911326--3/10/2006--TRIMERIS

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{cost, regulation, environmental}

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If Fuzeon does not maintain or increase its market acceptance, our business will be materially harmed. Roche has significant inventory of both finished product and raw materials on hand, if Fuzeon sales do not increase we could face the risk of significant write-offs. We have sustained operating losses since our inception, and these losses may continue. Any additional financing we obtain may result in dilution to our stockholders, restrictions on our operating flexibility or the transfer of particular rights to technologies or drug candidates. Our business may require substantial additional capital, which we may not be able to obtain on commercially reasonable terms, we could be required to cut back or stop certain operations if we are unable to raise or obtain needed funding. If Roche does not meet its contractual obligations to us, our research and development efforts and the regulatory approval and commercialization of our drug candidates could be delayed or otherwise materially and adversely affected. In order to become profitable we will need to maintain arrangements with third parties for the sale, marketing and distribution of our current and future drug candidates or expend significant resources to develop these capabilities. If sufficient amounts of Fuzeon or any other drugs we attempt to bring to market cannot be manufactured on a cost-effective basis, our financial condition and results of operations will be materially and adversely affected. We do not control the manufacturing and production schedule at Roche s Boulder facility where Fuzeon is manufactured and that we cannot ensure that significant costs associated with scheduling decisions will not be incurred. We are currently in the process of finalizing an amendment to our research agreement with Roche that addresses several significant issues related to the research and development of our next generation drug candidates and we cannot guarantee that these negotiations will lead to a final agreement. If Roche does not re-new our current research agreement to discover, develop and commercialize novel peptide fusion inhibitors, we may not be able to proceed with the development of our most promising drug candidates. We may not be able to effectively develop our drug pipeline. We face intense competition in our efforts to develop commercially successful drugs in the biopharmaceutical industry. If we are unable to compete successfully, our business will suffer. We may not receive all necessary regulatory approvals for future drug candidates or approvals may be delayed. The FDA may not accept our application to broaden the indication for Fuzeon administration or may request additional studies, which could have an adverse effect on our stock price. HIV is likely to develop resistance to Fuzeon and any of our future drug candidates, which could adversely affect demand for those drug candidates and harm our competitive position. Our business is based on a novel technology called fusion inhibition, and unexpected side effects or other characteristics of this technology may delay or otherwise adversely affect the development, regulatory approval and/ or commercialization of our drug candidates. We are dependent on the successful outcome of clinical trials for our drug candidates. Obtaining regulatory approvals and maintaining compliance with government regulations will entail significant costs that could harm our ability to achieve profitability. Failure to raise additional capital necessary to support our development programs and expand our operations could lower our revenues and reduce our ability to compete. If we cannot maintain commercial manufacturing arrangements with third parties on acceptable terms, or if these third parties do not perform as agreed, the commercial development of our drug candidates could be delayed or otherwise materially and adversely affected. If Roche or our manufacturing partners do not maintain good manufacturing practices, it could negatively impact our ability to obtain regulatory approvals and commercialize our drug candidates. Our internal research programs and our efforts to obtain rights to new products from third parties may not yield potential products for clinical development, which would adversely affect any future revenues. We depend on patents and proprietary rights, which may offer only limited exclusive protection and do not protect against infringement. If we are unable to protect our patents and proprietary rights, our assets and business could be materially harmed. The intellectual property of our competitors or other third parties may prevent us from developing or commercializing our drug candidates. Uncertainty relating to third -party reimbursement and health care reform measures could limit the amount we will be able to charge for our drugs and adversely affect our results of operations. If an accident or injury involving hazardous materials occurs, we could incur fines or liability, which could materially and adversely affect our business and our reputation. If the testing or use of our drug candidates harms people, we could face costly and damaging product liability claims far in excess of our liability and indemnification coverage. Our quarterly operating results are subject to fluctuations. If our operating results for a particular period deviate from the levels expected by securities analysts and investors, it could adversely affect the market price of our common stock. If we lose any of our executive management or other key employees, we will have difficulty replacing them. If we cannot attract and retain qualified personnel on acceptable terms, the development of our drug candidates and our financial position may suffer. If we are unable to meet or maintain the standards for maintaining internal controls over financial reporting as required by the Sarbanes-Oxley Act of 2002, our stock price could be materially harmed. We rely on our collaborative partner Roche to timely deliver important financial information relating to Fuzeon sales and expenses. In the event that this information is inaccurate, incomplete or not timely we will not be able to meet our financial reporting obligations as required by the SEC. Our charter requires us to indemnify our officers and directors to the fullest extent permitted by law, which obligates us to make substantial payments and to incur significant insurance-related expenses. We are controlled by our management and other related parties.

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911326--3/10/2006--TRIMERIS_INC