Xcyte Therapies, Inc. to Mail Proxy for Proposed Transaction and Asset Sale; NASDAQ Grants Listing Continuation

Xcyte Therapies, Inc. ("Xcyte", the "Company")(NASDAQ:XCYT) (NASDAQ:XCYTP) announced today that it intends tocommence mailing to the Company's stockholders on or about February10, 2006, a proxy statement/prospectus in connection with theCompany's planned acquisition of all of the capital stock of CyclacelLimited., a wholly-owned subsidiary of Cyclacel Group plc, a privatelyheld biotechnology company based in the United Kingdom, and the saleof its T cell expansion technology to Invitrogen Corporation. Xcytewill convene a special meeting of holders of its common stock on March16, 2006, at 9:00 a.m. Pacific Standard Time at 701 Fifth Avenue,Suite 5100, Seattle, Washington. Holders of the common stock at theclose of business on February 3, 2006, the record date for themeeting, will be eligible to vote at the meeting.

At the meeting, stockholders will be asked to approve: (1) theissuance of Xcyte common stock in connection with the purchase ofCyclacel Limited; (2) the sale of Xcyte's T cell expansion technologyknown as the "Xcellerate Process", including intellectual property,know-how, agreements and other assets, to Invitrogen Corporation; (3)a new equity incentive plan to provide for equity incentive awards toofficers, employees and directors of Xcyte after completion of thepurchase of Cyclacel Limited; and (4) amendments to Xcyte'scertificate of incorporation, including a reverse stock split ofXcyte's common stock. If all of the proposals are approved, Xcyteanticipates that the purchase of Cyclacel Limited and the asset saleto Invitrogen Corporation will close prior to March 31, 2006. Uponclosure of the transactions, Xcyte will be renamed CyclacelPharmaceuticals, Inc.

Xcyte also announced that on February 7, 2006 the Nasdaq ListingQualifications Panel granted Xcyte's request for continued listing onThe Nasdaq National Market, subject to certain conditions, includingthe announcement of the consummation of the acquisition of CyclacelLimited and Nasdaq's approval of a new listing application by Xcytepursuant to Nasdaq's "reverse merger" rules on or before April 12,2006.

"We are pleased that Nasdaq has granted our request for continuedlisting," said Robert L. Kirkman, M.D., Acting President and ChiefExecutive Officer of Xcyte Therapies. "We are excited about bringingour plans for Xcyte's future to fruition, and we are optimistic thatthe resulting combined company will be a significant opportunity forXcyte's stockholders."

Additional Information

Xcyte has filed an Amended S-4 registration statement thatcontains a proxy statement/prospectus with the Securities and ExchangeCommission. STOCKHOLDERS OF XCYTE AND OTHER INVESTORS ARE URGED TOREAD THE PROXY STATEMENT/PROSPECTUS (INCLUDING ANY ADDITIONALAMENDMENTS OR SUPPLEMENTS TO THE PROXY STATEMENT/PROSPECTUS) REGARDINGTHE PROPOSED TRANSACTIONS. Xcyte's stockholders will be able to obtaina free copy of the proxy statement/prospectus, as well as otherfilings containing information about Xcyte and Cyclacel, withoutcharge, at the SEC's Internet site (http://www.sec.gov). Copies of theproxy statement/prospectus and the filings with the SEC that will beincorporated by reference in the proxy statement/prospectus can alsobe obtained, without charge, by directing a request to XcyteTherapies, Inc., 1124 Columbia Street, Suite 130, Seattle, WA 98104Seattle, WA, Attention: Investor Relations, Telephone: (206) 262-6200.

Participants in the Solicitation

Xcyte and its directors and executive officers may be deemed to beparticipants in the solicitation of proxies from the stockholders ofXcyte in connection with the proposed transactions. Informationregarding the special interests of these directors and executiveofficers in the transactions is included in the proxystatement/prospectus of Xcyte referred to above. Additionalinformation regarding the directors and executive officers of Xcyte isalso included in Xcyte's proxy statement for its 2005 Annual Meetingof Stockholders, which was filed with the SEC on April 29, 2005. Thesedocuments are available free of charge at the SEC's web site(http://www.sec.gov) and from Investor Relations at Xcyte at theaddress described above. This communication shall not constitute anoffer to sell or the solicitation of an offer to buy any securities,nor shall there be any sale of securities in any jurisdiction in whichsuch offer, solicitation or sale would be unlawful prior toregistration or qualification under the securities laws of any suchjurisdiction. No offering of securities shall be made except by meansof a prospectus meeting the requirements of Section 10 of theSecurities Act of 1933, as amended.

Risk Factors

This news release contains certain forward-looking statements thatinvolve risks and uncertainties that could cause actual results to bematerially different from historical results or from any futureresults expressed or implied by such forward-looking statements. Suchforward-looking statements include statements regarding the timing orcompletion of the proposed transactions, the continued listing of theCompany's securities on The Nasdaq National Market and the approval ofproposals by the Company's stockholders. Factors that may cause actualresults to differ materially include the risk that Xcyte and Cyclacelmay not complete the proposed transaction, the risk that Xcyte andInvitrogen may not complete the proposed asset sale, and the risk thatstockholders of either Xcyte or Cyclacel may not approve the proposedtransaction. You are urged to consider statements that include thewords "may," "will," "would," "could," "should," "believes,""estimates," "projects," "potential," "expects," "plans,""anticipates," "intends," "continues," "forecast," "designed," "goal,"or the negative of those words or other comparable words to beuncertain and forward-looking. The transaction is subject to customaryclosing conditions, including approval of Xcyte's stockholders. Thesefactors and others are more fully discussed in Xcyte's periodicreports and other filings with the SEC.

Xcyte(R), Xcellerate(TM) and Xcyte Therapies(TM) are trademarks ofXcyte Therapies, Inc.