Revenues Increase for Quarter, Per Share Net Loss Narrows

BERKELEY, Calif.–(EMWNews)–Dynavax Technologies Corporation (Nasdaq:DVAX) today reported financial

results for the second quarter and six months ended June 30, 2008.

As of June 30, 2008, Dynavax reported cash, cash equivalents, marketable

securities and investments held by Symphony Dynamo, Inc. (SDI) totaling

$63.1 million. This compares to $88.2 million at December 31, 2007.

For the second quarter 2008, total revenues were $10.0 million, compared

to $1.8 million reported for the second quarter in 2007. Revenues for

the six months ended 2008 were $16.3 million, compared to $3.8 million

for the same period in 2007. The increase in revenues for the second

quarter and year-to-date reflects research and development funding under

our collaboration with Merck & Co. Inc. (Merck) for HEPLISAV^TM,

our hepatitis B vaccine product candidate. The reported revenues do not

include collaboration funding from Symphony Dynamo Inc. (SDI) for cancer

and HCV clinical activities. On a pro forma basis, including the

collaboration funding from SDI, revenues were $11.4 million and $19.3

million for the three and six months ended June 30, 2008, respectively,

compared to $4.9 million and $10.4 million for the same periods in 2007.

For the second quarter 2008, total operating expenses were $16.6

million, compared to $23.6 million for the second quarter in 2007.

Operating expenses for the six months ended 2008 were $36.5 million,

compared to $41.7 million for the same period in 2007. The decline in

operating expenses for the second quarter and year-to-date resulted

primarily from a reduction in clinical development costs. The operating

expenses in 2007 also included a one-time license payment for the

commercialization of HEPLISAV. Excluding the one-time and other non-cash

charges for stock-based compensation and amortization of intangible

assets, pro forma operating expenses were $15.6 million and $34.6

million for the three and six months ended June 30, 2008, respectively,

compared to $17.7 million and $34.7 million for the same periods in 2007.

The tables included as part of this press release provide a

reconciliation of GAAP revenues and operating expenses to pro forma

revenues and operating expenses.

The net loss of $6.1 million, or $0.15 per share, reported for the

second quarter 2008 improved from the net loss of $17.7 million, or

$0.45 per share, for the same period in 2007. The net loss of $18.5

million, or $0.47 per share, reported for the six months ended 2008 was

also significantly less than the net loss of $30.8 million, or $0.78 per

share, for the same period in 2007. For the second quarter and

year-to-date, the improvement in net loss reflected the increase in

revenues, in particular, revenue associated with the Merck collaboration.

Webcast Today

Dynavax will webcast a discussion of the HEPLISAV Phase 3 data announced

today along with the company’s second quarter

2008 financial results on Tuesday, August 5, 2008 at 4:30 p.m. Eastern

Daylight Time / 1:30 p.m. Pacific Daylight Time. The webcast can be

accessed on Dynavax’s website at http://investors.dynavax.com/events.cfm.

A telephonic replay of the discussion will be available through August

19, 2008 by dialing 1-888-203-1112, access code: 4643391. International

callers can dial 1-719-457-0820, access code: 4643391.

About Dynavax

Dynavax Technologies Corporation discovers, develops, and intends to

commercialize innovative TLR9 agonist-based products to treat and

prevent infectious diseases, allergy, cancer, and chronic inflammatory

diseases using versatile, proprietary approaches that alter immune

system responses in highly specific ways. Our TLR9 agonists are based on

immunostimulatory sequences, or ISS, which are short DNA sequences that

enhance the ability of the immune system to fight disease and control

chronic inflammation. Our clinical product candidates include: HEPLISAV,

a hepatitis B vaccine partnered with Merck & Co., Inc.; a therapy for

metastatic colorectal cancer; and therapies for hepatitis B and C. Our

preclinical asthma and COPD program is partnered with AstraZeneca. The

NIH partially funds our preclinical universal influenza vaccine program

that is being coordinated with Novartis. Symphony Dynamo Inc. (SDI)

funds our colorectal cancer and hepatitis C therapeutic programs. While

the NIH and SDI provide program support, Dynavax has retained rights to

seek strategic partners for future development and commercialization.

For more information, please visit http://www.dynavax.com.

Forward-looking Statements

This press release contains forward-looking statements that are subject

to a number of risks and uncertainties. Actual results may differ

materially from those set forth in this press release due to the risks

and uncertainties inherent in our business, including difficulties or

delays in development, initiation and completion of clinical trials, the

results of clinical trials and the impact of those results on the

initiation and completion of subsequent trials and issues arising in the

regulatory process; achieving our Merck collaborative agreement

objectives, resuming development and obtaining regulatory approval for

HEPLISAV; continuation of our third party collaboration and funding

arrangements; the scope and validity of patent protection and the

possibility of claims against us based on the patent rights of others;

our ability to obtain additional financing to support our operations;

and other risks detailed in the “Risk Factors” section of our Quarterly

Report on Form 10-Q. We undertake no obligation to revise or update

information herein to reflect events or circumstances in the future,

even if new information becomes available.

DYNAVAX TECHNOLOGIES CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
	(Unaudited)
		Three Months Ended June 30,								Six Months Ended June 30,
			2008				2007				2008				2007
Revenues:
	Collaboration revenue	$	7,701			$	752			$	13,475			$	1,499
	Grant revenue		1,122				587				1,446				1,715
	Service and license revenue		1,155				461				1,371				570
Total revenues			9,978				1,800				16,292				3,784
Operating expenses:
	Research and development (2)		12,946				19,164				28,066				32,796
	General and administrative (3)		3,420				4,206				7,991				8,386
	Amortization of intangible assets		245				252				490				503
Total operating expenses (1)			16,611				23,622				36,547				41,685
Loss from operations			(6,633	)			(21,822	)			(20,255	)			(37,901	)
Interest and other income, net			405				1,118				1,376				2,119
Interest expense			(1,340	)			(37	)			(2,684	)			(65	)
Loss including noncontrolling interest in Symphony Dynamo, Inc. (SDI).			(7,568	)			(20,741	)			(21,563	)			(35,847	)
Amount attributed to noncontrolling interest in SDI			1,489				3,037				3,055				5,053
Net loss		$	(6,079	)		$	(17,704	)		$	(18,508	)		$	(30,794	)
Basic and diluted net loss per share		$	(0.15	)		$	(0.45	)		$	(0.47	)		$	(0.78	)
Shares used to compute basic and diluted net loss per share			39,806				39,741				39,795				39,734
(1)	Total operating expenses excluding non-cash stock-based compensation charges are $15.8 million and $35.1 million for the three and six months ended June 30, 2008, respectively. Total operating expenses excluding non-cash stock-based compensation charges are $22.9 million and $40.2 million for the three and six months ended June 30, 2007, respectively.
(2)	Research and development expenses included non-cash stock-based compensation charges of $0.4 million and $0.6 million for the three and six months ended June 30, 2008, respectively. Research and development expenses included non-cash stock-based compensation charges of $0.3 million and $0.5 million for the three and six months ended June 30, 2007, respectively.
(3)	General and administrative expenses included non-cash stock-based compensation charges of $0.4 million and $0.9 million for the three and six months ended June 30, 2008, respectively. General and administrative expenses included non-cash stock-based compensation charges of $0.4 million and $1.0 million for the three and six months ended June 30, 2007, respectively.

DYNAVAX TECHNOLOGIES CORPORATION
RECONCILIATION OF GAAP REVENUES TO PRO FORMA REVENUES
(In thousands)
(Unaudited)
		Three Months Ended June 30,				Six Months Ended June 30,
		2008		2007		2008		2007
GAAP revenues		$ 9,978		$ 1,800		$ 16,292		$ 3,784
ADD: Collaboration funding incurred under SDI programs		1,432		3,136		2,963		6,632
Pro forma revenues (1)		$ 11,410		$ 4,936		$ 19,255		$ 10,416
(1)	These pro forma amounts are intended to illustrate the Company’s revenues to be inclusive of collaboration funding provided for the SDI programs. The collaboration funding is reflected in the amount attributed to the noncontrolling interest in SDI in the Company’s consolidated statement of operations, but would have been reported as revenue if SDI’s results of operations were not consolidated with those of the company. Management of the company believes the pro forma results are a more useful measure of the Company’s revenues because it provides investors the ability to evaluate the Company’s operations in the manner that management uses to assess the continued progress of programs funded under the SDI arrangement. These pro forma results are not in accordance with, or an alternative for, generally accepted accounting principles and may be different from pro forma measures used by other companies.

DYNAVAX TECHNOLOGIES CORPORATION
RECONCILIATION OF GAAP OPERATING EXPENSES TO PRO FORMA OPERATING EXPENSES
(In thousands)
(Unaudited)
		Three Months Ended June 30,				Six Months Ended June 30,
		2008		2007		2008		2007
GAAP operating expenses		$ 16,611		$ 23,622		$ 36,547		$ 41,685
LESS: Stock-based compensation expense		775		689		1,436		1,497
Licensing fee		—		5,000		—		5,000
Amortization of intangible assets		245		252		490		503
Pro forma operating expenses (2)		$ 15,591		$ 17,681		$34,621		$ 34,685
(2)	These pro forma amounts are intended to illustrate the Company’s operating expenses excluding certain non-cash charges in accordance with the financial statements that management uses to evaluate the Company’s operations. These pro forma results are not in accordance with, or an alternative for, generally accepted accounting principles and may be different from pro forma measures used by other companies. Dynavax Technologies Corporation Deborah A. Smeltzer, 510-665-7222 VP Operations & Chief Financial Officer [email protected] Major Newsire & Press Release Distribution with Basic Starting at only $19 and Complete OTCBB / Financial Distribution only $89 Get Unlimited Organic Website Traffic to your Website  TheNFG.com now offers Organic Lead Generation & Traffic Solutions