MEDIMMUNE INC /DE - 10-K Annual Report

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549

FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2001
Commission File Number: 0-19131

MEDIMMUNE, INC.
(Exact name of registrant as specified in its charter)
Delaware 52-1555759
State or other (I.R.S. Employer
jurisdiction of Identification No.)
incorporation or organization)

35 West Watkins Mill Road
Gaithersburg, Maryland 20878
(Address of principal executive office)
(Zip Code)

Registrant's telephone number, including area code: (301) 417-0770
Securities Registered pursuant to Section 12(b) of the Act: None
Securities Registered pursuant to Section 12(g) of the Act:
Common Stock, $.01 par value
(Title of Class)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes: X No:

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will
not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in
Part III of this Form 10-K or any amendment to this Form 10-K [ ].

Aggregate market value of the 248,493,923 shares of voting stock held by non-affiliates of the registrant based on the closing price
on March 14, 2002 was $10,449,169,462. Common Stock outstanding as of March 14, 2002: 249,915,151 shares.

Documents Incorporated by Reference:

Document Part of Form 10-K
-------- -----------------
Proxy Statement for the Annual Meeting Part III
of Stockholders to be held May 23, 2002.

MEDIMMUNE, INC.
FORM 10-K
TABLE OF CONTENTS
PART I PAGE
Item 1. Business........................................................................................2
Item 2. Properties.....................................................................................42
Item 3. Legal Proceedings..............................................................................42
Item 4. Submission of Matters to a Vote of Security Holders............................................44

PART II
Item 5. Market for MedImmune, Inc.'s Common Stock and Related
Shareholder Matters............................................................................45
Item 6. Selected Financial Data........................................................................46
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations............................................................48
Item 7A. Quantitative and Qualitative Disclosures about Market
Risk...........................................................................................63
Item 8. Financial Statements and Supplementary Data....................................................65
Report of Independent Accountants..............................................................94
Report of Management...........................................................................95
Item 9. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure............................................................96

PART III
Item 10. Directors and Executive Officers of MedImmune, Inc.............................................96
Item 11. Executive Compensation.........................................................................96
Item 12. Security Ownership Certain Beneficial Owners and
Management.....................................................................................96
Item 13. Certain Relationships and Related Transactions.................................................96

PART IV
ITEM 14. Exhibits, Financial Statement Schedule, and
Reports on Form 8-K............................................................................97
SIGNATURES.......................................................................................................98
Schedule I .............................................................................................S-1
Exhibit Index ..............................................................................................E-1
Exhibits (Attached to this Report on Form 10-K)

Synagis, CytoGam, Ethyol, RespiGam, and NeuTrexin are registered trademarks of the Company. Numax and Vitaxin are trademarks of the
Company. FluMist is a trademark of Aviron, a wholly owned subsidiary of MedImmune, Inc.

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The statements in this annual report that are not descriptions of historical facts may be forward-looking statements. Those
statements involve substantial risks and uncertainties. You can identify those statements by the fact that they contain words such
as "anticipate," "believe," "estimate," "expect," "intend," "project" or other terms of similar meaning. Those statements reflect
management's current beliefs, but are based on numerous assumptions which MedImmune cannot control and which may not develop as
MedImmune expects. Consequently, actual results may differ materially from those projected in the forward - looking statements.
Among the factors that could cause actual results to differ materially are: seasonal demand for and continued supply of the
Company's principal product, Synagis; whether FluMist receives clearance by the Food and Drug Administration and, if it does,
whether it will be successfully launched; availability of competitive products in the market; availability of third-party
reimbursement for the cost of our products; effectiveness and safety of our products; exposure to product liability, intellectual
property or other types of litigation; foreign currency exchange rate fluctuations; changes in generally accepted accounting
principles; growth in costs and expenses; the impact of acquisitions, divestitures and other unusual items; and the risks,
uncertainties and other matters discussed below under "Risk Factors" and elsewhere in this annual report and in our other periodic
reports filed with the U.S. Securities and Exchange Commission. MedImmune cautions that RSV disease occurs primarily during the
winter months; MedImmune believes its operating results will reflect that seasonality for the foreseeable future. MedImmune is also
developing several products (including FluMist) for potential future marketing. There can be no assurance that such development
efforts will succeed, that such products will receive required regulatory clearance or that, even if such regulatory clearance were
received, such products would ultimately achieve commercial success. Unless otherwise indicated, the information in this annual
report is as of December 31, 2001. This annual report will not be updated as a result of new information or future events.
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EXPLANATORY NOTE

Effective January 10, 2002, MedImmune, Inc. acquired Aviron through a stock-for-stock exchange offer and merger transaction that is
being accounted for as a purchase. Aviron is a biopharmaceutical company focused on prevention of disease through innovative vaccine
technologies. Aviron's lead product candidate is FluMist, a live, attenuated virus vaccine delivered as a nasal mist for the
prevention of influenza. A Biologic License Application relating to FluMist is currently pending before the U. S. Food and Drug
Administration.

The textual portion of this Annual Report on Form 10-K (i.e., Items 1 through 7A) gives effect to the Aviron acquisition and
describes the operations of Aviron as part of MedImmune's business. However, since the acquisition did not occur until January 2002,
MedImmune's Financial Statements and Supplementary Data as of and for the three years ended December 31, 2001 included in Item 8 of
this Annual Report only reflect the Aviron acquisition in Note 21 thereof entitled "Subsequent Event (unaudited)."

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PART I Item 1. Business

MedImmune, Inc. (together with its subsidiaries, "MedImmune" or "the Company") was founded in 1988 and is a biotechnology company
headquartered in Gaithersburg, Maryland with five products on the market and a diverse product pipeline. The Company is focused on
using advances in immunology and other biological sciences to develop important new products that address significantly unmet
medical needs in areas of infectious disease and immune regulation. The Company also focuses on oncology through its wholly owned
subsidiary, MedImmune Oncology, Inc.

On December 3, 2001, MedImmune announced it had entered into a definitive agreement to acquire Aviron, a biotech company located in
Mountain View, California. The acquisition was completed in January 2002, at which point Aviron became a wholly owned subsidiary of
the Company ("Aviron").

In 1998, the Company launched Synagis (palivizumab) in the United States for preventing respiratory syncytial virus ("RSV") in
high-risk pediatric patients. Synagis was the first monoclonal antibody approved for an infectious disease and has become an
important new pediatric product for the prevention of RSV, the leading cause of viral pneumonia and bronchiolitis in infants and
children.

The Company also markets CytoGam (cytomegalovirus immune globulin intravenous (human)) and RespiGam (respiratory syncytial virus
immune globulin intravenous (human)). Through MedImmune Oncology's sales and marketing group, the Company markets Ethyol
(amifostine) and NeuTrexin (trimetrexate glucuronate for injection). The Company owns or leases five manufacturing facilities: a
multi-use biologics facility in Frederick, Maryland; a fill and finish facility in Nijmegen, the Netherlands; a pilot manufacturing
facility at its headquarters in Gaithersburg, Maryland; a filling and packaging plant in Philadelphia, Pennsylvania; and a bulk
supply facility in Speke, England.

Products on the Market

Synagis

Synagis is a humanized monoclonal antibody approved for marketing in June 1998 by the U.S. Food and Drug Administration ("FDA") for
the prevention of serious lower respiratory tract disease caused by RSV in pediatric patients at high risk of RSV disease. Synagis
is administered by intramuscular injection at 15 mg/kg and is given once per month during anticipated periods of RSV prevalence in
the community. In the Northern Hemisphere, the RSV season typically commences in October and lasts through April or May.

RSV is the most common cause of lower respiratory infections in infants and children worldwide. Healthy children and individuals
with adequate immune systems often acquire a benign chest cold when infected with RSV. In contrast, certain high-risk infants such
as premature infants and children with chronic lung disease ("CLD," also known as bronchopulmonary dysplasia or "BPD") are at
increased risk for acquiring severe RSV disease (pneumonia and bronchiolitis), often requiring hospitalization. Each year in the
United States, more than 125,000 infants are hospitalized with RSV disease. The mortality rate of hospitalized infants with RSV
infection of the lower respiratory tract is about two percent.

There are approximately 325,000 infants at high risk of acquiring severe RSV disease born annually in the United States. The pivotal
clinical trial for Synagis showed a 55-percent reduction in RSV hospitalizations among high-risk pediatric patients receiving
Synagis versus those patients receiving placebo. Synagis was safe and generally well tolerated, and the proportions of subjects in
the placebo and Synagis groups who experienced any adverse event or any serious adverse event were similar.

In December 1997, the Company formed an exclusive worldwide marketing alliance with Abbott Laboratories ("Abbott") to commercialize
Synagis. Within the United States, the Ross Products Division of Abbott co-promotes Synagis with the Company. The Company records
all United States sales and pays Abbott a commission on sales above defined annual thresholds. Each company is responsible for its
own selling expenses.

In 2001, the Company reported sales of $516 million of Synagis to wholesalers and distributors. In general, the Company expects most
of its Synagis sales to occur in the fourth and first quarters of the year because of the seasonality of RSV in the United States.
Since most of the product is expected to be sold in the Northern Hemisphere, the Company expects this seasonality to continue in the
foreseeable future.

The Company believes that Synagis was broadly reimbursed by third-party payors in the United States during the 2000-2001 RSV season
and the first part of the 2001-2002 RSV season. There can be no assurance that third-party payors will not attempt to restrict
reimbursement guidelines of Synagis in the remainder of the 2001-2002 RSV season or in future RSV seasons.

Outside the United States, the International Division of Abbott Laboratories has the exclusive right to distribute Synagis. The
Company manufactures and sells Synagis to Abbott for sales outside the United States. As of February 1, 2002, the Company and Abbott
had submitted regulatory applications requesting approval to market Synagis in 58 countries outside the United States and had
received approval in the 46 countries listed here: Argentina, Austria, Australia, Bahrain, Belgium, Brazil, Chile, Colombia, Costa
Rica, Czech Republic, Denmark, El Salvador, Finland, France, Germany, Greece, Guatemala, Honduras, Hong Kong, Hungary, Iceland,
Ireland, Israel, Italy, Japan, Jordan, Kuwait, Luxembourg, Malaysia, Mexico, Netherlands, New Zealand, Nicaragua, Norway, Poland,
Portugal, Saudi Arabia, Singapore, South Africa, Spain, Sweden, Switzerland, Turkey, United Kingdom, Uruguay, and Venezuela. On
January 17, 2002, Synagis was approved by the Japanese Ministry of Health, Labor, and Welfare. Net revenue to the Company from
Abbott recorded as product sales in 2001 for sales of Synagis outside of the United States was $37 million.

The Company has established a manufacturing alliance with German-based Boehringer Ingelheim Pharma KG ("BI") to supplement its own
capacity to manufacture Synagis. In September 1998, the FDA approved the Company's supplement to its Biologic License Application
("BLA") allowing the Company to import and sell in the United States product from the BI facility. In December 1999, the FDA
approved the Company's own 91,000 square foot manufacturing facility in Frederick, Maryland ("Frederick Manufacturing Center" or
"FMC"). This approval allowed the Company to begin distributing Synagis manufactured at this facility. In 2001, the Company received
additional approval from the FDA to begin marketing Synagis manufactured using a fermentation improvement, called the "Enhanced
Yield Process" (EYP), which improves Synagis fermentation yields by over 300 percent. Even with these yield improvements, the
Company will continue to rely upon BI for a portion of worldwide Synagis production for at least the next few years. BI produces
Synagis in large lot sizes relative to overall product supply; there can be no assurance that failure of one or more lots of Synagis
will not adversely impact the Company's supply of product and/or market perception. Additionally, because Synagis costs are affected
by changes in foreign exchange rates and production yields, there can be no assurance that Synagis will continue to be economical to
purchase from BI. Further, there can be no assurance that product supply will be properly matched with demand.

The Company is continuing to evaluate Synagis in post-marketing clinical trials. In 2001, the Company announced that patient
enrollment was complete in a multi-year Phase 3 safety and efficacy study in children under two years of age with congenital heart
disease ("CHD") and in a multi-year Phase 4 safety study in children with cystic fibrosis. On October 31, 2001, the Cooperative
Antiviral Studies Group ("CASG") at the National Institutes of Health ("NIH") informed the Company that it had discontinued its
Phase 3 study with Synagis in bone marrow transplant recipients due to a failure to accrue patients in a timely manner. There can be
no assurance that data from these clinical trials will establish the safety or efficacy of Synagis in these populations, or that
results from these trials will not adversely affect perceptions of Synagis in the marketplace.

The Company received a composition of matter patent protecting Synagis through October 20, 2015. Additional patent applications
which could provide even broader and longer protection are pending. Other than the Company's product RespiGam (see below), the
Company is not aware of any competing products being marketed anywhere in the world for the prevention of RSV disease. The Company
believes that any products being developed, if successfully commercialized, would require at least four years of clinical
development and regulatory approval prior to reaching the marketplace. Nevertheless, there can be no assurance that a competitive
product will not be brought to market sooner than expected, or if brought to market, would not be superior to Synagis.

The Company intends to continue to explore opportunities to expand its franchise in the RSV marketplace, including the development
of a third-generation injectable antibody, Numax, which may one day replace Synagis in the marketplace for the treatment of RSV. The
Company has identified the top three Numax candidates, and is currently evaluating them in animal models to determine which molecule
to take into clinical evaluation.

Ethyol

Ethyol is an intravenous organic thiophosphate cytoprotective agent indicated for the reduction of cumulative renal toxicity
associated with repeated administration of cisplatin in patients with advanced ovarian cancer or non-small cell lung cancer
("NSCLC"). It is also indicated for the reduction of the incidence of moderate-to-severe xerostomia in patients undergoing
post-operative radiation treatment for head and neck cancer, where the radiation port includes a substantial portion of the parotid
glands. Xerostomia (chronic dry mouth) is caused by a reduction of salivary function. It is a frequent and debilitating condition
associated with radiation to the head and neck region. Patients with xerostomia are at increased risk of oral infection, dental
cavities and loss of teeth and often have difficulty chewing, swallowing, and speaking. According to the American Cancer Society,
approximately 40,000 cases of head and neck cancer are diagnosed each year in the United States. Radiation therapy, often in
conjunction with surgery and/or chemotherapy, is standard treatment for head and neck cancer.

Ethyol was initially approved by the FDA in 1995 for the ovarian cancer indication. In 1996, the FDA approved MedImmune Oncology's
supplemental new drug application under the Accelerated Approval Regulations to include treatment of patients with NSCLC. Products
approved under the Accelerated Approval Regulations require further adequate and well-controlled studies to verify and describe
clinical benefit. In 2001, the Company completed a clinical trial that it anticipates may fulfill this requirement. In the event the
clinical trial fails to verify the benefit of Ethyol for the NSCLC indication, the FDA may, under certain circumstances, withdraw
approval of this indication. In 1999, the FDA approved Ethyol's use in head and neck cancer patients.

In 2001, the Company reacquired the U.S. marketing rights to Ethyol from ALZA Corporation ("ALZA"). The rights to Ethyol were
originally scheduled to return to the Company on April 1, 2002, pursuant to the 1995 co-promotion agreement between the two
companies whereby ALZA was responsible for sales and marketing of the product in the United States. Due to a shift in ALZA's
priorities following its acquisition by Johnson & Johnson in early 2001, the Company believed it was in the product's best interest
for the Company to regain full commercial control as soon as possible. As part of the accelerated reacquisition, the Company
recognized approximately $20 million of incremental expenses in the third quarter of 2001 and began recording 100 percent of U.S.
sales on October 1, 2001. In accordance with the original agreement, the Company will pay ALZA a gradually diminishing royalty
beginning April 1, 2002 and expiring in 2011. Net U.S. sales of Ethyol recognized by the Company in 2001 were $14 million.

Ethyol has been approved in 60 countries worldwide. Outside the United States, Ethyol is primarily marketed by affiliates of
Schering-Plough Corporation ("Schering" or "Scherico"). Schering purchases Ethyol from the Company at a price based on a percentage
of the net sales price of Ethyol in Germany, the United Kingdom, Spain, Italy and France. Schering's exclusive rights to market the
product in the European Union ("EU") will continue through December 31, 2003. At the end of the exclusive period, the Company can
choose to co-promote Ethyol with Scherico for an additional two years, after which the rights revert back to the Company in exchange
for future royalties. The Company has various other distribution and marketing arrangements for Ethyol outside the U.S. and the EU,
primarily with affiliates of Schering. In 2001, net revenues of Ethyol to the Company (recorded as product sales) from sales outside
the United States were $6 million.

The Company is continuing to evaluate Ethyol in its approved indications through post-marketing clinical trials. In November 2001,
investigators presented data from a Phase 2 study with subcutaneous Ethyol suggesting that subcutaneous administration of Ethyol may
provide comparable protective effects against radiation therapy-induced xerostomia as intravenously administered Ethyol. The Company
plans to expand the applicability and usefulness of Ethyol to potential new indications by conducting trials that evaluate its
ability to reduce mucositis in non-small cell lung cancer patients caused by radiation or chemotherapy. There can be no assurance
that data from these clinical trials will establish the efficacy of Ethyol in these populations, or that results from these trials
will not adversely affect the perception of Ethyol in the marketplace.

CytoGam

CytoGam is an intravenous immune globulin product enriched in antibodies against cytomegalovirus ("CMV") and is marketed for
prophylaxis against CMV disease associated with transplantation of kidney, lung, liver, pancreas, and heart. CMV contributes
significantly to morbidity and mortality in organ transplant recipients. CMV can cause severe pneumonia and other organ
complications related to invasive CMV disease which, if not successfully treated, can lead to organ failure. CMV has also been shown
to cause increased bacterial and fungal infections, and has been associated with an increased risk of rejection of the transplanted
organ. There are approximately 20,000 kidney, lung, liver, pancreas, and heart transplants performed annually in the United States.
Clinical studies have shown a 50-percent reduction in CMV disease in kidney transplant patients given CytoGam and a 56-percent
reduction in serious CMV disease in liver transplant patients given CytoGam. CytoGam prophylaxis has also been associated with
increased survival in liver transplant recipients.

In December 2000, the Company received approval from the FDA for an amendment to the BLA for CytoGam allowing for the manufacture of
a portion of the production process of CytoGam at the FMC. The Company will continue to rely on third-party manufacturers to fulfill
the production steps for which the Company does not have FDA approval. Should any of the suppliers or manufacturers be unable to
supply the Company with product for any reason, there can be no assurances that the Company would be able to arrange alternate
production capabilities in a timely fashion or at all. Further, there can be no assurance that should such alternate production
capabilities be needed, the Company would be able to obtain such capabilities for a comparable cost or without continuing to incur
its existing manufacturing operating costs.

The Company began marketing CytoGam in the U.S. through its own hospital-based sales force in 1993. Net sales of CytoGam in the U.S.
were $28 million in 2001, 13 percent below sales of $32 million in 2000. The variance reflects a reduction in 2001 in the amount of
CytoGam used as a substitute for standard intravenous immune globulin (IVIG), which had been in short supply in 2000. The Company
believes that, currently, there is not a shortage of standard IVIG and has no way to predict future supply shortages. Somewhat
offsetting the drop in substitution usage, CytoGam sales in 2001 reflect a modest increase in its approved, core transplantation
business. The Company believes the United States marketplace for CMV drugs in transplantation is competitive and no assurance can be
given that growth in the product's labeled indications will continue. CytoGam has been designated as an orphan drug for use in lung,
liver, pancreas and heart and therefore has market exclusivity for these indications until 2005. The product's orphan drug status in
the United States for use of CytoGam in kidney transplants expired in 1997. There can be no assurance that additional CMV
intravenous specialty immune globulin products will not be successfully commercialized by other companies.

Internationally, CytoGam is approved for marketing and is currently registered for sale in Argentina, Canada, Turkey and South
Korea. The product is also available on a named patient basis in other countries. Additionally, the Company is evaluating the
potential to expand distribution into countries in Europe and Mexico. Net sales of CytoGam outside the U.S. in 2001 were $4 million.

RespiGam

RespiGam, an intravenous immune globulin enriched in neutralizing antibodies against RSV, was approved by the FDA for marketing in
the United States in January 1996. RespiGam is indicated for the prevention of serious RSV disease in children less than 24 months
of age with BPD or a history of premature birth (i.e., born at 35 weeks or less gestation) and is administered by an approximately
four-hour intravenous infusion. RespiGam was the first product demonstrated to be safe and effective in reducing the incidence and
duration of RSV hospitalization and the severity of RSV illness in these high-risk infants. The Company believes that RespiGam has
largely been replaced by Synagis in the marketplace. In 2001, net sales of RespiGam were $4 million.

NeuTrexin

NeuTrexin is a lipid-soluble, intravenously administered analog of methotrexate, a commonly used anti-cancer agent. In December
1993, NeuTrexin was approved in the United States and Canada for use with concurrent leucovorin administration as an alternative
therapy for the treatment of moderate-to-severe Pneumocystis carinii pneumonia ("PCP") in immunocompromised patients, including
patients with AIDS, who are intolerant of or refractory to, trimethoprim-sulfamethoxazole therapy, or for whom
trimethoprim-sulfamethoxazole is contraindicated. Due to the improvement in drugs to treat AIDS patients, worldwide use of NeuTrexin
has steadily declined in recent years. In 2001, net sales of NeuTrexin were $4 million.

Hexalen

Hexalen is an oral synthetic cytotoxic antineoplastic chemotherapeutic agent cleared for marketing by the FDA in December 1990 for
use as a single agent in the palliative treatment of patients with persistent or recurrent ovarian cancer following first-line
therapy with cisplatin and/or alkylating agent-based combination chemotherapy. In November 2000, MedImmune Oncology signed an
agreement to sell to MGI Pharma ("MGI") worldwide rights to Hexalen and all related assets and technology. MGI assumed product
responsibilities early in 2001. Under the terms of the agreement, MGI will pay the Company $7.2 million in cash plus royalties on
sales of Hexalen for ten years. The $7.2 million is being paid to the Company over 18 months, ending in March 2002.

Development-Stage Products

FluMist (Frozen)

FluMist was acquired by MedImmune as a part of the Company's acquisition of Aviron in January of 2002. FluMist is a live, attenuated
vaccine delivered as a nasal mist for the prevention of influenza. The BLA for FluMist was submitted to the FDA for approval on
October 31, 2000. Aviron received a Complete Response Letter from the FDA on August 31, 2001, and filed its response to this letter
on January 8, 2002. The Company is working to achieve approval of the product. There can be no assurance that such approval will be
received.

FluMist is based on live cold-adapted influenza vaccine technology developed by Dr. H.F. Maassab. It was licensed from the
University of Michigan and is being developed under a Cooperative Research and Development Agreement (CRADA) with the National
Institutes of Health (NIH).

FluMist has undergone, and is currently undergoing, extensive clinical trials to evaluate its usefulness as a vaccine to prevent
influenza in a number of human populations. To date, more than 20,000 children and adults have received FluMist. In studies that
have been published thus far, FluMist has been shown to provide a high protection rate against influenza in healthy children and
adults. In these studies, FluMist was shown to be generally well tolerated. FluMist recipients were more likely than placebo
recipients to report side effects, which were transitory in nature, such as sore throat, runny nose, and low-grade fever.

As a part of its response to the FDA's Complete Response Letter, Aviron provided data from two large Phase 3 clinical trials with
FluMist. The first study was a multi-year trial, involving more than 9,000 children, conducted by Aviron and the NIH. The trial was
initiated in 1998 in Temple, Texas and was funded by a $3.0 million grant from the NIH awarded to the Baylor College of Medicine.
The trial was designed to evaluate the impact of vaccinating preschool and school-age children with FluMist on the spread of
influenza into the community as measured by the number of doctor visits for flu-related illness as well as to examine the safety of
FluMist. The second Phase 3 trial completed in 2001 was one initiated by Kaiser Permanente in October 2000. In this trial, more than
9,700 participants, age one to 17 years, were enrolled during the 2000-2001 influenza season to compare the rates of different
medically attended events in the group receiving FluMist versus the group receiving placebo. There can be no assurance that data
from these clinical trials, or any future clinical trials, will establish the safety or efficacy of FluMist.

The manufacturing of FluMist involves three key processes, which since 1998, have been performed at three facilities owned or leased
by the Company's Aviron subsidiary. Each year, after the FDA's annual selection of the influenza strains to be included in the
subsequent season's vaccine, the master virus seeds are created for each of the selected vaccine strains for large scale production.
This first step is conducted at Aviron's Mountain View, California facility, and generally takes approximately four to 12 weeks.
Next, these master virus seeds are transferred to Aviron's leased facility in Speke, England, where they are used to make bulk
quantities of the vaccine strains. The vaccine's diluent, which is normal allantoic fluid ("NAF"), is also produced in bulk at this
U.K. facility. This process requires the use of specific pathogen-free hens' eggs. After an incubation period, the bulk vaccine
strains are carefully harvested from the eggs, frozen and shipped to Aviron's leased Pennsylvania facility. Once in Pennsylvania,
the frozen bulk vaccine strains and the frozen bulk NAF are thawed and blended into the trivalent vaccine, filled into nasal spray
devices, labeled, and packaged. As of December 31, 2001, none of the existing manufacturing facilities involved in the production of
FluMist had been licensed by any regulatory agency and FluMist had not yet been manufactured at a sustained commercial scale. There
can be no assurance that these facilities can achieve licensure by the FDA or any other regulatory agency. Nor can there be any
assurances that if licensed, commercial scale production can be achieved or sustained.

In January 1999, Aviron signed a worldwide collaborative agreement with Wyeth Lederle Vaccines for the development, manufacturing,
distribution, marketing, promotion, and sale of FluMist. Under this agreement, Wyeth has exclusive worldwide rights to market
FluMist, excluding Korea, Australia, New Zealand and some South Pacific countries. The two companies will co-promote FluMist in the
United States. Under the terms of the agreement, Wyeth will distribute FluMist and record all product sales. The Company will
receive approximately 50 percent of FluMist revenues, paid to the Company in the form of product transfer payments and royalties.
These payments are higher in the U.S. than internationally.

The FDA has estimated that approximately 80 million doses of the current inactivated influenza vaccine were manufactured for use in
the U.S. for the 2000/2001 influenza season. According to the U.S. Centers for Disease Control, 65 percent of the 35 million
Americans over the age of 64 received the influenza vaccine shot during 1997, up from less than 25 percent a few years earlier.
Experts suggest that very few of the 75 million children in the United States under age 19 receive the influenza vaccine, even those
at high risk for complications. Given FluMist's ease of administration, the Company believes this already large market has the
potential to grow substantially larger, primarily through expansion in the pediatric and adolescent markets.

Cold Adapted Influenza Vaccine (Liquid Formulation)

The original formulation of FluMist requires freezer storage throughout distribution. Because many international markets do not have
distribution channels well suited to the sale of frozen vaccines, Wyeth and Aviron are collaborating to develop a second generation,
refrigerator stable, liquid trivalent cold adapted influenza vaccine (CAIV-T).

Currently, there are a number of late-stage clinical trials being conducted to demonstrate the safety and efficacy of CAIV-T. In
2001, Wyeth completed a Phase 2 clinical trial of CAIV-T in more than 1,300 children in the southern hemisphere to demonstrate the
safety and immunogenicity of this formulation.

In addition, Wyeth is conducting several Phase 3 clinical trials with liquid CAIV-T:

o a Pan-Asian efficacy trial enrolled more than 3,000 participants from 12 to 36 months of age. The primary endpoint is
protection against culture-confirmed influenza.

o a Pan-European pediatric day care efficacy trial enrolled more than 1,500 children in day care from 6 to 36 months of age.
The primary endpoint is protection against culture-confirmed influenza.

o an efficacy trial in healthy elderly over 60 years of age in South Africa. The primary endpoint is protection against
culture confirmed influenza.

There can be no assurance that data from these clinical trials, or any future clinical trials, will establish the safety or efficacy
of CAIV-T.

Human Papillomavirus Vaccine

The Company is developing a vaccine against the human papillomavirus ("HPV") to prevent cervical cancer. There are over 75 different
types of HPV associated with a variety of clinical disorders, ranging from benign lesions to potentially lethal cancers. Two types
of HPV, HPV-16 and HPV-18, cause the majority of cervical cancer in the world. There are currently no vaccines to prevent HPV
infection, which is estimated to affect 24 to 40 million men and women in the United States.

In December 1997, the Company entered into a strategic alliance with GlaxoSmithKline ("GSK") to develop and commercialize the
Company's HPV vaccine. Under the terms of the agreement, GSK receives exclusive worldwide rights to the Company's HPV vaccine
technology and both companies will collaborate on research and development activities. To date, the Company has received a total of
$39.5 million in up-front payments, an equity investment, and research funding from GSK. Pursuant to the agreement, the Company will
continue to receive certain research funding, milestone payments (if specified development and sales goals are met), and royalties
on any product sales. Total funding and payments to the Company, exclusive of royalties, could total over $85 million.

Under the terms of the agreement, the Company conducted Phase 1 and Phase 2 clinical trials, manufactured clinical material for
those studies and received funding from GSK for these activities. GSK is responsible for the final development of the product, as
well as regulatory, manufacturing, and marketing activities.

The Company's strategy for this vaccine development relies on a virus-like particle ("VLP") technology for producing a structurally
identical, non-infectious form of the virus. Scientists at the Company, in collaboration with a team at Georgetown University, first
demonstrated the effectiveness of a VLP vaccine candidate using a dog model for papillomavirus infection.

In 2001, GSK and the Company completed enrollment in five clinical trials with this vaccine, including a Phase 1 trial, three Phase
2 trials, and a 3,000-person epidemiology trial. The Company hopes that data from these trials once completed and analyzed, will
help support the initiation of Phase 3 clinical testing.

No assurance can be given that the current clinical trials or any future clinical trials will be successful, or if successful, would
lead to a continuation of the programs in the indications currently studied or at all.

Siplizumab (formerly known as MEDI-507)

Siplizumab is a humanized monoclonal antibody that binds to the CD2 antigen receptor found on T cells and natural killer ("NK")
cells. Laboratory studies suggest that siplizumab primarily inhibits the response of T cells through its binding of the CD2 receptor
while allowing other immune cells to respond normally to foreign antigens. This suggested selectivity of T cell inhibition suggests
that siplizumab may have potential utility in certain autoimmune diseases such as psoriasis and psoriatic arthritis, as well as in
applications in the fields of transplant medicine (e.g., as a treatment or prevention of graft-versus-host disease ("GvHD")) and
cancer (e.g., as a treatment for T cell lymphoma).

The Company's current lead development program for siplizumab is in psoriasis. In 2001, MedImmune completed enrollment in three
large Phase 2 trials: a randomized, double-blind, placebo-controlled, subcutaneous administration trial involving 420 patients at 44
sites in North America; a randomized, double-blind, placebo-controlled, intravenous administration trial involving 124 patients at
approximately 25 sites in North America; and a randomized, double-blind, subcutaneous administration trial involving 121 patients at
approximately 20 sites in Europe.

Data from MedImmune's Phase 1 program were presented in September 2001 at the European Society of Dermatology Research meeting held
in Stockholm, Sweden, which built upon the preliminary data presented in San Francisco in June 2001 at the International Psoriasis
Symposium and European Congress on Psoriasis. The updated data provided longer-term safety analysis for two trials using intravenous
administration, as well as clinical data from a subcutaneously administered trial. Overall in these studies, siplizumab was found to
be generally well tolerated, and was shown to improve psoriatic disease as measured by PASI (Psoriasis Area and Severity Index)
score given either through intravenous or subcutaneous administration. The follow-up of patients in the Phase 1 program was
consistent with the preliminary safety and clinical results, and showed that improvement in patients' psoriasis appears to be
durable after completion of treatment at least through the initial three-month follow-up period in these trials.

Autoimmune diseases are of major medical importance worldwide and include common afflictions such as rheumatoid arthritis, multiple
sclerosis, Crohn's disease, psoriatic arthritis and psoriasis. Psoriasis is a common chronic, recurrent disease characterized by
dry, scaling, red lesions on the skin. Approximately six million Americans have psoriasis with between 150,000 and 260,000 new cases
reported each year. There is no cure for psoriasis and the treatments are often inconvenient, difficult to use, or have unwanted
side effects.

Siplizumab was derived from BTI-322, a rat monoclonal antibody the Company licensed from BioTransplant Incorporated
("BioTransplant") in 1995. Under the terms of the agreement with BioTransplant, the Company is responsible for all activities
related to commercialization. BioTransplant will receive milestone payments at various stages of product development and royalties
if the product is commercialized. BioTransplant has retained the right to use BTI-322 and/or siplizumab in its proprietary
ImmunoCognance systems. BTI-322 is a registered trademark of BioTransplant.

Urinary Tract Infection Vaccine

The Company is developing a vaccine candidate to prevent urinary tract infections ("UTIs") caused by Escherichia coli ("E. coli"), a
bacteria that causes 85 percent of all UTIs. UTIs are a significant medical problem and one of the most common disorders prompting
medical attention in otherwise healthy women and children. Retrospective data indicate that 40 percent of adult women in the United
States experience at least one UTI sometime during their lifetime and more than 20 percent experience recurrent infection. UTIs
result in more than 7 million physician and hospital visits per year at an estimated annual healthcare cost of greater than $1
billion. Older adults are also at risk with the incidence as high as 33 out of 100 people. Currently, there are no vaccines to
prevent UTIs. Most infections can be treated with antibiotics; however, recurrence is common and emerging antibiotic resistant
bacteria create an additional threat.

Early attempts to create a vaccine against UTIs targeted pili, hair-like protein appendages on the surface of bacteria. Such
attempts were not successful in protecting against a broad range of pathogenic bacteria, including E. coli, because of the
strain-to-strain variation in the major component of the pili. The identification of specific proteins, or "adhesins," at the end of
pili that facilitate the attachment of E. coli to human tissue, provided a novel target for vaccine development. The Company's
vaccine strategy is based on blocking these adhesins, thus preventing the disease-causing bacteria from binding and accumulating in
the bladder. The novel target of the Company's vaccine candidate is the FimH adhesin. FimH does not vary widely among the different
strains of E. coli that cause UTIs. The Company believes this is a requisite quality for development of a broadly effective UTI
vaccine.

During 2001, the Company completed enrollment in two Phase 2 clinical trials with its UTI vaccine: a 93-patient study in woman with
recurrent infection and a 305-patient study in women at risk of initial infection. No assurance can be given that these clinical
trials, or any future clinical trials will be successful, or if successful, would lead to a continuation of the programs in the
indications currently studied or at all.

Epstein Barr Virus Vaccine

The Company's Aviron subsidiary is developing a subunit vaccine against the Epstein Barr virus ("EBV"), a herpes virus that is the
leading cause of infectious mononucleosis ("mono"). This vaccine is based upon the single surface antigen apparently responsible for
most of the neutralizing antibodies stimulated by a natural EBV infection. In 1995, Aviron entered into a worldwide collaboration
with GlaxoSmithKline, excluding Korea, whereby GSK funds the development of the EBV vaccine in exchange for marketing rights. A
Phase 1 clinical study conducted by GSK in Europe showed that the vaccine was safe, well tolerated and showed evidence of an immune
response in vaccine recipients. In 2001, GSK conducted a Phase 1/2 trial in Europe in healthy adults. No assurance can be given that
this clinical trial, or any future clinical trials will be successful, or if successful, would lead to a continuation of the
development program for the current indication, or at all.

Mononucleosis affects most people. Infection at a young age may cause mild symptoms, but the most debilitating symptoms appear to
take place when infection first occurs in adolescence or young adulthood. Sore throat and swollen neck glands are followed by a
period of fatigue and lethargy which can last for weeks or even months. Many high school and college students become infected with
EBV each year in the United States, of which half or more may develop mono. The disease usually runs its course without significant
medical intervention; however, the long duration of mono can be a serious problem for high school and college students as well as
workers. No vaccine is currently available for EBV. Mono affects an estimated 250,000 young adults in the United States and Europe
annually. Studies of the U.S. population indicate that approximately 90 percent of adults have been infected with EBV.

Vitaxin

The Company is developing Vitaxin, an anti-angiogenic monoclonal antibody product, for potential use in both cancer and non-cancer
indications. Angiogenesis is the growth of new blood vessels, which in many situations is a welcome biological activity. However, in
certain diseases, such as cancer and rheumatoid arthritis, angiogenesis is an undesired event that can enhance the progression of
the disease. For example, certain solid tumors secrete growth factors that stimulate the angiogenic properties of endothelial cells.
These cells use a family of proteins called integrins to adhere to the surrounding tissue, allowing the new blood vessels to
continue their growth toward the tumor. Such new blood vessels are believed to supply the tumor nutrients and oxygen, as well as a
pathway for metastasizing to other organs. The Company believes that Vitaxin may offer a way to block the growth of new blood
vessels by binding to specific integrins, called alpha-v beta-3, found on newly sprouting blood vessels, vascular smooth muscle
cells, monocytes, macrophages, and osteoclasts.

In 1999, the Company acquired the worldwide rights to Vitaxin from Applied Molecular Evolution, Inc ("AME"), a biopharmaceutical
company engaged in the development of novel therapeutics. Pursuant to this agreement, the Company is responsible for clinical
development, manufacturing and commercialization of Vitaxin, will fund certain research to be performed by AME and will make future
milestone and royalty payments on sales of any resulting products.

During 2001, the Company initiated three important Phase 1 and Phase 1/2 trials in cancer and non-cancer indications. In March, the
Company initiated a non-randomized, open-label, dose-escalating Phase 1 pharmacokinetic study in 24 patients with refractory solid
tumors. In July, the Company initiated a Phase 1/2 open-label, single-center, dose escalation cancer study in up to 40 patients with
advanced colorectal cancer. Finally, in August, the Company announced that dosing had begun in a Phase 1 randomized, double-blind,
placebo-controlled, dose escalation trial in patients with rheumatoid arthritis, being conducted at eight sites in the U.S. and
Canada.

In 2001, the Company also signed a research and development agreement with Targesome, Inc., a private biotechnology company, to
evaluate the potential of combining Vitaxin with Targesome's proprietary nanoparticle technology. The combination could generate a
targeted nanoparticle capable of delivering a payload of a therapeutic or imaging agent for the treatment and/or diagnosis of
cancer. The goal is to create a new type of antibody therapy that could target the specific site on the endothelial cells expressing
alpha-v beta-3, and deliver a cytotoxic agent that may directly kill the new blood vessels and adjacent tumor cells. No assurance
can be given that any future clinical trials will be successful, or if successful, would lead to a continuation of the programs in
the indications currently studied or at all.

Numax

The Company intends to continue to expand its franchise in RSV prophylaxis by developing a third-generation anti-RSV product that
may be more potent than Synagis. Such a product may allow the Company to improve compliance, efficacy and patent position, thereby
further protecting its position in the RSV marketplace. The Company developed several variants of Synagis in 2000 that were at least
ten times more potent than Synagis in microneutralization studies. In 2001, the Company identified the top three Numax candidates,
and is currently evaluating them in animal models to determine which molecule to take into clinical evaluation.

No assurance can be given that any preclinical development or future clinical trials will be successful, or if successful, would
lead to a continuation of the programs in the indications currently anticipated or at all.

Anti-IL-9

MedImmune is attempting to develop therapeutics targeting IL-9 to prevent symptoms of asthma and other respiratory diseases. IL-9 is
implicated in the pathogenesis of asthma and may contribute to other respiratory disorders including chronic obstructive pulmonary
disease (COPD) and cystic fibrosis. Biopsies from asthmatic patients have shown an increase in expression of IL-9 as compared to
healthy individuals. Published findings, highlighting the central role of IL-9 in asthma, demonstrate its contribution to certain
clinical features including bronchial hyper-responsiveness, mucin production and eosinophil up-regulation in animal models and in
patients.

In 2001, the Company entered into a research collaboration and a worldwide exclusive licensing agreement with Genaera Corporation to
develop and commercialize antibodies or recombinant molecules targeting IL-9 and blocking interaction with its receptor. Pursuant to
the agreement, the companies will collaborate on the creation of specific assays and respiratory disease models for use in assessing
product candidates developed by MedImmune. MedImmune will be responsible for development, manufacturing, clinical testing, and
marketing of any resulting product.

Anti-EphA2

During 2001, the Company licensed EphA2 technology from Purdue Research Foundation. EphA2 is a protein normally expressed at low
levels on most epithelial cells. However, when over-expressed, EphA2 acts as a tumor-causing protein. Preliminary studies indicate
that it is the over-expression of EphA2 that subverts normal regulation of cell growth, which then leads to tumor cell growth and
metastases. Further, these studies show that the introduction of an antibody targeting EphA2 may allow the restoration of this cell
growth regulation or induce cell killing.

Under the agreement, MedImmune is responsible for developing, manufacturing and commercializing therapeutics that target EphA2. Any
such product will potentially be used to treat a variety of aggressive tumors, including breast, colon, prostate, lung and skin
cancers, as well as to prevent metastasis. As a part of the agreement, Purdue will receive certain upfront payments and future
milestones and royalty payments on sales of any resulting products.

Other Products

The Company and its subsidiaries continue to work on feasibility studies in a number of other areas, including the evaluation of
vaccines to prevent cytomegalovirus, parainfluenza virus-3 and respiratory syncytial virus. Any of these programs could become more
significant to the Company over the next 12 months; however, there can be no assurance that any of the new programs under review
will generate viable product opportunities. The Company may choose to address new opportunities for future growth in a number of
ways including, but not limited to, internal discovery and development of new products, in-licensing of products and technologies,
and/or merger or acquisition of companies with products and/or technologies. Any of these activities may require substantial capital
investment.

Products and Product Development Programs

The following table, sorted by stage of development, describes the Company's marketed and development-stage products.

MARKETED PRODUCTS

Synagis Used to prevent RSV disease in pediatric patients at high risk of RSV disease

CytoGam Used to prevent CMV disease associated with transplantation of kidney, lung, liver,
pancreas and heart

Ethyol A cytoprotective agent used to reduce: (1) the cumulative renal toxicity associated
with repeated administration of cisplatin in patients with advanced ovarian cancer or
non-small cell lung cancer; and (2) the incidence of moderate-to-severe xerostomia in
patients undergoing post-operative radiation treatment for head and neck cancer where
the radiation port includes a substantial portion of the parotid glands

RespiGam Used to prevent serious RSV disease in infants with prematurity or lung disease

NeuTrexin Used with concurrent leucovorin as an alternative treatment of moderate-to-severe
Pneumocystis carinii pneumonia in immunocompromised patients who are intolerant of, or
refractory to, trimethoprim-sulfamethoxazole therapy or for whom
trimethoprim-sulfamethoxazole is contraindicated

REGULATORY REVIEW

FluMist (frozen) A potential live, attenuated, cold-adapted influenza vaccine delivered by nasal mist

PHASE 4
- -------
Synagis Potential prophylactic against RSV disease in children under 2 years of age with
cystic fibrosis

PHASE 3
- -------

FluMist (Liquid) A liquid formulation for a potential live, attenuated, cold-adapted influenza vaccine
delivered by nasal mist

Synagis Potential prophylactic against RSV disease in children under 2 years of age with
congenital heart disease

Ethyol Potential cytoprotectant against nephrotoxicity associated with the administration of
cisplatin/vinblastine in patients with non-small cell lung cancer

Ethyol Potential prevention of hematologic and neurologic toxicities associated with the
administration of carboplatin/paclitaxel in patients with non-small cell lung cancer

Ethyol Potential prevention of mucositis associated with combined chemotherapy and radiation
therapy in non-small cell lung cancer patients

PHASE 2
- -------

Siplizumab A potential treatment for psoriasis

Urinary tract A potential vaccine to prevent urinary tract infections caused by E. coli
infection vaccine

Human A potential vaccine to prevent cervical cancer
papillomavirus
Vaccine

Epstein Barr virus A potential vaccine to prevent illness caused by the Epstein Barr virus.
vaccine

PHASE 1
- -------

Vitaxin A potential anti-angiogenic product that could be used to eliminate or impede the
advancement of certain solid tumors and/or metastasis

Vitaxin A potential rheumatoid arthritis therapy

CMV vaccine A potential vaccine to prevent cytomegalovirus disease

PRECLINICAL
- -----------

Numax A potential prophylactic to prevent RSV disease in high risk populations

Anti-IL-9 Potential asthma therapeutic

Anti-EphA2 Potential therapy for solid tumors and preventation of metastasis

PIV-3/RSV vaccine A potential vaccine to prevent parainfluenza virus type 3 and respiratory syncytial
virus

Siplizumab A potential treatment for psoriatic arthritis

Siplizumab A potential treatment for T cell lymphoma

Pneumococcal A potential vaccine to prevent Streptococcus pneumoniae
vaccine

Marketing, Research, Development and Collaborative Agreements

The Company's internal research programs are augmented by collaborative projects with a number of scientific partners. As part of
its strategy, the Company has established alliances with pharmaceutical and other biotechnology companies, academic scientists and
government laboratories. Its principal strategic alliances are listed below.

Abbott Laboratories

In December 1997, the Company entered into two agreements with Abbott Laboratories ("Abbott"). The first agreement calls for Abbott
to co-promote Synagis in the United States in exchange for a percentage of net sales in excess of annual sales thresholds. Each
company is responsible for its own selling expenses.

The second agreement allows Abbott to exclusively distribute Synagis outside the United States. The Company manufactures and sells
Synagis to Abbott at a price based on end-user sales. As of February 1, 2002, the Company and Abbott had submitted a total of 58
regulatory applications for approval to market Synagis and have received approval in the United States as well as 46 foreign
countries. No assurance can be given that any of the remaining applications submitted or any future submissions to any other
countries for marketing licensure will be approved in a timely manner or at all.

Wyeth (formerly American Home Products Corporation)

In January 1999, Aviron signed a worldwide collaborative agreement with Wyeth Lederle Vaccines, a subsidiary of Wyeth, for the
development, manufacturing, distribution, marketing, promotion, and sale of FluMist. Under this agreement, Wyeth has exclusive
worldwide rights to market FluMist, excluding Korea, Australia, New Zealand and some South Pacific countries. The two companies will
co-promote FluMist in the U.S. Wyeth holds the marketing rights for an initial term of seven years from the first commercial sale of
FluMist in the U.S. and an initial term of eight years from the first commercial sale of FluMist outside the U.S., with an option to
extend its rights both in the U.S. and internationally for an additional four years. Extending both U.S. and international rights
trigger payments to the Company in excess of $140 million.

Under the terms of the collaborative agreement with Wyeth, the two companies are to collaborate on the regulatory, clinical and
marketing programs for FluMist. As a part of the collaboration, the Company is to receive certain payments related to the
achievement of key milestones and events for FluMist. In January 2001, Aviron received $15.5 million from Wyeth related to the
acceptance by the FDA for the filing of the BLA for FluMist on December 28, 2000. Should the product be approved in the U.S., the
Company will receive a $20 million milestone payment from Wyeth. Other potential milestone payments to the Company from Wyeth
include: $20 million for advisory body recommendations and expanded label claims; $10 million for the submission of a license
application in Europe; a $27.5 million payment for the approval of a liquid formulation of FluMist and up to $50 million upon
licensure in international regions. Compensation for achieving additional development, supply and regulatory milestones is also
included in the collaboration agreement and may total up to an additional $67.5 million. The total potential value for the license
fees, milestones, financing support and term extension options that the Company could receive from Wyeth could exceed $400 million.

Under the terms of the agreement, Wyeth will distribute FluMist and record all product sales. The Company will receive approximately
50 percent of FluMist revenues, paid in the form of product transfer payments and royalties. These payments are higher in the U.S.
than internationally. The Company incurs expenses to manufacture, supply and co-promote FluMist. Wyeth shares in the product's
clinical development expenses and has agreed to spend up to $100 million for advertising and promotion of FluMist over the first
three years of commercialization in the United States.

The Company also had a strategic alliance with American Cyanamid Company, which was later acquired by American Home Products, which
is now called Wyeth, that provided for the co-development and co-promotion of RespiGam by the two companies. The agreement, entered
into in November 1993 and amended in October 1995, provided for Wyeth to fund a portion of the cost of the development of RespiGam
and to co-promote the product in the United States. Wyeth shared in the profits and losses of RespiGam in the United States. The
alliance provides for the Company to receive royalties on any sales of Wyeth's RSV subunit vaccine candidate, and for Wyeth to
receive royalties on United States sales of Synagis.

Pursuant to an amendment to the agreement signed in December 1999, Wyeth's obligation to co-promote RespiGam in the United States
was terminated. In addition, Wyeth no longer shares in any profits or losses of RespiGam in the United States; the royalty
obligations for Synagis and Wyeth's RSV subunit vaccine candidate remain unchanged.

GlaxoSmithKline

In December 1997, the Company entered into a strategic alliance with GlaxoSmithKline PLC ("GSK") to research, develop, manufacture
and commercialize therapeutic and prophylactic HPV vaccines. In exchange for exclusive worldwide rights to the Company's HPV
technology, GSK provided the Company with an up-front payment of $15 million, future funding and potential developmental and sales
milestones which together could total over $85 million, royalties on any product sales and an equity investment of $5 million. Under
the terms of the agreement, the companies have collaborated on research and development activities. The Company conducted Phase 1
and Phase 2 clinical trials and manufactured clinical material for those studies. GSK is responsible for the final development of
the product, as well as regulatory, manufacturing, and marketing activities.

In July 2000, the Company granted GSK a worldwide, exclusive license to its Streptococcus pneumoniae vaccine technology in exchange
for an up-front payment and future milestones totaling more than $30 million, plus royalties on product sales. Under the terms of
the agreement, GSK is responsible for all clinical development, manufacturing and sales and marketing activities for the S.
pneumoniae vaccine. The Company completed the technology transfer to GSK in late 2000. The technology licensed to GSK was originally
licensed from Human Genome Sciences, Inc. and St. Jude's Childrens Research Hospital.

In October 1995, Aviron signed an agreement with GSK to collaborate on its Epstein-Barr virus vaccine technology. Under the terms of
the agreement, GSK was granted an exclusive license to produce, use and sell non-live EBV (sub unit) vaccines incorporating our
technology for prophylactic and therapeutic uses on a worldwide basis, except in Korea, in exchange for an up-front payment, future
milestone payments and royalties. In addition, GSK obtained a right of first refusal to an exclusive, worldwide license, excluding
Korea, under any intellectual property rights relating to any live EBV vaccine technology developed or controlled by Aviron during
the term of this agreement. Aviron retained the right to co-distribute a monovalent formulation of the EBV vaccine in the United
States and to have GSK supply the vaccine. GSK agreed to fund Aviron's research and development efforts related the EBV vaccine in
specified minimum amounts during the first two years of the agreement. Unless otherwise terminated, this agreement will expire on a
country-by-country basis upon the expiration or invalidation of the last remaining patent covered by the agreement or 10 years from
the date of first commercial sale of the vaccine, whichever is later. GSK may terminate the agreement with respect to any country at
any time.

ALZA Corporation

MedImmune Oncology acquired U.S. marketing rights to Ethyol from ALZA Corporation, effective October 1, 2001. The rights to Ethyol
were originally scheduled to return to MedImmune Oncology on April 1, 2002, pursuant to the December 1995 co-promotion agreement
between the two companies whereby ALZA was responsible for sales and marketing of the product in the United States. In accordance
with the original agreement, MedImmune Oncology will pay ALZA a gradually diminishing royalty beginning April 1, 2002 until 2011.

BioTransplant, Inc.

In October 1995, the Company and BioTransplant, Inc. ("BTI") formed a strategic alliance for the development of products to treat
and prevent organ transplant rejection. The alliance is based upon the development of products derived from BTI's anti-CD2 antibody,
BTI-322, the Company's anti-T cell receptor antibody, MEDI-500, and future generations of products derived from these two molecules
(such as siplizumab, or humanized BTI-322). Pursuant to the alliance, the Company received an exclusive worldwide license to develop
and commercialize BTI-322 and any products based on BTI-322, with the exception of the use of BTI-322 in kits for
xenotransplantation or allotransplantation. The Company has assumed responsibility for clinical testing and commercialization of any
resulting products. The Company's clinical development efforts are focused on siplizumab. BTI may receive milestone payments which
could total up to an additional $11 million, as well as royalties on any sales of BTI-322, MEDI-500, siplizumab and future
generations of these products, if any.

Massachusetts Health Research Institute and Massachusetts Biologics Laboratories

In August 1989 and April 1990, the Company entered into a series of research, supply and license agreements with Massachusetts
Health Research Institute ("MHRI") and Massachusetts Public Health Biologics Laboratories, then a division of the Massachusetts
Department of Public Health ("The State Lab"), covering products intended for the prevention or treatment of CMV and RSV infection
and other respiratory virus infections by immune globulins or monoclonal antibodies. The Company agreed to pay royalties on all
sales using the licensed technology. Pursuant to the agreements, the Company paid $24.3 million in 2001, $23.6 million in 2000, and
$18.4 million in 1999, for royalties, process development and manufacturing.

Schering-Plough Corporation

In May 1993, MedImmune Oncology entered into an exclusive marketing and distribution agreement with Scherico, Ltd. ("Scherico"), an
affiliate of Schering, for Ethyol in the countries comprising the EU and European Free Trade Association (the "European
Territories"). Under this agreement, Scherico purchases Ethyol from the Company at a price based on a percentage of the net sales
price of Ethyol in Germany, United Kingdom, Spain, Italy and France. Scherico's exclusive rights to market the product will continue
through December 31, 2003. Following the exclusive period, the Company may co-promote Ethyol with Scherico for two years, through
December 31, 2005. Thereafter, the Company will reacquire sole marketing rights, subject to an obligation to pay Scherico a royalty
based on a percentage of net sales, if any, from the European Territories for a period of three years. Scherico may terminate the
agreement at any time by providing 180 days written notice.

MedImmune Oncology also entered into licensing agreements for Ethyol and NeuTrexin with affiliates of Schering for several
additional territories outside the United States. The licensees are required to pay the Company compensation based on their net
sales of the products, and the Company sells the products to the licensees at an agreed upon price.

CSL Limited

In June 1998, Aviron entered into a collaboration with CSL Limited ("CSL") of Victoria, Australia for the development, sale and
distribution of FluMist in Australia, New Zealand and some countries in the South Pacific. The Company's Aviron subsidiary and CSL
are jointly conducting clinical trials in Australia for FluMist. Under the agreement, CSL will sponsor the marketing application
with the Therapeutic Goods Administration, Australia's ruling regulatory agency. CSL has exclusive rights to sell and distribute
FluMist in these countries, and the Company will share the profits from these sales. The Company also will benefit from expansion of
CSL's current flu vaccine in pediatric and healthy adult market segments following the approval to market FluMist in the territory.
In addition, CSL has agreed, under an option agreement, to grant warrants to the Company to purchase CSL common stock upon CSL's
attainment of certain milestones.

Applied Molecular Evolution

On February 25, 1999, the Company and Applied Molecular Evolution ("AME") announced an alliance to develop four monoclonal
antibodies. Under the terms of the alliance, AME would use its AMEsystem directed evolution protein engineering technology to
optimize antibodies identified by the Company, and the Company would be responsible for clinical development, manufacturing and
commercialization of any resulting products. The Company made a $6.4 million equity investment in AME, funds certain research
performed by AME and will make future milestone and royalty payments on sales of any resulting products.

Also in February 1999, the Company entered into an exclusive license with AME for Vitaxin, an anti-angiogenesis monoclonal antibody.
As part of this agreement, the Company acquired worldwide rights to Vitaxin, and became responsible for all clinical development and
marketing for the product. AME will receive royalties on any future sales of the product, should it be approved for marketing.

National Institute of Allergy and Infectious Diseases

In March 1995, Aviron entered into a five-year Collaborative Research and Development Agreement with the National Institute of
Allergy and Infectious Diseases ("NIAID") of the National Institutes of Health ("NIH") to conduct clinical trials of the Company's
cold-adapted influenza vaccine. In June 2000, Aviron extended its collaboration with the NIH through June 2003. As a part of this
agreement, Aviron obtained exclusive rights to data generated from previous clinical trials conducted by the NIH and by Wyeth. Wyeth
had conducted clinical trials for FluMist under a license it had obtained from the NIH in 1991, which it subsequently relinquished
in 1993.

In September 2000, Aviron was awarded a $2.7 million Challenge Grant from the NIAID to develop a vaccine using the intranasal
delivery technology currently used in FluMist to protect against possible pandemic influenza virus strains. Aviron committed $2.7
million to the project over the three-year duration of the grant. Challenge Grants are milestone-driven awards, requiring
pre-determined product goals be met during the development process in order to receive the awarded funds.

In June 2000, Aviron entered into a clinical trial agreement with NIAID granting NIAID the right to conduct clinical trials at
various locations with Aviron's CMV vaccine technology.

In May 1996, Aviron obtained exclusive rights from NIAID to certain biological materials and clinical trial data for its PIV-3
program. The NIH granted Aviron exclusive rights in specific strains of bovine parainfluenza virus to develop, test, manufacture,
use and sell products for vaccination against human parainfluenza virus and other human and animal diseases. In addition, Aviron
obtained from NIAID the right to incorporate by reference an existing IND and certain data relating to the licensed materials. The
NIH retained rights to the licensed materials on behalf of the United States government to conduct research and to grant research
licenses to third parties under certain circumstances. In return for the rights granted by NIH, the Company's Aviron subsidiary will
make payments to NIH on the achievement of specified milestones and will make certain royalty payments to NIH. Unless otherwise
terminated, the agreement will terminate on cessation of commercial sales of licensed products by Aviron or its sublicensee. The
Company has the unilateral right to terminate the agreement in any country upon providing 60 days notice to NIH.

University of Michigan

In February 1995, Aviron entered into a materials transfer and intellectual property agreement with the University of Michigan.
Pursuant to the agreement, the University of Michigan granted Aviron exclusive worldwide rights to certain intellectual property and
technology relating to the cold-adapted influenza vaccine and proprietary master donor strains of influenza viruses useful in the
production of vaccines against influenza and potentially for gene therapy and other uses. Specifically, Aviron obtained the
exclusive right to develop, manufacture, use, market and sell products incorporating any such intellectual property or using the
master strains worldwide. Consideration granted to the University of Michigan under the agreement included a warrant to purchase
340,000 shares of common stock of Aviron at an exercise price of $10.00 per share and a warrant to purchase 50,000 shares of Aviron
common stock at $9.30 per share. In connection with the Company's acquisition of Aviron, these warrants were exchanged for warrants
to purchase 419,250 shares of MedImmune common stock in the aggregate. The agreement also provides for the issuance, upon the first
commercial sale of FluMist, of a warrant for approximately 5,150 shares of MedImmune common stock at an exercise price equal to 125%
of the acquisition price of Aviron.

Pursuant to the agreement, Aviron was required to grant to the university an irrevocable, royalty-free license for research
purposes, or for transfer to a subsequent licensee should the agreement be terminated, to (1) all improvements developed by Aviron,
its affiliates or sublicensees, whether or not patentable, relating to delivery mechanisms and processes for administration and
manufacturing of products, as well as packaging, storage and preservation processes for the master strains and (2) all new technical
information acquired by Aviron, its affiliates or sublicensees relating to the master strains and products.

The agreement terminates upon the later of (1) the last to expire of the university's patents licensed to Aviron or (2) 20 years
from the date of first commercial sale of a product incorporating the university's technology. Aviron has the right to terminate for
any reason upon 12 months notice to the university.

The Mount Sinai School of Medicine

In February 1993, Aviron entered into a technology transfer agreement with The Mount Sinai School of Medicine ("Mount Sinai"). Under
this agreement, Mount Sinai assigned to Aviron all of its right, title and interest in and to certain patents and patent
applications, as well as all associated know-how and other technical information relating to recombinant negative-strand RNA virus
expression systems and vaccines, attenuated influenza viruses and certain other technology. Mount Sinai also granted to Aviron: (1)
an option to acquire any improvements to the inventions disclosed in the assigned patents and patent applications thereafter
developed by Mount Sinai, and (2) a right of first negotiation for a license or assignment to additional related technology. Aviron
issued common stock and warrants to purchase common stock as consideration for these rights. The warrants expired in November 2001.

Other Agreements

The Company has a number of other collaborative and business agreements with academic institutions and business corporations,
including agreements with: 1) Washington University in St. Louis, Missouri covering development of pilus-based anti-bacterial
vaccines, dated July 1994; 2) Georgetown University, dated February 1993, the German Cancer Research Center, dated June 1996, and
the University of Rochester, dated October 1995, covering development of vaccines for human papillomaviruses; 3) Chiron Corporation
covering supply of MF59, a proprietary vaccine adjuvant to be used for B19 parvovirus and E. coli development, dated September 1998;
4) Alkermes to develop a pulmonary formulation of Numax targeting RSV, dated June 2000; 5) Medarex, Inc. covering the development of
fully human antibodies to multiple antigens using Medarex's HuMAb-Mouse technology, dated June 2000; 6) University of Texas covering
Fc technology to increase the half life of an antibody, dated May 1999; 7) Genaera Corporation to develop and commercialize
antibodies or recombinant molecules against IL-9 to prevent symptoms of asthma and other respiratory diseases, dated April 2001; 8)
Purdue Research Foundation for the development of EphA2 technology, dated October 2001; 9) Sang-A Pharm. Co., Ltd. for the
development, manufacture, and marketing of vaccines for EBV, CMV, HSV-2 and RSV in Korea, dated March 1995; and 10) ARCH Development
Corporation related to its HSV and EBV vaccines, and various recombinant methods and materials dated July 1992. In addition, the
Company has license agreements with third parties for CytoGam, RespiGam, Synagis, Ethyol and substantially all of its other
potential products. Under such license agreements the Company is obligated to pay royalties on any sales of these products.

Marketing and Sales

The Company has developed a sales and marketing organization which it believes is responsive to the increased importance of managed
care and the need of the healthcare industry to provide higher quality care at lower costs.

Including the Company's new Aviron subsidiary, the Company now employs approximately 320 people devoted to sales and marketing of
its products in the United States. Approximately 60 sales and managed care representatives cover approximately 500 hospitals,
managed care organizations, and clinics in the United States, which specialize in transplantation and/or pediatric/neonatal care,
for the promotion of CytoGam and Synagis or RespiGam, respectively. Each of these 60 sales representatives is responsible for
promoting all three of these products. Approximately 90 pediatric specialty sales specialists cover the top 10,000 pediatric
practices in the United States for the promotion and detailing of Synagis and RespiGam. Approximately 60 oncology/immunology
specialists are devoted to sales and marketing of Ethyol to oncologists practicing in cancer treatment centers, large hospitals and
private medical practices.

The Company has co-promotion agreements with Abbott, through its Ross Products division. Through its 500 sales representatives, the
Ross Products division details Synagis to 27,000 office-based pediatricians and 6,000 birth hospitals.

Sales outside the United States are made through distributors. Abbott serves as the Company's exclusive distributor for Synagis
outside of the United States. Scherico is the exclusive distribution partner for Ethyol in the countries comprising the European
Territories. Scherico and other affiliates of Schering have various other licensing and distribution arrangements for Ethyol and
NeuTrexin outside of the United States. In 2001, CytoGam, NeuTrexin and RespiGam were marketed outside of the United States under
distribution agreements with various companies.

Manufacturing and Supply

The Company has entered into manufacturing, supply and purchase agreements in order to provide production capacity for all of its
products.

Synagis

In December 1997 the Company entered into a manufacturing and supply agreement with Boehringer Ingelheim Pharma KG ("BI") to provide
supplemental production capacity for Synagis, a humanized monoclonal antibody product. For 2001, BI was the primary manufacturer of
Synagis. BI also fills and packages Synagis produced at its facility. The BI facility is subject to inspection and approval by the
appropriate regulatory authorities in connection with maintaining its FDA licensure as well as for obtaining and maintaining
approval from certain ex-U.S. countries. While the Company's Frederick manufacturing facility was licensed for production of Synagis
by the FDA in December 1999, the Company will continue to rely upon BI for production of additional quantities of Synagis for at
least the next few years in order to meet expected worldwide demand for the product. Should BI be unable to supply Synagis to the
Company for any reason, there can be no assurance that the Company would be able to secure an alternate manufacturer in a timely
basis or without increased cost.

The Company's manufacturing facility in Frederick, Maryland is a multi-use biologics facility containing a cell culture production
area for the manufacture of recombinant products, such as Synagis and siplizumab, if and when siplizumab is cleared for marketing by
the FDA. The Company's amendment to its BLA for approval of the facility for production of Synagis was approved in December 1999. In
August 2001, the Company received approval from the FDA to begin selling Synagis manufactured with an improved fermentation process,
called "Enhanced Yield Process" (EYP), which enables the Company to make over 300 percent more Synagis per run than in previous
seasons. There can be no assurance that the facility will receive regulatory approval for its other intended purposes. The Company
has limited experience in commercial manufacturing. Accordingly, the Company may encounter risks associated with commercial
manufacturing, including cost overruns, product defects and environmental problems. Furthermore, there can be no assurance that the
Company will be able to manufacture products at a cost that is competitive with third party manufacturing operations or that the
production yields will be comparable or better than those achieved at third party manufacturing operations.

The Company has a pilot plant facility in Gaithersburg, Maryland that produces materials for the Company's clinical trials.
Materials currently being used in clinical trials for siplizumab, the urinary tract infection vaccine, Vitaxin and MEDI-491 have
been produced at the Company's pilot plant.

The Company executed an agreement with Chiron Corporation ("Chiron") effective in April 1998, pursuant to which Chiron fills and
packages Synagis produced at the Gaithersburg pilot plant and Frederick manufacturing plant. The original term of the agreement was
for three years. In 2001, the Company renegotiated an extension of this contract for an additional three years. Should Chiron be
unable to fill and package Synagis for any reason, there can be no assurance that the Company would be able to secure an alternate
provider without increased costs or in a timely manner.

FluMist

Since 1998, supplies for all frozen FluMist clinical trials have been produced at several facilities either owned or leased by the
Company's Aviron subsidiary. The master virus seeds are prepared at the Company's Mountain View, California facility. The bulk
monovalents and diluent are produced at a facility owned and operated by Evans Vaccines Limited ("Evans") in Speke, the United
Kingdom. Blending and filling of FluMist into its trivalent formulation takes place at Aviron's Philadelphia, Pennsylvania facility.
None of these existing manufacturing facilities have yet been licensed for the manufacture of FluMist and have not yet manufactured
FluMist at a sustained commercial scale. The Company has begun the initial stages of commercial scale manufacturing of FluMist for
sale during the 2002-2003 influenza season, pending receipt of marketing approval from the FDA. No assurance can be given that such
approval will be received in time for the 2002-2003 season or at all.

In October 2000, Aviron restructured its agreement with Evans for the bulk production of the monovalents and the diluent in the
Speke, U.K. facility, subsequent to Evans purchase of this facility from Medeva Pharma Limited in September 2000. The new agreement,
which runs through June 2006, transferred responsibility for bulk production, as well as approximately 100 Evans employees, to the
Company's wholly owned U.K. subsidiary. The Company also acquired the remaining 24 years of a 25-year lease from Celltech Group Plc
of approximately eight acres of land in Speke, U.K. The Company expects to use an existing 45,000 square foot structure on this
property to build a new FluMist manufacturing facility, if and when FluMist is approved for marketing by the FDA.

In 1998, the Company's Aviron subsidiary opened a 34,000 square foot manufacturing suite in Philadelphia, Pennsylvania, where doses
of FluMist are blended and filled. This suite is located within a facility owned by Packaging Coordinators, Inc., ("PCI"), a
division of Cardinal Health, Inc., the company with which Aviron has contracted for the labeling and packaging of FluMist for
commercial sale until October 2004. In August 2000, the Company extended the term of its original agreement with PCI until December
2004, with options to extend for up to two additional terms of three years. If regulatory approval for FluMist is received, the
Pennsylvania facility is expected to be used for blending, filling, labeling, packaging and storage of commercial lots of FluMist.
No assurance can be given that the Pennsylvania facility will be granted approval by the appropriate regulatory authorities.

The production of FluMist is subject to the availability of a large number of specific pathogen-free eggs, for which there is
currently a limited number of suppliers. In June 1999, the Company entered into a non-exclusive agreement with Specific
Pathogen-Free Avian Supply, a division of Charles River Laboratories, for the purchase of pathogen-free hens' eggs through December
2001. In accordance with the terms of this agreement, the Company renewed this agreement in 2001 for an additional three years.

In August 1998, Aviron entered into a worldwide supply agreement with Becton Dickinson and Company ("Becton") whereby Becton would
supply its AccuSpray non-invasive nasal spray delivery system to the Company for the administration of FluMist. This agreement
provided for an initial term of five years with automatic renewal until terminated by either party. The Company depends on the
existing Device Master File ("DMF") application for the AccuSpray delivery system submitted to the FDA by Becton. The Company
referenced Becton's DMF as part of its BLA submission for FluMist. AccuSpray is a trademark of Becton.

The Company's current frozen formulation of FluMist is being designed to meet an acceptable level of stability for the U.S. market.
In addition to its current frozen formulation, the Company is exploring alternative formulations and presentations for FluMist that
may enable improved distribution and longer shelf life. The Company believes that a liquid formulation of FluMist will be required
to address markets outside the United States and Canada. The Company and Wyeth are jointly producing clinical trial material for the
liquid formulation of FluMist at the Company's California and Pennsylvania facilities and in Wyeth's facilities in Pennsylvania. As
part of the Company's agreement with Wyeth, both companies have the right to manufacture the liquid formulation.

Plasma Products

CytoGam and RespiGam are produced from human plasma collected from donors who have been screened to have high concentrations of
antibodies against CMV and RSV, respectively. Human plasma for CytoGam and RespiGam is converted to an intermediate raw material
(Fraction II+III paste). The State Lab, which holds the sole product and establishment licenses for CytoGam and RespiGam, processes
the Fraction II+III paste into bulk product. In December 2000, the Company received approval from the FDA for an amendment to the
establishment license held by the State Lab to allow production of Fraction II + III paste for CytoGam at the FMC. The Company has
an agreement with Aventis Pasteur ("AP") to fill and package CytoGam and RespiGam. If the State Lab or AP is unable to satisfy the
Company's product requirements on a timely basis or is prevented for any reason from manufacturing its products, the Company may be
unable to secure an alternative supplier or manufacturer without undue and materially adverse operational disruption and increased
cost.

The Company incurs significant fixed costs associated with the operation of the FMC. Further, the Company currently has unutilized
capacity in the plasma production portion of the FMC. Should the Company be unable to produce Fraction II + III paste at the FMC for
any reason there can be no assurance that an alternate manufacturer could be arranged at a comparable cost, or at all, or that the
Company would not continue to incur significant fixed costs that might not be offset by product sales.

Ethyol and NeuTrexin

The Company also operates a small volume parenteral products manufacturing facility in Nijmegen, the Netherlands. This manufacturing
facility received the approval of the Dutch regulatory authorities and is now able to manufacture Ethyol and the finished dosage
form of NeuTrexin for commercial sale in Europe. The Nijmegen manufacturing facility has also been inspected by the FDA and approved
as a manufacturing site for NeuTrexin and Ethyol for commercial sale in the United States.

The Company relies on third parties to manufacture drug substance for Ethyol and NeuTrexin, and to a decreasing but still important
extent, on third parties to manufacture these finished drug products.

Patents, Licenses and Proprietary Rights

The following table summarizes the patents issued in the United States owned or licensed by the Company and its subsidiaries:

Patents Owned or Licensed by MedImmune, Inc.

Product/ Project US Patent No. Subject Matter* Expiration Date

E. coli 4,795,803 Adhesin antigens 1/3/2006

5,804,198 Adhesin vaccines 9/8/2015

6,291,649 Anti-adhesin antibodies 3/2/2005

Vitaxin 5,753,230 Use of antibodies anti-(alpha)v(beta)3 antibodies to inhibit 5/19/2015
angiogenesis in tumors and inflamed tissue
MEDI-507 5,730,979 Anti-CD2 antibodies and their use in treating T-cell mediated immune 3/24/2015
responses

5,951,983 Anti-CD2 antibodies and their use in treating T-cell mediated immune 9/14/2016
responses

5,817,311 Use of anti-CD2 antibodies in treating T-cell mediated immune responses 10/6/2015

HPV 6,228,368 Capsomeres containing HPV L1 protein and their use in preventing and 10/6/2017
treating HPV infection

6,066,324 HPV VLPs containing L1 protein with deletions 10/9/2015

6,261,765 Disassembly/reassembly of Papillomavirus Virus Like Particles 9/5/2017

6,165,471 HPV capsomeres with reduced assembly capacity 7/2/2018

6,153,201 Oral Immunization with Papillomavirus Virus Like Particles 3/9/2013

RSV 5,824,307 Synagis(R)& other anti-RSV antibodies and their use in treating or 10/20/2015
preventing RSV infection

5,582,827 Immunoglobulin from plasma for treatment of RSV 12/10/2013

4,800,078 Treatment of respiratory disease caused by RSV using human gamma
globulin 1/24/2006

Strep 5,928,900 Pad1 protein 7/27/2016

5,981,229 DNA encoding Exp1 and PlpA proteins 11/9/2016

5,834,278 DNA encoding pneumococcal MsrA 5/1/2016

6,245,335 Streptococcal choline binding proteins 5/1/2017

IL-9 5,157,112 Antibodies which specifically bind mammalian T cell growth factor P40 10/20/2009

6,037,149 DNA and RNA molecules that encode Met-IL-9 and their use for 8/23/2016
recombinant production

5,580,753 DNA molecules encoding IL-9 and their use for recombinant production 12/3/2013

5,734,037 Nucleic acid molecules that hybridize to DNA encoding IL-9 5/23/2009

5,414,071 Human IL-9 protein 5/9/2012

5,164,317 Method for enhancing proliferation of mast cells using IL-9 3/23/2010

5,132,109 Method for enhancing IgG production using IL-9 and IL-4 10/5/2010

5,246,701 Method to inhibit IgE production using anti-IL-9 antibodies or other 10/5/2010
IL-9 inhibitors

5,962,269 Processes and hybridomas for producing anti-IL-9 receptor antibodies 10/5/2016

6,261,559 Treating asthmatic symptoms using anti-IL-9 antibodies 8/23/2016

5,789,237 Nucleic acid molecules that hybridize to DNAs encoding human and murine 8/4/2015
IL-9 receptors

5,750,377 Methods for production of mammalian T cell growth factor P40 5/12/2015

5,116,951 IL-9 receptor protein 9/19/2010

5,587,302 Nucleic acid molecules encoding mammalian T cell growth factor P40 12/24/2013

5,208,218 Mammalian T cell growth factor P40 protein 5/4/2010

5,180,678 Methods of detecting IL-9 9/19/2010

Ethyol 5,424,471 Process for preparing crystalline forms 7/13/2012

5,591,731 Dosage forms of crystalline amifostine 7/31/2012

5,824,664 Agents and methods for inhibiting HIV viral and protein expression 10/20/2015
using compounds that belong to a family which contains amifostine

5,846,958 Methods of stimulating hematopoietic progenitor cells using a compound 12/8/2015
that belong to a family which contains amifostine

5,906,984 Methods of stimulating hematopoietic progenitor cells using specific 2/17/2015
compounds, which include amifostine

5,994,409 Methods of treating toxicities associated with chemotherapy, a method 12/9/2017
of treating a nephrodisorder, and a method of treating xerostomia, all
of which use a compound that belongs to a family which contains
amifostine

6,051,563 Subcutaneous administration, method of protecting against toxicities 2/12/2017
associated with ionizing radiation

6,127,351 Methods of treating or protecting against toxicities associated with 2/12/2017
chemotherapy using a specific dosing regime, a method of stimulating
bone marrow growth, and a method of treating myelodysplastic syndrome,
all of which use a compound that belongs to a family which contains
amifostine

6,218,377 Methods of treating or protecting against toxicities associated with 2/12/2017
specific chemotherapy agents, and a method of protecting normal tissue
in cancer patients, both of which use a compound that belongs to a
family which contains amifostine

6,239,119 Methods of treating damaged or infected mucosal tissue using a 4/26/2019
compounds that belongs to a family which contains amifostine

NeuTrexin 5,716,960 Cystalline glucuronate hydrate salt 2/10/2015

6,017,921 Crystalline glucuronate salt 1/13/2015

6,017,922 Thermally stable crystalline non-salts 5/18/2018

6,258,821 Trimetrexate ascorbate and compositions comprising trimetrexate and 4/26/2019
ascorbic acid

6,258,952 Methods of producing monohydrate 5/18/2018

PALA 5,491,135 Methods of treating a viral infections (e.g., hepatitis B and C and 2/13/2013
secondary to HIV 1)

Patents Owned or Licensed by Aviron

6,322,967 Recombinant tryptophan mutants of influenza PB2 gene 2/23/2016

6,316,243 Recombinant attenuated double strand RNA viruses 11/13/2018

6,322,967 Recombinant tryptophan mutants of influenza PB2 gene 2/23/2016

6,291,236 Human CMV sequences and attenuated viruses 3/31/2015

6,090,391 Recombinant tryptophan mutants of influenza PB2 gene 2/23/2016

6,087,170 VZV gene and mutant VZV viruses 4/28/2014

6,054,130 Non-splicing variants of EBV gp350 protein and gene 4/18/2014

6,040,170 Human CMV sequences and attenuated viruses 3/31/2015

6,022,726 Attenuated negative strand RNA viruses and methods 2/8/2017

6,001,634 Recombinant negative strand RNA viruses 8/28/2009

5,925,751 Human CMV sequences and attenuated viruses 3/31/2015

5,922,328 Gamma 34.5 mutants of herpes simplex viruses 9/11/2016

5,840,520 Recombinant RSV viruses 11/24/2015

5,824,508 Non-splicing variants of EBV gp350 protein and gene 4/18/2014

5,721,354 Human CMV sequences and attenuated viruses 3/31/2015

5,690,937 Temperature sensitive mutants of influenza 6/5/2015

5,578,473 Recombinant negative strand RNA viruses 11/24/2009

5,820,871 Recombinant negative strand RNA viruses - bicistronic 10/13/2015

5,854,037 Recombinant negative strand RNA viruses 12/29/2015

5,786,199 Recombinant negative strand RNA viruses and vaccines 7/28/2015

5,166,057 Recombinant negative strand RNA viruses 11/24/2009

6,120,773 Gamma 34.5 gene modification of herpes simplex viruses 9/19/2017

6,172,047 Herpes viruses modified for use as cancer treatment 1/9/2018

6,071,692 Herpes simplex as a gene expression vector and vaccine 6/4/2004

5,714,153 Recombinant herpes simplex vaccines and vectors 12/23/2012

5,846,707 Herpes simplex as a vector 6/4/2004

5,641,651 Synthetic HSV promoters and uses 6/24/2014

5,599,691 Herpes simplex as a vector 2/4/2014

5,328,688 Recombinant herpes simplex with 34.5 gene knockout 6/12/2011

5,288,641 Herpes simplex as a vector 2/22/2011

4,859,587 Recombinant herpes simplex vectors and vaccines 8/22/2006

4,769,331 Recombinant herpes simplex cloning methods and materials 9/6/2005

4,707,358 Epstein-Barr virus gp350 subunit protein vaccine 11/17/2004

4,554,159 Vaccine against HSV-1 and HSV-2 11/19/2002

*The Company encourages any interested investor to obtain an independent legal analysis of the precise scope of the claims of the
patents listed above.

In addition, the Company owns or licenses approximately 100 patent applications currently pending in the United States.

Products currently being developed or considered for development by the Company are in the area of biotechnology, an area in which
there are extensive patent filings. The Company relies on patent protection against use of proprietary products and technologies by
competitors. The patent position of biotechnology firms generally is highly uncertain and involves complex legal and factual
questions. To date, no consistent policy has emerged regarding the breadth of claims allowed in biotechnology patents. Accordingly,
there can be no assurance that patent applications owned or licensed by the Company will result in patents being issued or that, if
issued, such patents will afford protection against competitors with similar technology.

The Company believes that there are other patents issued to third parties and/or patent applications filed by third parties which
could have applicability to each of the Company's products and product candidates and could adversely affect the Company's freedom
to make, have made, use, have used, sell, or have sold such products or use certain processes for their manufacture. Some of these
third parties have contacted the Company claiming patent infringement by the Company. The Company is unable to predict whether it
will ultimately be necessary to seek licenses from such third parties or, if such licenses were necessary, whether such licenses
would be available on terms acceptable to the Company. The necessity for such licenses could have a material adverse effect on the
Company's business.

There has been substantial litigation regarding patent and other intellectual property rights in the biotechnology industry.
Litigation may be necessary to enforce certain intellectual property rights of the Company, or to defend against unasserted
intellectual property rights of third parties. Any such litigation could result in substantial cost to and diversion of effort by
the Company.

Government Regulation

The production and marketing of the Company's products and research and development activities are subject to regulation for safety
and efficacy by numerous governmental authorities in the United States and other countries. In the United States, vaccines,
biologics, drugs and certain diagnostic products are subject to FDA review and licensure. The federal Food, Drug and Cosmetics Act,
the Public Health Service Act and other federal statutes and regulations govern or influence the testing, manufacture, safety,
labeling, storage, record keeping, licensure, advertising and promotion of such products. No assurances can be given that any
products under development will be licensed for marketing by the FDA or, if approved, that the product would be successfully
commercialized or maintained in the marketplace. Noncompliance with applicable requirements could result in fines, recall or seizure
of products, total or partial suspension of production, refusal of the government to approve product license applications,
restrictions on the Company's ability to enter into supply contracts and criminal prosecution. The FDA also has the authority to
revoke product licenses and establishment licenses previously granted.

The Orphan Drug Act was established to encourage development of drugs for rare diseases and conditions affecting a small patient
population (generally fewer than 200,000 people). Orphan designation of a product can potentially provide a company with seven years
of market exclusivity if the company is the first to receive FDA product marketing approval for the orphan drug in the designated
indication. Additionally, this designation provides a company with tax credits of 50 percent for qualified clinical research
expenses and the opportunity for clinical research grants. CytoGam, RespiGam, Ethyol and MEDI-507 have been designated as orphan
drugs for certain indications by the FDA. Accordingly, (1) CytoGam has market exclusivity for use in lung, liver, pancreas, and
heart transplants until December 2005; (2) RespiGam has market exclusivity for its currently licensed indication through January 17,
2003; and (3) Ethyol has market exclusivity for its currently licensed chemoprotective indication for patients with ovarian cancer
through December 2002, and for its radioprotective indication through June 2006. NeuTrexin's market exclusivity under the Orphan
Drug Act for its currently licensed PCP indication expired at the end of December 2000. Ethyol has also been designated as an orphan
drug for use as a chemoprotective agent for use with cyclophosphamide in the treatment of advanced ovarian carcinoma, as a
chemoprotective agent for use with cisplatin in the treatment of metastatic melanoma, for the treatment of myelodysplastic
syndromes, and for the reduction of the incidence and severity of cisplatin-induced toxicities. NeuTrexin has also been designated
as an orphan drug for the treatment of metastatic colorectal adenocarcinoma, metastatic carcinoma of the head and neck, pharynx and
larynx, pancreatic adenocarcinoma and advanced non-small cell carcinoma of the lung and osteogenic sarcoma. MEDI-507 has been
designated as an orphan drug for the treatment of graft versus host disease. Accordingly, each of these products would have market
exclusivity for seven years from the date of FDA approval if it is the first product approved by the FDA for treatment of the
designated orphan indication. The orphan drug designation for CytoGam for use in kidney transplants expired in 1997.

The Company is also subject to regulation by the Occupational Safety and Health Administration ("OSHA") and the Environmental
Protection Agency ("EPA") and to regulation under the Toxic Substances Control Act, the Resources Conservation and Recovery Act and
other regulatory statutes, and may in the future be subject to other federal, state or local regulations. OSHA and/or the EPA may
promulgate regulations concerning biotechnology that may affect the Company's research and development programs. The Company is
unable to predict whether any agency will adopt any regulation which would have a material adverse effect on the Company's
operations. The Company voluntarily attempts to comply with guidelines of the National Institutes of Health regarding research
involving recombinant DNA molecules. Such guidelines, among other things, restrict or prohibit certain recombinant DNA experiments
and establish levels of biological and physical containment that must be met for various types of research.

Sales of pharmaceutical and biopharmaceutical products outside the United States are subject to foreign regulatory requirements that
vary widely from country to country. Whether or not FDA licensure has been obtained, licensure of a product by comparable regulatory
authorities of foreign countries must be obtained prior to the commencement of marketing the product in those countries. The time
required to obtain such licensure may be longer or shorter than that required for FDA approval, and no assurance can be given that
such approval will be obtained.

Competition

The biotechnology and pharmaceutical industries are characterized by rapidly evolving technology and intense competition. The
Company's competitors include pharmaceutical, chemical and biotechnology companies, many of which have financial, technical and
marketing resources significantly greater than those of the Company. In addition, many specialized biotechnology companies have
formed collaborations with large, established companies to support research, development and commercialization of products that may
be competitive with those of the Company. Academic institutions, governmental agencies and other public and private research
organizations are also conducting research activities and seeking patent protection and may commercialize products on their own or
through joint ventures.

The Company is aware of certain potentially competitive products targeting areas of medical interest to the Company, including
influenza, respiratory syncytial virus ("RSV"), psoriasis, human papillomavirus ("HPV") infections and organ graft rejection. In the
prevention of CMV disease, the Company's CytoGam competes with several products including other antiviral drugs, such as intravenous
and oral ganciclovir, marketed by Hoffmann-La Roche Inc., and standard immune globulin preparations. The Company is aware that a
number of physicians have prescribed CytoGam in combination with ganciclovir for the prevention of CMV disease in certain patients.

The Company believes that for the prevention of RSV disease, Synagis and RespiGam are the only products currently available.
However, the Company is aware of one product in the United States, ribavirin, which is indicated for the treatment of RSV disease.
The existence of this product, or other products or treatments of which the Company is not aware, or products or treatments that may
be developed in the future, may adversely affect the marketability of products developed by the Company.

In relation to flu vaccines, the Company is aware of three main distributors of inactivated, injectible vaccines (Aventis-Pasteur,
Medeva/Evans and Wyeth). Approximately 80 million doses of these inactivated vaccines are sold annually in the United States. The
Company is also aware of one inactivated, nasally administered flu vaccine by Berna, which was previously available in Switzerland
until its removal from the market in 2001. The Company is also aware that Merck recently licensed a Russian live virus intranasal
vaccine, currently available in Russia. Any of the products listed here, as well as other products of which the Company is not
aware, may adversely affect the marketability of FluMist.

Many companies, including well-known pharmaceutical companies, are marketing anticancer drugs and drugs to ameliorate or treat the
side effects of cancer therapies, and are seeking to develop new products and technologies for these applications. Many of these
drugs, products and technologies are, or in the future may be, competitive with the Company's oncology products. In the United
States, the Company believes that Bristol-Myers Squibb Company holds the largest share of the chemotherapy market both in terms of
approved products and annual sales, and therefore dominates the marketplace. Other companies maintaining an active oncology
marketing and sales presence include Schering-Plough Corporation, Pharmacia & Upjohn, AstraZeneca, Hoffmann-La Roche, Inc., Johnson
& Johnson, Immunex Inc. (a subsidiary of American Home Products), Amgen, Inc., Chiron Corporation, Aventis SA, Eli Lilly and Company
and GlaxoSmithKline p.l.c. Many of these companies have substantially greater financial, technical, manufacturing, marketing and
other resources than the Company and may be better equipped than the Company to develop, market and manufacture these therapies. No
assurance can be given that the oncology drugs developed by the Company will be able to compete successfully against therapies
already established in the marketplace or against new therapies that may result from advances in biotechnology or other fields which
may render the Company's oncology drugs less competitive or obsolete. In addition, the Company's oncology drugs may become subject
to generic competition in the future.

The Company expects its products to compete primarily on the basis of product efficacy, safety, patient convenience, reliability,
price and patent position. In addition, the first product to reach the market in a therapeutic or preventive area is often at a
significant competitive advantage relative to later entrants to the market. The Company's competitive position will also depend on
its ability to attract and retain qualified scientific and other personnel, develop effective proprietary products, implement
product and marketing plans, obtain patent protection and secure adequate capital resources.

EXECUTIVE OFFICERS OF THE COMPANY
Officer
Name Age Position Since
- ------------------------------------------ --- --------- -----

Wayne T. Hockmeyer, Ph.D. 57 Chairman 1988
David M. Mott 36 Chief Executive Officer and Vice Chairman 1992
Melvin D. Booth 56 President and Chief Operating Officer 1998
James F. Young, Ph.D. 49 President, Research and Development 1989
Franklin H. Top, Jr., M.D. 66 Executive Vice President and Medical Director 1988
Armando Anido 44 Senior Vice President, Sales and Marketing 1999
Edward J. Arcuri, Ph.D. 51 Senior Vice President, Manufacturing 2002
Edward M. Connor, M.D. 49 Senior Vice President, Clinical Development 1999
Harry B. Greenberg, M.D. 57 Senior Vice President, Research 2002
Gregory S. Patrick 50 Senior Vice President and Chief Financial
Officer 2001
Gail Folena-Wasserman 47 Senior Vice President, Development 2002

Dr. Wayne T. Hockmeyer relinquished his position as Chief Executive Officer in October 2000 and now serves as the Chairman of the
Board of Directors. Dr. Hockmeyer founded MedImmune, Inc. in April 1988 as President and Chief Executive Officer and was elected to
serve on the Board of Directors in May 1988. He became Chairman of the Board of Directors in May 1993. Dr. Hockmeyer earned his
bachelor's degree from Purdue University and earned his Ph.D. from the University of Florida in 1972. Prior to founding MedImmune,
he served as a commissioned officer in the United States Army from 1966 to 1986. From 1980 to 1986 he was Chairman of the Department
of Immunology at the Walter Reed Army Institute of Research. In 1986, Dr. Hockmeyer joined Praxis Biologics as Vice President of
Research and Development and was there until founding MedImmune, Inc. in 1988. Active in other leadership roles, Dr. Hockmeyer was
appointed by Governor Parris Glendening to the Maryland Economic Development Commission and the Maryland Technology Development
Corporation. He is a member of the Board of Directors of Digene Corporation, Intermune Pharmaceuticals, Inc., GenVec, Inc., TolerRx,
Diversa and Advancis Pharmaceutical Corp. Dr. Hockmeyer is also a member of the Board of Directors of the Biotechnology Industry
Organization, the Technology Council of Maryland, a member of the Board of Visitors of the University of Maryland Biotechnology
Institute, and the University of Maryland Baltimore County.

Mr. Mott was appointed Chief Executive Officer and Vice Chairman in October 2000. He joined the Company in April 1992 as Vice
President with responsibility for business development, strategic planning and investor relations. In 1994, Mr. Mott assumed
additional responsibility for the medical and regulatory groups, and in March 1995 was appointed Executive Vice President and Chief
Financial Officer. In November 1995, Mr. Mott was appointed to the position of President and Chief Operating Officer and was elected
to the Board of Directors. In October 1998, Mr. Mott was appointed Vice Chairman. Prior to joining the Company, he was a Vice
President in the Health Care Investment Banking Group at Smith Barney, Harris Upham & Co., Inc. Mr. Mott is Chairman of the Board of
Directors of Conceptis Technologies and also serves on the Board of Trustees of St. James School and on the Board of Governors of
Beauvoir, the National Cathedral Elementary School. He holds a bachelor of arts degree from Dartmouth College.

Mr. Booth joined the Company in October 1998 as President and Chief Operating Officer and was elected to serve on the Board of
Directors in November 1998. Prior to joining the Company, Mr. Booth was President, Chief Operating Officer and a member of the Board
of Directors of Human Genome Sciences, Inc. from July 1995 until October 1998. Prior to this time, Mr. Booth was employed at Syntex
Corporation from 1975 to 1995, where he held a variety of positions, including President of Syntex Laboratories, Inc. from 1993 to
1995 and Vice President of Syntex Corporation from 1992 to 1995. From 1992 to 1993, he served as the President of Syntex
Pharmaceuticals Pacific. From 1991 to 1992, he served as an area Vice President of Syntex, Inc. From 1986 to 1991, he served as the
President of Syntex, Inc., Canada. Mr. Booth is a past Chairman of the Pharmaceutical Manufacturers Association of Canada, and is
currently a board member of NovaScreen Biosciences Corporation and Spacehab, Inc. Mr. Booth graduated from Northwest Missouri State
University and holds a Certified Public Accountant Certificate.

Dr. Young was promoted to the position of President, Research and Development in December 2000. He joined MedImmune in 1989 as Vice
President, Research and Development. In 1995, he was promoted to Senior Vice President and in 1999 he was promoted to Executive Vice
President, Research and Development. Dr. Young received his doctorate in microbiology and immunology from Baylor College of Medicine
in Houston, Texas and bachelor of science degrees in biology and general science from Villanova University.

Dr. Top became the Company's Medical Director in 1990. Dr. Top joined the Company in June 1988 as Executive Vice President and was
elected to the Board of Directors in July 1988. Prior to joining the Company, Dr. Top served as Senior Vice President for Clinical
and Regulatory Affairs at Praxis Biologics from 1987 to 1988. Prior to 1987, Dr. Top served for 22 years in the U.S. Army Medical
Research and Development Command, where he was appointed Director, Walter Reed Army Institute of Research in 1983. Dr. Top holds a
doctorate of medicine cum laude and a bachelor of science degree in biochemistry from Yale University.

Mr. Anido joined the Company in 1999 as Senior Vice President, Sales and Marketing. Prior to joining the Company, Mr. Anido was Vice
President of CNS Marketing at Glaxo Wellcome, Inc. from 1996 to 1999. Prior to this time, Mr. Anido served in various positions at
Lederle Laboratories from 1989 to 1995, culminating in his service as the Vice President of Anti-Infectives Marketing. Mr. Anido is
a registered pharmacist, and holds a Bachelor of Science in pharmacy and a Master of Business Administration degree from West
Virginia University.

Dr. Arcuri was appointed Senior Vice President, Manufacturing in February 2002 following the Company's acquisition of Aviron. Dr.
Arcuri was Senior Vice President, Operations of Aviron since May 2000. He joined Aviron as Vice President, Manufacturing in July
1999. Prior to joining Aviron, Dr. Arcuri served as Vice President, Manufacturing Operations and Process Development for North
American Vaccine, Inc., or NAVA, from January 1995 to July 1999. Prior to joining NAVA, Dr. Arcuri served as Senior Director,
Biological Manufacturing at Merck & Co., Inc. from 1991 to 1994. Dr. Arcuri holds a B.S. degree in Biology from the State University
of New York at Albany and a masters degree and Ph.D. in Biology from Rensselaer Polytechnic Institute.

Dr. Connor was promoted to Senior Vice President, Clinical Development in 1999. He joined the Company in 1994 as the Director of
Clinical Studies and was promoted in 1995 to Vice President of Clinical Development. Dr. Connor holds a bachelor's degree in biology
from Villanova University and a medical degree from University of Pennsylvania School of