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AVI BioPharma and Cook Group Enter Into License Agreement to Develop NEUGENE Drugs for Vascular Diseases

PORTLAND, Ore.--(Business Wire)--March 13, 2006--


Cook to Fund All Clinical Development of Three Products for
Cardiovascular Restenosis and Develop Products for
Peripheral Vascular Diseases

AVI BioPharma, Inc. (Nasdaq: AVII), today announced that it has
entered into agreements with Cook Group Inc. (Cook) for Cook's
development and commercialization of products for vascular diseases.
Cook has specifically licensed AVI's NEUGENE(R) antisense technology
for down-regulating c-myc gene expression in the field of
cardiovascular disease. Cook will take over clinical development of
AVI's device-related programs for cardiovascular restenosis, including
its Resten-NG(R) drug-eluting stent (DES) program, Resten-MP(TM)
microparticle delivery program and its new program for catheter
delivery of Resten-NG.

Cook will fully fund the development, clinical and regulatory
costs of these programs in the U.S. and Europe leading to
commercialization. This funding is expected to result in expenditures
by Cook that could reach $100 million.
Cook has also entered into a supply agreement to purchase the
drugs for development, clinical studies and commercialization from
AVI. Because of the drugs' established Phase II clinical efficacy, AVI
has forgone certain near-term milestone payments in favor of a
double-digit royalty on worldwide product sales and a
commercialization milestone. Cook will purchase 692,003 shares of AVI
common stock for $5 million under a stock purchase agreement. Cook
will take over AVI's facilities and personnel at its Colorado site.

Additional terms of the agreements were not disclosed.
"Based upon promising Phase II clinical data in combating
cardiovascular restenosis and progress in our drug-eluting stent and
Resten-MP programs, AVI has now partnered its device-related
cardiovascular programs with one of the pre-eminent vascular device
companies in the world," said Denis R. Burger, Ph.D., chief executive
officer of AVI. "Together, Cook's device expertise and AVI's antisense
technology become a formidable combination to address vascular
diseases on many fronts."

AVI will narrow its internal cardiovascular focus exclusively to
its coronary artery bypass graft (CABG) program, which is moving into
Phase II clinical trials later this year. This agreement also enables
AVI to apply resources more aggressively toward the company's
infectious disease program, focusing on hepatitis C and influenza A,
including avian influenza type H5N1.

Resten-NG (AVI-4126) is a third-generation antisense agent that
targets the key regulatory gene involved in cardiovascular restenosis,
the transcription factor referred to as c-myc. It is believed that it
regulates the many downstream genes which produce the pathology of
restenosis, namely cell migration and adhesion, collagen formation,
secretion of extra-cellular matrix, and cell proliferation, among
others. The c-myc gene expression is immediately activated by the
injury to the vascular lining during angioplasty and stent placement
and peaks at 24 to 48 hours before subsiding. NEUGENE antisense drugs
are particularly suited to prevent this process because they can be
delivered immediately following injury to the angioplasty site by a
variety of means including catheter and stent elution, or by systemic
delivery using AVI's microparticle delivery system, Resten-MP.

"Based upon our preliminary investigation, we believe that
Resten-NG (AVI-4126) has great potential for use on drug-eluting
stents to reduce restenosis of stented vessels," said Bill Cook, CEO
of Cook Group Inc. "AVI's NEUGENE antisense drug therapies also have
potential to treat stenotic vessels systematically via catheter. Our
company is honored to be a partner with AVI in the exploration of new,
antisense vascular therapies."

Joseph B. Horn, AVI's vice president of cardiology who recently
joined AVI from Cook, will be rejoining Cook to advance these programs
through clinical development and into commercialization. While at
Cook, Horn was responsible for the introduction of Cook cardiology
products worldwide. In addition, Horn worked with Cook medical
researchers and physicians in the management of clinical studies of
new medical devices. Previously, Horn spent eight years as president
and CEO for Global Therapeutics, a medical device company that he
founded and which was acquired by Cook in 1998.

"I'm thrilled to be rejoining Cook with the team I've assembled to
complete the mission that I started at AVI in the field of cardiology
in the near term, and in all areas of vascular medicine in the longer
term," Horn said. "Moving AVI's cardiovascular program forward in both
Europe and the United States will be my initial priority, and I'm
pleased to be surrounded by a talented team of professionals with
cutting-edge technology to apply clinically. I believe this is a
win-win scenario for both companies"



AVI BioPharma, Inc.
Michael Hubbard, 503-227-0554
[e-mail]
or
Cook Group Inc.
Director of Public Relations
David McCarty, 812-339-2235 ext. 2387
[e-mail]
or
Investors:
Lippert/Heilshorn & Associates Inc.
Bruce Voss, 310-691-7100
[e-mail]
or
Jody Cain, 310-691-7100
[e-mail]
or
Press:
Waggener Edstrom Worldwide
Bioscience and Healthcare Practice
Jenny Moede, 503-443-7000
[e-mail]

Copyright Business Wire 2006
13Mar06 14:00 GMT
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