Forward-Looking Statements

          This press release contains forward-looking statements subject to risks and uncertainties that could cause actual results to differ materially from those projected, including: whether the company will achieve levels of revenues and control expenses to meet projected financial performance; whether Vical or others will continue development of the influenza vaccine candidate, the anthrax vaccine candidate, the HIV vaccine candidate, or any other product candidates being developed by Vical, its collaborators or licensees; whether Vical or others will continue evaluation of Vaxfectin(TM) as an adjuvant for conventional vaccines against seasonal or pandemic flu; whether Vaxfectin(TM) will be used as a dose-sparing agent with conventional flu vaccines; whether results in animal studies will be predictive of results in human studies; whether H5N1 or other strains of avian influenza will emerge as pandemic threats; whether Temasek’s investment in the company will generate returns consistent with its historical returns; whether the company will begin Phase 1 human clinical testing of its pandemic influenza DNA vaccine candidate in 2007, if at all; whether the NIH will begin a Phase 2 trial of several thousand HIV-uninfected subjects using the company’s technology in early 2007, if at all; whether any product candidates being developed by Vical, its collaborators or licensees will be shown to be safe and effective in clinical trials; and additional risks set forth in the company’s filings with the Securities and Exchange Commission.  These forward-looking statements represent the company’s judgment as of the date of this release.  The company disclaims, however, any intent or obligation to update these forward-looking statements.

          Use of Non-GAAP Financial Measure

          This press release contains adjusted net loss projections that are not calculated in accordance with GAAP. Specifically, the company’s adjusted net loss projection for 2006 excludes an estimated non-cash, stock-based compensation expense associated with adoption of Statement of Financial Accounting Standards No. 123R, “Share-Based Payment,” on January 1, 2006. This non-cash expense and is currently estimated at $1 million to $2 million. As the final amount of such expense cannot yet be determined, the company currently cannot make a net loss projection in accordance with GAAP or reconcile its non-GAAP net loss projection to a net loss projection calculated in accordance with GAAP.

          Vical believes that this non-GAAP financial measure provides meaningful information regarding the company’s performance by excluding expenses that may not be indicative of the company’s core operating results.  In addition, Vical believes that the use of this non-GAAP financial measure enhances the consistency and comparability of the company’s reported financial results and enables investors to better evaluate the company’s current performance compared to its past performance.  However, this information should not be considered in isolation or as an alternative to financial information calculated in accordance with GAAP.