Bavarian Nordic

Share Issue/Capital Change • May 27, 2011

Company Announcement

27 May 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 completes rights issue

Kvistgård, Denmark, May 27, 2011 - Bavarian Nordic A/S (NASDAQ OMX: BAVA) today completed an offering of shares of up to 12,962,052 new shares each of a nominal value of DKK 10 with pre-emptive rights to the Company's existing shareholders (the "Offering"). In the Offering, 12,918,593 new shares with a nominal value of DKK 10 each were subscribed, corresponding to 99.7 % of the offered shares.

The new shares were subscribed at DKK 54 per share with a nominal value of DKK 10, resulting in gross proceeds to Bavarian Nordic of approximately DKK 698 million, equivalent to net proceeds of approximately DKK 653 million after deduction of expenses related to the Offering.

The new shares are expected to be admitted to trading and official listing on NASDAQ OMX Copenhagen A/S on 31 May 2011 under the same ISIN code as Bavarian Nordic's existing shares (DK0015998017).

Following registration of the 12,918,593 new shares with a nominal value of DKK 10 each, Bavarian Nordic's nominal share capital will be DKK 258,806,450 corresponding to 25,880,645 shares with a nominal value of DKK 10 each. Each share with a nominal value of DKK 10 carries one vote.

The new shares have the same rights as the Company's existing shares.

Following the Offering, the Company expects its year-end cash preparedness to be in the level of DKK 525 million. The Company's expectations for full-year revenue and result remain as previously announced.

Anders Hedegaard, President & CEO comments: "We are delighted to announce a successful result of our offering, which has attracted a lot of positive attention from both new and existing investors, adding several new and reputable international healthcare investors to our shareholder base. With the completion of the offering, we look forward to a promising period for Bavarian Nordic. Our capital preparedness has been strengthened, enabling us to pursue the independent development of PROSTVAC® and thus initiate the Phase 3 trial in the second half of 2011 as planned. At the same time we have secured both the progress of the project, as well as a strong position in the further discussions with potential partners by maintaining the value of PROSTVAC® in the company."

Asger Aamund Chairman of the Board

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

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

About Bavarian Nordic

Bavarian Nordic is a vaccine-focused 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.