It gives me great pride to provide leadership for SIGA’s extraordinary biopharmaceutical initiatives against infectious disease. I am particularly proud of ST-246^®, our drug candidate for smallpox. This oral drug has shown remarkable results in multiple animal models and in human safety testing. Our progress with ST-193 in Lassa fever demonstrates that SIGA’s discovery platform can be applied effectively to other viruses as well.

The path of research and development for platforms like SIGA’s, applicable to multiple disease conditions, is very familiar to me. During my twelve-year tenure as Chairman of Columbia’s Department of Surgery, the Department’s researchers brought another unique platform to fruition as treatment for a range of inflammation-based conditions, including Alzheimer’s disease, atherosclerosis, and diabetes. As SIGA’s CEO, I now have the opportunity to work on the industry side of medical science, bringing powerful biotechnology products to market.

As our world faces the alarming prospects of biological warfare disasters and infectious disease epidemics, SIGA’s discovery approach can contribute important new drugs. We have been very successful in leveraging our capital through partnerships with the National Institutes of Health (NIH), receiving $21 million of grant and contract commitments in 2006 for continued development of ST-246^®, as well as a three-year grant of $6 million supporting development of antiviral drugs for Lassa fever. We also have contracts with the U.S. Army for important work in animal models at USAMRIID.

Approximately $9 billion has been directed by the federal government towards the research, development, and acquisition of countermeasures in the area of biological warfare defense. We believe that SIGA’s developing science has been and will continue to be able to capture a meaningful portion of these funds. In the near future, we will work diligently to complete the regulatory work needed to initiate federal government procurement efforts and ultimately sell ST-246^® to federal, local, and international agencies charged with protecting populations from bioterrorism. We also believe that private industry will purchase our drug to protect their employees and their businesses from the potentially calamitous impact of a bioterrorist attack.

I am very optimistic about the prospects for our product candidates and our ongoing science, and am excited by our continued progress.

Respectfully yours,

Eric A. Rose, MD