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Therapeutic DNA Vaccine Company Inovio Biomedical Reports Second Quarter 2008 Financial Results
Date:8/7/2008

vestment advisor informed us that decreased market liquidity for this type of security caused the valuation of these investments to fall below par. At June 30, 2008, we recorded on our consolidated balance sheet an unrealized loss of $1.1 million on these investments and reclassified $12.5 million as a non-current asset.

These securities retain the AAA/AA ratings they had when we purchased them, and have yielded uninterrupted interest payments that we receive on a monthly basis directly from the issuers. The lack of liquidity may require us to hold the ARSs until they are redeemed by the issuer or to maturity, but we believe the decline in their liquidity and fair value is temporary. We expect that liquidity of these investments is not required to fund our operations during the next twelve months. The Company anticipates receiving approval of and executing a $5.0 million line of credit from its investment advisor in the third quarter, secured by the ARS, to provide additional working capital.

Corporate Update

The operational highlights for the second quarter included further positive interim results reported by our partners from ongoing DNA vaccine clinical studies. A summary of these results follows, covering R&D and clinical studies using Inovio's electroporation delivery technology. More details can be found in the news release section of Inovio's website.

The University of Southampton presented interim data from its phase I/II clinical study of an experimental DNA-based prostate cancer vaccine, indicating that the combination of this DNA vaccine and electroporation DNA delivery was safe and well-tolerated. Patients treated using electroporation displayed higher levels of antibody and cellular immune responses. Data from preclinical studies performed in collaboration with scientists at Beth Israel Deaconess Medical Center (BIDMC) demonstrated a 77-fold increase in dendritic cells at the site of administration of a D
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