IMUGENE LIMITED — Capital/Financing Update 2003

Dec 18, 2003

LIMITED

19 December 2003

ASX ANNOUNCEMENT

MERIAL and IMUGENE JOINT ANNOUNCEMENT

Attached is the joint announcement made today by MERIAL Limited and Imugene Limited. The joint release provides an update to Imugene's two poultry products and one pig product under evaluation and development by MERIAL.

Yours sincerely Imugene Limited

Dr Warwick Lamb Managing Director

ABN: 99 009 179 551 Level 1, 14 - 20 Delhi Road, North Ryde NSW 2113 PO Box 307, North Ryde NSW 1870 Tel: +61 2 9870 7330 Fax: +61 2 9888 9338 website: www.imugene.com

IMLIGENE LIMITED

IMUGENE and MERIAL extend their collaboration agreements

Duluth, Georgia /Sydney, Australia 19th December, 2003 Imugene (ASX Code - IMU) an Australian biopharmaceutical company specializing in the commercialisation of biological animal health products, and Merial, one of the world's leading and innovative animal health companies, jointly announced today an update and extension to their collaboration agreements signed in September 2002.

Poultry Productivity Enhancer

Recently, Imugene announced a major improvement in the efficacy of the Adenoviral Delivery Vector. Imugene, based on trials to date, anticipates that the new improved Vector is likely to significantly increase the effectiveness of the poultry productivity enhancer. Accordingly, Imugene has granted Merial an extension in the final evaluation period under the existing evaluation and sublicense option agreement. This additional period will allow Imugene to manufacture sufficient quantities of the new improved productivity enhancer vaccine for shipping to Merial for inclusion in a new series of trials.

Poultry Respiratory Disease Vaccine

Imugene and Merial have agreed to continue the evaluation of Imugene's vaccine against an important poultry respiratory disease. They will jointly produce an updated version of the vaccine candidate for further trials. Imugene and Merial have jointly agreed to extend the previously agreed evaluation period pursuant to the Evaluation and Sub License Option Agreement to allow the improved vaccine candidate to be constructed and evaluated.

Adenoviral Delivery Vector - Pig Viral Disease

The two companies will also extend their collaboration relating to a major pig viral disease. Imugene and Merial have previously collaborated on the use of the Adenoviral Delivery Vector as a vaccine delivery system for an important viral disease of pigs. Under the latest contract Imugene will provide to Merial, a newer version of the vaccine candidate previously tested including the recently announced improvements to their Adenoviral Delivery Vector.

Dr Bob Nordgren, Head of Research and Technology Acquisitions for Merial said "These new agreements demonstrate Imugene's commitment to provide Merial with the best possible products for evaluation. The changes made by Imugene to their delivery system have the potential to create a more effective, more marketable product for both poultry and pigs."

Imugene's Managing Director, Dr Warwick Lamb, welcomed the further collaboration. "Imugene is delighted with Merial's ongoing commitment to these projects. Merial is recognized as the world leader in regulatory affairs for this type of product and the input of their development and regulatory personnel, combined with the skills of our commercial team, will ensure these products have the quickest possible path to market.

Editors Notes

About Merial

Merial is a world leading innovation-driven animal health company, providing a comprehensive range of products to enhance the health, well being and performance of a wide range of animals. Merial employs around 6,000 people and operates in more than 150 countries worldwide. Its 2002 sales were in excess of US\$ 1.7 billion.

Merial is a joint venture between Merck & Co., Inc. and Aventis S.A. For further information please see www.merial.com

About Imugene

Imugene Limited (ASX Code: IMU) is an Australian biopharmaceutical company specializing in the development and commercialisation of animal health products for production animals (pigs and poultry) and companion (pet) animals.

Imugene's products safely prevent disease and parasites in animals, reduce or eliminate the use of antibiotics, harmful chemicals and drugs and, in production animals, reduce the level of antibiotic and chemical residue entering the human food chain.

Imugene's poultry and pig portfolio is tapping into segments worth US\$3 billion of the existing estimated US\$6.6 billion global spend on existing treatments per year. The majority of the existing treatments are chemical and antibiotic solutions that are becoming less effective for disease treatment and productivity enhancement. Compounding the problem of diminishing efficacy, governments and health organizations internationally, are lobbying and legislating against the use of antibiotics in favour of non-chemical treatments.

Imugene's biological products are administered by vaccination, either by injection or orally via feed, water or aerosol using the patented Adenoviral Delivery Vector vaccine. In addition to the products under evaluation by Merial, Imugene is also continuing its research, development and commercialisation of biological pig growth promotant products to deliver safe productivity gains and biological vaccines for the prevention of other pig and poultry diseases of economic importance worldwide.

For further information, contact:

Imugene:

Graham Dowland - Executive Chairman Tel: +61 8 9322 9189 Dr Warwick A Lamb - Managing Director Tel +61 2 9870 7330

Merial

Dr Bob Nordgren, Head of Research & Technology Acquisition, +1 678 638 3607 Dr. Marcus Remmers, Head of Business Development, +1 678 638 3787