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Alliance Pharmaceutical Corp. Reaches Agreement With Lender Committee Related to the Restructuring of Its Senior Convertible Promissory Notes

SAN DIEGO, March 23 -- Alliance Pharmaceutical Corp. (BULLETIN BOARD: ALLP) announced today that it has reached an agreement with its Lender Committee with respect to the extension of the maturity date and restructuring of the outstanding Senior Convertible Promissory Notes in the aggregate outstanding principal amount of $10,476,250 (the "Senior Notes"). This agreement must be approved by each and every holder of a Senior Note before it becomes effective. If all of the holders of the Senior Notes do not approve the agreement reached with the Lender Committee, then the Senior Notes will become due and payable as of March 24, 2006. Alliance intends to solicit the approval of the holders of the Senior Notes to this agreement prior to April 15, 2006.

About Alliance Pharmaceutical Corp.
Alliance Pharmaceutical Corp., founded in 1989, is a development-stage pharmaceutical company that is currently focused on developing its lead product, Oxygent. Alliance is currently the only company that has advanced a synthetic perfluorochemical (PFC) emulsion-based oxygen therapeutic into late- stage multi-center international clinical trials in both Europe and North America. Alliance is developing Oxygent as an intravascular oxygen therapeutic, based on its proprietary PFC technology.

Except for historical information, the matters set forth in this release are forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially from those set forth herein, including the uncertainties related to the approval of the tentative agreement reached with the Lender Committee by each and every holder of a Senior Note. Alliance refers you to cautionary information contained in documents Alliance files with the Securities and Exchange Commission from time to time, including the last Form 10-KSB and Form 10-QSB, and those risk factors set forth in the most recent registration statement on Form SB-2 (File No. 333-119428). Alliance is under no obligation (and expressly disclaims any obligation) to update or alter its forward-looking statements, whether as a result of new information, future events, or otherwise.

Source: Alliance Pharmaceutical Corp.

CONTACT: Corporate Communications, Alliance Pharmaceutical Corp., +1-858-410-5275

Web site: http://www.allp.com/