KVISTGÅRD, Denmark, September 19 /PRNewswire/ --     Bavarian Nordic will establish a new separate sales- and marketing
function in order to strengthen the company's commercial activities and
increase the sales promotion for its third generation smallpox vaccine,
IMVAMUNE(R) and future vaccines, including HIV and cancer vaccines.

The commercial function will, besides intensifying the sales promotion of
IMVAMUNE(R), ensure that the company's research and development is going in a
commercial way to a still higher extent, and that necessary market knowledge
at an early stage is integrated in the decision-making processes within
clinical development.

Within the latest years Bavarian Nordic has used many resources on
obtaining the RFP-3 order from the U.S. government. The production facility
in Kvistgaard is completed, and the company has advanced its clinical
development of the IMVAMUNE(R) smallpox vaccine. With a strong patent
position on the company's MVA technology, Bavarian Nordic is ready to fully
exploit the commercial options worldwide. The company sees a great potential
in a market for IMVAMUNE(R) outside the U.S. In order to cultivate this
market, Bavarian Nordic will strenghten its effort towards potential
customers and partners.

To lead this new commercial function, Bavarian Nordic will employ an
Executive Vice President Commercial Affairs, who will join the Corporate
Management group and refer to Anders Hedegaard, CEO. The company expects to
appoint a person for this position within the end of 2007. Furthermore a
number of other people will be employed to strengthen the sales and marketing
work.

Status on development programmes

IMVAMUNE(R) - smallpox vaccine

The RFP-3 base contract with a total value of USD 500 million covers a
development contract followed by delivery contract.

As part of fulfilling a number of activities, Bavarian Nordic will obtain
advanced and milestone payments, which amount to USD 150 million. In 2007,
the company expects to receive advanced payments of USD 50 million and two
milestone payments of each USD 25 million for the fulfilment of a number of
important milestones within the following areas:

- Build-up of security systems

- Establishment of various procedues and training

- Validation of equipment and processes

- Report on the Phase II study in preparation for design of Phase
III studies

Other markets

Bavarian Nordic is currently in negotiations with the authorities in a
number of other countries on the manufacture and delivery of IMVAMUNE(R) as a
safe third-generation smallpox vaccine. The timing and value of potential
contracts is not yet known.

HIV vaccines

The company's most advanced HIV vaccine project is MVA HIV nef. Data from
the Phase II study are currently being analysed and are expected to be
presented in third quarter of 2007. Discussions with a clinical expert panel
on the data will form basis for the further development of the programme.

Three ongoing Phase I studies are ongoing with MVA-BN(R) HIV polytope,
the company's second clinical development programme. Immunogenicity data from
the first study is expected in fourth quarter of 2007.

The development programme for the third HIV vaccine candidate, MVA-BN(R)
HIV multiantigen is proceeding as planned with an expected release of the
vaccine for clinical trials in 2007 and initiation of Phase I in 2008.

Cancer

Bavarian Nordic's U.S. based subsidiary, BN ImmunoTherapeutics, has
initiated Phase I/II clinical studies with the company's breast cancer
vaccine candidate, MVA-BN(R)-HER2. Enrolment of patients for two studies in
the U.S. and Europe is on-going and proceeding as planned.

The prostate cancer programme is proceeding as planned and clinical
studies are expected to commence at the turn of the year 2007/2008.

Pipeline

Programme           Phase       Next milestone
    IMVAMUNE(R)         II          Start of Phase III (2008)
    (smallpox)
    HIV nef             II          Immunogenicity data (Q3, 2007)
    HIV polytope        I/II        Immunogenicity data (Q4, 2007)
    HIV multiantigen    Preclinical Start of Phase I (2008)
    Breast cancer       I/II        Safety and immunogenicity data (Q1, 2008)
    Prostate cancer     Preclinical Start of Phase I (2007/2008)
    Measles             Preclinical Start of Phase I (2007)
    RSV                 Preclinical Start of Phase I (2008)



Tropical diseases

The company's two projects in tropical diseases, dengue fever and
Japanese encephalitis are awaiting discussions with an external partner.

Other development programmes

As part of the strategy process which was recently initiated, the
company's other development programmes, including the immunotherapy programme
(IMVABOOST(TM)), are being evaluated together with a number of potential new
projects.

Guidance for the 2007 results

Guidance for the full year result is maintained. Based on the planned
activities and milestone payments, the company expects revenue of around DKK
380 million and a loss before tax of DKK 50 million. At year-end the
company's net liquidity is expected to amount approximately DKK 900 million.

About Bavarian Nordic

Bavarian Nordic (CSE: BAVA) is a leading international biopharmaceutical
company developing and producing innovative vaccines to prevent and treat
infectious diseases and cancer. With operations in Denmark, Germany, the USA,
and Singapore, Bavarian Nordic employs over 250 people. Bavarian Nordic's
patented technology, MVA-BN(R), is as been demonstrated in clinicial studies,
one of the world's safest, multivalent vaccine vectors for the development of
vaccines against various infectious diseases such as smallpox, HIV/AIDS, as
well as against breast and prostate cancer. Several MVA-BN(R)-based HIV and
smallpox vaccines are in clinical Phase I and Phase II trials. Bavarian
Nordic has ongoing development contracts with the US government to develop
IMVAMUNE(R) as a safe third-generation smallpox vaccine. Bavarian Nordic has
supplied several other governments with smallpox vaccines.

For more information please visit http://www.bavarian-nordic.com

Contacts:

    Anders Hedegaard,
    President & CEO
    Telephone: +45-33-26-83-83
    Media: United Kingdom
    Mary Clark, Capital MS&L
    Telephone: +44-207-307-5330