Novavax and Bharat Biotech Announce Strategic Alliance for Pandemic Influenza Vaccine Development

HYDERABAD, India & MALVERN, PA., March 6, 2006 – Novavax, Inc. (NASDAQ: NVAX) and Bharat Biotech International Limited (BBIL), today jointly announced a strategic alliance to pursue the rapid development of pandemic influenza vaccine for India and certain other south Asian markets. Under the terms of the agreement, BBIL will fund 100% of the preclinical and clinical studies for these markets and assist in developing an efficient manufacturing process for the VirusLike Particle (VLP) based influenza vaccine. BBIL will be responsible for the sale and distribution of the vaccine in India and other urrounding countries. Novavax will receive unrestricted access to all preclinical and clinical data generated by BBIL and will receive a double digit royalty on all future sales located within BBIL’s geographic territories.

Cases of avian influenza (Bird Flu) in poultry and humans have been occurring sporadically throughout the world, prompting the World Health Organization to call avian flu the greatest concern to human health. There are at least 16 Hemagglutinin and 9 Neuraminidase genes within various subtypes of influenza viruses known to circulate in wild waterfowl, each with the potential to infect and cause severe disease in poultry and humans. Three avian influenza subtypes (H9N2, H7N7, and H5N1) have transmitted to humans in recent years and are considered major threats for a pandemic outbreak.

Novavax’s VirusLike Particle Vaccines use recombinant DNA technology to produce antigenic structures that mimic a virus to produce a protective immune response without the risk of infection or disease. Viral proteins can selfassemble into VLPs when overexpressed in certain cells. The use of VLP technology has already been proven with the success of the Hepatitis B vaccine. In addition, the developmental Human Papilloma Virus vaccines are also based on VLP technology. This is the first time that VLP technology has been applied to create an influenza virus vaccine. The technology is a particularly good fit for addressing pandemic influenza because it obviates the reliance on the supply of embryonated eggs for the production of the vaccine. Novavax has recently adopted a manufacturing process that reduces contamination risk and produces high, costeffective yields of the influenza VLP vaccine (See Press Releases dated September 13, 2005 and February 28, 2006). In addition, this technology can be used to rapidly create vaccines against emerging threats or new strains of existing pathogens.

Commenting on the agreement, Dr. M.K. Bhan, Secretary, Department of Biotechnology, Government of India said, “This is a very positive development. In the spirit of combining global expertise to collectively combat the threat posed by the rapidly spreading avian influenza virus, the department of iotechnology and the Government of India stand ready to provide all enabling support to ensure the success of this partnership between Novavax and BBIL”.

Dr. Rahul Singhvi, President and CEO of Novavax said, “We are delighted that BBIL has chosen Novavax’s VLP and Novasome® adjuvant technologies to develop, produce, and distribute a vaccine against H5N1 and other strains of avian influenza for the Indian population. BBIL has established itself as a leader in adopting innovative vaccine technologies as evidenced by their collaborations with Wyeth and Acambis. We believe that by leveraging the clinical, process and manufacturing capabilities of BBIL, we will be able to expedite the development and regulatory approval of our VLPbased pandemic influenza vaccines around the world”.

Dr. Krishna M. Ella, Chairman and Managing Director of Bharat Biotech International Ltd, said “We are extremely pleased to announce this unique partnership between Novavax and BBIL, with the guidance and support of the Department of Biotechnology, Government of India. This agreement between our companies is bigger than just business. It is an attempt to bring together capabilities of two different organizations across the world to address the global public health and economic threat posed by pandemic influenza. Novavax’s VLP technology is clearly one of the most effective in addressing emerging strains of the virus and BBIL’s proven capabilities in process development, clinical development, and manufacturing infrastructure will help expedite the availability of a VLPbased vaccine for pandemic influenza to the Indian public and the world at large. By joining hands with Novavax, BBIL would be making, in a modest
way, its contribution to the cause of Public Health in India and the Developing World”.

This alliance will be overseen by a Steering Committee chaired by Dr. Richard Klausner, eminent scientist and Former Executive Director of the Bill and Melinda Gates Foundation and Former Director of the US National Cancer Institute. Dr. Klausner is a special advisor to both the Government of India and to Novavax, Inc. Commenting on this agreement, Dr. Klausner said “I am heartened by this partnership between Novavax and BBIL. I have had a chance to work with each of these organizations and I know the principals in both firms well. These organizations and their management teams are serious in their commitment and are uniquely suited to develop a vaccine against pandemic influenza. I am confident that by combining their mutual capabilities and by working closely with the Department of Biotechnology, Government of India, they will be more effective in arriving at a solution for the good of public health orldwide”.