##### 



Exhibit 99.1
 
 FOR IMMEDIATE RELEASE
 Nastech Announces First Quarter 2006 Financial Results
 Bothell, Wash., May 3, 2006 
 1-34
     RECENT CORPORATE HIGHLIGHTS
 
    
    Executed a product development and commercialization agreement with P&G for PTH1-34nasal spray for the treatment of osteoporosis with the potential for $577 million in
development and




---



##### 



commercialization milestones in addition to product sales royalties, and research and
development reimbursement revenue
    
    Presented positive Phase I pharmacokinetic study results for PTH1-34 nasal
spray
    
    Acquired the RNAi intellectual property from Galenea for the development of RNAi
therapeutics against viral respiratory infections, including influenza, rhinovirus and other
respiratory diseases
    
    Successfully demonstrated effectiveness of Nastechs small interfering RNA (siRNA)
therapeutics both in vitroand in vivoto broadly target and inhibit influenza viral
production
 Conference Call and Webcast Information
  http://www.nastech.com
 ABOUT NASTECH
 www.nastech.com
 Nastech Forward-Looking Statements
  Contacts:
Nastech      Noonan Russo




---



##### 



NASTECH PHARMACEUTICAL COMPANY INC. AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS  (In Thousands, Except Per Share Data)
 Three MonthsEndedMarch 31,2005
    
    
    2006RevenuesProduct revenue, net
    
    
    
    
    
    $
    419License and research fees
    
    $
    3,330
    
    
    
    6,299Total revenue
    
    $
    3,330
    
    
    $
    6,718Operating expenses:Cost of product revenue
    
    
    
    
    
    
    239Research and development
    
    
    7,231
    
    
    
    11,801Selling, general and administrative
    
    
    2,485
    
    
    
    3,346Total operating expenses
    
    
    9,716
    
    
    
    15,386Loss from operations
    
    
    (6,386
    )
    
    
    (8,668
    )Other income (expense):Interest income
    
    
    409
    
    
    
    638Interest expense
    
    
    (120
    )
    
    
    (118
    )Other income and expense, net
    
    
    10
    
    
    
    10Loss before change in accounting principle
    
    $
    (6,087
    )
    
    $
    (8,138
    )Cumulative effect of change in accounting
principle
    
    
    
    
    
    
    291Net Loss
    
    $
    (6,087
    )
    
    $
    (7,847
    )Basic and diluted net loss per share:Prior to cumulative effect of change
in accounting principle
    
    $
    (0.34
    )
    
    $
    (0.39
    )Cumulative effect of change in
accounting principle
    
    
    
    
    
    
    0.01Net loss per common share  basic and
diluted
    
    $
    (0.34
    )
    
    $
    (0.38
    )Shares used in computing net loss per
share  basic and diluted
    
    
    17,751
    
    
    
    20,689
 December 31,
    
    March 31,Selected Balance Sheet Data
    
    2005
    
    2006Cash, cash equivalents and investments
(includes restricted cash of $998 and $1,498 respectively)
    
    $
    59,909
    
    
    $
    62,959Accounts receivable
    
    
    189
    
    
    
    1,548Property, intangibles and other assets
    
    
    12,855
    
    
    
    13,803Total assets
    
    
    72,953
    
    
    
    78,310Working capital
    
    
    55,198
    
    
    
    57,690Accumulated deficit
    
    
    (115,616
    )
    
    
    (123,463
    )Stockholders equity
    
    
    55,567
    
    
    
    56,443