Tricia Richardson – Senior Manager, Investor Relations John Lambert – Chairman Rahul Singhvi – President and Chief Executive Officer Penny Heaton – Vice President of Clinical Development and Chief Medical Officer Len Stigliano – Vice President, Chief Financial Officer and Treasurer

Ken Trbovich – RBC Capital Markets Kevin DeGeeter – Oppenheimer Vernon Bernardino – Rodman & Renshaw

Good morning, ladies and gentlemen, and welcome to the Novavax 2008 third quarter results conference call. My name is Darlene, and I will be your coordinator for today. (Operator's Instructions). Novavax, please proceed with your call.

On today's call will be Mr. John Lambert, Chairman of the Board, Dr. Rahul Singhvi, President and Chief Executive Officer, Penny Heaton, Vice President of Clinical Development and Chief Medical Officer, and Len Stigliano our Chief Financial Officer. We remind you that during this call, management will make forward-looking statements within the meaning of the Private Securities Litigation Reform Act which involves risks and uncertainties inherent in our business. Actual results may differ materially from our expectations, and you should consider all of the cautionary statements made in our SEC filings and in this morning's press release, including risks related to product development, clinical trials, and results from clinical trials, and the company's ability to obtain adequate financing for a complete statement of these risk. This conference call will be available for replay after the conclusion of the call. Mr. Lambert, please proceed with the call.

Good morning and welcome to the Novavax conference call for our 2008 third quarter financial results and business update. In a difficult US and global economic environment, we have continued to make good progress on multiple fronts. Our advancement of our vaccine candidates in preclinical and clinical trials, the announcement of our second discovery vaccine program for respiratory syncytial virus or RSV, a significant unmet medical need in terms of a vaccine, and our recent successful equity financing. In summary, progress has been very good. To provide you with a more detailed account in each of these areas, I would now like to hand over the call to Rahul and his team.

Thank you, John, and good morning, everyone. Let me begin with some of the highlights from the quarter. We announced at the end of August favorable results from the second stage of our Phase IIa clinical trial of our pandemic VLP vaccine candidate. Recall that this vaccine was administered at three different does trends; 15, 45, and 90 micrograms. The vaccine candidate induced strong utilizing antibody titers across all three doses tested, exhibiting increasing antibody titers with escalation of dose. There were no serious adverse events reported for this study. In addition to the new antibody titers, we are continuing to gather strong supporting immunological data to define the potential efficacy of the vaccine, and we will report these data over the next several months. On the commercialization front, we are continuing our discussion with various governments around the world through our GE collaboration to provide our unique in border regional manufacturing approach as a potential vaccine solution to the next influenza pandemic. On the seasonal influenza program, we submitted our IND in August and received clearance to begin clinical trials which we did in September. We enrolled all subjects within a week of commencing enrolment for our Phase IIa dose ranging trial in healthy adults. As a result, we are now on track to report top line results from this trial in the fourth quarter of this year. While the data remain blinded, we have observed a slightly different safety profile pertaining to non serious adverse events in the seasonal influenza VLP study, compared to the Phase IIa pandemic VLP vaccine trial. We will delay our seasonal phase II study in the elderly, until we have top line results from our Phase IIa study in healthy adults so that we better understand where we are on the dose response curve, as well as our immunological and safety by dose. Recall that we have planned to initiate the study in the elderly population in the fourth quarter of the year. On the new product front, we are very excited to report that our second discovery candidate is against respiratory syncytial virus or RSV. We believe that the VLP approach holds great promise for developing a safe and efficacious vaccine against this virus that afflicts not only the very young, but causes significant respiratory disease in older adults. There is no approved vaccine against RSV, and a new vaccine would represent a multibillion potential market opportunity. Penny will provide more details regarding our clinical plans for our seasonal flu vaccine candidate and progress on our two discovery vaccine candidates. On the business front, we've made significant progress in the third quarter. First, we completed an 18 million equity financing which generated net proceeds of 17.6 million at the end of July, attracting several strong investors as well as insider participation. The funds from this offering (inaudible 00:05:47) of the balance sheet and will provide cash to execute our critical seasonal flu vaccine trials, as well as advance our discovery candidates into late preclinical studies through the third quarter of 2009. As you are well aware, these are difficult times in the capital market. We are taking appropriate actions to preserve our cash and prioritize our spending towards achieving key milestones. One of the several planned actions we have completed that reduced spending was to close our manufacturing operations in northeast Philadelphia at the end of August. This facility was manufacturing Estrasorb, until that period of time. As we have stated before, we are continuing to seek buyers for our remaining miselanano (ph 00:06:30) particle assets, which we — as we focus completely on our vaccine business. Now let me turn it over to Penny Heaton who will provide more details on our vaccine development programs. Penny?

Thank you, Rahul, and good morning, everyone. It's my pleasure today to update you on the progress we've made on our discovery, preclinical, and our clinical candidate vaccine programs, so please allow me to start with our discovery projects. First, we continue to develop our Varicella Zoster vaccine candidate. Our objective is to find an optimized vaccine candidate for the prevention of Shingles and its associated complications and to move this candidate forward into advanced preclinical studies. We have made significant progress in the development of several different vaccine constructs, and we are evaluating these candidates according to prespecified criteria to determine which vaccine candidate has the optimal properties for further development. Several animal studies are now under way to evaluate the immune responses being induced by these candidates, including both antibody and cell mediated immunity. We'll take these results, together with manufacturing considerations, and select a candidate or candidates for more advanced preclinical study. We've also made considerable progress on our recently announced discovery vaccine candidate for respiratory syncytial virus, or RSV. We believe that a VLP vaccine has the potential to be a powerful weapon against this disease through stimulation of potent antibody responses and cell mediated immunity. RSV infects almost all children by their second birthday and is the leading cause of bronchiolitis and pneumonia among children under a year of age. RSV infection leads to 75,000 to 125,000 pediatric hospitalizations in the US each year. It is also a leading cause of severe pneumonia in the elderly, resulting in 14,000 deaths and over 177,000 hospitalizations in adults annually, at a cost that exceeds $1 billion, and there is currently no approved vaccine for RSV. Now let me turn to our influenza vaccine programs. As we previously announced, the study of our pandemic H5N1 influenza vaccine showed strong neutralizing antibody titers against the H5N1 Indonesia strain across all the doses that we evaluated. As you may recall, our influenza VLP vaccines consist of three important proteins that are important for immunity, including the surface hemagglutinin or HA, the surface neuraminidase or NA, and the core matrix protein or M1. We are now evaluating the contribution of each of the vaccine components to the overall immune response induced by the vaccine, including the antibody to HA and NA, and cell mediated immune responses. Safety follow up for all the subjects in the study will be completed this month, and the additional immunogenicity analyses will be available on a rolling basis over the next several weeks. With regard to seasonal flu, the first study of our seasonal influenza vaccine program commenced in September of this year. This study will evaluate the safety and immunogenicity of different doses of the trivalent seasonal influenza vaccine at five micrograms, 15 micrograms, and 30 micrograms, as compared with a placebo, in healthy adults 18 to 49 years of age. Top line safety and immunogenicity results by dose from this Phase IIa study will be announced later this year. Based on a review of blinded safety data, we saw different non serious adverse events in this seasonal vaccine study as compared with those that we observed in the Phase IIa pandemic influenza vaccine study. Therefore, we've decided to delay the start of the planned vaccine trial in the elderly, or subjects greater than 65 years of age, until next year, after we've reviewed the unblinded immunogenicity safety and dose response data from the ongoing study in healthy adults. The planned study in the elderly population is an important one for the company's seasonal influenza vaccine program, and we'll evaluate the safety and immunogenicity of different doses of the vaccine in adults 65 years of age and older. The study will also include a group of subjects will receive an existing approved seasonal influenza vaccine. Including this treatment arm, will permit us to compare the safety and immunogenicity of our VLP vaccine candidate with that of a vaccine that's already licensed by FDA. This study is critical to us as it will provide the first data to support differential of the VLP seasonal influenza vaccine candidate from that of other marketed vaccines in older adults. As most of you know, the two vaccines currently available for this population is modest, leaving older adults susceptible to flu and its associated morbidity and mortality. CDC estimates that influenza is responsible for 36,000 deaths and 200,000 hospitalizations in the US each year, the vast majority of which occur in the elderly. We have best designed our VLP seasonal influenza vaccine candidate to induce a broad set of immune responses which we hope will address the need for better vaccines in this population. We remain excited about our development programs which are moving forward aggressively to accumulate additional human data on our VLP vaccine candidates. I look forward to updating you on our progress over the coming quarters. And now I would like to turn the agenda over to Len Stigliano, our CFO. Len?

Thank you, Penny. I'd like to give a brief synopsis of our third quarter results which are disclosed in this morning's press release, and in our form 10-Q which will be filed by today's close of business. Since we made the decision to discontinue production of Estrasorb in the fourth quarter of 2007, for financial reporting purposes, all activities for Estrasorb have been classified as discontinued operations for fiscal 2008, as well as prior years. The press release and form 10-Q reflect this classification. Revenues from continuing operations for the third quarter were 194,000, consisting of principally contract research, a decrease of 600,000 compared to the third quarter of 2007. The decrease in revenue from 2007 was principally due to lower contract research as certain government contracts were completed earlier this year. Total operating expenses for the third quarter were 9.9 million as compared to 8.9 million in 2007. The increase in operating expenses was principally due to higher expenses in research and development as we advance our vaccine candidates in the preclinical and human studies. Accordingly, total operating loss from continuing operations for the quarter was 10.3 million as compared to 7.8 million in the comparable 2007 quarter. Income from discontinued operations was $2.5 million for the quarter, a $3.7 million increase or improvement over the loss recorded in the third quarter of 2007 of 1.2 million. Income for the third quarter of 2008 was entirely due to the recording of all associated revenue related to the Graceway transaction, including the completion of all production required under the supply agreement. Because there were multiple deliverables under the agreements with Graceway, all revenue associated with this transaction was recorded in the third quarter of this year. As a result, net loss was 7.8 million or $0.12 loss per share, as compared to the prior year loss of $9 million or a loss of $0.15 per share. Total cash, cash equivalents, and short-term investments were 45.2 million as compared to 46.5 million at the end of fiscal 2007. The total net burn rate for the nine months ended September 2008 was 18.9 million, before consideration given to the net equity raised in the third quarter of 2008 of 17.6 million. The equity financing was entirely offset by increased spending for advancement of our vaccine preclinical and clinical programs. The company believes we have sufficient cash to fund contemplated operations through the third quarter of 2009, and it expects it will raise additional capital in the future through several potential venues such as sale of equity, securities, partnering transactions, and non diluted funding. At this point in time we have not obtained such funding or financing. Now I would like to turn it over to Rahul for his summary comments.

Thank you, Len. We continue to accomplish key development milestones both in our clinical programs as well as in discovery. The key milestone that you can look forward to later this year is the report on top line results from our Phase IIa clinical study from our seasonal flu vaccine candidate in healthy adults. In addition to the clinical development and discovery of new products, we have made significant advances on our ability to characterize and manufacturer VLPs. Our accomplishments in manufacturing include continued progress in process yields which remains a key competitive advantage for us, as well as progress in fitting out our production facility with commercial scale equipment. We've also made significant technological advances which have improved and strengthened our intellectual property position. Our core VLP technologies continue to deliver on its promise to create effective and much needed vaccines through a novel manufacturing solution. And thanks to a very talented development and management team, a growing intellectual property estate, and the support of terrific investors, we are rapidly transitioning to a mature late stage vaccine development company. With your tremendous support, we remain committed to moving forward with our programs in an aggressive manner and in sustainable value for patients, partners, shareholders, and employees. This completes our prepared comments and now we'll open the conference call to questions.

(Operator's Instructions). Our first question comes from Ken Trbovich, sorry if I mispronounced your last name, your line is open. Ken Trbovich – RBC Capital Markets: Thanks for taking the question. Rahul, I guess I want to circle back and ask a quick question about the Phase II study in terms of the seasonal, the ongoing seasonal study. You mentioned top line results in the fourth quarter, I'm guessing because the study was initiated in September, you don't get all the safety data until March so we may not see complete safety reporting until the second quarter?

Let me have Penny answer that.

Yes. Ken, you're right. The primary safety data that we're interested in for any vaccine there is — the safety data that is collected during the immediate time during the first few weeks after vaccination, and we will have those data to report to you in an unblended fashion by the end of the year. That's the way we set up the analysis that w can have an unblinded safety and immunogenicity analysis by group, so we know what treatment group they're in. And then you're right in that we will continue to follow the subjects for a full six months after the dose, and then we'll have the unblinded safety data at the subject level around the March timeframe, late first quarter, early second quarter. Ken Trbovich – RBC Capital Markets: Okay. All right. That's helpful. I guess part of my confusion stemmed from the sort of curious notion of whether or not you want to wait for the complete reporting down to the individual patient level before starting the elderly study or whether that initial top line safety data, in and of itself, if you find nothing all that troubling in there, with whether that would be sufficient to move forward then with the elderly study.

Yes. The analysis that we have by the end of this year we think will help us with that. The main thing we need to understand is, first of all, obviously we want to see the safety data in an unblinded fashion. We need to understand where we are on the dose response curve, and by unblinding the data by treatment group, or by dose, we will have the data that we need to then make our plans for moving forward. Ken Trbovich – RBC Capital Markets: Okay. And can you give us a sense as to the nature of this adverse amount? I know you've described it as sort of being not severe so I'm supposing it may be just simply fever or achiness?

Yes. It's a collection of non serious adverse events that you see with other flu vaccines and you know what, those are similar to what you've just described. I'm hesitant to comment on them any further until I actually see all the unblinded data and can see the full data set because all I've seen so far is just a list with blinded data. Ken Trbovich – RBC Capital Markets: And the blinded data is not by dose group so you don't obviously have any sense as to whether it's concentrated in the highest doses.

That's correct. Ken Trbovich – RBC Capital Markets: Okay. And then I guess next question, just in terms of from Len's perspective, now that manufacturing is shut down, and I understand the manufacturing has been accounted for under discontinued, but should we expect to see significant reductions in the sort of actual cash burned beyond those changes we've seen to date as a result of the shutdown or are there additional carrying costs that you'll continue to be burdened with?

I'll take that. No, there's no additional costs, Ken. So, I mean this year we actually, because of the Graceway transaction, had a positive cash flow, but from an expense perspective that will completely stop as of this quarter so you should see nothing going forward. Ken Trbovich – RBC Capital Markets: Okay. Thanks again.

Thanks, Ken.

Thank you. Our next question comes from Kevin DeGeeter's line. Your line is open. Kevin DeGeeter – Oppenheimer: Hey. Good morning, guys. Thanks for taking my call. Maybe I want to touch base here, and get an appreciation within the context of the current capital markets. What are the value propositions here of sort of platform technology of VLP — I mean, how do we balance out the growing portfolio of clinical candidates with capital constraints which may be here for awhile, and just help us appreciate kind of — I guess ultimately where I'm going, how to — where those R&D dollars are going and kind of how we can keep this moving forward with multiple shots on goal given some constraints we have for the next 12 months?

Right. Kevin, thanks for the question. So, the way we are spending our money is wherever we have the highest opportunities for creating value. So, in the case of seasonal influenza, the biggest value that we have is in demonstrating the potential differentiation we can see in older adults, so that's the key milestone that we want to drive towards. And with regards to new products, again, the choice of new products is very important because we have to look at not only where the medical need is, but whether technology can create the appropriate immune response to address it, so we want to address those new products where we have the highest chance of success. And then, in terms of moving forward, we want to do those experiments which define the biggest questions in terms of whether or not those products have a higher chance of going forward in later stage development. And when it comes to the capital needs, we've also stated very clearly that some of these products are going to be partnered and we are looking to get them partnered at the appropriate time. Kevin DeGeeter – Oppenheimer: And maybe just from a commercial perspective, I mean, when we look at the three kind of core product areas which you've announced so far; RSV, influenza, and Shingles, which perspective argues for commercial partner sooner rather than later? Kind of help us rank those out.

I think both RSV and Shingles have very significant commercial value, so they I think will still attract partners if we're able to move them forward with appropriate data and answer the key questions that the partners are looking to get answered, even at a preclinical level. Kevin DeGeeter – Oppenheimer: Terrific. And lastly, and then I'll get back in queue, can you just quickly give us an update with the collaboration with GE? Kind of when should we hope to see some sort of P&L impact? Is that likely to be in 2009?

That's our expectation is that we will have — we expect to have at least one potential collaboration in the year 2009. Kevin DeGeeter – Oppenheimer: Terrific. Thanks so much.

Thank you.

Thank you. Our next question comes from Vernon Bernardino's line. Your line is open. Vernon Bernardino – Rodman & Renshaw: Hi. Thanks for taking my question.

Hi, Vernon. Vernon Bernardino – Rodman & Renshaw: Hi. This is perhaps a question for Penny. So, the RSV program is now formal, just wondering if you could provide a little more detail as to what stage it is, what kind of candidates you have, and what should we see next regarding this program aside for potential partnering?

Sure. The RSV program, we have actually a variety of vaccine candidates that we currently have in animal studies in mouse studies. We have one study that has already been completed for which we have results that we're currently analyzing actually, and then we have other studies that are ongoing, and what we will be doing is actually looking at the appropriateness of the immune response that we're getting. We obviously want something, a candidate that induces good neutralizing antibody and good cell mediated immunity with a TH1 weighted responses. So, we're looking at those types of attributes. We're looking at the efficacy of the vaccine, if you will, to reduce the titer of the RSV virus in the lungs of these mice when they're challenged with the RSV, and also we're looking at the yield, the VLPs, because we have made great progress there, but want to make sure that we do get something with the right immune reponse, we have something that's commercially viable. So, we're currently evaluating a series of candidates with the goal of identifying a single candidate that we would then move forward into preclinical studies to support an IND and getting into the clinic. And we, of course, we are looking forward to potentially having a partner to assist us with this program and we would look at that when we have the right data and when it makes sense to do so and we can get the value for this obviously great vaccine — potential vaccine, and we'll look at the timing accordingly. Vernon Bernardino – Rodman & Renshaw: Great. And then regarding the seasonal flue program, given what you're seeing so far regarding dose response, has any of your thinking changed regarding, for example, the yield, costs of manufacturing, and potential production capacity?

For the seasonal program, we are still blinded to the results of that study. So we won't be able to make any further comments about that until the end of the year when we get the unblinded data. Vernon Bernardino – Rodman & Renshaw: Okay. Thanks for taking my question.

Thank you.

Thank you. I'm showing no further questions at this time.

Well, that's great, so I appreciate all of you coming on the call today and thanks again for all your support and we look forward to catching up again the next quarter.

Thank you for your participation in today's conference. This concludes the presentation. You may now disconnect. Good day.