    ($132,244)
                                                           =======================================================================

<CAPTION>
                                                                ACCUMULATED
                                                                      OTHER           TOTAL
                                                              COMPREHENSIVE    STOCKHOLDERS'    COMPREHENSIVE
                                                              (LOSS) INCOME          EQUITY     (LOSS) INCOME
                                                              -------------          ------     -------------
<S>                                                                   <C>          <C>             <C>
Balance at July 31, 2003.................................             ($85)        $109,381

Net (loss) for the year ended July 31, 2004..............               ---          (6,232)          ($6,232)
Unrealized loss on available-for-sale
    securities, net of tax...............................              (161)           (161)             (161)
Surrender of common stock for exercise of stock options..               ---          (5,669)              ---
Exercise of stock options (see Note 2)...................               ---           6,565               ---
Issuance of stock for employee 401(k) plan match.........               ---             282               ---
                                                                                                     --------
Comprehensive (loss).....................................               ---             ---           ($6,393)
                                                           --------------------------------          ========
Balance at July 31, 2004.................................              (246)        104,166

Net income for the year ended July 31, 2005..............               ---           3,004            $3,004
Unrealized gain on available-for-sale
    securities, net of tax...............................                43              43                43
Reclassification adjustment for net loss
realized and reported in net income......................               122             122               122
Valuation reserve........................................               (50)            (50)              (50)
5% stock dividend (fair value on date declared)..........               ---             ---               ---
Surrender of common stock for exercise of stock options..               ---            (325)              ---
Tax benefit for stock options exercised..................               ---             124               ---
Exercise of stock options (see Note 2)...................               ---             831               ---
Issuance of stock for employee 401(k) plan match.........               ---             352               ---
                                                                                                     --------
Comprehensive income.....................................               ---             ---            $3,119
                                                           --------------------------------          ========
Balance at July 31, 2005.................................              (131)        108,267

Net (loss) for the year ended July 31, 2006..............               ---         (15,667)         $(15,667)
Realized loss on available-for-sale
    securities, net of tax...............................               131             131               131
Surrender of common stock for exercise of stock options..               ---          (2,505)              ---
Exercise of stock options (see Note 2)...................               ---           3,116               ---
Issuance of stock for employee 401(k) plan match.........               ---             402               ---
Share based compensation charges.........................               ---           1,763               ---
Stock options issued for consulting services.............               ---              80               ---
                                                                                                     --------
Comprehensive (loss).....................................               ---             ---          ($15,536)
                                                           --------------------------------          ========
Balance at July 31, 2006.................................               ---         $95,587
                                                           ================================
</TABLE>

                                       F-5

                 The accompanying notes are an integral part of
                     these consolidated financial statements




<PAGE>

                                ENZO BIOCHEM, INC
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>

                                                                                                   Years ended July 31,
                                                                                           -----------------------------------
                                                                                           2006            2005           2004
                                                                                           ----            ----           ----
OPERATING ACTIVITIES
<S>                                                                                       <C>           <C>           <C>
Net (loss) income ...................................................................     ($15,667)     $  3,004      ($ 6,232)

Adjustments  to  reconcile  net (loss)  income to net cash (used in) provided by
operating activities:
       Depreciation and amortization of property, plant and equipment ...............        1,049         1,020         1,076
       Amortization of patent costs .................................................           75         1,312         1,286
       Provision for uncollectible accounts receivable ..............................        3,633         4,967        11,987
       Write-off and/or reserve for obsolete inventory ..............................          596          --            --
       Deferred taxes ...............................................................          640           891        (1,651)
       Share based compensation charges .............................................        1,763          --            --
       Options issued to consultant .................................................           80          --            --
       Issuance of stock for 401(k) employer match ..................................          402           352           282
       Deferred rent ................................................................         --             (87)         (233)
       Realized loss on sales of marketable securities ..............................          154           200          --
       Tax benefit on stock option exercises ........................................         --             124          --
       Other ........................................................................         --             (51)            2

Changes in operating assets and liabilities:
        Accounts receivable .........................................................         (659)       (3,593)       (9,515)
        Inventories .................................................................         (120)          558           (13)
        Prepaid expenses ............................................................          383          (747)          400
        Recoverable and prepaid income taxes ........................................         (602)        2,578        (3,365)
        Accounts payable - trade ....................................................       (1,110)          322           771
        Accrued liabilities .........................................................         (463)        1,620          (377)
        Other current liabilities ...................................................         (279)          509          --
                                                                                          ------------------------------------
 Adjustments ........................................................................        5,542         9,975           650

           Net cash (used in) provided by operating activities ......................      (10,125)       12,979        (5,582)

INVESTING ACTIVITIES
    Capital expenditures ............................................................       (4,227)       (1,276)       (1,304)
    Patent costs ....................................................................         --             (20)         (444)
    Sales of marketable securities ..................................................        6,760        10,692        (2,349)
    Purchases of marketable securities ..............................................          (69)         (249)         --
    Security deposits and other .....................................................           73          --            --
                                                                                          ------------------------------------
           Net cash provided by (used in) investing activities ......................        2,537         9,147        (4,097)

FINANCING ACTIVITIES
    Proceeds from the exercise of stock options .....................................          611           506           896
    Payment of long term installment payable ........................................         (150)         (150)         --
    Other ...........................................................................         --            --              14
                                                                                          ------------------------------------
           Net cash provided by financing activities ................................          461           356           910

Net (decrease) increase in cash and cash equivalents ................................       (7,127)       22,482        (8,769)
Cash and cash equivalents at the beginning of year ..................................       76,981        54,499        63,268
                                                                                          ------------------------------------
Cash and cash equivalents at the end of year ........................................     $ 69,854      $ 76,981      $ 54,499
                                                                                          ====================================
</TABLE>







                                       F-6

                 The accompanying notes are an integral part of
                     these consolidated financial statements


<PAGE>
                               ENZO BIOCHEM, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             JULY 31, 2006 AND 2005


NOTE 1 -    BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BUSINESS

Enzo  Biochem,  Inc.  (the  "Company")  is  engaged  in  research,  development,
manufacturing and marketing of diagnostic and research products based on genetic
engineering,  biotechnology and molecular  biology.  These products are designed
for the diagnosis of and/or screening for infectious diseases,  cancers, genetic
defects and other medically pertinent diagnostic information and are distributed
in the United States and internationally. The Company is conducting research and
development  activities in the development of therapeutic  products based on the
Company's  technology platform of genetic modulation and immune modulation.  The
Company also operates a clinical  laboratory that offers and provides diagnostic
medical  testing  services to the health care  community in the greater New York
and New Jersey area. The Company operates in three segments (see Note 13).

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

PRINCIPLES OF CONSOLIDATION

The accompanying  consolidated  financial statements include the accounts of the
Company  and its  wholly  owned  subsidiaries,  Enzo  Clinical  Labs,  Enzo Life
Sciences,  Enzo Therapeutics and Enzo Realty LLC ("Realty") Realty was formed in
fiscal 2006 to acquire a building  (see Note 5). All  intercompany  transactions
and balances have been eliminated.

USE OF ESTIMATES

The preparation of financial statements in conformity with accounting principles
generally  accepted in the United States  requires  management to make estimates
and  assumptions  that affect the reported  amount of assets and liabilities and
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements  and  amounts of income and  expenses  during the  reporting  period.
Actual results could differ from those estimates.


CONCENTRATION OF CREDIT RISK

Financial  instruments that potentially subject the Company to concentrations of
credit risk primarily consist of cash and cash equivalents, accounts receivable,
accounts  payable and accrued  liabilities.  The Company's cash  equivalents are
invested in diverse financial  instruments with high credit ratings. The Company
believes the fair value of the aforementioned financial instruments approximates
the current value due to the immediate or short-term nature of these items.

Concentration of credit risk with respect to the Company's life sciences segment
is mitigated  by the  diversity of the  Company's  clients and their  dispersion
across many different  geographic regions. To reduce risk, the Company routinely
assesses the financial strength of these customers and,  consequently,  believes
that its accounts  receivable credit exposure,  with respect to these customers,
is limited.

The Company  believes  that the  concentration  of credit  risk with  respect to
clinical laboratory's accounts receivable is limited due to the diversity of the
Company's  client base, the number of insurance  carriers it deals with, and its
numerous  individual  patient  accounts.  As is  standard  in  the  health  care
industry,  substantially  all of the Company's  clinical  laboratory's  accounts
receivable  is with  numerous  third party  insurance  carriers  and  individual
patient accounts. The Company also provides services to certain patients covered
by various  third-party  payers,  including the Federal  Medicare  program.  The
clinical  laboratory  industry  is  characterized  by a  significant  amount  of
uncollectible  accounts  receivable  resulting  from the  inability  to  receive
accurate  and  timely  billing  information  in order to forward it to the third
party payers for reimbursement, and the inaccurate information received from the
covered individual patients for unreimbursed unpaid amounts.



                                      F-7
<PAGE>

                               ENZO BIOCHEM, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             JULY 31, 2006 AND 2005


REVENUE RECOGNITION

Product revenues

Revenues from product sales are  recognized  when the products are shipped,  the
sales price is fixed or determinable and  collectibility is reasonably  assured.
The Company has certain non-exclusive distribution agreements, which provide for
consideration  to be paid to the  distributors  for the  manufacture  of certain
products.  The Company records such consideration provided to distributors under
these non-exclusive  distribution agreements as a reduction to product revenues.
The Company did not  recognize  any revenue from these  distributors  during the
year ended July 31, 2006.  During the years ended July 31, 2005,  and 2004,  the
manufacturing  and processing cost of these products sold was $0.7 million,  and
$7.4 million,  respectively.  The revenue from these non-exclusive  distribution
agreements are recognized when shipments are made to their respective  customers
and reported to the Company.

Royalties

Royalty  revenues  are  recorded  in the period  earned.  Royalties  received in
advance of being earned are recorded as deferred revenues.

Clinical laboratory services

Revenues from the clinical  laboratory  are  recognized  upon  completion of the
testing process for a specific  patient and reported to the ordering  physician.
These revenues and the associated accounts receivable are based on gross amounts
billed or billable for services rendered, net of a contractual adjustment, which
is the difference  between  amounts  billed to payers and the expected  approved
reimbursable settlements from such payers.

The following are tables of the clinical  laboratory  segment's net revenues and
revenue  percentages  by revenue  category for the years ended July 31, 2006 and
2005:

<TABLE>
<CAPTION>
Net revenues                                       Year ended                     Year ended
                                                 July 31, 2006                   July 31, 2005
                                                 -------------                   -------------
Revenue Category                            (In 000'S)           (In %)        (In 000'S)       (In %)
----------------                            ----------           ------        ----------       ------
<S>                                             <C>                  <C>           <C>            <C>
Medicare                                        $7,462               23            $6,906           21
Third party carriers                            17,680               56            17,528           53
Patient self-pay                                 4,925               15             6,904           21
HMO's                                            1,859                6             1,519            5
                                                 -----                -             -----            -
Total                                          $31,926             100%           $32,857         100%
                                               =======             ====           =======         ====
</TABLE>

The Company provides services to certain patients covered by various third-party
payers,  including the Federal  Medicare  program.  Revenue,  net of contractual
expense,  from direct  billings  under the Federal  Medicare  program during the
years ended July 31, 2006,  2005 and 2004 were  approximately  23%, 21% and 26%,
respectively,  of the  Clinical  Lab  segment's  revenue.  Laws and  regulations
governing  Medicare are complex and subject to  interpretation  for which action
for  noncompliance  includes  fines,  penalties and exclusion  from the Medicare
programs. The Company believes that it is in compliance with all applicable laws
and  regulations  and is not aware of any pending or  threatened  investigations
involving allegations of potential wrongdoing.




                                      F-8
<PAGE>

                               ENZO BIOCHEM, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             JULY 31, 2006 AND 2005


CONTRACTUAL ADJUSTMENTS

The  Company's  estimate  of  contractual  adjustments  is based on  significant
assumptions and judgments,  such as its interpretation of the applicable payer's
reimbursement  policies, and bears the risk of change. The estimation process is
based on the  experience  of amounts  approved as  reimbursable  and  ultimately
settled  by  payers,  versus  the  corresponding  gross  amount  billed  to  the
respective  payers.  The  contractual  expense is an estimate that reduces gross
revenue,  based on gross billing rates,  to amounts  expected to be approved and
reimbursed.  The Company adjusts the contractual expense estimate  periodically,
based  on its  evaluation  of  historical  settlement  experience  with  payers,
industry reimbursement trends, and other relevant factors.

ACCOUNTS RECEIVABLE AND ALLOWANCE FOR DOUBTFUL ACCOUNTS

Accounts  receivable  are reported at realizable  value,  net of allowances  for
doubtful accounts,  which is estimated and recorded in the period of the related
revenue.

For the Clinical Labs segment,  the allowance for doubtful  accounts  represents
amounts  that the  Company  does not expect to  collect  after the  Company  has
exhausted its  collection  procedures.  The Company  estimates its allowance for
doubtful  accounts in the period the related services are billed and adjusts the
estimate in future  accounting  periods as necessary.  It bases the estimate for
the allowance on the evaluation of historical collection  experience,  the aging
profile of  accounts  receivable,  the  historical  doubtful  account  write-off
percentages, payer mix, and other relevant factors.

The allowance for doubtful accounts includes the balances,  after receipt of the
approved  settlements  from third party  payers for the  insufficient  diagnosis
information  received  from the  ordering  physician  which result in denials of
payment,  and  the  uncollectible  portion  of  receivables  from  self  payers,
including  deductibles  and  copayments,  which are  subject to credit  risk and
patients'  ability to pay.  During the years ended July 31,  2006 and 2005,  the
Company  determined  an allowance  for doubtful  accounts less than 210 days and
wrote off 100% of  accounts  receivable  (for all payers)  over 210 days,  as it
assumed those  accounts are  uncollectible.  The Company  adjusts the historical
collection analysis for recoveries, if any, on an ongoing basis.

The Company's ability to collect outstanding receivables from third party payers
is critical to its operating  performance and cash flows. The primary collection
risk lies with  uninsured  patients or patients for whom primary  insurance  has
paid but a patient  portion remains  outstanding.  The Company also assesses the
current state of its billing functions in order to identify any known collection
issues in order to assess the impact,  if any, on the allowance  estimates which
involves  judgment.   The  Company  believes  that  the  collectibility  of  its
receivables  is directly  linked to the quality of its billing  processes,  most
notably,  those  related to obtaining the correct  information  in order to bill
effectively for the services provided.  Should  circumstances change (e.g. shift
in payer mix,  decline  in  economic  conditions  or  deterioration  in aging of
receivables),  our estimates of net  realizable  value of  receivables  could be
reduced by a material amount.


                                      F-9
<PAGE>

                               ENZO BIOCHEM, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             JULY 31, 2006 AND 2005


The following is a table of the  Company's  net accounts  receivable by segment.
The Clinical Labs segment's net receivables are detailed by billing category and
as a  percent  to its  total  net  receivables:  At  July  31,  2006  and  2005,
approximately  88%  and  94%,  respectively,   of  the  Company's  net  accounts
receivable relates to its clinical labs business,  which operates in the greater
New York and New Jersey area.

<TABLE>
<CAPTION>
Net accounts receivable                                 As of                             As of
                                                    July 31, 2006                     July 31, 2005
                                                    -------------                     -------------
Billing  Category                               (In 000'S)           (In %)      (In 000'S)            (In %)
-----------------                               ----------           ------      ----------            ------
Clinical Labs
-------------
<S>                                                 <C>                  <C>         <C>                   <C>
   Medicare                                         $1,367               15          $1,594                13
   Third party carriers                              4,025               44           6,742                54
   Patient self-pay                                  3,294               36           3,819                30
   HMO's                                               475                5             394                 3
                                                       ---                -             ---                 -
Total Clinical Labs                                  9,161             100%          12,549              100%
                                                                       ====                              ====
Total Life Sciences                                  1,286                              872
                                                     -----                              ---
Total accounts receivable                          $10,447                          $13,421
                                                   =======                          =======
</TABLE>

Changes in the Company's allowance for doubtful accounts are as follows:

In 000's                             July 31, 2006               July 31, 2005
--------                             -------------               -------------
Beginning balance                           $2,292                      $2,770
Provision for doubtful accounts              3,633                       4,967
Write-offs                                  (4,892)                     (5,445)
                                            ------                      ------
Ending balance                              $1,033                      $2,292
                                            ======                      ======

CASH AND CASH EQUIVALENTS

Cash and cash equivalents  include highly liquid corporate debt instruments with
maturities of three months or less at the time acquired by the Company.

MARKETABLE SECURITIES

Investments  with a maturity  greater  than three months at the date of purchase
are  designated as marketable  securities.  During the year ended July 31, 2006,
the Company sold all investments  designated as marketable securities and had no
investments in marketable securities as of July 31, 2006.

At July  31,  2005,  management  designated  marketable  securities  held by the
Company as  available-for-sale  securities,  in accordance  with of Statement of
Financial   Accounting  Standards  ("SFAS")  No.  115  "Accounting  for  Certain
Investments in Debt and Equity Securities".  Available-for-sale  securities were
carried at fair value  with the  unrealized  losses  reported  in  stockholders'
equity under the caption  "Accumulated  other  comprehensive  loss". The Company
periodically  reviewed  its  investment  portfolio  to determine if there was an
impairment that is other than temporary. In testing for impairment,  the Company
considers,  among  other  factors,  the  length  of  time  and the  extent  of a
security's  unrealized loss, the financial  condition and near term prospects of
the  issuer,  economic  forecasts  and market or  industry  trends.  The cost of
marketable  securities  sold  was  based on the  original  cost  basis  plus any
reinvested dividends.

INVENTORIES

Inventories  are stated at the lower of cost  (first-in,  first-out)  or market.
Work-in-process  and finished goods inventories  consist of material,  labor and
manufacturing overhead.


                                      F-10
<PAGE>

                               ENZO BIOCHEM, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             JULY 31, 2006 AND 2005


PROPERTY, PLANT AND EQUIPMENT

Property,  plant  and  equipment  is  stated  at cost,  and  depreciated  on the
straight-line  basis  over  the  estimated  useful  lives of the  various  asset
classes.  The useful  life for the  building  is 30 years.  The useful  life for
laboratory  machinery and equipment and office furniture and computer  equipment
ranges from 3-5 years. Leasehold improvements are amortized over the term of the
related leases or estimated useful lives of the assets, whichever is shorter.

GOODWILL

Goodwill  represents the cost of acquired businesses in excess of the fair value
of assets acquired,  including separately recognized intangible assets, less the
fair value of liabilities assumed in the business acquisition.  The Company uses
a  non-amortization  approach  to account  for  purchased  goodwill.  Under this
approach, goodwill is not amortized, but instead is reviewed for impairment. All
of the Company's goodwill is related to its clinical laboratory  segment.  Prior
to adopting SFAS No. 142,  "Goodwill and Other  Intangibles"  ("SFAS 142"),  the
Company  recorded  amortization  of  goodwill  aggregating   approximately  $9.8
million.

Under the  non-amortization  provisions  of SFAS 142,  goodwill is subject to at
least an annual  assessment for impairment by applying a fair-value  based test.
The Company performs the annual impairment  testing during the fourth quarter of
its fiscal year. Based on this testing, there has been no impairment to Goodwill
recorded on the accompanying balance sheets as of July 31, 2006 and 2005.

IMPAIRMENT OF LONG-LIVED ASSETS

The Company  reviews the  recoverability  of the  carrying  value of  long-lived
assets,  primarily property, plant and equipment, for impairment whenever events
or changes in  circumstances  indicate that the carrying  amount of an asset may
not be fully  recoverable.  Should  indicators of impairment exist, the carrying
values of the assets are evaluated in relation to the operating  performance and
future undiscounted cash flows of the underlying business. The net book value of
an asset is adjusted to fair value if its expected future undiscounted cash flow
is less than its book value.  No impairment  losses were  identified  during the
years ended July 31, 2006, 2005 or 2004.

PATENT COSTS

The Company capitalizes certain legal costs directly incurred in pursuing patent
applications as patent costs. When such applications result in an issued patent,
the  related  costs  are  amortized  over a ten year  period  or the life of the
patent,  whichever  is  shorter,  using the  straight-line  method.  The Company
reviews its issued patents and pending patent applications, and if it determines
to abandon a patent  application or that an issued patent no longer has economic
value, the unamortized  balance in deferred patent costs relating to that patent
is immediately expensed.  The Company estimates amortization for patent costs at
July 31,  2006 to be at  approximately  $79,000 in each of the next five  fiscal
years.

COMPREHENSIVE (LOSS) INCOME

SFAS No. 130, "Reporting  Comprehensive  Income" (SFAS 130"), requires reporting
and displaying of comprehensive loss and its components. In accordance with SFAS
130,  the  Accumulated  Other  Comprehensive  Loss,  which is  comprised  of net
unrealized losses on marketable securities, is disclosed as a separate component
of stockholders' equity.


                                      F-11
<PAGE>
                               ENZO BIOCHEM, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             JULY 31, 2006 AND 2005

SHIPPING AND HANDLING COSTS

Product revenue shipping and handling costs included in selling expense amounted
to approximately $226,000, $299,000, and $384,000 for years ended July 31, 2006,
2005, and 2004, respectively.

RESEARCH AND DEVELOPMENT

Research and development costs are charged to expense as incurred.

ADVERTISING

All costs  associated  with  advertising  are expensed as incurred.  Advertising
expense,  included in Selling,  general and administrative  expense approximated
$128,000,  $57,000 and $18,000 for the years ended July 31, 2006, 2005 and 2004,
respectively.

INCOME TAXES

The Company  accounts for income taxes under the liability  method of accounting
for  income  taxes.  Under  the  liability  method,   deferred  tax  assets  and
liabilities  are  recognized  for the future tax  consequences  attributable  to
differences  between the financial statement carrying amounts of existing assets
and liabilities and their  respective tax bases.  The liability  method requires
that any tax benefits  recognized for net operating loss carryforwards and other
items be reduced by a valuation  allowance  when it is more likely than not that
the  benefits  may not be  realized.  Deferred  tax assets and  liabilities  are
measured  using  enacted tax rates  expected  to apply to taxable  income in the
years in which those  temporary  differences  are  expected to be  recovered  or
settled.  Under the  liability  method,  the effect on  deferred  tax assets and
liabilities  of a change in tax rates is recognized in income in the period that
includes the enactment date.

SEGMENT REPORTING

The Company follows SFAS No. 131,  "Disclosures  About Segments of an Enterprise
and Related Information" ("SFAS 131") which establishes  standards for reporting
information on operating segments in interim and annual financial statements. An
enterprise is required to separately  report  information  about each  operating
segment  that  engages in  business  activities  from which the segment may earn
revenues and incur  expenses,  whose  separate  operating  results are regularly
reviewed by the chief operating decision maker regarding allocation of resources
and  performance  assessment and which exceed specific  quantitative  thresholds
related to revenue and profit or loss.  The Company's  operating  activities are
reported in three segments (see Note 13).

NET (LOSS) INCOME PER SHARE

The Company applies SFAS No. 128,  "Earnings per  Share."("SFAS  128"). SFAS 128
establishes standards for computing and presenting earnings per share. Basic net
income (loss) per share  represents  net income  (loss)  divided by the weighted
average  number of common  shares  outstanding  during the period.  The dilutive
effect of potential common shares,  consisting of outstanding stock options,  is
determined  using the treasury stock method in accordance with SFAS 128. Diluted
weighted  average  shares  outstanding  for  2006 and  2004 do not  include  the
potential  common  shares  from stock  options  because to do so would have been
antidilutive.  Accordingly,  basic and diluted net loss per share is the same in
fiscal  2006 and 2004.  The number of  potential  common  shares  ("in the money
options") excluded from the calculation of diluted earnings per share during the
years ended July 31,  2006,  2005 and 2004 was 423,000,  0, and 798,000  shares,
respectively.


                                      F-12
<PAGE>
                               ENZO BIOCHEM, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             JULY 31, 2006 AND 2005



The following  table sets forth the  computation of basic and diluted net (loss)
income per share pursuant to SFAS 128 for the years ended July 31:

<TABLE>
<CAPTION>
IN 000'S                                                                      2006              2005             2004
--------                                                                      ----              ----             ----
<S>                                                                      <C>                  <C>            <C>
Numerator:
    Net (loss) income                                                    $(15,667)            $3,004         $(6,232)
                                                                         =========            ======         ========

Denominator:
    Weighted-average common shares outstanding- Basic
                                                                            32,215            32,097           31,700

    Effect of dilutive stock options                                           - -               666              - -
                                                                               ---               ---              ---

    Weighted-average common shares outstanding -  Diluted
                                                                            32,215            32,763           31,700
                                                                            ======            ======           ======

Net (loss) income per share
    Basic                                                                   $(.49)              $.09           $(.20)
                                                                            ======              ====           ======

    Diluted                                                                 $(.49)              $.09           $(.20)
                                                                            ======              ====           ======
</TABLE>

For the years ended July 31, 2006,  2005 and 2004,  the effect of  approximately
1,916,000,  818,000, and 554,000 respectively, of outstanding "out of the money"
options to purchase  common shares were excluded from the calculation of diluted
net (loss) income per share because their effect would be anti-dilutive.

SHARE-BASED COMPENSATION

Effective  August 1, 2005,  the Company  adopted SFAS No.  123(R),  "Share-Based
Payment"  ("SFAS  123(R)")  and related  interpretations  which  superseded  the
provisions of Accounting  Principles  Board ("APB") Opinion No. 25,  "Accounting
for Stock  Issued to  Employees"  ("APB 25") and related  interpretations.  SFAS
123(R) requires that all share-based compensation be recognized as an expense in
the financial statements and that such cost be measured at the fair value of the
award.  SFAS 123(R) was adopted  using the modified  prospective  method,  which
requires the Company to recognize  compensation  expense on a prospective basis.
Therefore,  prior period financial statements have not been restated. Under this
method,  in  addition to  reflecting  compensation  expense for new  share-based
awards,  expense is also  recognized to reflect the remaining  service period of
awards that had been included in pro-forma disclosures in prior periods.

With the  adoption  of SFAS  123(R),  the Company is required to record the fair
value of share-based  compensation  awards as an expense.  In order to determine
the fair value of stock options on the date of grant,  the Company  utilizes the
Black-Scholes  option-pricing  model.  Inherent  in this  model are  assumptions
related to expected stock-price volatility, option life, risk-free interest rate
and dividend  yield.  While the risk-free  interest rate and dividend  yield are
less subjective assumptions, typically based on factual data derived from public
sources, the expected stock-price volatility and option life assumptions require
a greater level of judgment which make them critical accounting  estimates.  The
Company uses an expected  stock-price  volatility  assumption  that is primarily
based on historical  realized volatility of the underlying stock during a period
of time.  No employee or director  stock  options were  granted  during the year
ended July 31, 2006.



                                      F-13
<PAGE>
                               ENZO BIOCHEM, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             JULY 31, 2006 AND 2005


In November 2005, the FASB issued FSP FAS 123(R)-3, "Transition Election Related
to Accounting for the Tax Effects of Share-Based  Payment Awards", to provide an
alternate  transition method for the implementation of SFAS No. 123(R).  Because
some entities do not have, and may not be able to re-create,  information  about
the net excess tax benefits that would have qualified as such had those entities
adopted SFAS No. 123(R) for recognition purposes,  this FSP provides an elective
alternative   transition  method.  The  method  comprises  (a)  a  computational
component that establishes a beginning balance of the additional paid in capital
pool ("APIC pool") related to employee  compensation and (b) a simplified method
to determine the subsequent  impact on the APIC pool of employee awards that are
fully vested and outstanding  upon the adoption of SFAS No. 123(R).  The Company
is evaluating  the  principles set forth in this FSP to determine its APIC pool.
The  implementation  date is one year from the later of the initial  adoption of
SFAS No. 123(R) or the effective date of FSP FAS 123(R)-3.

Prior to August 1, 2005,  the Company  accounted for employee stock option plans
under the  intrinsic  value  method  in  accordance  with APB 25.  Under APB 25,
generally no compensation  expense is recorded when terms of the award are fixed
and the exercise  price of employee and director stock options equals or exceeds
the fair value of the underlying stock on the date of the grant.

As a result of adopting  SFAS 123(R),  the Company's net loss for the year ended
July 31, 2006 was  approximately  $1.6 million  higher,  than if the Company had
continued to account for  share-based  compensation  under APB No. 25. Basic and
diluted loss per share for the year ended July 31, 2006 were  increased by $0.05
per share as a result of adopting  SFAS 123(R).  SFAS 123(R) also  requires that
excess tax benefits  related to stock option exercises be reflected as financing
cash inflows  instead of  operating  cash  inflows.  For the year ended July 31,
2006, no excess tax benefits were  recognized.  Other  share-based  compensation
expense  relating to the fair value of restricted  shares and  restricted  stock
units  issued and vested  during the year ended July 31, 2006 was  approximately
$172,000 (see Note 8).

The  following  table sets forth the  amount of expense  related to  share-based
payment  arrangements  included  in  specific  line  items  in the  accompanying
Statement of operations for the year ended July 31, 2006:

  In 000's
  --------
  Cost of products                                                      $21
  Research and development                                              249
  Selling, general and administrative                                 1,493
                                                                     ------
                                                                     $1,763
                                                                     ======

As of July 31, 2006, there was $2.0 million of total  unrecognized  compensation
cost related to nonvested  share-based  compensation  arrangements granted under
the Company's stock option and restricted stock plans,  which will be recognized
over a weighted average remaining life of approximately one and a half years.

During  the  years  ended  July 31,  2005 and 2004,  the  Company  followed  the
provisions of FASB Statement No. 148 ("SFAS 148"),  "Accounting  for Stock-Based
Compensation  -  Transition  and  Disclosure."  SFAS 148  amends  SFAS No.  123,
"Accounting for Stock-Based  Compensation,"  ("SFAS 123") to provide alternative
methods  of  transition  to SFAS  123's  fair  value  method of  accounting  for
stock-based  employee   compensation.   SFAS  148  also  amends  the  disclosure
provisions  of SFAS 123 to require  disclosure  in the  summary  of  significant
accounting policies of the effects of an entity's accounting policy with respect
to stock-based employee  compensation on reported net income. While SFAS 148 did
not amend SFAS 123 to require  companies to account for employee  stock  options
using the fair value method,  as SFAS 123(R) did, the  disclosure  provisions of
SFAS 148 are applicable to all companies with share-based employee  compensation
method of SFAS 123 or the intrinsic value method of APB 25.



                                      F-14
<PAGE>
                               ENZO BIOCHEM, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             JULY 31, 2006 AND 2005



On June 3, 2005, the Board of Directors  approved the acceleration of vesting of
unvested "out of the money" stock options held by employees, including executive
officers and  directors.  The stock options  considered as out of the money were
those with an exercise  price that was $1.50 or more than the  closing  price of
the  Company's  common  stock on June 3, 2005 of  $14.82.  All  other  terms and
conditions of these "out of the money" options remain unchanged.  As a result of
the  acceleration,  options  to  purchase  approximately  666,000  shares of the
Company's  common stock (which  represented  approximately  21% of the Company's
then outstanding stock options) became exercisable immediately.  The accelerated
options ranged in exercise prices from $16.39 to $19.02 and the weighted average
exercise price of the accelerated options was $17.55 per share. The total number
of options subject to acceleration  included  options to purchase 575,000 shares
held by executive  officers and directors of the Company.  This action was taken
to avoid expense  recognition in future  financial  statements  upon adoption of
SFAS 123(R).  The accelerated  vesting of the "out of the money" options did not
result in a charge in the Company's  statement of operations  for the year ended
July 31,  2005  based on U.S.  generally  accepted  accounting  principles.  The
Company reported  approximately $10.1 million of pro forma compensation  expense
for the year ended July 31, 2005,  of which $6.0 million was  applicable  to the
accelerated "out of the money" options.

Pro  forma  information   regarding  net  income  (loss)  applicable  to  common
stockholders is required under SFAS 123, as if the Company has accounted for its
stock  options  under  the  fair  value  method.   For  purposes  of  pro  forma
disclosures,  the  estimated  fair value of the options is  amortized to expense
over the options' vesting period. The fair value for these options was estimated
using the Black-Scholes option-pricing model with the following weighted-average
assumptions  used for all grants in the years ended July 31,  2005 and 2004:  no
dividend  yield,  weighted-average  expected  life of the option of seven years,
risk-free  interest  rate ranges of 3% to 6.88% and a volatility of 71% and 74%,
respectively, for all grants.

The following  table  illustrates the effect on net income (loss) if the Company
had applied the fair value recognition  provisions of SFAS 123 (in 000's, except
per share):

Years Ended July 31,                                 2005                 2004
--------------------                                 ----                 ----
Reported net income (loss)                         $3,004              $(6,232)

Pro forma compensation expense                    (10,129)              (3,239)
                                                 --------              -------

Pro forma net (loss)                              $(7,125)             $(9,471)
                                                 ========              =======

Pro forma net (loss) per share:
Basic                                               $(.22)               $(.30)

Diluted                                             $(.22)               $(.30)

EFFECT OF NEW ACCOUNTING PRONOUNCEMENTS

In June 2005,  the FASB  issued  SFAS No.  154,  "Accounting  Changes  and Error
Corrections  ("SFAS  154"),  a  replacement  of APB Opinion  No. 20,  Accounting
Changes,  and FASB  Statement  No. 3,  Reporting  Accounting  Changes in Interim
Financial  Statements." SFAS 154 changes the requirements for the accounting for
and reporting of a change in accounting  principle.  Previously,  most voluntary
changes in accounting  principles  required  recognition via a cumulative effect
adjustment  within net income for the period of the  change.  SFAS 154  requires
retrospective  application to prior periods' financial statements,  unless it is
impracticable to determine either the period-specific  effects or the cumulative
effect of the change.  SFAS 154 is  effective  for  accounting  changes  made in
fiscal years  beginning  after  December 15,  2005;  however,  SFAS 154 does not
change the transition provisions of any existing accounting pronouncements.  The
adoption of SFAS 154 is not expected to have a material  impact on the Company's
financial condition or results of operations.


                                      F-15
<PAGE>
                               ENZO BIOCHEM, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             JULY 31, 2006 AND 2005



In June 2006, the FASB issued FASB Interpretation No. 48 ("FIN 48"), "Accounting
for Uncertainty in Income Taxes - an  interpretation  of FASB Statement No. 109,
"Accounting  for Income  Taxes" ("SFAS  109")",  to clarify the  accounting  for
uncertainty in income taxes recognized in an enterprise's  financial  statements
in  accordance  with SFAS 109.  This  Interpretation  prescribes  a  recognition
threshold and measurement  attribute for the financial statement recognition and
measurement of a tax position taken or expected to be taken in a tax return. FIN
48  also  provides  guidance  on  derecognition,  classification,  interest  and
penalties,  accounting  in interim  periods,  disclosure,  and  transition.  The
provisions of FIN 48 are effective for fiscal years beginning after December 15,
2006.  The  Company  has not  evaluated  the  impact of FIN 48 on its  financial
statements at this time.

RECLASSIFICATIONS

Certain amounts in prior years have been reclassified to conform to current year
presentation.

NOTE 2 - SUPPLEMENTAL DISCLOSURE FOR STATEMENT OF CASH FLOWS

In the years ended July 31,  2006,  2005 and 2004,  net income  taxes paid by or
(refunded to) the Company  approximated  ($1,374,000),  $3,566,000  and $219,000
respectively.

In fiscal 2006,  certain officers of the Company exercised 227,800 stock options
in a non-cash transaction. The officers surrendered 185,300 shares of previously
owned shares of the Company's  common stock to exercise the stock  options.  The
Company recorded approximately $2.5 million, the market value of the surrendered
shares, as treasury stock.

In fiscal 2005, a director of the Company  exercised  31,660 stock  options in a
non-cash transaction. The director surrendered 17,000 previously owned shares of
the Company's  common stock to exercise the stock options.  The Company recorded
approximately  $325,000,  the market value of  surrendered  shares,  as treasury
stock.

In fiscal 2004,  certain officers of the Company exercised 769,300 stock options
in a non-cash transaction.  The officers surrendered 349,900 of previously owned
shares of the Company's common stock to exercise the stock options.  The Company
recorded approximately $5.7 million, the market value of the surrendered shares,
as treasury stock.

In fiscal 2004, the Company purchased the assets of a privately held company for
$650,000,  of which  $350,000 was paid during  fiscal 2004 and  $150,000  during
fiscal  2006.  The  remaining  $150,000  is to be  paid  in  fiscal  2007 on the
thirty-sixth month anniversary date of the acquisition.

NOTE 3 - MARKETABLE SECURITIES

Marketable securities are recorded at fair value. The Company had no investments
in  marketable  securities  at July 31,  2006.  The  following  is a summary  of
available-for-sale securities at July 31, 2005:

<TABLE>
<CAPTION>
In 000's                                                           Fair Value          Unrealized Holding (Loss)
--------                                                           ----------          -------------------------
<S>                                                                    <C>                                <C>
Income bond mutual fund                                                $5,639                             $(126)
Marketable debt securities:
 U.S. Government and agency securities                                    449                                 -
 Corporate debt securities                                                626                                (5)
                                                                          ---                                 -
(Average of remaining maturity of debt                                 $6,714                             $(131)
securities was approximately four months at                            ======                             ======
July 31, 2005)
</TABLE>


                                      F-16
<PAGE>
                               ENZO BIOCHEM, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             JULY 31, 2006 AND 2005



During fiscal 2006, the Company realized proceeds of approximately  $6.8 million
from maturities and sales of marketable securities,  on which it realized a loss
of approximately  $154,000,  based on the average cost.  During fiscal 2005, the
Company  realized  proceeds of  approximately  $10.7 million from maturities and
sales of  marketable  securities,  on which it realized a loss of  approximately
$200,000,  based on the average cost.  There were no realized gains or losses on
marketable security transactions during fiscal 2004. The Company's cost basis in
marketable securities as of July 31, 2005 was approximately $6.8 million.

The following is a summary of accumulated other  comprehensive loss, relating to
the Company's  investments  in marketable  securities  which were  classified as
available for sale securities:

<TABLE>
<CAPTION>
In 000's                                                Accumulated Loss        Tax (Expense)          Accumulated Loss
--------                                                      Before Tax           or Benefit                Net of Tax
                                                              ----------           ----------                ----------
<S>                                                               <C>                     <C>                    <C>
Fiscal 2003 - unrealized losses                                   $(139)                  $54                    $(85)
                                                                  ------                  ---                    -----
Balance - July 31, 2003                                           $(139)                  $54                    $(85)
Fiscal 2004 - unrealized losses                                    (262)                  101                    (161)
                                                                   -----                  ---                    -----
Balance - July 31, 2004                                           $(401)                 $155                   $(246)
Fiscal 2005 - realized losses                                       200                   (78)
Fiscal 2005 - unrealized gain
and valuation allowances                                             70                   (77)                    115
                                                                     --                  ----                     ---
Balance - July 31, 2005                                            (131)                   --                    (131)
Fiscal 2006 - realized losses, net                                  131                    --                     131
                                                                    ---                    --                     ---
Balance - July 31, 2006                                            $--                    $--                     $--
                                                                   ====                  ====                     ===
</TABLE>

NOTE 4 - INVENTORIES

At July 31, 2006 and 2005  inventories  - net of  reserves  of $238,000  and $0,
respectively, consist of:

In 000's                                                  2006            2005
--------                                                  ----            ----
Raw materials                                              $38             $52
Work in process                                          1,518           1,767
Finished products                                          845           1,057
                                                           ---           -----
                                                        $2,401          $2,876
                                                        ======          ======

NOTE 5 - PROPERTY, PLANT, AND EQUIPMENT

At July 31, 2006 and 2005 property, plant, and equipment consist of:

In 000's                                                  2006            2005
--------                                                  ----            ----
Building                                                $2,470              --
Laboratory machinery                                     2,242          $2,098
Office furniture and computer equipment                  5,696           5,080
Leasehold improvements                                   2,975           2,771
                                                         -----           -----
                                                        13,383           9,949
Accumulated depreciation and amortization              (8,247)         (7,279)
                                                       -------         -------
                                                         5,136          $2,670
Land and land improvements                                 712              --
                                                           ---              --
                                                        $5,848          $2,670
                                                        ======          ======

In June 2006,  the Company  acquired land and building  aggregating  $3,182,000,
which upon completion of improvements,  will be primarily used for the Company's
Life  Sciences and  Therapeutics  research  and  development  and  manufacturing
operations.


                                      F-17
<PAGE>
                               ENZO BIOCHEM, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             JULY 31, 2006 AND 2005



NOTE 6 - INCOME TAXES

The Company  accounts  for income  taxes under the  provisions  of SFAS 109. The
benefit (provision) for income taxes is as follows:

<TABLE>
<CAPTION>
Fiscal Year Ended July 31, (In 000's)                                2006                  2005                    2004
-------------------------------------                                ----                  ----                    ----
<S>                                                                <C>                 <C>                       <C>
Current benefit (provision):
  Federal                                                          $2,047              $(1,386)                  $3,287
  State and local                                                     (65)                  64                     (191)
Deferred (provision) benefit                                         (640)                (891)                   1,752
                                                                    -----                 -----                   -----
Benefit (provision) for income taxes                               $1,342              $(2,213)                  $4,848
                                                                   ======              ========                  ======
</TABLE>

Deferred tax assets and liabilities arise from temporary differences between the
tax basis of assets and liabilities and their reported  amounts in the financial
statements.  The components of deferred tax assets  (liabilities) as of July 31,
2006 and 2005 are as follows:

<TABLE>
<CAPTION>
In 000's                                                                           July 31, 2006          July 31, 2005
--------                                                                           -------------          -------------
<S>                                                                                       <C>                      <C>
Deferred tax assets:
  Federal tax carryforward losses                                                         $3,315                     --
  Provision for uncollectible accounts receivable                                            404                   $889
  State and local tax carry forward losses                                                 1,080                    245
  Depreciation                                                                                14                     33
  Research and development and other tax credit carryforwards                                405                      -
  Realized and unrealized losses on marketable securities                                    138                    129
                                                                                             ---                    ---
          Gross deferred tax assets                                                        5,356                  1,296
                                                                                           -----                  -----

Deferred tax liabilities:
  Deferred patent costs                                                                    (280)                  (293)
  Other, net                                                                               (220)                  (234)
                                                                                           -----                  -----
           Gross deferred tax liabilities                                                  (500)                  (527)
                                                                                           -----                  -----

Net deferred tax assets - before valuation allowance                                      $4,856                   $769
Less: valuation allowance                                                                 (4,856)                  (129)
                                                                                         -------                 -----
Deferred tax assets, net                                                                     --                    $640
                                                                                             ==                    ====
</TABLE>

Pursuant to SFAS 109, the Company recorded a valuation allowance during the year
ended July 31,  2006 equal to its net  deferred  tax assets at July 31, 2005 and
for net deferred tax assets  generated in fiscal 2006. The Company believes that
the valuation  allowance is necessary as it is not more likely than not that the
deferred tax assets will be realized in the foreseeable future based on positive
and  negative  evidence  available  at this time.  This  conclusion  was reached
because of uncertainties relating to future taxable income, in terms of both its
timing  and its  sufficiency,  which  would  enable the  Company to realize  the
deferred tax assets.  During fiscal 2005, the Company determined that it was not
more likely than not that it would  generate  taxable  income  against which the
deferred  tax  asset  for the  realized  and  unrealized  losses  on  marketable
securities  could be applied.  Therefore,  the Company  established  a valuation
reserve against that deferred tax asset.

As of  July  31,  2006,  the  Company  had a U.S.  federal  net  operating  loss
carryforward of approximately $9.7 million. The U.S. federal tax loss expires in
2024 if not fully  utilized by then.  Utilization  is  dependent  on  generating
sufficient  taxable  income prior to  expiration  of the tax loss  carryforward.
There was no U.S.  federal net operating loss  carryforward as of July 31, 2005.
As of July 31, 2006 and 2005,  the Company has state and local tax carry forward
losses of approximately $21.1 million and $5.1 million, respectively.



                                      F-18
<PAGE>
                               ENZO BIOCHEM, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             JULY 31, 2006 AND 2005


The  benefit  (provision)  for income  taxes were at rates  different  from U.S.
federal statutory rates for the following reasons:

<TABLE>
<CAPTION>
Year Ended July 31,                                                                 2006            2005           2004
-------------------                                                                 ----            ----           ----
<S>                                                                                  <C>           <C>              <C>
Federal statutory rate                                                               34%           (34%)            34%
Expenses not deductible for income tax return purposes                               (4%)           (2%)            (3%)
State income taxes, net of (benefit) of federal tax deduction.                        5%            (6%)             4%
Change in valuation allowance                                                       (28%)            --             --
Benefit of foreign sales                                                             --              1%              2%
Fixed asset basis difference                                                         --              --              8%
Other                                                                                 1%            (1%)            (1%)
                                                                                      --            ----           ----
                                                                                      8%           (42%)            44%
                                                                                      ==           =====            ===
</TABLE>

NOTE 7 - ACCRUED LIABILITIES AND OTHER CURRENT LIABILITIES

At July 31, 2006 and 2005, Accrued liabilities consist of:

<TABLE>
<CAPTION>
In 000's                                                                                            2006           2005
--------                                                                                            ----           ----
<S>                                                                                               <C>            <C>
Legal                                                                                             $1,974         $2,717
Payroll, benefits, and commissions                                                                   868            652
Research and development                                                                             408            286
Professional fees                                                                                    369            413
Outside reference lab testing                                                                        122             30
Other                                                                                                662            768
                                                                                                     ---            ---
                                                                                                  $4,403         $4,866
                                                                                                  ======         ======
At July 31, 2006 and 2005 other current liabilities consist of:

In 000's                                                                                            2006           2005
--------                                                                                            ----           ----
Installment payable                                                                                 $150           $150
Deferred revenue                                                                                      80            359
                                                                                                      --            ---
                                                                                                    $230           $509
                                                                                                    ====           ====
</TABLE>

NOTE 8 - STOCKHOLDERS' EQUITY

TREASURY STOCK

In fiscal 2006,  certain officers of the Company exercised 227,800 stock options
in a non-cash transaction. The officers surrendered 185,300 shares of previously
owned shares of the Company's  common stock to exercise the stock  options.  The
Company recorded approximately $2.5 million, the market value of the surrendered
shares, as treasury stock.

In fiscal 2005, a director of the Company  exercised  31,660 stock  options in a
non-cash transaction. The director surrendered 17,000 previously owned shares of
the Company's  common stock to exercise the stock options.  The Company recorded
approximately  $325,000,  the market value of  surrendered  shares,  as treasury
stock.

In fiscal 2004,  certain officers of the Company exercised 769,300 stock options
in a non-cash transaction.  The officers surrendered 349,900 of previously owned
shares of the Company's common stock to exercise the stock options.  The Company
recorded approximately $5.7 million, the market value of the surrendered shares,
as treasury stock.


                                      F-19
<PAGE>
                               ENZO BIOCHEM, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             JULY 31, 2006 AND 2005


INCENTIVE STOCK OPTION PLANS

The Company has incentive stock option plans ("1994  plan","1999 plan" and "2005
plan")  under  which the Company may grant  options for up to  1,336,745  shares
(1994 plan), up to 2,312,356 shares (1999 plan) and up to 1,000,000 shares (2005
plan) of common stock. No additional options may be granted under the 1994 plan.
The exercise  price of options  granted  under such plans is equal to or greater
than fair  market  value of the common  stock on the date of grant.  The options
granted  pursuant  to the plans may be either  incentive  stock  options  or non
statutory  options.  Stock options generally become  exercisable at 25% per year
after  one year and  expire  ten years  after  the date of grant.  The 2005 plan
provide for the issuance of restricted  stock and  restricted  stock unit awards
which generally vest over a two to four year period.

A summary of the  information  pursuant to the Company's  stock option plans for
the years ended July 31, 2006, 2005 and 2004 is as follows:

<TABLE>
<CAPTION>
                                             2006                      2005                        2004
                               -------------------------------------------------------------------------------
                                             Weighted -                Weighted -                  Weighted -
                                             Average                   Average                     Average
                                             Exercise                  Exercise                    Exercise
                               Options       Price      Options        Price        Options        Price
                               ---------     ---------- -------        ----------   -------        ----------
<S>                            <C>           <C>        <C>            <C>          <C>            <C>
Outstanding at
beginning of year              3,154,125     $12.61     2,856,801      $11.86       3,397,087       $9.88
Granted                          100,000     $24.84       431,975      $16.57         428,925      $17.02
Exercised                       (285,030)    $10.93      (100,332)      $7.39        (917,539)       7.16
Cancelled                        (91,368)    $12.61       (34,319)     $11.64         (51,672)     $10.13
                               ---------                ---------                  ----------
Outstanding at
end of year                    2,877,727     $13.20     3,154,125      $12.61       2,856,801      $11.86
                               =========                =========                  ==========

Exercisable at
end of year                    2,554,148     $12.78     2,126,442      $11.28       1,770,492      $10.54
                               =========                =========                  ==========

Weighted average fair  value of
options
granted during year                           $1.01                    $11.76                      $12.40
                                             ======                    ======                      ======
</TABLE>

The aggregate  intrinsic value of stock options exercised during the years ended
July 31, 2006 and 2005,  including  the non-cash  transactions  (see Note 2) was
$0.7 million and $0.9 million,  respectively.  The aggregate  intrinsic value of
options both outstanding and exercisable at July 31, 2006 is approximately  $3.7
million.

The following table summarizes information for stock options outstanding at July
31, 2006:

<TABLE>
<CAPTION>
                                         Options outstanding                   Options exercisable
                                         -------------------              --------------------------
                                   Weighted-Average      Weighted-                    Weighted-
 Range of Exercise                    Remaining       Average Exercise             Average Exercise
     prices              Shares    Contractual Life        Price         Shares         Price
     -----               ------    ----------------        -----         ------         -----
<S>                   <C>               <C>                <C>         <C>             <C>
    $5.45-8.08          289,020         2.2 years           $5.64        289,020        $5.64
   $8.33-12.25        1,502,111         4.4 years          $11.09      1,378,906       $10.91
  $12.93-19.02          906,719         7.4 years          $16.82        806,345       $16.60
  $20.20-24.84          161,644         2.9 years          $23.02         61,644       $21.42
        $36.05           18,233         3.4 years          $36.05         18,233       $36.05
                      ---------                                           ------
                      2,877,727                                        2,554,148
                      =========                                        =========
</TABLE>


                                      F-20
<PAGE>

                               ENZO BIOCHEM, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             JULY 31, 2006 AND 2005

During the year ended July 31, 2006, the Company  granted  100,000  options to a
consultant with an exercise price of $24.84, which vest over six months and have
a two year term.  The fair value of these  options at July 31, 2006 is $101,000.
The  fair  value of the  options,  which  will be  accounted  for as a  variable
instrument,  will be fair valued and  recognized  as expense  over the six month
vesting term.  The  assumptions  used to fair value this option grant as of July
31, 2006 were as follows:  risk free interest rate of 4.97%,  expected term of 2
years, expected volatility of 49%, and no dividend yield. In connection with the
options  issued  to this  consultant,  the  Company  recognized  an  expense  of
approximately  $80,000 in  selling,  general and  administrative  expense in the
accompanying statements of operations for the year ended July 31, 2006.

RESTRICTED STOCK AWARDS

During  fiscal  2006,  the  compensation  committee  of the  Company's  board of
directors  approved grants of 84,950  restricted stock and restricted stock unit
awards (the "Awards") under the 2005 Plan to the Company's directors and certain
officers and employees.  The Awards vest in full upon the recipient's  continued
employment or director service over either two, three or four years. Share-based
compensation  expense is  recorded  over the vesting  period on a  straight-line
basis. The Awards will be forfeited if the recipient ceases to be employed by or
serve as a director of the Company,  as defined in the Award grants.  The Awards
settle in shares of the  Company's  common stock on a one-for-one  basis.  As of
July 31, 2006, all Awards were unvested.

A summary of the information pursuant to the Company's Awards for the year ended
July 31, 2006 is as follows:

                                                              Weighted - Average
                                                     Awards       Award Price
                                                     ------       -----------
Outstanding at
beginning of year                                        --                --
Awarded                                              84,950            $12.29
Forfeited                                            (7,500)           $13.13
                                                     ------            ------
Outstanding at end of year                           77,450            $12.21
                                                     ======            ======

Weighted average market value of Awards
granted during year                                                    $12.29
                                                                       ======

As of July 31, 2006, there were approximately 629,000 shares available for grant
under the Company's stock option plans.

STOCK DIVIDENDS

During  fiscal  2005,  the  Company's  board of  directors  declared  a 5% stock
dividend on October 5, 2004 payable  November 15, 2004 to shareholders of record
as  of  October  25,  2004.   The  fiscal  2004  per  share  data  was  adjusted
retroactively  to reflect the stock  dividend  declared on October 5, 2004.  The
Company recorded a charge to accumulated  deficit and offsetting credits to both
common stock and additional paid-in capital of $23,433,400 in fiscal 2005, which
reflects the fair value of the stock dividends on the dates of declaration.

NOTE 9 - EMPLOYEE BENEFIT PLAN

The Company has a qualified  Salary  Reduction  Profit Sharing Plan (the "Plan")
for eligible  employees  under Section 401(k) of the Internal  Revenue Code. The
Plan provides for voluntary employee  contributions through salary reduction and
voluntary employer contributions at the discretion of the Company. For the years
ended July 31, 2006,  2005 and 2004,  the Company  authorized  employer  matched
contributions of 50% of the employees'  contribution up to 10% of the employees'
compensation,  payable in Enzo Biochem,  Inc. common stock.  The 401(k) employer
matched  contributions expense was $402,300,  $351,600,  and $282,200, in fiscal
years 2006, 2005, and 2004, respectively.

                                      F-21
<PAGE>

                               ENZO BIOCHEM, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             JULY 31, 2006 AND 2005

NOTE 10 - GAIN ON PATENT LITIGATION SETTLEMENT, LICENSE AGREEMENT AND ROYALTY
INCOME

In fiscal 2005, the Company as plaintiff finalized and executed a settlement and
license agreement with Digene  Corporation to settle a patent litigation lawsuit
(the  "Agreement").  Under the terms of the Agreement,  the Company  received an
initial  payment  of $16.0  million,  would  earn in the first  "annual  period"
(October  1, 2004 to  September  30,  2005) a minimum  royalty  payment  of $2.5
million,  and receive a minimum royalty of $3.5 million in each of the next four
annual periods.  In addition,  the Agreement provides for the Company to receive
quarterly  running  royalties on the net sales of Digene products subject to the
license until the  expiration of the patent on April 24, 2018.  These  quarterly
running royalties are fully creditable  against the minimum royalty payments due
in the first five years of the  Agreement.  The balance,  if any, of the minimum
royalty  payment is  recognized in the final  quarter of the  applicable  annual
royalty period.

As a result of the  Digene  Agreement,  the  Company  recorded  a gain on patent
litigation  settlement of $14.0 million  during the year ended July 31, 2005 and
deferred $2 million,  which was earned from net sales of the Company's  licensed
products  covered by the Agreement  during the first annual  period.  During the
years ended July 31, 2006 and 2005,  the Company  recorded  royalty income under
the  Agreement of  approximately  $3.1 million and $1.6  million,  respectively,
which is included in the Life Sciences segment.

NOTE 11 - COMMITMENTS

LEASES

The  Company  leases  equipment,  office  and  laboratory  space  under  several
non-cancelable operating leases that expire between January 2007 and March 2017.
An entity owned by certain executive  officers/directors of the Company owns the
building that the Company leases as its main facility for laboratory,  research,
and  manufacturing  operations.  In March 2005, the Company amended and extended
the lease for another 12 years.  In addition  to the minimum  annual  rentals of
space,  the lease is subject to annual  increases,  based on the consumer  price
index.  Annual increases are limited to 3% per year. Rent expense,  inclusive of
real estate  taxes,  under this renewed  lease and the prior lease  approximated
$1,337,000, $1,289,000, and $1,370,000 during fiscal years 2006, 2005, and 2004,
respectively.

Total  consolidated  rent expense  incurred by the Company  during  fiscal 2006,
2005,  and  2004  was  approximately  $2,257,000,   $2,140,000,  and  $1,801,000
respectively.  Minimum  future  annual  rentals under  non-cancelable  operating
leases as of July 31, 2006, are as follows:

                Years ended July 31,                         In 000's
                --------------------                         --------
                2007                                         $2,663
                2008                                          2,505
                2009                                          2,384
                2010                                          2,337
                2011                                          2,044
                Thereafter                                    8,429
                                                              -----
                                                            $20,362
                                                            =======

Employment Agreements

The Company has employment  agreements with certain executive  officers that are
cancelable  at any time but provide for  severance pay in the event an executive
officer  is  terminated  by  the  Company  without  cause,  as  defined  in  the
agreements.  Unless  cancelled  earlier,  the contracts expire through May 2008.
Aggregate  minimum   compensation   commitments,   exclusive  of  any  severance
provisions,  for the  years  ended  July 31,  2007 and 2008 are  $1,490,000  and
$870,000, respectively


                                      F-22
<PAGE>

                               ENZO BIOCHEM, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             JULY 31, 2006 AND 2005

NOTE 12- CONTINGENCES

LITIGATION

In October 2002,  the Company filed suit in the United States  District Court of
the Southern  District of New York against Amersham plc,  Amersham  Biosciences,
Perkin Elmer, Inc., Perkin Elmer Life Sciences, Inc., Sigma-Aldrich Corporation,
Sigma Chemical Company,  Inc.,  Molecular Probes,  Inc. and Orchid  Biosciences,
Inc. In January 2003,  the Company  amended its Complaint to include  defendants
Sigma Aldrich Co. and Sigma  Aldrich,  Inc. The counts set forth in the suit are
for breach of contract; patent infringement; unfair competition under state law;
unfair  competition  under  federal law;  tortious  interference  with  business
relations;  and fraud in the inducement of contract.  The Complaint alleges that
these counts arise out of the defendants' breach of  distributorship  agreements
with the Company concerning labeled nucleotide products and technology,  and the
defendants' infringement of patents covering the same. In April, 2003, the Court
directed that individual  Complaints be filed separately against each defendant.
The defendants have answered the individual Complaints and asserted a variety of
affirmative  defenses and  counterclaims.  Fact discovery is ongoing.  The Court
issued a claim  construction  opinion on July 10,  2006.  The  Company and Sigma
Aldrich  ("Sigma")  entered into a Settlement  Agreement  and Release  effective
September 15, 2006 (the "Agreement").  Pursuant to the Agreement,  the Company's
litigation with Sigma was dismissed and the Company will recognize $2 million on
settlement  in the  first  quarter  ending  October  31,  2006.  There can be no
assurance  that the Company will be successful  with the  remaining  outstanding
litigation. However, even if the Company is not successful,  management does not
believe that there will be a significant adverse monetary impact to the Company.
The Company has not recorded  revenue  under these  distribution  agreements  in
fiscal 2006. The Company recorded revenue from only Perkin Elmer in fiscal 2005.

On October 28, 2003, the Company and Enzo Life  Sciences,  Inc., a subsidiary of
the  Company,  filed suit in the United  States  District  Court of the  Eastern
District  of New York  against  Affymetrix,  Inc.  The  Complaint  alleges  that
Affymetrix improperly transferred or distributed  substantial business assets of
the Company to third parties,  including  portions of the Company's  proprietary
technology, reagent systems, detection reagents and other intellectual property.
The  Complaint  also  charges  that  Affymetrix  failed to account  for  certain
shortfalls in sales of the Company's  products,  and that Affymetrix  improperly
induced   collaborators   and  customers  to  use  the  Company's   products  in
unauthorized  fields or otherwise in violation of the  agreement.  The Complaint
seeks full  compensation  from  Affymetrix  to the Company  for its  substantial
damages,  in addition to injunctive and  declaratory  relief to prohibit,  among
other things,  Affymetrix's  unauthorized use, development,  manufacture,  sale,
distribution  and  transfer  of  the  Company's  products,   technology,  and/or
intellectual   property,  as  well  as  to  prohibit  Affymetrix  from  inducing
collaborators,  joint venture partners, customers and other third parties to use
the  Company's  products  in  violation  of the terms of the  agreement  and the
Company's rights.  Subsequent to the filing of the Complaint against Affymetrix,
Inc. referenced above, on or about November 10, 2003, Affymetrix, Inc. filed its
own Complaint against the Company and its subsidiary,  Enzo Life Sciences, Inc.,
in the United  States  District  Court for the  Southern  District  of New York,
seeking among other things,  declaratory  relief that Affymetrix,  Inc., has not
breached the parties'  agreement,  that it has not  infringed  certain of Enzo's
Patents,  and that  certain  of  Enzo's  patents  are  invalid.  The  Affymetrix
Complaint  also seeks  damages for  alleged  breach of the  parties'  agreement,
unfair  competition,  and tortuous  interference,  as well as certain injunction
relief to prevent  alleged unfair  competition  and tortuous  interference.  The
Company does not believe that the Affymetrix Complaint has any merit and intends
to defend  vigorously.  Affymetrix also moved to transfer venue of Enzo's action
to the Southern District of New York, where other actions commenced by Enzo were
pending as well as Affymetrix's  subsequently filed action. On January 30, 2004,
Affymetrix's  motion  to  transfer  was  granted.   Accordingly,  the  Enzo  and
Affymetrix  actions are now both pending in the  Southern  District of New York.
Initial  pleadings have been  completed and discovery has  commenced.  The Court
issued a Markman (claim construction)  opinion on July 10, 2006. The Company did
not record any revenue  from  Affymetrix  during the fiscal years ended July 31,
2006, 2005 and 2004.

                                      F-23
<PAGE>

                               ENZO BIOCHEM, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             JULY 31, 2006 AND 2005

On June 2,  2004  Roche  Diagnostic  GmbH  and  Roche  Molecular  Systems,  Inc.
(collectively  "Roche")  filed suit in the U.S.  District  Court of the Southern
District of New York against Enzo  Biochem,  Inc. and Enzo Life  Sciences,  Inc.
(collectively  "Enzo").  The  Complaint  was filed after Enzo  rejected  Roche's
latest cash offer to settle Enzo's  claims for,  INTER ALIA,  alleged  breach of
contract and  misappropriation of Enzo's assets. The Complaint seeks declaratory
judgment (i) of patent  invalidity with respect to Enzo's  4,994,373 patent (the
"'373 patent"),  (ii) of no breach by Roche of its 1994  Distribution and Supply
Agreement with Enzo (the "1994  Agreement"),  (iii) that non-payment by Roche to
Enzo for certain  sales of Roche  products  does not  constitute a breach of the
1994  Agreement,  and (iv)  that  Enzo's  claims  of  ownership  to  proprietary
inventions,  technology and products  developed by Roche are without  basis.  In
addition,  the suit claims tortious  interference  and unfair  competition.  The
Company does not believe that the  Complaint has merit and intends to vigorously
respond to such action with appropriate  affirmative defenses and counterclaims.
Enzo filed an Answer and  Counterclaims  on November 3, 2004  alleging  multiple
breaches of the 1994 Agreement and related  infringement  of Enzo's `373 patent.
Discovery has  commenced.  The Court issued a Markman  opinion on July 10, 2006.
The Company did not record any revenue  from Roche  during the fiscal year ended
July 31, 2006. The Roche agreement remains in force to date.

On March 6, 2002, the Company was named,  along with certain of its officers and
directors among others,  in a complaint  entitled Lawrence F. Glaser and Maureen
Glaser,  individually  and on behalf of  Kimberly,  Erin,  Hannah,  and Benjamin
Glaser v. Hyman Gross,  Barry Weiner,  Enzo  Biochemical  Inc.,  Elazar Rabbani,
Shahram Rabbani, John Delucca, Dean Engelhardt, Richard Keating, Doug Yates, and
Does I-50, Case No.  CA-02-1242-A (the "Glasser  Action"),  in the U.S. District
Court for the  Eastern  District of  Virginia.  This  complaint  was filed by an
investor in the Company who had filed for bankruptcy  protection and his family.
The complaint alleged  securities fraud,  breach of fiduciary duty,  conspiracy,
and common law fraud and sought in excess of $150 million in damages.  On August
22, 2002, the complaint was voluntarily  dismissed;  however a new substantially
similar  complaint was filed at the same time. On October 21, 2002,  the Company
and the  other  defendants  filed a motion to  dismiss  the  complaint,  and the
plaintiffs responded by amending the complaint and dropping their claims against
defendants  Keating and Yates.  On November 18, 2002,  the Company and the other
defendants again moved to dismiss the Amended  Complaint.  On July 16, 2003, the
Court  issued a  Memorandum  Opinion  dismissing  the Amended  Complaint  in its
entirety with prejudice. Plaintiffs thereafter moved for reconsideration but the
Court denied the motion on September 8, 2003. Plaintiffs thereafter appealed the
decision to the United States Court of Appeals for the Fourth Circuit.  On March
21, 2005, the Fourth Circuit  affirmed the lower Court's prior  dismissal of all
claims asserted in the action, with the sole exception of a portion of the claim
for common law fraud and remanded  that  remaining  portion of the action to the
U.S.  District  Court for the Eastern  District of  Virginia.  On May 20,  2005,
defendants  again moved the District Court to dismiss the sole  remaining  claim
before it. On July 14, 2005,  the District  Court  granted  defendants'  renewed
motion to dismiss.  On July 29, 2005,  Plaintiffs moved to amend their Complaint
for reconsideration.  On August 19, 2005, the Court denied Plaintiffs' motion to
amend  and  entered  final  judgment   dismissing  the  complaint.   Thereafter,
Plaintiffs  appealed the order and judgment to the Fourth Circuit.  On September
16, 2006, the United States Court of Appeals for the Fourth Circuit affirmed the
dismissal of the Complaint relating to the Glasser Action.  Although the Glasser
plaintiffs  still have the option of  requesting  a rehearing  before the Fourth
Circuit or petitioning  for a writ of certiorari  from the United States Supreme
Court,  absent  such  further  relief,  the Glasser  Action will be closed.  The
Company continues to believe that the Glasser Action and the remaining complaint
have no  merit  whatsoever  and  intends  to  continue  to  defend  the  actions
vigorously.

On June  7,  2004,  the  Company  and its  wholly-owned  subsidiary,  Enzo  Life
Sciences,  Inc., filed suit in the United States District Court for the District
of Connecticut  against  Applera  Corporation  and its  wholly-owned  subsidiary
Tropix, Inc. The complaint alleges  infringement of six patents (relating to DNA
sequencing systems,  labelled nucleotide products,  and other technology).  Yale
University  is the owner of four of the patents and the Company is the exclusive
licensee.  Accordingly,  Yale is also a plaintiff in the lawsuit.  Yale and Enzo
are aligned in protecting the validity and  enforceability of the patents.  Enzo
Life  Sciences is the owner of the remaining  two patents.  The complaint  seeks
permanent   injunction  and  damages   (including   treble  damages  for  wilful
infringement).  Defendants  answered the complaint on July 29, 2004.  The answer
pleads  affirmative  defences of  invalidity,  estoppels  and laches and asserts
counterclaims of non-infringement  and invalidity.  Fact discovery is ongoing. A
one-day  Markman  hearing was held on May 25, 2006 and the parties are currently
waiting  for a Markman  ruling.  Dispositive  motions due dates are based on the
Markman ruling date.

                                      F-24
<PAGE>

                               ENZO BIOCHEM, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             JULY 31, 2006 AND 2005

The trial date is  currently  scheduled  for  December 1, 2006.  There can be no
assurance  that the Company will be successful in this  litigation.  Even if the
Company is not  successful,  management  does not  believe  that there will be a
significant adverse monetary impact on the Company.

NOTE 13 - SEGMENT REPORTING

The Company has three  reportable  segments:  Life Sciences,  Therapeutics,  and
Clinical Labs. The Company's Life Sciences segment develops,  manufactures,  and
markets  products  to  research  and  pharmaceutical  customers.  The  Company's
Therapeutic segment conducts research and development activities for therapeutic
drug candidates.  The Clinical Labs segment provides  diagnostic services to the
health care community.  Prior to fiscal 2006, the Life Sciences and Therapeutics
segments were reported  together as the Research and  Development  segment.  The
fiscal 2005 and 2004  segment  information  has been  restated  to reflect  this
change. The Company evaluates segment performance based on segment income (loss)
before  taxes.  Costs  excluded  from  segment  income  (loss)  before taxes and
reported as other consist of corporate  general and  administrative  costs which
are not allocable to the three reportable segments.

Management  of the  Company  assesses  assets on a  consolidated  basis only and
therefore, assets by reportable segment have not been included in the reportable
segments below. The accounting  policies of the reportable segments are the same
as those described in the summary of significant accounting policies.

The following  financial  information  (in  thousands)  represents the operating
results of the reportable segments of the Company:

 YEAR ENDED JULY 31, 2006

<TABLE>
<CAPTION>
Revenues:                                             Life Sciences     Therapeutics  Clinical Labs        Other    Consolidated
--------                                              -------------     ------------  -------------        -----    ------------
<S>                                                          <C>            <C>             <C>        <C>             <C>
Product revenues and royalty income                          $7,900               --             --           --          $7,900
Clinical laboratory services                                     --               --        $31,926           --          31,926
                                                             ------         --------        -------    ---------       ---------
                                                              7,900               --         31,926           --          39,826

Cost and expenses and other (income):
-------------------------------------
Cost of products                                              2,174               --             --           --           2,174
Cost of clinical laboratory services                             --               --         13,917           --          13,917
Research and development                                      3,659           $4,237             --           --           7,896
Provision for uncollectible accounts                             --               --          3,633           --           3,633
Selling, general and administrative and legal                 2,260               --         14,322       15,777          32,359
Interest income                                                  --               --             --       (3,144)         (3,144)
                                                             ------         --------        -------    ---------       ---------
(Loss) income before income taxes                             ($193)         ($4,237)           $54     $(12,633)       $(17,009)
                                                             ======         ========            ===    =========       =========

Depreciation and amortization included above                   $180              $12           $897          $35          $1,124
                                                               ====              ===           ====          ===          ======

Share-based compensation included in above:
-------------------------------------------
Cost of products                                                $21               --             --           --             $21
Research and development                                        106             $143             --           --             249
Selling, general and adminstrative and legal                     87               --           $539         $867           1,493
                                                                 --               --           ----         ----           -----
               Total                                           $214             $143           $539         $867          $1,763
                                                               ====             ====           ====         ====          ======

Capital expenditures                                         $3,332               $6           $860          $29          $4,227
                                                             ======               ==           ====          ===          ======
</TABLE>


                                      F-25
<PAGE>

                               ENZO BIOCHEM, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             JULY 31, 2006 AND 2005

YEAR ENDED JULY 31, 2005
<TABLE>
<CAPTION>
                                                      Life Sciences       Therapeutics    Clinical Labs  Other       Consolidated
                                                      -------------       ------------    -------------  -----       ------------
<S>                                                        <C>              <C>             <C>        <C>             <C>
REVENUES:
Product revenues and royalty income                         $10,546               --             --         --          $10,546
Clinical laboratory services                                     --               --        $32,857         --           32,857
                                                           --------         --------         ------   --------          -------
                                                             10,546               --         32,857         --           43,403

Cost and expenses and other (income):
-------------------------------------
Cost of products                                              2,197               --             --         --            2,197
Cost of clinical laboratory services                             --               --         12,548         --           12,548
Research and development                                      5,340           $3,112             --         --            8,452
Provision for uncollectible accounts                             --               --          4,967         --            4,967
Selling, general and administrative and legal                 2,405               --         12,505    $10,635           25,545
Interest income                                                  --               --             --     (1,523)          (1,523)
Gain on patent litigation settlement                        (14,000)              --             --         --          (14,000)
                                                           --------         --------         ------   --------          -------
Income (loss) before income taxes                           $14,604         ($3,112)         $2,837   ($9,112)           $5,217
                                                            =======         ========         ======   ========           ======

Depreciation and amortization included above                 $1,382              $13           $887        $50           $2,332
                                                             ======              ===           ====        ===           ======
Capital expenditures                                           $126              $40         $1,100        $10           $1,276
                                                             ======              ===         ======        ===           ======
</TABLE>

YEAR ENDED JULY 31, 2004
<TABLE>
<CAPTION>
                                                      Life Sciences       Therapeutics    Clinical Labs  Other       Consolidated
                                                      -------------       ------------    -------------  -----       ------------
<S>                                                        <C>              <C>             <C>        <C>             <C>
REVENUES:
Product revenues                                            $12,972               --             --         --          $12,972
Clinical laboratory services                                     --               --        $28,672         --           28,672
                                                           --------          -------       --------    -------         --------
                                                             12,972               --         28,672         --           41,644

Cost and expenses and other (income):
-------------------------------------
Cost of products                                              2,518               --             --         --            2,518
Cost of clinical laboratory services                             --               --         10,586         --           10,586
Research and development                                      5,661           $2,417             --         --            8,078
Provision for uncollectible accounts                          1,753               --         10,234         --           11,987
Selling, general and administrative and legal                 1,922               --          9,331     $9,454           20,707
Interest income                                                  --               --             --     (1,152)          (1,152)
                                                           --------          -------       --------    -------         --------
(Loss) income before income taxes                            $1,118          $(2,417)       ($1,479)   ($8,302)        ($11,080)
                                                             ======          =======        =======    =======         ========

Depreciation and amortization included above                 $1,397              $17           $903        $45           $2,362
                                                             ======              ===           ====        ===           ======
Total capital expenditures                                      $70               $7         $1,142        $85           $1,304
                                                             ======              ===         ======        ===           ======
</TABLE>

The  Company's  reportable  segments are  determined  based on the services they
perform,  the  products  they sell,  and the  royalties  they  earn,  not on the
geographic  area in which they  operate.  The  Company's  Clinical  Labs segment
operates 100% in the United  States with all revenue  derived from this country.
The Life Sciences  segment  earns product  revenue both in the United States and
foreign  countries and royalty income in the United  States.  The following is a
summary of the Life Sciences segment revenues  attributable to customers located
in the United States and foreign countries:

In 000's                            2006       2005         2004
--------                            ----       ----         ----
United States                     $6,361     $7,985       $8,029
Foreign countries                  1,539      2,561        4,943
                                   -----      -----        -----
                                  $7,900    $10,546      $12,972
                                  ======    =======      =======


                                      F-26
<PAGE>

                               ENZO BIOCHEM, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             JULY 31, 2006 AND 2005

NOTE 14 - SUMMARY OF SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)

The  following  table  contains  statement of  operations  information  for each
quarter of the years ended July 31, 2006 and 2005. The Company believes that the
following  information reflects all normal recurring adjustments necessary for a
fair  presentation of the information for the periods  presented.  The operating
results for any quarter are not necessarily indicative of results for any future
period.

Unaudited quarterly financial data (in thousands,  except per share amounts) for
fiscal 2006 and 2005 is summarized as follows:

<TABLE>
<CAPTION>
                                                                                 Quarter Ended
                                                     ---------------------------------------------------------------------------
                    FISCAL 2006                         OCTOBER 31,          JANUARY 31,      APRIL 30,           JULY 31,
                                                               2005                 2006           2006               2006
                                                               ----                 ----           ----               ----
<S>                                                         <C>                  <C>            <C>                <C>
Total revenues                                              $10,165              $10,116         $9,630             $9,915
Gross profit                                                  6,143                6,300          5,658              5,634
Loss before income taxes                                    (3,163)              (5,098)        (3,793)            (4,955)
Net loss                                                    (3,286)              (4,439)        (3,436)            (4,506)
Basic loss per common share                                 ($0.10)              ($0.14)        ($0.11)            ($0.14)
Diluted loss per common share                               ($0.10)              ($0.14)        ($0.11)            ($0.14)
</TABLE>

<TABLE>
<CAPTION>
                                                                                 Quarter Ended
                                                     ---------------------------------------------------------------------------
                    FISCAL 2005                         OCTOBER 31,          JANUARY 31,      APRIL 30,           JULY 31,
                                                               2004                 2005           2005               2005
                                                               ----                 ----           ----               ----
<S>                                                         <C>                  <C>            <C>                <C>
Total revenues                                              $10,301              $11,235        $11,000            $10,867
Gross profit                                                  6,812                7,820          7,035              6,991
Income (loss) before income taxes                            12,173                (944)        (2,553)            (3,459)
Net income (loss)                                             7,021                (528)        (1,497)            (1,992)
Basic income (loss) per common share                          $0.22              ($0.02)        ($0.05)            ($0.06)
Diluted income (loss) per common share                        $0.22              ($0.02)        ($0.05)            ($0.06)
</TABLE>

                                      F-27
<PAGE>

                                ENZO BIOCHEM, INC
                             SCHEDULE II - VALUATION
                             AND QUALIFYING ACCOUNTS
                    Years ended July 31, 2006, 2005 and 2004
                                 (in thousands)

<TABLE>
<CAPTION>

                                                                        Charged     Charged
                                                        Balance at    (credited)    to other
Year ended                                              Beginning      to costs     accounts-  Deductions-        Balance at
 July 31,  Description                                  of period   and expenses    describe   describe          end of period
 --------  -----------                                  ---------   ------------    ---------  -----------       -------------
<S>        <C>                                           <C>              <C>          <C>       <C>               <C>
   2006    Allowance for doubtful accounts receivable    $2,292           $3,633       ---       $4,892 (1)        $1,033

   2005    Allowance for doubtful accounts receivable     2,770            4,967       ---        5,445 (1)         2,292

   2004    Allowance for doubtful accounts receivable     2,257           11,987       ---       11,474 (1)         2,770

   2006    Deferred tax asset valuation allowance           129            4,727       ---            -             4,856

   2005    Deferred tax asset valuation allowance             -              129       ---            -               129

   2006    Reserve for obsolete inventory                     -              596       ---          358 (2)           238
</TABLE>





       (1) Write-off of uncollectible accounts receivable.

       (2) Write-off of obsolete inventory.


                                      S-1