NEW YORK, Oct. 9 /PRNewswire/ -- Duane Reade Holdings, Inc. issued the
following statement today following announcements by the United States
Attorney's Office and the Securities and Exchange Commission of the filing
of criminal and civil securities fraud charges against Anthony J. Cuti, a
former CEO of the Company, and another former executive.

    "Duane Reade has cooperated fully with the various government agencies
in their investigations over the last 16 months and we are pleased to see
this issue reach resolution," said John Lederer, Duane Reade's Chairman and
Chief Executive Officer. "We are gratified that the government has
concluded its investigation with no finding of any wrongdoing by the
Company or any of its current executives. Most importantly, the actions
taken today have no effect upon our current business and our financial
condition is unaffected by these actions. Our business continues to perform
well and we remain fully focused on elevating Duane Reade to the next
level."

    The indictment charges fraudulent and illegal activities that took
place several years ago, between 2000 and the first half of 2005. The
Company noted that a former executive, William Tennant, was also charged by
the government. Mr. Tennant was employed by the Company until December,
2001 and was a consultant to the Company until April, 2005. Duane Reade
terminated Mr. Cuti's employment in November, 2005.

    As previously disclosed in May, 2007, the Company's Audit Committee,
with the assistance of independent counsel, conducted an investigation into
matters related to today's announcement. As a result of the investigation,
the Company restated its financial results for the impacted historical
periods and reported the results of its investigation to the United States
Attorney's Office and the SEC.

    About Duane Reade

    Founded in 1960, Duane Reade is the largest drug store chain in the
metropolitan New York City area, offering a wide variety of prescription
and over-the-counter drugs, health and beauty care items, cosmetics,
greeting cards, photo supplies and photofinishing. As of September 27,
2008, the Company operated 246 stores.

    Except for historical information contained herein, the statements in
this release and the accompanying discussion on the earnings conference
call are forward-looking and made pursuant to the safe harbor provisions of
the Private Securities Litigation Reform Act of 1995. In addition, this
document may contain statements, estimates or projections that constitute
"forward-looking" statements as defined under U.S. federal securities laws.
Forward-looking statements involve known and unknown risks and
uncertainties, which may cause the Company's actual results in future
periods to differ materially from forecasted or expected results. Those
risks include, among other things, the competitive environment in the drug
store industry in general and in the New York metropolitan area, the
ability to open and operate new stores, the continued efforts by payers and
government agencies to reduce prescription reimbursement rates and
prescription drug benefits, the strength of the economy in general, the
economic conditions in the New York greater metropolitan area, changes in
federal and state laws and regulations, including the potential impact of
changes in regulations surrounding the importation of pharmaceuticals from
foreign countries and changes in laws governing minimum wage requirements,
changes in the Company's operating strategy, capital expenditure plans or
development plans, the Company's ability to attract, hire and retain
qualified pharmacy and other personnel, the Company's significant
indebtedness, labor disturbances, the continued impact of, or new
occurrences of, terrorist attacks in the New York greater metropolitan area
and any actions that may be taken in response, demographic changes, the
Company's ability to limit fraud and shrink, the results of the Company's
legal proceedings and recalls of pharmaceutical products due to health
concerns or other reasons. Those and other risks are more fully described
in Duane Reade's reports filed with the SEC from time to time, including
its annual reports on Form 10-K, quarterly reports on Form 10-Q and current
reports on Form 8-K. You should not place undue reliance on forward-looking
statements, which speak only as of the date they are made. Except to the
extent otherwise required by federal securities laws, we do not undertake
to publicly update or revise any forward-looking statements.


    Duane Reade Holdings, Inc.
    John Henry
    Chief Financial Officer
    (212) 273-5746

    Investors: Cara O'Brien
    Press:  Diane Zappas
    (212) 850-5600
    Financial Dynamics

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