Vijay B. Samant President and Chief Executive Officer

1
Vijay B. SamantPresident and Chief Executive
Officer

• September 2005

2
Safe Harbor

• This presentation contains forward-looking
  statements that are subject to risks and
  uncertainties that could cause actual results to
  differ materially from those set forth in the
  forward-looking statements, including whether any
  product candidates will be shown to be safe and
  efficacious in clinical trials and the risks set
  forth in the companys filings with the
  Securities and Exchange Commission. Actual
  results may differ materially from those
  projected. These forward-looking statements
  represent the companys judgment as of the date
  of this presentation. The company disclaims,
  however, any intent or obligation to update these
  forward-looking statements.

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Vical Overview

• Platform technology
• Non-viral gene delivery ? 13 active dev. programs
• Broad applications
• Vaccines
• Cancer
• Angiogenesis
• Animal health
• Key partnerships with pharma partners
• Broad collaboration with NIH
• Experienced management team

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Independent Product Pipeline
? Phase 2
CMV Vaccine
Transplants
IL-2 EP
Solid Tumors
Phase 1
Allovectin-7
Melanoma
? Phase 3
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CMV The Vical Advantage

• The opportunity
• Herpes virus infects 50-85 in the US by age 40
• No vaccine available
• Initial vaccine target transplant patients
• Potential follow-on target at-risk women
• Advantages of Vicals vaccine approach
• Ability to harness antibody and T-cell responses
• Non-infective - a MUST for immunosuppressed
  patients
• Proof of efficacy in transplant patients
• Small clinical trials

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Unmet Medical Need CMV Disease Burden (U.S.)

• Transplant recipients
• Incidence 2,800 patients/yr
• Serious effects 1,600 patients/yr
• Mortality 160 deaths/yr
• Congenital infections
• Incidence 40,000 infants/yr
• Neurological effects 9,400/yr
• Mortality 400 deaths/yr
• Total U.S. healthcare burden 4 billion/yr

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DNA Vaccine for CMVClinical Status

• Encouraging Phase 1 data presented in April 2005
• Safe and well-tolerated
• Immunogenic
• Antibody responses
• T-cell responses
• Advancing to Phase 2 in 2005
• 4.1 million in NIH grants

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Phase 2 Proof of Concept TrialHCT Vaccine
Strategy
160 Subjects
I. Donor receives 3 injections prior to donation
II. Recipient receives 1 injection prior to
transplant and 2 injections after transplant
R
Day -3 to -5, 3-6 weeks and 12 weeks
D
-3 weeks (Week -3, -2, -1)
HCT Transplant
HCT Recipient
HCT Donor
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IL-2 EP

• Objective
• Sustained local expression of IL-2 at therapeutic
  levels
• Avoid systemic toxicity associated with protein
  therapy
• Phase 1 Trial Design
• Up to 29 patients
• Dose escalation 0.5, 1.5, 5.0 mg
• Highest dose cohort expanded to 20 patients total
  
• Status
• Trial started July 2005
• 0.5 mg dose cohort fully enrolled
• Preliminary data in 2006

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Allovectin-7

• Phase 2 high-dose trial complete
• Excellent safety profile
• 11.8 objective response rate (15 pts of 127 pts)
  
• Special Protocol Assessment complete
• 375 chemo-naïve patients randomized 21
• Primary endpoint objective response rate _at_ gt 24
  wks.
• Potential partners have advanced to due diligence
• Unlikely to pursue Phase 3 trial without a partner

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Partnered Product Pipeline
Angiogenesis
VEGF-2
Coronary Artery Disease (CAD)
Phase 2B
Corautus
Phase 2
Centelion
FGF-1
Peripheral Artery Disease (PAD)
CAD / PAD
HGF
AnGes MG
Phase 1 / Phase 3
I.D. Vaccines
HIV
Treatment/Prevention
Phase 1
Merck
HIV
Treatment/Prevention
Phase 1
NIH
Ebola
Biodefense
Phase 1
NIH
WNV
Humans
Phase 1
NIH
Prevention
SARS
Phase 1
NIH
Veterinary
Pets/Livestock
I.D./Cancer
Research ? Field Trials
Merial
Salmon
I.D.
Aqua Health
Approved
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AnGes MG

• Japanese company founded December 1999
• Hepatocyte Growth Factor technology from Osaka U.
• License from Vical May 2005
• 1 million milestones and royalties
• Phase 3 PAD started 2004 Japan
• Phase 2 PAD started 2003 USA
• Phase 1 CAD started 2004 USA

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Other Angiogenesis Programs

• Sanofi
• Phase 2 PAD started 2002 USA and Europe
• Phase 2 PAD started 2004 USA and Europe
• 10 million received (under multiple agreements)
• Corautus Genetics
• Phase 2b CAD started 2004 USA

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NIH Collaborations

• NIH vaccine development programs
• HIV
• Ebola
• West Nile virus
• SARS
• NIH grants
• CMV
• Anthrax
• HSV
• Influenza

• Supply of clinical material
• Access to IP
• Fully-funded clinical trials

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DNA Vaccine for HIV

• Six-plasmid construct
• Includes genes for envelope and internal proteins
• Includes genes for three clades
• Phase 1 complete
• Data expected 2005-2006
• 12 million in new production orders
• Supplies for large Phase 2 study

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DNA Vaccine for Ebola

• Phase 1 started November 2003
• First time in man with Ebola vaccine
• Enrollment in Phase 1 complete 27 volunteers
• Immunogenicity data 2005
• Approval under FDAs Animal Rule
• Commercialization rights from NIH
• Project BioShield
• 350 million allocated for Ebola

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DNA Vaccine for WNV

• Highly immunogenic
• Neutralizing antibodies
• Premembrane (prM)
• Envelope (E)
• Protection in mice and horses
• Phase 1 started April 2005
• Commercialization rights from CDC and NIH

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NIH Grants

• Vaccine Status Funding
• Anthrax Phase 1 7 million
• CMV ? Phase 2 4 million
• Avian influenza Preclinical 3 million
• Influenza Preclinical lt 1 million
• HSV Preclinical lt 1 million

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Merck Partnership

• HIV, hep C, hep B, cancer
• 6/05 exercised options on 3 cancer targets
• 9/05 took additional cancer vaccine options
• Commercial terms
• 28 million received
• Additional milestones and royalties
• Co-promotion rights in U.S.

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Animal Health Programs

• Merial (Merck / Sanofi)
• Animal health vaccines for I.D. and cancer
• Conditional approval for canine melanoma vaccine
• Expected early 2006
• 7 million received
• Aqua Health (Novartis)
• DNA vaccine against IHNV in salmon
• Licensed in Canada July 2005
• Commercially marketed

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Revenues
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Financial Highlights

• (in millions except per share amounts) Q205
  Q204
• Revenues 4.8 5.7
• Expenses 10.0 11.2
• Net investment income 0.2 0.1
• Net loss (5.0 ) (5.3 )
• Net loss per share (0.21 ) (0.23 )
• Forecast 2005 net loss (23 26)
• Cash, cash equivalents and
• marketable securities _at_ 6/30
  59
• Shares outstanding _at_ 6/30 23.5

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Milestones

• Allovectin-7 Special Protocol Assessment
• NIH Phase 1 trial with West Nile virus vaccine
• New angiogenesis collaboration with AnGes MG
• Merck exercise of cancer vaccine options
• 12.1 million in production orders from NIH for
  HIV vaccine
• Aqua Health vaccine approved in Canada
• Started IL-2 / electroporation Phase 1 trial
• Merck expanded cancer vaccine options
• CRADA with NIH for HIV-EP program
• 3 million NIH grant for human vaccine against
  pandemic avian flu
• Allovectin-7 partnership update
• Start Phase 2 CMV vaccine trial in transplant
  patients
• Partner updates on angiogenesis trials
• NIH update on HIV and Ebola trials
• Approval of Merial melanoma vaccine for dogs

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Program Priorities

• Allovectin partnering
• CMV Phase 2
• IL-2 EP Phase 1
• HIV EP NIH
• Influenza NIH
• Technology out-licensing