AVI BioPharma Updates Progress on Cardiovascular Disease Program With NeuGene Antisense

Third-Generation Antisense Appears Promising for Cardiovascular Restenosis And Coronary Artery Bypass Grafting

PORTLAND, Ore. - July 30, 2003 - AVI BioPharma, Inc. (Nasdaq: AVII, AVIIW, AVIIZ), announced an update on its cardiovascular disease program. The program uses the company's proprietary NeuGene® antisense agents to target the genes implicated in cardiovascular restenosis, coronary artery bypass grafting, cholesterol lowering, and coagulation.

Coronary artery disease leads to occlusion of the major arteries supplying blood to the heart, which can be treated by intervention using balloon angioplasty or by surgery involving bypass grafting. There are approximately 1 million balloon angioplasties and 550,000 bypass grafts done in the United States annually, and a significant percentage of them fail. Failure in both angioplasty and saphenous vein grafts is the result of injury to the vessel lining and activation of a regulatory gene, called c-myc. This results in cell proliferation, secretion of collagen, formation of extra-cellular matrix, and expression of inflammatory mediators and adherence factors. This leads to restenosis, or reclosing of the artery, in 20 percent or more of balloon angioplasties and a similar failure rate of saphenous vein bypass grafts.

Resten-NG™, the company's flagship cardiovascular NeuGene antisense agent, works by inhibiting c-myc expression, and therefore the pathology that leads to restenosis or graft failure. This third-generation antisense compound has been successfully delivered using three methods: systemically with a microbubble technique, locally via a drug-delivery catheter, or as a drug coating on stents following balloon angioplasty. In the case of saphenous vein bypass grafts, it can be delivered ex vivo (outside the body) by incubation of the vein graft in a solution of the drug before grafting into the patient.

Catheter Delivery of Resten-NG
A Phase II trial delivering Resten-NG with a catheter was completed and positive interim results have been reported. Final results are expected to be reported at the Transcatheter Cardiovascular Therapeutics Symposium in Washington, D.C., in September. Based on these data, AVI plans to initiate Phase III studies in Europe later this year.

Strategic Partnerships
AVI has a strategic partnership with Medtronic, Inc., for delivery of Resten-NG via devices, including stents and catheters. Recently, AVI and Medtronic agreed to extend their exclusive contractual relationship while additional data are being gathered. This extended collaboration is expected to continue through approximately September, at which point the additional data will have been reviewed, and further negotiations will decide the course of any future agreements.

Systemic Delivery of Resten-NG
The company plans to commence a Phase II human clinical trial at the University of Nebraska Medical Center with its newest delivery method for Resten-NG, called "microbubble" technology. Fundamentally, this technology couples Resten-NG with perfluorocarbon microbubbles. These microbubbles can be injected intravenously and selectively target the sites of vascular injury such as tissue damaged by balloon angioplasty.

The microbubble interaction with the damaged vascular wall potentially allows delivery of Resten-NG without the use of a stent or catheter. Importantly, it may also be used in conjunction with stents. This makes it applicable for use with bare or drug-eluting stents, and usable on a repeated basis. The company anticipates that this Phase II program will be available for strategic partnering upon its completion in 2004.

Bypass Grafting
In conjunction with Thomas Jefferson University, AVI is finalizing preclinical studies using Resten-NG to prevent the failure of saphenous veins used in coronary artery bypass grafting. AVI expects this program to move into clinical development in 2004 and plans to develop the program internally.

Other Programs
AVI's antisense drugs for cholesterol lowering and coagulation target other genes and are in an early stage of development. For cholesterol lowering, AVI is completing preclinical development and expects to enter clinical trials later this year or early next year. AVI's antisense drug to modulate coagulation is in the research and development stage and is expected to enter preclinical development next year.

About AVI BioPharma

AVI BioPharma develops therapeutic products for the treatment of life-threatening diseases using two technology platforms: third-generation NeuGene antisense drugs and cancer immunotherapy. AVI's lead NeuGene antisense compound is designed to target cardiovascular restenosis, cancer, polycystic kidney disease and other cell proliferation disorders. In addition to targeting specific genes in the body, AVI's antiviral program uses NeuGene antisense compounds to target single-stranded RNA viruses, including West Nile virus, SARS coronavirus, calicivirus, and Hepatitis C. AVI's second technology, Avicine®, is a therapeutic cancer vaccine with late-stage trials planned for the treatment of pancreatic and colorectal cancer. More information about AVI is available on the company's Web site at http://www.avibio.com/.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: The statements that are not historical facts contained in this release are forward-looking statements that involve risks and uncertainties, including, but not limited to, the results of research and development efforts, the results of preclinical and clinical testing, the effect of regulation by the FDA and other agencies, the impact of competitive products, product development, commercialization and technological difficulties, and other risks detailed in the Company's Securities and Exchange Commission filings.