On May 6, 2011, the Company issued an aggregate of 11,927,034 shares of its common stock and warrants to purchase up to an additional 4,174,457 shares of its common stock in a registered direct offering.  Net proceeds from the offering were approximately $15.8 million, after deducting estimated offering expenses.  The warrants will be exercisable six months after issuance at $1.755 per share and will expire five years from the date of issuance. The shares of common stock and warrants are immediately separable and will be issued separately.  The securities were sold pursuant to a shelf registration statement declared effective by the SEC on May 20, 2010.   Alexza believes that, based on its cash, cash equivalents and marketable securities balance at March 31, 2011, the net proceeds from the May financing, and the Company's expected cash usage, it has sufficient capital resources to meet its anticipated cash needs into the first quarter of 2012.  Changing circumstances may cause Alexza to consume capital significantly faster or slower than currently anticipated, or to alter its operations.  Financial Results - Periods Ended March 31, 2011 and 2010

Alexza recorded $1.3 million of revenues in the quarter ended March 31, 2011, and no revenues in the quarter ended March 31, 2010.  The 2011 revenues are a result payments received under the license agreement with Cypress Biosciences, Inc.

Operating expenses were $9.1 million and $12.6 million in the quarters ended March 31, 2011 and 2010, respectively.  Research and development expenses were $6.3 million and $7.6 million in the quarters end
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