Dynavax Technologies Corporation
Jul 30, 2010

Dynavax Reports 2010 Second Quarter Financial Results

BERKELEY, CA, Jul 30, 2010 (MARKETWIRE via COMTEX News Network) -- Dynavax Technologies Corporation (NASDAQ: DVAX) today reported financial results for the second quarter ended June 30, 2010, including $57.4 million in cash and cash equivalents. This compared to $30.1 million at March 31, 2010. In April, the Company completed a financing which resulted in net proceeds of $41 million. The $13.7 million cash usage for the second quarter primarily reflected accelerated enrollment and immunization of over 2,400 subjects in the HEPLISAVTM Phase 3 lot-to-lot consistency and safety study and to a lesser extent, planned investment in early clinical development of the Company's universal flu vaccine and autoimmune program.

Total revenues for the second quarter 2010 were $2.2 million, compared to $15.9 million reported for the second quarter in 2009, of which $13.0 million was non-cash deferred revenue recognized following the termination of the Merck collaboration.

Total operating expenses for the second quarter 2010 were $18.5 million, versus $17.3 million reported for the first quarter 2010, driven by intensified clinical and manufacturing activities for HEPLISAV. Total operating expenses for the second quarter 2009 were $13.0 million prior to restarting the HEPLISAV clinical program in September 2009.

One-time events affected the net loss for the first half of 2010 and 2009. Net loss for the second quarter 2010 was $28.0 million, or $0.34 per share, which included non-operating expense of $11 million resulting from the issuance of common stock and warrants to Symphony in connection with the Company's April 2010 financing. Net income for the second quarter 2009 was $4.1 million, or $0.10 per share, reflecting the non-cash deferred revenue of $13 million described above.

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.

About HEPLISAV

HEPLISAV is an investigational adult hepatitis B vaccine. The vaccine candidate is being evaluated in two Phase 3 studies that are directed toward fulfilling licensure requirements in U.S., Canada and Europe. In a completed pivotal Phase 3 trial, HEPLISAV demonstrated increased, rapid protection with fewer doses than current licensed vaccines. Dynavax has worldwide commercial rights to HEPLISAV and is developing the vaccine for large, high-value populations that are less responsive to current licensed vaccines, including individuals with chronic kidney disease. HEPLISAV combines hepatitis B surface antigen with a proprietary Toll-like Receptor 9 agonist known as ISS to enhance the immune response.

About Dynavax

Dynavax Technologies Corporation, a clinical-stage biopharmaceutical company, discovers and develops novel products to prevent and treat infectious diseases. The Company's lead product candidate is HEPLISAV, an investigational adult hepatitis B vaccine designed to enhance protection more rapidly and with fewer doses than current licensed vaccines. For more information visit www.dynavax.com.

Forward Looking Statements

This press release contains "forward-looking statements," that are subject to a number of risks and uncertainties. Future actual operating and financial results may differ materially due to the risks and uncertainties inherent in our business, including whether successful clinical and regulatory development and approval of HEPLISAV can occur in a timely manner or without significant additional studies or difficulties or delays in development or clinical trial enrollment and whether the studies can support registration for commercialization of HEPLISAV; 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; the Company's ability to obtain additional financing to support the development and commercialization of HEPLISAV and its other operations, possible claims against the Company based on the patent rights of others; and other risks detailed in the "Risk Factors" section of our current periodic reports with the SEC. Past financial results are not necessarily indicative of future financial performance. We undertake no obligation to revise or update information herein to reflect events or circumstances in the future, even if new information becomes available. Information on Dynavax's website at www.dynavax.com is not incorporated by reference in the Company's current periodic reports with the SEC.

- tables to follow -

                     DYNAVAX TECHNOLOGIES CORPORATION
                  CONSOLIDATED STATEMENTS OF OPERATIONS
                 (In thousands, except per share amounts)
                               (Unaudited)
                                 Three Months Ended     Six Months Ended
                                      June 30,              June 30,
                                --------------------  --------------------
                                  2010       2009       2010       2009
                                ---------  ---------  ---------  ---------
Revenues:
  Collaboration revenue         $   1,341  $  14,596  $   8,762  $  32,288
  Grant revenue                       617        895      1,479      2,034
  Service and license revenue         233        393        294        906
                                ---------  ---------  ---------  ---------
Total revenues                      2,191     15,884     10,535     35,228
Operating expenses:
  Research and development         14,045      9,239     26,525     19,571
  General and administrative        4,173      3,533      8,743      7,957
  Amortization of intangible
   assets                             245        245        490        490
                                ---------  ---------  ---------  ---------
Total operating expenses           18,463     13,017     35,758     28,018
                                ---------  ---------  ---------  ---------
Income (loss) from operations     (16,272)     2,867    (25,223)     7,210
Interest income                        39         46         41        156
Interest expense                     (431)       (12)      (830)       (27)
Other income (expense)            (11,340)       226    (11,176)      (120)
                                ---------  ---------  ---------  ---------
Net income (loss)                 (28,004)     3,127    (37,188)     7,219
Add: Losses attributed to
 noncontrolling interest in SDI        --        983         --      1,992
                                ---------  ---------  ---------  ---------
Net income (loss) attributable
 to Dynavax                     $ (28,004) $   4,110  $ (37,188) $   9,211
                                ---------  ---------  ---------  ---------
Basic net income (loss) per
 share attributable to Dynavax
 stockholders                   $   (0.34) $    0.10  $   (0.54) $    0.23
                                =========  =========  =========  =========
Shares used to compute basic
 net income (loss) per share
 attributable to Dynavax
 stockholders                      82,012     39,923     68,264     39,906
                                =========  =========  =========  =========
Diluted net income (loss) per
 share attributable to Dynavax
 stockholders                   $   (0.34) $    0.10  $   (0.54) $    0.23
                                =========  =========  =========  =========
Shares used to compute diluted
 net income (loss) per share
 attributable to Dynavax
 stockholders                      82,012     40,064     68,264     39,906
                                =========  =========  =========  =========
                     DYNAVAX TECHNOLOGIES CORPORATION
           RECONCILIATION OF GAAP REVENUES TO PRO FORMA REVENUES
                               (In thousands)
                                 (Unaudited)
                                       Three Months Ended  Six Months Ended
                                             June 30,         June 30,
                                        ----------------- -----------------
                                          2010     2009     2010     2009
                                        -------- -------- -------- --------
GAAP revenues                           $  2,191 $ 15,884 $ 10,535 $ 35,228
ADD:
Collaboration funding incurred
 under SDI programs                           --      795       --    1,542
LESS:
Non-cash deferred revenue from
 Merck collaboration                          --   12,948       --   28,485
                                        -------- -------- -------- --------
Pro forma revenues (1)                  $  2,191 $  3,731 $ 10,535 $  8,285
                                        ======== ======== ======== ========
(1) These pro forma amounts are intended to illustrate the Company's
    revenues including collaboration funding provided for the SDI programs
    and excluding certain non-cash items. 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 operating programs. 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  Six Months Ended
                                             June 30,         June 30,
                                        ----------------- -----------------
                                          2010     2009     2010     2009
                                        -------- -------- -------- --------
GAAP operating expenses                 $ 18,463 $ 13,017 $ 35,758 $ 28,018
LESS:
Stock-based compensation expense             425      667      966    1,186
Amortization of intangible assets            245      245      490      490
                                        -------- -------- -------- --------
Pro forma operating expenses (2)        $ 17,793 $ 12,105 $ 34,302 $ 26,342
                                        ======== ======== ======== ========
(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
                        SELECTED BALANCE SHEET DATA
                               (In thousands)
                                 (Unaudited)
                                                    June 30,   December 31,
                                                      2010         2009
                                                  ------------ ------------
Assets
 Cash and cash equivalents and marketable
  securities                                      $     57,378 $     36,720
 Property and equipment, net                             6,324        7,997
 Goodwill                                                2,312        2,312
 Other intangible assets, net                              789        1,279
 Other assets                                            4,875        2,162
                                                  ------------ ------------
Total assets                                      $     71,678 $     50,470
                                                  ============ ============
Liabilities and stockholders' equity
 Accounts payable                                 $      1,033 $      1,686
 Accrued liabilities                                    14,644        7,507
 Warrant liability to Holdings                          12,029        2,567
 Current portion of deferred revenue                     1,429        2,718
 Noncurrent portion of deferred revenue                 16,369       17,083
 Long-term note payable to Holdings                     10,140        9,342
 Long-term contingent liability to Holdings              3,161        3,040
 Other long-term liabilities                                65          151
 Stockholders' equity                                   12,808        6,376
                                                  ------------ ------------
Total liabilities and stockholders' equity        $     71,678 $     50,470
                                                  ============ ============

Contact:
Jennifer Lew
Vice President, Finance
510-665-7217
Email Contact


SOURCE: Dynavax Technologies

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