SUMMARY OF THE JOINT PROXY STATEMENT/PROSPECTUS

        This summary highlights selected information from this joint proxy statement/prospectus and does not contain all of the information that is important to you. To better understand the proposed transaction and the proposals on which your vote is being solicited, you should read this entire document carefully, including the annexes, and in particular, the Acquisition Agreement attached as Annex A. The page references provided parenthetically in this summary indicate where you can find a more complete description of the topics presented in this summary.

The Companies

Inovio Biomedical Corporation
114994 Sorrento Valley Road
San Diego, California 92121
(858) 597-6006

        Inovio Biomedical Corporation, a Delaware corporation, organized in 2001, is a San Diego-based biomedical company focused on the development of next-generation vaccines to prevent or treat cancers and chronic infectious diseases. Inovio is a leader in developing DNA delivery solutions based on electroporation, which uses brief, controlled electrical pulses to create temporary pores in cell membranes and enable increased cellular uptake of a useful biopharmaceutical. Inovio has licensing and collaborative arrangements for use of its patented technologies with research-driven biopharmaceutical companies and government and non-government agencies. Inovio licenses the use of its electroporation-based DNA delivery systems, and contracts to manufacture and supply such systems, for partners to use in conjunction with their proprietary DNA vaccines or DNA-based immunotherapies. These arrangements provide Inovio with some combination of upfront payments, development fees, milestone payments, royalties and a supply agreement, while the partners pursue development of proprietary agents or conduct research using Inovio's electroporation technology. Inovio has also been pursuing proprietary vaccine development or co-development, resulting in whole or partial ownership in promising vaccines to prevent or treat cancers and chronic infectious diseases. Inovio's technology is protected by an extensive patent portfolio covering in vivo electroporation, encompassing a range of apparatuses, methodologies, conditions and applications including oncology, gene delivery, vascular, and transdermal as well as ex vivo electroporation.

        Inovio's common stock is currently traded on the NYSE Alternext under the trading symbol "INO."

        Inovio's website address is www.inovio.com ; however, information on Inovio's website is not a part of, or incorporated by reference in, this joint proxy statement/prospectus, and should not be relied upon in evaluating the proposals set forth for approval by the Inovio or VGX stockholders.

Inovio Acquisition, LLC
114994 Sorrento Valley Road
San Diego, California 92121
(858) 597-6006

        Inovio Acquisition, LLC, or Submerger, is a wholly-owned direct subsidiary of Inovio that was originally incorporated in Delaware as Inovio Acquisition Corporation in June 2008 and converted into a limited liability company in October 2008. Submerger does not engage in any operations and exists solely to facilitate the Merger.

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VGX Pharmaceuticals, Inc.
450 Sentry Parkway
Blue Bell, Pennsylvania 19422
(267) 440-4200

        VGX Pharmaceuticals, Inc., a Delaware corporation organized in December 2000, is a biopharmaceutical company with DNA Vaccines and small molecule product candidates for the treatment of infectious diseases, cancer and inflammatory diseases. VGX's clinical development programs include programs focused on HIV infection, inflammatory diseases and a DNA-based therapeutic for cervical cancer. In addition, VGX has filed investigational new drug, or IND, applications with the U.S. Food and Drug Administration, or FDA, for a novel DNA therapy that utilizes growth hormone releasing hormone, or GHRH, for the treatment of cancer cachexia and anemia and a DNA preventative vaccine for avian influenza. VGX has established a vertically-integrated DNA vaccines and therapies platform, which includes a patented DNA delivery system (CELLECTRA® electroporation), and access to advanced cGMP plasmid manufacturing capabilities through its affiliate, VGX International. VGX is also a majority shareholder of VGX Animal Health, whose lead product candidate, LifeTide™ SW 5, received regulatory approval in Australia in January 2008 and became the world's first approved DNA therapy for food animals. VGX's product candidates and technology programs are protected by the VGX's extensive intellectual property portfolio.

        VGX's website address is www.vgxp.com ; however, information on VGX's website is not part of, or incorporated by reference in, this joint proxy statement/prospectus, and should not be relied upon in evaluating the proposals set forth for approval by Inovio or VGX stockholders.

The Combined Group

        Inovio and VGX both operate in the biotechnology industry, focused primarily on the development of DNA-based vaccines and therapies. The combined group intends to remain focused on this goal utilizing Inovio's proprietary electroporation technology to continue development of Inovio's pipeline of pre-clinical and clinical candidates and maintaining a substantial number of Inovio's ongoing collaborations and partnerships with pharmaceutical industry leaders and academic institutions, while adding existing VGX pre-clinical and clinical programs and VGX's ongoing collaborations with other pharmaceutical industry leaders and academic institutions. The combined group anticipates integrating and maintaining a balanced portfolio of programs drawn from Inovio's and VGX's current pre-clinical and clinical efforts that are most likely to benefit from and extend the strength of the combined group's intellectual property related to use of Inovio's electroporation technology for DNA delivery and VGX's DNA therapeutics platform. The combined group expects that its initial product pipeline will include DNA-based therapeutics for delivery via electroporation targeted to HIV, hepatitis C virus, human papilloma virus, and influenza. Management of the combined group will be primarily located in San Diego, California, with additional research and development facilities in Blue Bell, Pennsylvania, The Woodlands, Texas and Oslo, Norway.

Summary of the Transaction (see Page 62)

        Upon the terms and subject to the conditions of the Acquisition Agreement and in accordance with the DGCL, Inovio, Submerger and VGX will enter into a business combination pursuant to which VGX will be merged with and into Submerger. Upon consummation of the Merger, VGX will cease to exist and Submerger will continue as the surviving entity and as a wholly-owned subsidiary of Inovio and change its name to VGX Pharmaceuticals, LLC. Thus, Inovio will remain the parent, publicly reporting and listed entity, retain its current subsidiaries, and hold VGX Pharmaceuticals, LLC and the current VGX subsidiaries as its direct and indirect subsidiaries upon completion of the transaction.

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        In consideration for the Merger, based on an exchange ratio and on the terms and conditions described in this joint proxy statement/prospectus:

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all of the issued and outstanding shares of common stock of VGX shall be canceled and converted into the right to receive shares of common stock of Inovio,



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all outstanding options to purchase shares of VGX common stock shall be assumed by Inovio and converted into options to purchase Inovio common stock,



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all outstanding warrants to purchase shares of VGX common stock shall be assumed by Inovio and converted into warrants to purchase Inovio common stock, and



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all outstanding convertible debt of VGX shall become debt convertible into Inovio common stock on existing terms.

        As a result, Inovio will issue and otherwise allocate for issuance under options and warrants to purchase common stock and debt convertible into common stock, a total of up to 60,689,523 shares of new Inovio common stock pursuant to the terms of the Acquisition Agreement. Following the completion of the Merger, holders of VGX common stock will become holders of Inovio common stock, and holders of options, warrants and debt exercisable or convertible for shares of VGX common stock will become holders of options, warrants, and debt exercisable or convertible for shares of Inovio common stock, respectively. In addition, Inovio and VGX have agreed that any other contractual rights to receive shares of VGX common stock, other than the VGX options, warrants and convertible debt to be assumed and converted as described above, shall be converted into rights to receive shares of Inovio common stock in accordance with the terms and conditions of the contract(s) providing such rights.

        In order to complete the transaction, Inovio stockholders must vote to approve the Merger, including the issuance of shares of Inovio common stock and other securities in exchange for all of the outstanding securities of VGX, and the 2000 Plan Amendment, and VGX stockholders must vote to approve the Merger. Pursuant to the Acquisition Agreement, upon the closing date, three members of Inovio's current board of directors and two members of the VGX board of directors will be appointed to the Inovio board of directors, and the senior management team of the combined group will be composed of executives from both Inovio and VGX will take over management of the Surviving Entity. Further terms, conditions and results of the transaction are described in the sections entitled "The Transaction" on page 62 and "The Acquisition Agreement" on page 99.

Conditions to the Transaction (see Page 112)

        Inovio's obligation to consummate the Merger and issue its securities pursuant to the Acquisition Agreement, which we refer to as the "closing," will not take place until the parties satisfy, or waive where allowable, the conditions listed in the Acquisition Agreement. These closing conditions include, but are not limited to, the following:

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Inovio's registration statement, of which this joint proxy statement/prospectus is a part, shall have become effective under the Securities Act and shall not be the subject of any stop order or proceeding seeking a stop order.



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Inovio shall have obtained the approval of Inovio's stockholders of



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the Acquisition Agreement, the Merger and the other transactions contemplated by the Acquisition Agreement; and



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the amendment of the Inovio 2000 Plan to clarify the acceleration of vesting of Inovio options issued and outstanding at the Effective Time and to remove the termination of

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unexercised Inovio options issued and outstanding under the Inovio 2000 Plan at the Effective Time.

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VGX shall have obtained the approval of VGX's stockholders of the Acquisition Agreement, the Merger and the other transactions contemplated by the Acquisition Agreement.



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The number of shares held by dissenting VGX stockholders shall not exceed 10% of the number of shares of outstanding VGX common stock.



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No governmental entity, as defined in the Acquisition Agreement, shall have enacted, issued, promulgated, enforced or entered any statute, rule, regulation, executive order, decree, injunction or other order (whether temporary, preliminary or permanent) which is in effect and which has the effect of making the Merger illegal or otherwise prohibiting consummation of the Merger, the issuance of the Inovio's securities to VGX stockholders or the assumption of the VGX securities.



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The directors and officers of VGX and Inovio in office immediately prior to the closing shall have resigned as directors and officers, unless they will be continuing in the same capacity with the combined group.



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The waiting period, if any (and any extension thereof), applicable to the Merger under the Hart-Scott-Rodino Act, or "HSR Act," shall have been terminated or shall have expired.



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Inovio shall have received an opinion of K&L Gates LLP, and VGX shall have received an opinion of Duane Morris LLP, each to the effect that the Merger will qualify as a "reorganization" within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended, or the Code.



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The representation and warranties by Inovio, VGX and Submerger contained in the Acquisition Agreement shall continue to be true and correct as of the closing.



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No event having a material adverse effect with respect to Inovio or VGX shall have occurred.



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Inovio, VGX and Submerger shall have performed or complied in all material respects with the agreements and covenants required by the Acquisition Agreement to be performed or complied with by them, and VGX and Inovio shall have received certificate from each other to such effect signed by a duly authorized officer.



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Inovio and VGX shall have furnished the other party all consents, approvals and waivers set forth in the Acquisition Agreement.



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Inovio's common stock shall continue to be listed on the NYSE Alternext or listed or quoted on an alternate securities exchange or quotation system in accordance with the other terms and conditions of the Acquisition Agreement.



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The shares issued pursuant to the Merger shall be authorized for listing on the NYSE Alternext, or listed or quoted on an alternate securities exchange or quotation system in accordance with the other terms and conditions of the Acquisition Agreement.



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VGX and Inovio shall have received customary legal opinions from each other's counsel reasonably acceptable and consistent with the opinions anticipated pursuant to the Acquisition Agreement.



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VGX's auditor's opinion with respect to the VGX audited consolidated financial statements (including restatements thereof, if applicable) for the periods ended December 31, 2005, 2006 and 2007, shall remain in full force and effect and VGX shall not have received any written notice from its auditors that such opinions and related financial statements may no longer be

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relied upon, nor that VGX's reviewed financial statements for each of the quarters ended subsequent to January 1, 2008 may no longer be relied upon.

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VGX shall have paid in full, principal and interest accrued, all VGX debt, convertible and non-convertible, other than the $4.4 million of the VGX convertible debt identified in the Acquisition Agreement and have amended such remaining notes to provide for optional conversion at $1.05 per share after the Effective Time and to provide for mandatory conversion at such price should Inovio's common stock trade at or above $2.10 for five consecutive trading days after the Effective Time.



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VGX shall have entered into a manufacturing agreement in conjunction with its prior asset sale to VGXI, Inc., and such agreement shall upon its terms be effective at the time of the closing and bear a term for at least 12 months post-closing.



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VGX shall have received payment in full of all principal and interest owed on all loans to VGX's directors, officers and/or employees and there shall be no outstanding loans from VGX or any affiliate of VGX to any director, officer or employee of VGX or any of its subsidiaries, other than advances made in the ordinary course of business for business purposes.



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The signatories to the voting trust agreement contemplated by the Acquisition Agreement shall have provided executed signature pages to the voting trust agreement, to be held in escrow pending the closing.

Termination of the Acquisition Agreement (see Page 115)

        The Acquisition Agreement may be terminated prior to the date the registration statement, of which this joint proxy statement/prospectus is a part, becomes effective, or the subsequent closing of the Merger, under several circumstances, including:

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by mutual written consent duly authorized by the boards of directors of Inovio and VGX;



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by either Inovio or VGX, if, with certain exceptions, the closing shall not have occurred by March 31, 2009, with certain automatic extensions related to the status of the registration process and special meetings;



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if a governmental entity shall have issued an order, decree or ruling or taken any other action (including the failure to take action), in any case having the effect of permanently restraining, enjoining or otherwise prohibiting the Merger, which order, decree or ruling is final and nonappealable;



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by VGX, upon a breach of any representation, warranty, covenant or agreement on the part of Inovio set forth in the Acquisition Agreement, or if any representation or warranty of Inovio shall have become untrue, in either case such that the conditions set forth in the Acquisition Agreement would not be satisfied as of the time of such breach or as of the time such representation or warranty shall have become untrue, with certain cure period exceptions;



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by Inovio, upon a breach of any representation, warranty, covenant or agreement on the part of Inovio set forth in the Acquisition Agreement, or if any representation or warranty of VGX shall have become untrue, in either case such that the conditions set forth in the Acquisition Agreement would not be satisfied as of the time of such breach or as of the time such representation or warranty shall have become untrue, with certain cure period exceptions;



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by VGX, upon written notice to Inovio setting forth



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the determination of VGX's board of directors that a competing proposal received constitutes a VGX superior offer, as defined by the Acquisition Agreement;

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the determination of VGX's board of directors to withdraw its recommendation in favor of recommending the VGX superior offer to the VGX stockholders, in satisfaction of its fiduciary duties; and



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VGX's representation of full and complete compliance with the terms of the Acquisition Agreement's no solicitation provisions prior to such termination, with certain limitations related to compliance with notice and document delivery requirements pursuant to the Acquisition Agreement; or



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by Inovio, upon written notice to Inovio setting forth



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the determination of Inovio's board of directors that a competing proposal received constitutes a Inovio superior offer, as defined by the Acquisition Agreement,



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the determination of Inovio's board of directors to withdraw its recommendation in favor of recommending the Inovio superior offer to the Inovio stockholders, in satisfaction of its fiduciary duties, and



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Inovio's representation of full and complete compliance with the terms of the Acquisition Agreement's no solicitation provisions prior to such termination, with certain limitations related to compliance with notice and document delivery requirements pursuant to the Acquisition Agreement.

        In the event that the Acquisition Agreement is terminated by either Inovio or VGX pursuant to the provisions related to recommendation of a competing superior offer, the terminating party shall pay the other party a fee equal to $3,500,000 in immediately available funds and such payment shall be the sole and exclusive remedy relating to such termination.

No Solicitation (see Page 110)

        The Acquisition Agreement contains detailed provisions prohibiting Inovio and VGX, as well as their respective officers, directors, employees, agents and representatives, from taking any action to solicit a competing acquisition proposal. Notwithstanding these restrictions, the Acquisition Agreement provides that under limited circumstances prior to the approval of the Acquisition Agreement by their respective stockholders, Inovio or VGX, upon receipt of an acquisition proposal from a third party, may furnish non-public information to that third party and/or enter into discussions or negotiations with that third party. We refer to an acquisition proposal from a third party which meets the specified criteria and is recognized as such by the relevant board of directors as a "superior offer." If either Inovio or VGX receives a superior offer, then the board of directors of the receiving party may change its recommendation relating to the transaction.

Vote of Stockholders Required (see Pages 214 and 222)

        In order to transact business at the Inovio special meeting, holders of a majority of the shares of Inovio common stock entitled to vote as of the record date for the Inovio special meeting must be present, either in person or by proxy. The approval of a business combination between Inovio and VGX, whereby Inovio will issue shares of common stock to outstanding stockholders of VGX in the Merger and upon exercise of assumed VGX options and warrants and upon conversion of VGX convertible debt assumed by Inovio on a consolidated basis, on the terms and conditions set forth in the joint proxy statement/prospectus, requires the approval of the holders of a majority of the shares of Inovio common stock entitled to vote and present at the Inovio special meeting, either in person or by proxy duly authorized. The approval of the proposed changes to the Inovio 2000 Plan requires approval of the holders of a majority of the shares of Inovio common stock entitled to vote and present at the Inovio special meeting, either in person or by proxy duly authorized. As of the close of business on the record date for the Inovio special meeting, [                ] 2009, Inovio directors, executive officers and affiliates beneficially owned and were entitled to vote [                ] shares of Inovio common stock, which represented [        ]% of the [                ] shares of Inovio common stock outstanding and entitled to vote on that date.

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        In order to transact business at the VGX special meeting, holders of the majority of the shares of VGX common stock entitled to vote as of the record date for the VGX special meeting must be present, either in person or by proxy. The approval of the business combination between Inovio and VGX, whereby Inovio will issue shares of common stock to outstanding stockholders of VGX in the Merger and upon exercise of assumed VGX options and warrants and upon conversion of VGX convertible debt assumed by Inovio on a consolidated basis, on the terms and conditions set forth in the joint proxy statement/prospectus, requires the approval of the holders of a majority of the outstanding shares of VGX common stock entitled to vote at the VGX special meeting.

        As of the close of business on the record date for the VGX special meeting, [                ] 2009, VGX directors, executive officers and affiliates beneficially owned and were entitled to vote [    ] shares of VGX common stock, which represented [    ]% of the [                ] shares of VGX common stock outstanding and entitled to vote on that date. Of such shares, shares representing        % of the shares of VGX common stock outstanding and entitled to vote are already committed to voting in favor of the Merger pursuant to certain voting agreements, as described in "Support Stockholders' Voting Agreements " beginning on page 117.

Appraisal and Dissenters Rights (see Page 81)

        If any VGX stockholder entitled to appraisal rights under DGCL with respect to the Merger has properly exercised and perfected such appraisal rights pursuant to and in accordance with Section 262 of the DGCL, and the Merger is consummated, such holder shall, to the extent allowed under applicable laws, be entitled to an appraisal by the Delaware Court of Chancery of the fair value of such shares of VGX common stock as provided in Section 262 of the DGCL, provided that such VGX stockholder acts in accordance with and meets all the requirements of Section 262 of the DGCL. Prior to the closing, Inovio, Submerger and VGX shall comply, and after the closing, Inovio and the Surviving Entity shall comply, with the information delivery and other requirements pursuant to Section 262 of the DGCL and applicable Delaware law. See Annex E for a copy of Section 262 of the DGCL.

        Notwithstanding any other provision in the Acquisition Agreement to the contrary, shares of VGX common stock that have not consented to or been voted for approval of, as applicable, the Merger and with respect to which such VGX stockholders become entitled to, and do properly exercise dissenters' rights in accordance with Section 262 of DGCL, or the "dissenting shares," will not be converted into or represent a right to receive consideration in connection with the Merger, but will instead be converted into the right to receive such consideration as may be determined to be due with respect to such dissenting shares pursuant to the DGCL. If a holder of dissenting shares, or a "dissenting stockholder," withdraws such dissenting stockholder's demand for such payment and appraisal or becomes ineligible for such payment and appraisal, then, as of the Effective Time or the occurrence of such event of withdrawal or ineligibility, whichever last occurs, such dissenting stockholder's dissenting shares will cease to be dissenting shares and will be converted into the right to receive, and will be exchangeable for the merger consideration. However, if the number of dissenting shares exceeds 10% of the number of shares of outstanding VGX common stock outstanding just prior to closing, a condition to consummation of the Merger will not be satisfied and the Merger will not close unless Inovio waives the condition.

Directors and Management of Inovio Following the Transaction (see Page 87)

        The Acquisition Agreement provides that Inovio's board of directors will take all actions necessary such that, on the closing date of the transaction, three directors who shall be acceptable to Inovio's board of directors shall be nominated and appointed to the Inovio board, including Dr. Avtar Dhillon, who shall serve as chairman of the board of the post-Merger board of directors. Further, the Acquisition Agreement provides that VGX's board of directors will take all actions necessary such that,

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on the closing date of the transaction, two directors who shall be acceptable to VGX's board of directors shall be nominated and appointed to the Inovio board. The parties shall ensure that the composition of the Inovio board upon such appointments shall comply with the rules and regulations of the NYSE Alternext, or other applicable securities exchange or quotation system, and the SEC. Consistent with these requirements, the parties have identified and anticipate that Dr. Avtar Dhillon, Dr. J. Joseph Kim, Mr. Simon Benito, Mr. Chin-Cheong Chong and Dr. Morton Collins will serve on the post-Merger board of directors.

        The post-Merger management team of the combined group shall consist of the following persons as of closing:

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J. Joseph Kim shall be appointed Chief Executive Officer;



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Avtar Dhillon shall be appointed President;



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Peter Kies shall be appointed Chief Financial Officer;



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C. Jo White shall be appointed Chief Medical Officer;



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Niranjan Sardesai shall be appointed Senior Vice President, Research & Development;



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Kevin Rassas shall be appointed Senior Vice President, Business Development;



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Gene Kim shall be appointed Vice President, Finance;



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Punit Dhillon shall be appointed Vice President, Operations;



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Michael Fons shall be appointed Vice President, Corporate Development;



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Iacob Mathiesen, Vice President, Research & Development and Managing Director, Inovio AS; and



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Ruxandra Draghi-Akli shall be appointed Vice President, Research.

Opinion of Inovio's Financial Advisor (see Page 74)

        In connection with the Merger, Inovio's board of directors received a written opinion, dated July 2, 2008, of Inovio's financial advisor, Oppenheimer & Co. Inc., referred to as Oppenheimer, as to the fairness, from a financial point of view and as of the date of the opinion, to Inovio of the Merger Exchange Ratio provided for in the original agreement and plan of merger (prior to its amendment). Oppenheimer's opinion, dated July 2, 2008, relates only to the Merger Exchange Ratio provided for in the original merger agreement and does not take into account any events or developments after the date of such opinion, including any modification to the proposed Merger or the Merger Exchange Ratio provided for in the Acquisition Agreement, dated as of December 5, 2008.

        The full text of Oppenheimer's written opinion, dated July 2, 2008, which describes the assumptions made, procedures followed, matters considered and limitations on the review undertaken, is attached to this joint proxy statement/prospectus as Annex B . Oppenheimer's opinion was provided to Inovio's board of directors in connection with its evaluation of the Merger Exchange Ratio from a financial point of view to Inovio and does not address any other aspect of the Merger. Oppenheimer's opinion does not address the underlying business decision of Inovio to effect the Merger, the relative merits of the Merger as compared to any alternative business strategies that might exist for Inovio or the effect of any other transaction in which Inovio might engage and does not constitute a recommendation to any stockholder as to how such stockholder should vote or act with respect to any matters relating to the Merger.

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Interests of Directors, Officers and Affiliates (see Page 86)

        In considering the recommendation of Inovio's board of directors that Inovio stockholders vote in favor of the issuance of Inovio's securities in conjunction with the Merger and the resulting change of control of Inovio, Inovio stockholders should be aware that some Inovio executive officers and directors have interests in the transaction that may be different from, or in addition to, their interests as stockholders of Inovio. These interests include the execution of new employment agreements, to be effective upon closing of the Merger, between Inovio and its current executive officers, which provide for certain payments upon closing of the Merger and eligibility for future severance payments under certain terms and conditions.

        Inovio's board of directors was aware of these interests and considered them, among other matters, in making its recommendation to Inovio's stockholders that they approve the transaction and other related proposals. In addition, subsequent to such recommendation, Dr. Avtar Dhillon, Mr. Simon Benito and Mr. Chin-Cheong Chong were selected to continue service on the Inovio board as directors post-Merger, for which Mr. Benito and Mr. Chong will continue to receive customary director compensation, and Dr. Dhillon will also serve as chairman of the board of directors and president of Inovio post-Merger.

        In considering the recommendation of VGX's board of directors to VGX's stockholders that they approve the transaction, VGX stockholders should be aware that some officers and directors of VGX have interests in the transaction that are different from, or in addition to, the other VGX stockholders. These interests include:

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Dr. J. Joseph Kim, Chief Executive Officer of VGX, will become the Chief Executive Officer of Inovio post-Merger; and



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Dr. C. Jo White, Chief Medical Officer of VGX, will serve as the Chief Medical Officer of Inovio post-Merger.

        As of September 30, 2008, all current directors and executive officers of VGX as a group beneficially owned approximately 33.6% of the shares of VGX common stock. Under the terms of the Acquisition Agreement, at the effective time of the Merger, each outstanding and unexercised option to purchase shares of VGX common stock, whether vested or unvested, will be assumed by Inovio and will become an option to acquire, on the same terms and conditions as were applicable under the stock option agreement by which such option is evidenced and the stock option plan under which such option was issued, an option to purchase shares of Inovio common stock. VGX's current executive officers and directors, as of September 30, 2008, own vested and unvested options and warrants to purchase an aggregate of 8,181,800 shares VGX common stock.

        VGX's board of directors was aware of these interests and considered them, among other matters, in making its recommendation to VGX's stockholders that they approve the transaction. In addition, subsequent to such recommendation, Dr. J. Joseph Kim and Dr. Morton Collins were selected to serve as directors of Inovio post-Merger, for which Dr. Collins will receive customary director compensation.

Accounting Treatment of the Merger (see Page 84)

        The Merger will be accounted for using the purchase method of accounting for business combinations under United States generally accepted accounting principles, which is referred to as GAAP. Although the parties view the business combination of Inovio and VGX as a "merger of equals," Inovio has been determined to be the acquirer for purposes of generally accepted accounting principles, in accordance with the provisions of Statement of Financial Accounting Standards No. 141, Business Combinations (SFAS 141). Accordingly, the historical consolidated financial statements of Inovio will be carried forward at their historical cost, the assets and liabilities of VGX will be recorded at their fair value and the results of operations of VGX will be included in the consolidated financial statements from the date of the closing of the Merger. In evaluating the appropriate accounting

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treatment under SFAS 141, the parties and their accountants considered all relevant facts and circumstances, including, without limitation, the relative operational size and revenue production of the legacy entities, the relative voting rights of the legacy holders in the combined group, the composition of the post-Merger company's board of directors and its committees, and the composition and relevant experience of senior management.