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NEUGENE Antisense Compound Was Well-Tolerated and Exhibited Favorable Pharmacoki

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AVI BioPharma Reports Favorable Safety and Pharmacokinetic Data From

Its Clinical Trial Targeting Hepatitis C Virus; NEUGENE Antisense

Compound Was Well-Tolerated and Exhibited Favorable Pharmacokinetic

Parameters

BIOWIRE2K

PORTLAND, Ore.--(BUSINESS WIRE)--Jan. 10, 2006--AVI BioPharma, Inc.

(Nasdaq:AVII), today announced favorable safety and pharmacokinetic

results from the first phase of its clinical trial for chronic active

hepatitis C virus (HCV). The multicenter study is designed to assess

the safety, tolerability, pharmacokinetics (PK) and viral response to

daily subcutaneous administration of its proprietary NEUGENE®

antisense compound AVI-4065 among healthy volunteers and patients

with HCV.

" There is a large, unmet medical need for effective HCV treatments,

as the current therapy is successful in less than half of the

patients infected with genotype 1 HCV, the most common form of the

virus in the U.S., " said Denis R. Burger, Ph.D., chief executive

officer of AVI. " In addition, the current treatment regimen with

interferon and ribavirin is expensive, has a plethora of side

effects, and is not well-tolerated by many patients. The favorable

safety and PK data reported today provide further evidence for the

large potential therapeutic window for NEUGENE antisense drugs. This

is in sharp contrast to previous antisense failures by other

companies with other antisense chemistries, which have been primarily

due to dose-limiting toxicity. "

The first phase of this study has been completed by enrolling and

evaluating approximately 30 healthy volunteers at three dosage levels

of AVI-4065. Trial participants have received 50 mg, 100 mg or 300 mg

of study drug by subcutaneous injection daily for 14 days, with each

dose level evaluated for safety and tolerability, and a PK analysis

conducted.

No serious drug-related adverse events occurred at any dosage level.

All dosages were well-tolerated with no injection site reactions or

events that required intervention. The apparent plasma elimination

half-life ranged from 10 hours to 12 hours with a peak concentration

at about four hours after subcutaneous injection. The PK profile

suggests that the target dosage for efficacy phase of this trial will

fall between the 100 mg and 300 mg dosages.

Dr. Mark Holodniy, FACP, professor of medicine at Stanford University

School of Medicine and director of the Department of Veterans Affairs

Public Health Research & Consultation Program in Palo Alto, Calif.,

principal investigator for the trial, said, " I am pleased to

participate as an investigator at one of many study sites in the

rigorous clinical testing of AVI's lead compound targeted to the HCV

virus. The study should provide a better understanding of the

compound's safety, pharmacokinetics and potential biological effects

against HCV. "

In addition to this clinical trial, a supporting safety and PK study

has been completed in nonhuman primates. Groups of primates received

daily injections of up to 40 mg/kg AVI-4065 for 28 days or about 15

times the largest human dose used, and for twice the duration. No

serious adverse events, toxicities or tolerability issues were

observed. Importantly, the liver accumulation of AVI-4065 was found

to be approximately three times the plasma concentration. These data

allowed for a direct calculation of the potential liver concentration

of drug in humans from the clinical cohorts.

Together with the primate data, calculations from the first phase of

the clinical study provide the basis for a dosage regimen for the

second efficacy phase. The second phase will include up to 40

patients with chronic active HCV, stratified into two cohorts, one

composed of patients who have not received previous treatment and the

other composed of patients who have failed conventional interferon

and ribavirin treatment.

The study will continue to assess the safety, tolerability and

pharmacokinetics in addition to efficacy, as measured by HCV

virological responses over a minimum of 14 days of treatment.

Patients will also be monitored following treatment to assess the

duration of the HCV virological response to AVI-4065. Preliminary

data from the second phase of this program are expected in the first

quarter of 2006.

HCV is a single-stranded RNA virus. Because HCV and other single-

stranded RNA viruses have relatively simple genetic structures, they

are attractive targets for AVI's NEUGENE antisense, which is designed

to target conserved portions of the viral genetic code that are not

likely to mutate over time.

About Hepatitis C Infection

Chronic HCV infection causes an inflammation of the liver that can

result in the development of cirrhosis, liver cancer or liver

failure. According to the World Health Organization, approximately

170 million people worldwide are chronically infected with HCV. It is

the most common chronic blood-borne infection in the developed world

and the leading cause of liver transplants in the U.S. The Centers

for Disease Control estimates that approximately 3.9 million

Americans have been infected with HCV, of whom 2.7 million are

chronically infected.

The Hepatitis Foundation International estimates that between 8,000

and 10,000 people die annually in the U.S. from HCV-related cirrhosis

or liver cancer. The current treatment for HCV, 24 to 48 weeks of

therapy with pegylated interferon alpha and ribavirin, is successful

in less than half of the patients infected with genotype 1 HCV, the

most common form of the virus in the U.S. Furthermore, this treatment

has numerous side effects, some of them severe, which make it

difficult for nearly half of initially treated patients to tolerate

the recommended dosages and duration of treatment.

About AVI BioPharma

AVI BioPharma develops therapeutic products for the treatment of life-

threatening diseases using third-generation NEUGENE antisense drugs.

AVI's lead NEUGENE antisense compound is designed to target cell

proliferation disorders, including cardiovascular restenosis, cancer

and polycystic kidney disease. In addition to targeting specific

genes in the body, AVI's antiviral program uses NEUGENE antisense

compounds to combat disease by targeting single-stranded RNA viruses,

including West Nile virus, hepatitis C virus, dengue virus and Ebola

virus. AVI has introduced a NEUGENE-based exon-skipping technology

called ESPRIT therapy. More information about AVI is available on the

company's Web site at http://www.avibio.com.

" Safe Harbor " Statement under the Private Securities Litigation

Reform Act of 1995: The statements that are not historical facts

contained in this release are forward-looking statements that involve

risks and uncertainties, including, but not limited to, the results

of research and development efforts, the results of preclinical and

clinical testing, the effect of regulation by the FDA and other

agencies, the impact of competitive products, product development,

commercialization and technological difficulties, and other risks

detailed in the company's Securities and Exchange Commission filings.

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