Bavarian Nordic

Share Issue/Capital Change • Apr 4, 2011

Bavarian Nordic A/S is required to post this announcement on NASDAQ OMX. It is not for distribution in the United States. Not for release, publication or distribution in the United States, Canada, Australia or Japan

Company Announcement

4 April 2011

This announcement does not constitute an offer to sell or the solicitation of an offer to buy the securities of Bavarian Nordic A/S (the "Securities") in the United States or in any other jurisdiction. The Securities may not be offered or sold in the United States absent registration or an exemption from registration under the U.S. Securities Act of 1933, as amended. The issuer of the Securities has not registered, and does not intend to register, any portion of the Offering in the United States or in any jurisdiction outside Denmark and the United Kingdom, and does not intend to conduct a public offering of the Securities in the United States or in any other jurisdiction outside Denmark and the United Kingdom. Copies of this announcement are not being made and may not be distributed or sent into the United States, Canada, Australia or Japan.

This announcement is only being distributed to, and is only directed at, persons in the United Kingdom that are qualified investors, as that term is defined in the Prospectus Directive, that are also (i) "investment professionals" falling within Article 19(5) of the Financial Service and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order") or (ii) "high net worth entities" and other persons to whom it may lawfully be communicated, falling within the meaning of Article 49(2)(a) to (d) of the Order (all such persons being "relevant persons"). The securities of Bavarian Nordic A/S (the "Securities") are only available to relevant persons and any invitation, offer or agreement to subscribe, purchase or otherwise acquire such Securities will be engaged in only with relevant persons. Any person who is not a relevant person should not act or rely on this announcement or any of its content.

Bavarian Nordic plans a DKK 650 Million Rights Issue

Kvistgård, Denmark, April 4, 2011 – Bavarian Nordic A/S (OMX: BAVA) has today convened the Annual General Meeting to be held on April 26, 2011. In that respect, the board has proposed to extend the current authorisation to increase the Company's share capital with the purpose of carrying out a rights issue with preemptive rights for existing shareholders.

As previously announced together with the publication of the 2010 Annual Report, the Company has reviewed various options to fund the continued development of PROSTVAC® , in particular opportunities to pursue an independent development in parallel with continuing the partnership discussions. Accordingly, the Company has concluded a rights issue to be the most suitable approach.

The rights issue is expected to be completed in the first half of 2011, subject to market conditions. The Company expects proceeds from the rights issue of approximately DKK 650 million, which in combination with positive cash flow from existing contracts for the Company's smallpox vaccine, IMVAMUNE® , would, the Company believes, enable the Company to pursue the independent development of PROSTVAC® , including the completion of the pivotal Phase 3 trial.

The total costs for completing the pivotal Phase 3 trial with PROSTVAC® are estimated to be approximately DKK 850 million, including internal costs, production of clinical trial material, contract research costs and validation of the commercial manufacturing process.

In parallel with the initiation of Phase 3, the Company will continue its discussions with potential partners among global pharmaceutical companies with the aim of entering into a collaboration agreement on codevelopment and commercialization of PROSTVAC® .

Bavarian Nordic has engaged Carnegie, Jefferies International Limited and Nordea Markets (Division of Nordea Bank Danmark A/S) as Joint Global Coordinators in the Rights Issue.

Asger Aamund Chairman of the Board

Contact Anders Hedegaard, President & CEO. Phone +45 23 20 30 64

Page 1 of 2 Company Announcement no. 7 /2011

DK-3490 Kvistgaard Fax: +45 33 26 83 80 Denmark

Not for release, publication or distribution in the United States, Canada, Australia or Japan

About Bavarian Nordic

Bavarian Nordic is a leading industrial biotechnology company developing and producing novel vaccines for the treatment and prevention of life-threatening diseases with a large unmet medical need. The company's clinical pipeline targets cancer and infectious diseases, and includes seven development programmes. Two programmes are under preparation for Phase III: PROSTVAC® , a therapeutic vaccine for advanced prostate cancer is being developed under a collaboration agreement with the National Cancer Institute, and IMVAMUNE® , a third-generation smallpox vaccine is being developed under a contract with the US government.

Bavarian Nordic is listed on NASDAQ OMX Copenhagen under the symbol BAVA.

For more information please visit www.bavarian-nordic.com

PROSTVAC® is a registered trademark in the U.S.

Forward-looking statements

This announcement includes "forward-looking statements" that involve risks, uncertainties and other factors, many of which are outside of our control that could cause actual results to differ materially from the results discussed in the forward-looking statements. Forward-looking statements include statements concerning our plans, objectives, goals, future events, performance and/or other information that is not historical information. We undertake no obligation to publicly update or revise forward-looking statements to reflect subsequent events or circumstances after the date made, except as required by law.