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UNITED STATES SECURITIES AND
    EXCHANGE COMMISSION
 Washington, D.C.
    20549
      Form 10-K
  þ

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended
    December 31, 2005oro

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the transition period
    from          to   Commission File Number:
    000-51709
  Iomai Corporation
 (exact name of registrant as
    specified in its charter)
  Delaware

52-2049149(State or other jurisdiction
    of
    incorporation or organization)

(I.R.S. Employer
    Identification No.)   20 Firstfield Road, Suite 250, Gaithersburg, Maryland
    20878
 (Address of principal executive
    offices including zip code)
  Registrants telephone number, including area code:
 (301) 556-4500
  Securities registered pursuant to Section 12(b) of the
    Act:
  None

None(Title of each Class)

(Name of each exchange on which
    registered)   Securities registered pursuant to Section 12(g) of the
    Act:
 Common Stock, $.01 Par Value Per Share
  o þ
  þ o
  o þ
  Regulation S-K Form 10-K Form 10-K. o
  Rule 12b-2
  Large
    accelerated filer o
    Accelerated
    Filer  o
    Non-accelerated
    filer þ  Rule 12b-2 o þ
    DOCUMENTS
    INCORPORATED BY REFERENCE
  Form 10-K.




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TABLE OF
    CONTENTS
  PagePART
    IITEM 1.

BUSINESS


1Overview


1Market
    Overview


2The TCI
    Solution


5Products in
    Development


6Our
    Strategy


11Intellectual
    Property and Proprietary Technology


12Manufacturing
    and Commercial Supply


15Competition


16Government
    Regulation


17Sales and
    Marketing


19Employees


19Corporate
    Information


19Availability
    of Periodic SEC Reports


19ITEM 1A.

RISK FACTORS


19ITEM 1B.

UNRESOLVED STAFF
    COMMENTS


34ITEM 2.

PROPERTIES


34ITEM 3.

LEGAL
    PROCEEDINGS


34ITEM 4.

SUBMISSION OF
    MATTERS TO A VOTE OF SECURITY HOLDERS


34PART IIITEM 5.

MARKET FOR
    REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND
    ISSUER PURCHASES OF EQUITY SECURITIES


35ITEM 6.

SELECTED FINANCIAL
    DATA


37ITEM 7.

MANAGEMENTS
    DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
    OPERATIONS


38ITEM 7A.

QUANTITATIVE AND
    QUALITATIVE DISCLOSURES ABOUT MARKET RISK


49ITEM 8.

FINANCIAL
    STATEMENTS AND SUPPLEMENTARY DATA


49ITEM 9.

CHANGES IN AND
    DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
    DISCLOSURE


49ITEM 9A.

CONTROLS AND
    PROCEDURES


49ITEM 9B.

OTHER
    INFORMATION


49PART IIIITEM 10.

DIRECTORS AND EXECUTIVE OFFICERS
    OF THE REGISTRANTITEM 11.

EXECUTIVE COMPENSATIONITEM 12.

SECURITY OWNERSHIP OF CERTAIN
    BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERSITEM 13.

CERTAIN RELATIONSHIPS AND RELATED
    TRANSACTIONSITEM 14.

PRINCIPAL ACCOUNTING FEES AND
    SERVICESPART IVITEM 15.

EXHIBITS, FINANCIAL
    STATEMENT SCHEDULES


5015(a) (1)
    Financial Statements


5015(a) (2)
    Financial Statement Schedules


5015(a) (3)
    Exhibits


5015(b) Exhibits


50   i




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CAUTIONARY
    STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
  Form 10-K
  
    the implementation of our corporate strategy;
    our future financial performance and projected expenditures;
    our ability to enter into future collaborations with
    pharmaceutical, biopharmaceutical and biotechnology companies
    and academic institutions or to obtain funding from government
    agencies;
    our product research and development activities, including the
    timing and progress of our clinical trials, and projected
    expenditures;
    our technologys potential efficacy, advantages over
    current approaches to vaccination and broad applicability to
    infectious diseases;
    our ability to receive regulatory approvals to develop and
    commercialize our product candidates;
    our ability to increase our manufacturing capabilities for our
    product candidates;
    our ability to develop or obtain funding for our immunostimulant
    patch for pandemic flu applications;
    our projected markets and growth in markets;
    our product formulations and patient needs and potential funding
    sources;
    our staffing needs;
    our use of the proceeds from this offering; and
    our plans for sales and marketing.      ® tm tm
 ii




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PART I  Item 1.
    Business OVERVIEW  and/or
      
    Needle-free flu vaccine patch.  We are
    developing a needle-free flu vaccine patch that combines flu
    antigens with an adjuvant in a single patch. We completed a
    Phase 1 study of our needle-free flu vaccine patch in
    Europe during the fourth quarter of 2004 and are working to
    further optimize our formulation and product design. We plan to
    commence a Phase 1/2 trial during the third quarter of
    2006, with the goal of stimulating an immune response equal to
    or greater than that of existing injectable vaccines. We plan to
    conduct additional Phase 2 trials after completing the
    Phase 1/2 trial. In the development of our needle-free flu
    vaccine patch, we are also actively seeking to collaborate with
    suppliers of commercial flu antigens because the manufacture of
    flu antigens is not part of our business strategy. Each flu
    season, approximately 15 million to 60 million people
    in the United States become ill with influenza. This infection
    rate results in approximately 36,000 deaths and approximately
    200,000 hospitalizations in the United States annually.
    Approximately 80 million people in the United States are
    vaccinated against the flu annually.
    IS patch for elderly receiving flu
    vaccines.  We are developing our IS patch to
    improve the immune response of the elderly to existing
    injectable influenza vaccines. We have completed a number of
    Phase 1 studies in the United States and Phase 1 and
    Phase 2 studies in Europe. We are planning to commence a
    Phase 2 study in the United States in 2006. Approximately
    40,000 individuals aged 65 and over die from influenza,
    influenza-related pneumonia and related respiratory
    complications in the United States each year, making influenza
    one of the leading causes of death among the elderly. According
    to the United States Centers for Disease Control and Prevention,
    or CDC, over 65% of the elderly population in the United States
    receive influenza vaccination, and public health officials have
    stated the goal of achieving 90% vaccination rates by 2010. Our
    IS patch, when administered in combination with existing
    commercially available injectable flu vaccines distributed by
    different flu vaccine manufacturers, which will require
    individual testing and FDA approval with our IS patch, is
    designed to improve the immune response of the elderly to these
    flu vaccines.
    IS patch for pandemic flu preclinical
    program.  We are developing an IS patch to achieve
    dose-sparing when administered in combination with pandemic flu
    vaccines. While there are currently pandemic flu vaccines under
    development by different manufacturers, no pandemic flu vaccines
    have been approved for use to date. We have conducted
    preclinical studies in mice, the results of which suggest that a
    10-fold
    reduction in vaccine dose may be achievable when our IS patch is
    applied to the injection site of pandemic flu 1




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vaccine that is delivered into muscle tissue, and a 100-fold
    reduction in vaccine dose may be achievable when our IS patch is
    applied to the injection site of pandemic flu vaccine that is
    delivered just below the skin surface. In January 2005, the NIH
    awarded us a two-year, $2.9 million grant for further
    development of our IS patch technology for pandemic flu
    applications. We are continuing to conduct preclinical studies
    of our IS patch for pandemic flu and continue to seek additional
    government funding for these studies. If our IS patch for
    pandemic flu receives regulatory approval, we expect to sell our
    IS patches to the United States government rather than to the
    public. While it is difficult to estimate the ultimate size of
    the market for our IS patch for pandemic flu, the United States
    government recently announced a $7.1 billion initiative to
    prevent the spread of pandemic flu.  
    Needle-free travelers diarrhea vaccine
    patch.  We are also developing a needle-free
    travelers diarrhea vaccine patch product candidate,
    consisting of a new vaccine and patch delivery system, for which
    we completed a double-blind, placebo-controlled safety and
    efficacy trial in the United States during the first quarter of
    2005. The results of this study demonstrated the product
    candidates ability to induce a strong immune response that
    diminished the severity and delayed the onset of the most common
    form of travelers diarrhea. In a recent Phase 1/2
    travelers diarrhea trial comparing our current dry patch
    formulation to a wet patch, interim data indicates that our
    current dry patch formulation provided equal or greater immune
    responses to vaccination than the wet patch. We are currently
    preparing for additional Phase 2 trials designed to
    determine the final dry patch formulation, number and timing of
    doses, and duration of patch wear. If we successfully complete
    these Phase 2 trials on our currently anticipated timeline
    of completion by early 2007, we expect to begin enrollment in
    Phase 3 clinical trials in mid-2007. Travelers
    diarrhea usually is contracted by the ingestion of food or water
    contaminated with Enterotoxigenic E. colibacteria
    (ETEC). The CDC estimates that 20% to 50% of international
    travelers contract travelers diarrhea. Currently, in the
    United States there are no approved vaccines against
    travelers diarrhea caused by ETEC.     MARKET
    OVERVIEW  The
    immune system and vaccines
     2




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Our
    initial target markets
  Influenza
      Influenza
    in the elderly
    Pandemic
    flu
   3




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Travelers
    diarrhea
    E. coli
  over-the-counter
 4




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THE TCI
    SOLUTION        
    
    Following pretreatment that involves a mild abrasion of the skin
    at the application point to disrupt the outer dead layer of
    skin, known as the stratum corneum, a patch containing an
    adjuvant and one or more antigens from the target pathogen (the
    three antigens associated with the flu vaccine each year, for
    example) is applied.
    After permeating the disrupted stratum corneum, the adjuvant and
    antigens reach and activate the underlying Langerhans cells.
    The Langerhans cells take up the adjuvant and antigens and
    migrate through the skin and the lymphatic system to the nearest
    lymph node, where they stimulate a systemic immune response. 5




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
    Increased efficacy with reduced risk of side
    effects.  Because the adjuvant and antigens
    delivered by our needle-free vaccine patch cannot penetrate
    further than the outer layers of the skin, neither the adjuvant
    nor the antigens circulate systemically as they would if
    delivered through injection. Preventing a systemic distribution
    of adjuvants and antigens reduces the risk of side effects. As a
    result, our needle-free vaccine patch permits the use of more
    potent adjuvants relative to other systemic means of delivery
    (such as injection, intranasal and oral delivery), which
    increases the overall level of immune response. We and our
    collaborators have conducted over 21 trials, including
    three double-blind, placebo-controlled trials, with over 1,600
    volunteers receiving the LT adjuvant, and no vaccine-related
    serious adverse events from applying this adjuvant to the skin
    were observed.
    Increased compliance.  We believe needle-free
    administration has the potential to increase acceptance by
    patients who dislike the use of needles and desire a more
    convenient and less painful means of vaccination.
    Safer administration and disposal.  Needle-free
    administration eliminates the risk to the health care provider
    of inadvertent needle sticks and avoids the need to dispose of
    contaminated needles.
    Reduced dosages.  By targeting the skin and
    eliciting a stronger immune response, we believe the amount of
    antigen required for immunization may be reduced.
    Cheaper transport and storage.  Most vaccines
    must be stored in refrigerated environments. We believe our
    vaccines will be stable at room temperature, making both
    transport and storage without refrigeration simple and
    inexpensive.   PRODUCTS
    IN DEVELOPMENT      Product Candidates

Clinical StatusNeedle-free flu vaccine patch


Phase 1IS patch for elderly receiving flu
    vaccines


Phase 2IS patch for pandemic flu


PreclinicalNeedle-free travelers
    diarrhea vaccine patch


Phase 2  6




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Needle-free
    flu vaccine patch
        Immunostimulant
    (IS) patch for elderly receiving flu vaccines
   7




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Enhanced
    Immune Responses In Elderly After IS Patch Application
  
  time-of-patch-wear.
  IS
    patch for pandemic flu
  and/or
 8




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100-fold
  
    Needle-free
    travelers diarrhea vaccine patch
  LT-secreting
 9




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proof-of-principle
      Antibody
    Response to Toxin After Vaccination
  
   10




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head-to-head
    Additional
    indications
   OUR
    STRATEGY    
    Seek a strategic collaboration for the development, marketing
    and commercialization of our needle-free flu vaccine
    patch.  As we do not intend to manufacture the flu
    antigens for our needle-free flu vaccine patch, we are actively
    exploring collaborations with large pharmaceutical companies in
    the United States and Europe that would provide the flu antigens
    and financial resources to develop and, if approved,
    commercialize our needle-free flu vaccine patch. To date, we
    have retained all of our rights to this product, and we believe
    this will enable us to obtain advantageous terms in any
    potential collaboration.
    Commercialize our IS patch for elderly receiving flu
    vaccines.  We intend to advance our IS patch for
    elderly receiving flu vaccines into and through Phase 3
    clinical trials ourselves, and then into 11




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commercialization, possibly with a partner. To date, we have
    retained all of our rights to this product candidate, and we
    believe this will enable us to obtain advantageous terms in any
    potential collaboration.  
    Develop our IS patch for pandemic flu
    applications.  We plan to utilize the
    $2.9 million grant from NIH to fund the further development
    of our IS patch technology for pandemic flu applications. We
    also plan to respond to the request for proposals to be issued
    by the U.S. Department of Health and Human Services for
    contracts to develop antigen sparing approaches to administering
    flu vaccines, to increase overall influenza vaccine capacity by
    utilizing adjuvants or alternate administration routes.
    Commercialize our needle-free travelers diarrhea
    vaccine patch.  We intend to advance our
    needle-free travelers diarrhea vaccine patch into and
    through Phase 3 clinical trials ourselves, and then into
    commercialization, possibly with a partner. To date, we have
    retained all of our rights to this product candidate, and we
    believe this will enable us to obtain advantageous terms in any
    potential collaboration.
    Continue to develop and expand our manufacturing capabilities
    to retain manufacturing rights.  We intend to
    retain manufacturing rights for our adjuvant and patch
    technologies. To the extent practicable, we intend to continue
    to develop and expand our manufacturing capabilities to meet our
    expected demands. In 2005, we completed the build-out and
    validation of the major systems of a pilot manufacturing
    facility, and we believe we currently have the capacity to
    produce anticipated needs through initial commercialization of
    our first product.
    Leverage our broad technology platform to develop additional
    product candidates.  As our TCI technology has the
    potential to be useful with many different types of vaccines,
    other companies developing vaccines represent possible partners
    with which to develop new products. For example, we are working
    with a large pharmaceutical company to evaluate three vaccine
    candidates in preclinical studies. We intend to continue to
    evaluate and develop additional product candidates to expand our
    pipeline where we perceive a significant unmet medical need and
    commercial potential. INTELLECTUAL
    PROPERTY AND PROPRIETARY TECHNOLOGY      
    3 issued US patents;
    14 US non-provisional patent applications;
    20 issued foreign patents;
    29 foreign patent applications that are in various national
    stages of prosecution; and
    2 foreign patent applications not at the national stage.   12




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
    net sales of licensed products by us and by our
    affiliates; and
    revenues received by us from the licensed TCI technology and by
    our affiliates under any sublicenses of the licensed TCI
    technology.
    In addition, we are required to pay to WRAIR:  
    a minimum annual payment of $15,000 as a non-recoverable advance
    against royalty and milestone payments;
    milestone payments upon the achievement of specified regulatory
    approval based milestones, which may total up to $1,560,000 in
    the aggregate if we secure regulatory approval for six or more
    products; and
    all costs and expenses relating to prosecution of patent
    protection for the licensed TCI technology.      
    such sublicenses are necessary to fulfill public health and
    safety needs that we are not reasonably addressing;
    such sublicenses are necessary to meet requirements for public
    use specified by applicable United States government regulations
    with which we are not reasonably in compliance; or
    we are not manufacturing our products substantially in the
    United States.    
    do not expend reasonable efforts and resources to carry out the
    development and marketing of the licensed TCI technology and do
    not manufacture, use or operate products that use the TCI
    technology by April 2008 (subject to extension based upon a
    showing of reasonable diligence in developing the technology);
    do not continue to make our TCI-based products available to the
    public on commercially reasonable terms after we have developed
    such products;
    misuse the licensed TCI technology or permit any of our
    affiliates or sub-licensees to do so; 13




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
    fail to pay royalties or meet our other payment or reporting
    obligations under the license;
    become bankrupt; or
    otherwise materially breach our obligations under the license.          
    royalties equal to a percentage of net sales of products
    incorporating LT produced under the license;
    milestone payments based upon regulatory approval of products
    incorporating LT produced under the license, which may total up
    to $500,000 for each approved product; and
    time-based fees for any continuing technical assistance we may
    request at DowPharmas prevailing hourly rate, with fees
    for the first 500 hours of technical assistance due only
    upon the date the first milestone payment, if any, is due.      paid-up
  
    at any time during the term of the license agreement, reasonably
    agree with Dow that there are material health and safety risks
    associated with products produced under the license which create
    a material risk of liability to DowPharma;
    fail to meet our payment obligations under the license;
    become bankrupt; or
    otherwise materially breach our obligations under the license. 14




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MANUFACTURING
    AND COMMERCIAL SUPPLY         15




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COMPETITION      over-the-counter
      
    safety and efficacy profile;
    product price;
    ease of application;
    length of time to receive regulatory approval;
    product supply; 16




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
    enforceability of patent and other proprietary rights; and
    marketing and sales capability.   GOVERNMENT
    REGULATION      
    preclinical laboratory tests and animal tests;
    the submission to the FDA of an investigational new drug
    application, or IND, for human clinical testing, which must
    become effective before human clinical trials may begin;
    adequate and well-controlled human clinical trials to establish
    the safety and efficacy of the product for its specific intended
    use(s);
    the submission to the FDA of a BLA;
    satisfactory completion of an FDA inspection of the
    manufacturing facility or facilities at which the product is
    made to assess compliance with current good manufacturing
    practices, or cGMP; and
    FDA review and approval of the BLA.      
    evaluate preliminarily the efficacy of the drug for specific,
    targeted conditions; 17




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
    determine dosage tolerance and appropriate dosage; and
    identify possible adverse effects and safety risks.    and/or
         18




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SALES AND
    MARKETING   EMPLOYEES   CORPORATE
    INFORMATION  (301) 556-4500.
 AVAILABILITY
    OF PERIODIC SEC REPORTS  www.iomai.com. Form 10-K, Form 10-Q, Form 8-K, 1-800-SEC-0330.
  Item 1A.
    Risk
    Factors  Cautionary Statement Regarding Forward-Looking
    Statements
  Risks
    Relating to Our Business
  We are
    a biopharmaceutical company with a limited operating history and
    have generated no revenue from product sales. As a development
    stage company, we face many risks inherent in our business. If
    we do not overcome these risks, our business will not
    succeed.   19




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
    obtain sufficient capital to support our efforts to develop our
    technology and commercialize our product candidates;
    complete and continue to enhance the product characteristics and
    development of our product candidates; and
    attempt to transition from a development stage company to a
    company capable of supporting commercial activities.  We
    have a history of operating losses and may never be
    profitable.        We
    will need additional funding, and we cannot guarantee that we
    will find adequate sources of capital in the
    future.    
    the number, size and complexity of our clinical trials;
    our progress in developing our product candidates;
    the timing of and costs involved in obtaining regulatory
    approvals;
    costs of manufacturing our product candidates; 20




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
    costs to maintain, expand and protect our intellectual property
    portfolio; and
    costs to develop our sales and marketing capability.      The
    success of some programs, such as our needle-free flu vaccine
    patch, may depend on licensing biologics from, and entering into
    collaboration arrangements with, third parties. We cannot be
    certain that our licensing or collaboration efforts will succeed
    or that we will realize any revenue from them.
        
    may lose our rights to develop and market our product candidates;
    may lose patent
    and/or trade
    secret protection for our product candidates;
    may experience significant delays in the development or
    commercialization of our product candidates; 21




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
    may not be able to obtain any other licenses on acceptable
    terms, if at all; and
    may incur liability for damages.    None
    of our product candidates has been approved for commercial sale,
    and we may never receive such approval.
            Our
    technology is unproven and presents challenges for our product
    development efforts.
    
    research could demonstrate that the scientific basis of our
    technology is incorrect or less sound than we had believed;
    unexpected research results could reveal side effects or other
    unsatisfactory conditions that either will add cost to
    development of our product candidates or jeopardize our ability
    to complete the necessary clinical trials; and 22




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
    time and effort required to solve technical problems could
    sufficiently delay the development of product candidates such
    that any competitive advantage that we may enjoy is lost.      As
    part of our product development efforts, we may make significant
    changes to our product candidates. These changes may not yield
    the benefits that we expect.
    We
    recently began testing a new formulation for our TCI patch
    technology. If this new formulation does not perform as well as
    we expect, we will need to seek an alternate formulation for our
    patch, which would delay, or prevent, the development of our TCI
    products.
   23




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We may
    be required to conduct clinical trials of our IS patch with flu
    vaccines developed by different manufacturers, which may lead to
    added cost and delay in approval and commercialization of our IS
    patch.
    We
    recently began developing and manufacturing heat labile toxin
    which may not perform comparably to the heat labile toxin we
    have purchased for use in previous clinical
    trials.
    The
    skin pretreatment methods used in connection with our product
    candidates may make our products less attractive to
    consumers.
    If any
    of our products is approved for commercial sale, we may be
    subject to penalties if we fail to comply with post-approval
    regulatory requirements or experience unanticipated problems
    with any approved products.
    
    product recalls;
    revocation of previously granted approvals; 24




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
    the need to conduct additional clinical trials; and
    fines and other censures.    If
    physicians and patients do not accept our products, we may be
    unable to generate significant revenue.
    Our IS
    patch for pandemic flu program relies on government health
    organizations for funding clinical development and for
    ultimately procuring the product, if approved.
     25




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Our
    license to use TCI technology from The Walter Reed Army
    Institute of Research, or WRAIR, is critical to our success.
    Under some circumstances, WRAIR may modify or terminate our
    license or sublicense the TCI technology to third parties which
    could adversely affect our business.
    
    do not expend reasonable efforts and resources to carry out the
    development and marketing of the licensed TCI technology and do
    not manufacture, use, or operate products that use the TCI
    technology by April 2008 (subject to extension based upon a
    showing of reasonable diligence in developing the technology);
    do not continue to make our TCI-based products available to the
    public on commercially reasonable terms after we have developed
    such products;
    misuse the licensed TCI technology or permit any of our
    affiliates or sub-licensees to do so;
    fail to pay royalties or meet our other payment or reporting
    obligations under the license;
    become bankrupt; or
    otherwise materially breach our obligations under the license.      
    such sublicenses are necessary to fulfill public health and
    safety needs that we are not reasonably addressing;
    such sublicenses are necessary to meet requirements for public
    use specified by applicable United States government regulations
    with which we are not reasonably in compliance; or
    we are not manufacturing our products substantially in the
    United States.     26




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If we
    are unable to protect our intellectual property, we may not be
    able to operate our business profitably.
      If we
    are unable to protect the confidentiality of our proprietary
    information and know-how, the value of our technology and
    products could be adversely affected.
    If the
    use of our technology conflicts with the intellectual property
    rights of third parties, we may incur substantial liabilities,
    and we may be unable to commercialize products based on this
    technology in a profitable manner, if at all.
   27




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
    we may become involved in time-consuming and expensive
    litigation, even if the claim is without merit;
    we may become liable for substantial damages for past
    infringement if a court decides that our technology infringes
    upon a competitors patent;
    a court may prohibit us from selling or licensing our product
    without a license from the patent holder, which may not be
    available on commercially acceptable terms, if at all, or which
    may require us to pay substantial royalties or grant cross
    licenses to our patents; and
    we may have to redesign our product so that it does not infringe
    upon others patent rights, which may not be possible or
    could be very expensive and time-consuming.    We may
    be involved in lawsuits to protect or enforce our patents or the
    patents of our collaborators or licensors, which could be
    expensive and time consuming.
        We
    depend on our key personnel, the loss of whom would adversely
    affect our operations. If we fail to attract and retain the
    talent required for our business, our business will be
    materially harmed.
   28




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We
    rely on third parties to conduct our clinical trials, and those
    third-parties may not perform satisfactorily, including failing
    to meet established deadlines for the completion of such trials.
    Our
    competitors may have superior products, manufacturing capability
    or marketing expertise.
    
    develop products or product candidates earlier than we do;
    form collaborations before we do, or preclude us from forming
    collaborations with others;
    obtain approvals from the FDA or other regulatory agencies for
    such products more rapidly than we do;
    develop and validate manufacturing processes more rapidly than
    we do;
    obtain patent protection or other intellectual property rights
    that would limit our ability to use our technologies or develop
    our product candidates;
    develop products that are safer or more effective than those we
    develop or propose to develop; or
    implement more effective approaches to sales and marketing.    E. coli bacteria over-the-counter,
 29




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Our
    ability to generate revenues will be diminished if we fail to
    obtain acceptable prices or an adequate level of reimbursement
    for our
    products.
  out-of-pocket.
    
    government and health administration authorities;
    private health insurers; and
    other third party payors.   30




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We may
    not be able to manufacture our product candidates in commercial
    quantities, which would prevent us from commercializing our
    product
    candidates.
  scale-up
  We
    have no experience in sales, marketing and distribution and will
    depend on the sales and marketing efforts of third
    parties.
    Our
    business exposes us to potential product liability
    claims.
      We
    deal with hazardous materials that may cause injury to others
    and are regulated by environmental laws that may impose
    significant costs and restrictions on our
    business.
  E. coli
 31




---



##### 



Until
    recently, we have operated as a private company and as a result,
    we have limited experience attempting to comply with public
    company obligations. Attempting to comply with these
    requirements will increase our costs and require additional
    management resources, and we still may fail to
    comply.
      If we
    fail to maintain an effective system of internal control over
    financial reporting, we may not be able to accurately report our
    financial results or prevent fraud. As a result, stockholders
    could lose confidence in our financial and other public
    reporting, which would harm our business and the trading price
    of our common
    stock.
    Investment
    Risks
  We
    expect that our stock price will fluctuate significantly, which
    may adversely affect holders of our stock and our ability to
    raise
    capital.
    
    the timing and the results from our clinical trial programs;
    FDA or international regulatory actions;
    failure of any of our product candidates, if approved, to
    achieve commercial success;
    announcements of clinical trial results or new product
    introductions by our competitors;
    market conditions in the pharmaceutical, biopharmaceutical and
    biotechnology sectors; 32




---



##### 




    developments concerning intellectual property rights;
    litigation or public concern about the safety of our potential
    products;
    actual and anticipated fluctuations in our quarterly operating
    results;
    deviations in our operating results from the estimates of
    securities analysts;
    additions or departures of key personnel;
    third party reimbursement policies; and
    developments concerning current or future strategic alliances.    If the
    price and volume of our common stock experience extreme
    fluctuations, then we could face costly
    litigation.
    Our
    directors and management will exercise significant control over
    our
    company.
    We may
    not achieve our projected development goals in the time frames
    we announce and expect.
    Provisions
    of Delaware law or our charter documents could delay or prevent
    an acquisition of our company, even if the acquisition would be
    beneficial to our stockholders, and could make it more difficult
    for you to change management.
      
    a staggered board of directors;
    a prohibition on stockholder action through written consent; 33




---



##### 




    a requirement that special meetings of stockholders be called
    only by the chairman of the board of directors, the chief
    executive officer, or the board of directors pursuant to a
    resolution adopted by a majority of the total number of
    authorized directors;
    advance notice requirements for stockholder proposals and
    nominations; and
    the authority of the board of directors to issue preferred stock
    with such terms as it may determine.    Because
    we do not expect to pay dividends in the foreseeable future, you
    must rely on stock appreciation for any return on your
    investment.
    Item 1B.
    Unresolved
    Staff Comments    Item 2.
    Properties    Item 3.
    Legal
    Proceedings    Item 4.
    Submission
    of Matters to a Vote of Security Holders    
    amendment of our Second Amended and Restated Certificate of
    Incorporation to effect a
    1-for-13
    reverse stock split of all issued and outstanding Common Stock;
    election of M. James Barrett and Stanley C. Erck as Class I
    directors, to serve until the annual meeting of stockholders in
    2006, election of Jeff Himawan and R. Gordon Douglas as
    Class II directors, to serve until the annual meeting of
    stockholders in 2007, election of James Young and Richard
    Douglas as Class III directors, to serve until the annual
    meeting of stockholders in 2008;
    approval and adoption of our Third Amended and Restated
    Certificate of Incorporation, which became effective
    concurrently with the closing of the initial public offering of
    our Common Stock;
    approval and adoption of our Second Amended and Restated
    By-laws, which became effective immediately upon approval by the
    stockholders; 34




---



##### 




    approval and adoption of our 2005 Incentive Plan, which became
    effective concurrently with the closing of the initial public
    offering of our Common Stock; and
    approval and adoption of our 2006 Employee Stock Purchase Plan,
    which became effective concurrently with the closing of the
    initial public offering of our Common Stock.    Executive
    Officers of the Registrant
    Name

Age


Position(s)Stanley C. Erck


57


President, Chief Executive
    Officer, Treasurer and DirectorGregory M. Glenn, M.D.


51


Senior Vice President and Chief
    Scientific OfficerRussell P. Wilson


46


Senior Vice President, Chief
    Financial Officer, General Counsel and Secretary   Stanley C. Erck.
  Gregory M. Glenn, M.D.
  Russell P. Wilson.
  (301) 556-4478.
 PART II  Item 5.
    Market
    for the Registrants Common Equity, Related Stockholder
    Matters and Issuer Purchases of Equity Securities   35




---



##### 



High


Low2006First Quarter (through
    March 15, 2006)

$
7.34


$
5.22       Securities
    Authorized For Issuance Under Equity Compensation
    Plans
    Number of SecuritiesNumber of Securities





Remaining Available forto Be Issued


Weighted-average


Future Issuance UnderUpon Exercise of


Exercise Price of


Equity Compensation PlanOutstanding Options,


Outstanding Options,


(Excluding SecuritiesWarrants and Rights(1)


Warrants and Rights


Reflected in Column(a))(2)Plan Category

(a)


(b)


(c)Equity compensation plans approved
    by security holders


1,893,264


$
1.64



1,187,074Equity compensation plans not
    approved by security holders










Total


1,893,264







1,187,074     (1)
    
    Includes (i) outstanding options to purchase
    50,380 shares of common stock under the 1998 Plan, of which
    50,380 have been vested; and (ii) outstanding awards to
    purchase 1,842,884 shares of common stock under the 1999
    Plan, of which 734,368 have been vested. Options granted under
    the 1999 Plan to purchase 38,169 shares of common stock
    were exercised prior to December 31, 2005.  (2)
    
    Includes (i) up to 26,543 shares of common stock that
    may be issued under the 1998 Plan; (ii) up to
    120,531 shares of common stock that may be issued under the
    1999 Plan; and (iii) up to 1,040,000 shares of common
    stock that may be issued under the 2005 Plan. Does not include
    up to 80,000 shares that may be issued under the 2006
    Employee Stock Purchase Plan which became effective upon our
    initial public offering.  Use of
    proceeds from registered securities
  Form S-1/A No. 333-128765),
 36




---



##### 



Item 6.
    Selected
    Financial Data  Form 10-K.
  Years Ended
    December 31,Statement of Operations
    Data:

2001


2002


2003


2004


2005(In thousands, except share and
    per share data)Revenues:License, option agreements and
    grants

$



$
995


$
1,601


$
2,345


$
2,371Total revenues






995



1,601



2,345



2,371Cost and expenses:Research and development


6,463



7,354



13,332



14,349



16,529General and administrative


4,666



2,411



3,348



3,206



3,780Purchased in-process research and
    development






2,517











Reimbursed by related party


(5,736
)


(426
)










Loss on investments in related
    entities


4,905















Total costs and expenses


10,298



11,856



16,680



17,555



20,309Loss from operations


(10,298
)


(10,861
)


(15,079
)


(15,210
)


(17,938
)Other (expense)
    income:Gain on discharge of convertible
    notes payable






11,219











Interest income


66



57



953



620



392Interest expense


(1,352
)


(2,120
)


(128
)


(265
)


(467
)Other expense, net






(75
)


(448
)


(225
)


(17
)Total other (expense) income, net


(1,286
)


9,081



377



130



(92
)Net loss


(11,584
)


(1,780
)


(14,702
)


(15,080
)


(18,030
)Dividends on and accretion of
    convertible preferred stock






(380
)


(5,466
)


(5,525
)


(5,562
)Carrying value of preferred stock
    in excess of fair value transferred






11,092











Net income (loss) available to
    common stockholders

$
(11,584
)

$
8,932


$
(20,168
)

$
(20,605
)

$
(23,592
)Net income (loss) per share of
    common stock  basic and diluted

$
(15.29
)

$
11.79


$
(26.43
)

$
(26.90
)

$
(30.14
)Weighted average shares of common
    stock outstanding  basic and diluted


757,402



757,402



763,075



765,945



782,715     (1)
    
    The pro forma basic and diluted net loss per share reflects the
    weighted effect of the assumed conversion of convertible
    preferred stock. See Note 2 to our financial statements for
    information regarding computation of basic and diluted net loss
    per share and pro forma basic and diluted net loss per share.  37




---



##### 



As of
    December 31,Balance Sheet Data:

2001


2002


2003


2004


2005(In thousands)Cash, cash equivalents and
    marketable securities

$
1,718


$
49,493


$
38,213


$
22,397


$
5,190Working capital


309



47,263



34,945



18,878



270Total assets(1)


4,991



51,398



41,511



28,942



11,861Debt and capital lease obligations


12,522



706



2,966



5,273



4,230Redeemable convertible preferred
    stock and Series C warrant


9,750



52,435



59,555



65,357



70,386Common stock subject to put right


1,958



1,958



1,958



1,958



1,958Total stockholders deficit


(21,157
)


(6,533
)


(26,038
)


(45,993
)


(68,458
)     (1)
    
    As of December 31, 2005, we had net operating loss (NOL)
    and research and development credit carryforwards of
    approximately $56.6 million. Tax benefits may arise from
    these carryforwards in the future in the event that we realize
    U.S. taxable income. Potential tax benefits arising from
    these carryforwards are not reflected in our total assets.
    Despite the NOL carryforward, we may have an income tax
    liability in future years due to the application of the
    alternative minimum tax rules. The NOL may also be limited in
    its ability to offset future losses in the event that there is a
    change in the stock ownership as defined by federal tax
    regulations.  Item 7.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations  The following discussion of our financial condition and
    results of operations should be read in conjunction with our
    financial statements and the notes to those financial statements
    appearing elsewhere in this annual report on
    Form 10-K.
    This discussion contains forward-looking statements, which are
    identified under our Cautionary Statement Regarding
    Forward-Looking Statements at the beginning of this
    report, that involve significant risks and uncertainties. As a
    result of many factors, such as those set forth under Risk
    factors in Item 1A and elsewhere in this annual
    report on
    Form 10-K,
    our actual results may differ materially from those anticipated
    in these forward-looking statements.
  OVERVIEW
      
    continue the clinical development of our needle-free flu vaccine
    patch and IS patch for elderly receiving flu vaccines;
    expand the clinical trial program for our needle-free
    travelers diarrhea vaccine patch; 38




---



##### 




    continue our existing preclinical development programs,
    including our IS patch for pandemic flu vaccines, and commence
    new programs;
    increase our manufacturing capabilities for product
    candidates; and
    expand our research and development activities.    Financing
    history
           39




---



##### 



FINANCIAL
    OPERATIONS REVIEW
  Revenues
    Research
    and development expenses
    
    salaries and related expenses for personnel;
    fees paid to consultants and clinical research organizations in
    conjunction with their monitoring our clinical trials and
    acquiring and evaluating data in conjunction with our clinical
    trials;
    consulting fees paid to third parties in connection with other
    aspects of our product development efforts;
    fees paid to research organizations in conjunction with
    preclinical animal studies;
    costs of materials used in research and development;
    depreciation of facilities and equipment used to develop our
    product candidates; and
    milestone payments, license fees, and royalty payments for
    technology licenses. 40




---



##### 



Estimated Total Costs
    IncurredFrom January 1, 2003to December 31,Product Candidate

2005(In thousands)Needle-free flu vaccine patch

$
7,204IS patch for elderly receiving flu
    vaccines


14,554Needle-free travelers
    diarrhea vaccine patch


10,201Other programs, including pandemic
    flu


12,251TOTAL:

$
44,210     General
    and administrative expense
    RESULTS
    OF OPERATIONS
  Comparison
    of the years ended December 31, 2005 and 2004
  Revenues.
  Research and Development Expenses.
  General and Administrative Expenses.
 41




---



##### 



Interest Income (Expense) and
    Other  Net.
  Net Loss.
  Comparison
    of the years ended December 31, 2004 and 2003
  Revenues.
  Research and Development Expenses.
  General and Administrative Expense.
  Interest Income (Expense) and
    Other  Net.
  Net Loss.
 42




---



##### 



RESEARCH
    AND DEVELOPMENT PROGRAMS
    Years Ended
    December 31,Research and Development
    Program

2003


2004


2005(In thousands)Needle-free flu vaccine patch

$
194


$
2,116


$
4,895IS patch for elderly receiving flu
    vaccines


8,576



4,434



1,545Needle-free travelers
    diarrhea vaccine patch


1,670



2,890



5,641Other programsPandemic flu






4



2,409Other research, excluding pandemic
    flu


2,892



4,905



2,039Subtotal other programs


2,892



4,909



4,448Total Research and Development
    Expenses

$
13,332


$
14,349


$
16,529     Needle-Free Flu Vaccine Patch.
     43




---



##### 



IS Patch for elderly receiving flu
    vaccines.
  time-of-patch-wear
  Needle-free travelers diarrhea vaccine
    patch.
      Liquidity
    and capital resources
     44




---



##### 



available-for-sale.
  and/or
    year-to-year
     45




---



##### 



Payments Due by PeriodLess Than








More ThanContractual
    Obligations

Total


1 Year


1-3 Years


3-5 Years


5 Years(In thousands)Long-Term Debt(1) (2)

$
5,175


$
1920


$
1,979


$
619


$
657Capital Lease Obligations


6



5



1







Operating Lease Obligations(2)


4,682



571



1,188



1,270



1,653Total

$
9,863


$
2,496


$
3,168


$
1,889


$
2,310     (1)
    
    Includes interest payable in the period.(2)
    
    In October 2005, we amended our lease agreement to increase our
    rented research, manufacturing, and administrative space in
    Gaithersburg, Maryland to approximately 34,800 square feet,
    with the lease term extending until May 2013. We also extended
    our payment terms for the indebtedness we have with our
    landlord. Our obligations under the amended lease and these
    revised debt repayment terms are reflected in the table as long
    term debt and operating lease obligations. See discussion of
    amended lease terms below.              
    the progress and costs of preclinical development and laboratory
    testing and clinical trials;
    the time and costs involved in obtaining regulatory approvals; 46




---



##### 




    delays that may be caused by evolving requirements of regulatory
    agencies;
    our ability to establish, enforce, and maintain collaborations
    required for product commercialization;
    the number of product candidates we pursue;
    the costs involved in filing and prosecuting patent applications
    and enforcing or defending patent claims;
    our plans to establish sales, marketing,
    and/or
    manufacturing capabilities;
    the acquisition of technologies, products, and other business
    opportunities that require financial commitments; and
    our revenues, if any, from successful development and
    commercialization of our products.    Critical
    accounting policies and estimates
    Revenue Recognition.
  Research and Development Costs.
  Stock-Based Compensation. Accounting for Stock-Based Compensation Accounting for
    Stock-Based Compensation  Transition and
    Disclosure, an amendment of FASB Statement No. 123
  No. 96-18, Accounting for Equity Instruments That are Issued to Other
    Than Employees for Acquiring, or in conjunction with, Selling,
    Goods and Services.
   47




---



##### 



Recent
    accounting pronouncements
  Share-Based Payment Accounting for Stock-Based
    Compensation. Accounting for Stock Issued to Employees Statement of Cash
    Flows.
    fair-value-based Accounting for Stock-Based
    Compensation  Transition and Disclosure.
 48




---



##### 



Item 7A.
    Quantitative
    and Qualitative Disclosures About Market Risk        Item 8.
    Financial
    Statements and Supplementary Data  Page F-1.
  Item 9.
    Changes
    in and Disagreements With Accountants on Accounting
    and  Financial Disclosure    Item 9A.
    Controls
    and Procedures  Disclosure
    Controls and Procedures
  Rules 13a-15(e) 15d-15(e)
  Changes
    in Internal Controls Over Financial Reporting
    Item 9B.
    Other
    Information   PART III  Form 10-K
 49




---



##### 



PART IV   Item 15.
    Exhibits,
    Financial Statement Schedules  (a) 1. Consolidated Financial Statements    2. Consolidated Financial Statement Schedules    3. Exhibits    (b) Exhibits  Exhibit Index
  Exhibit No.

Description

Location3
.1.3

Third Amended and Restated
    Certificate of Incorporation


(1)3
.2.3

Third Amended and Restated By-laws


(2)4
.1

Specimen Stock Certificate


(1)4
.2

Grant of Put Option dated
    April 6, 2001 by Iomai Corporation to the Walter Reed Army
    Institute of Research as representative of the United States of
    America.


(1)4
.3

Option Agreement dated
    December 4, 2002 by and between Iomai Corporation and Elan
    Corporation, plc.


(1)4
.4

Stock Purchase Warrant dated
    December 4, 2002 issued by Iomai Corporation to Friedman
    Billings Ramsey & Co., Inc.


(1)4
.5.1

Investor Rights Agreement dated
    December 4, 2002 between Iomai Corporation and the
    individuals specified in Exhibit A thereto.


(1)4
.5.2

Amendment to the Investor Rights
    Agreement dated March 27, 2003 among Iomai Corporation and
    the Purchasers listed on the signature pages thereto.


(1)4
.5.3

Amendment to Investor Rights
    Agreement and Consent dated May 30, 2003 among Iomai
    Corporation and the Purchasers listed on the signature pages
    thereto.


(1)4
.5.4

Amendment to Investor Rights
    Agreement and Consent dated December 1, 2005 among Iomai
    Corporation and the purchasers listed on the signature pages
    thereto.


(1)4
.6

Registration Rights Agreement
    dated April 6, 2001 by and between Iomai Corporation and
    MdBio, Inc. as trustee for and on behalf of the Walter Reed Army
    Institute of Research, a representative of the United States of
    America.


(1)4
.7

Registration Rights Agreement
    dated March 30, 1999 by and between Iomai Corporation and
    Maryland Health Care Product Development Corporation.


(1)4
.8

Registration Rights Agreement
    dated July 18, 2000 by and between Iomai Corporation and
    Eiicha Ida.


(1)4
.9

Registration Rights Agreement
    dated July 18, 2000 by and between Iomai Corporation and
    Yuichi Suzuki.


(1)4
.10

Registration Rights Agreement
    dated July 18, 2000 by and between Iomai Corporation and
    Toshiro Osoegawa.


(1)4
.11

Registration Rights Agreement
    dated August 15, 2000 by and between Iomai Corporation and
    CZ Venture Operations, Inc.


(1) 50




---



##### 



Exhibit No.

Description

Location4
.12

Registration Rights Agreement
    dated January 4, 2001 by and between Iomai Corporation and
    Alexandria Real Estate Equities, L.P.


(1)9
.1

Voting Trust and Escrow Agreement
    dated April 6, 2001 between Iomai Corporation and MdBio,
    Inc., as trustee for and on behalf of Walter Reed Army Institute
    of Research, a representative of the United States of America.


(1)10
.1

Employment Agreement dated
    May 18, 2002 between Iomai Corporation and Stanley Erck, as
    amended on October 25, 2002.**


(1)10
.1.1

Amendment No. 2, dated
    December 1, 2005, to the Employment Agreement between Iomai
    Corporation and Stanley Erck.**


(1)10
.2

1998 Stock Option Plan, as amended
    January 16, 2002.**


(1)10
.3.1

1999 Stock Incentive Plan


(1)10
.3.2

Form of Incentive Stock Option
    Agreement.**


(1)10
.3.3

Form of Nonqualified Stock Option
    Agreement.**


(1)10
.4

2005 Incentive Plan.**


(1)10
.5

2006 Employee Stock Purchase
    Plan.**


(1)10
.6

Terms of Non-Employee Director
    Compensation.**


(1)10
.7

Amended and Restated License
    Agreement dated April 6, 2001 by and between Iomai
    Corporation and the Walter Reed Army Institute of Research as
    representative of the United States of America.+


(1)10
.8

Form of Subordinated Convertible
    Promissory Note issued by Iomai Corporation to the Walter Reed
    Army Institute of Research as representative of the United
    States of America.


(1)10
.9

Commercial License Agreement dated
    June 30, 2005 by and between Iomai Corporation and Dow
    Global Technologies Incorporated.+


(1)10
.10.1

Master Security Agreement dated
    September 26, 2003 by and between Iomai Corporation and
    Oxford Finance Corporation.


(1)10
.10.2

Form of Promissory Note issued by
    Iomai Corporation to Oxford Finance Corporation together with
    schedule identifying dates, principal amounts and interest rates
    of all outstanding promissory notes.


(1)10
.11.1

Lease Agreement dated
    December 18, 2000 by and between Iomai Corporation and
    ARE-20/22/1300 Firstfield Quince Orchard, LLC.


(1)10
.11.2

First Amendment to Lease dated
    November 29, 2001 by and between Iomai Corporation and
    ARE-20/22/1300 Firstfield Quince Orchard, LLC.


(1)10
.11.3

Second Amendment to Lease dated
    April 14, 2003 by and between Iomai Corporation and
    ARE-20/22/1300 Firstfield Quince Orchard, LLC.


(1)10
.11.4

Third Amendment to Lease dated
    August 28, 2003 by and between Iomai Corporation and
    ARE-20/22/1300 Firstfield Quince Orchard, LLC.


(1)10
.11.5

Fourth Amendment to Lease dated
    October 26, 2005 by and between Iomai Corporation and ARE
    20/22/1300 Firstfield Quince Orchard, LLC.


(1)10
.11.6

Letter Agreement amending Fourth
    Amendment to Lease dated January 3, 2006 by and between
    Iomai Corporation and ARE 20/22/1300 Firstfield Quince Orchard,
    LLC.10
.11.7

Sublease Agreement dated
    February 28, 2006 by and between Geomet Technologies, LLC
    and Iomai Corporation.10
.12

Form of change in Control
    Agreement, between Iomai Corporation and certain officers.**


(1)23
.1

Consent of Independent Registered
    Accounting Firm.31
.1

Certification of Chief Executive
    Officer pursuant to
    Rules 13a-14(a)
    and 15d-14(a) under the Securities Exchange Act of 1934, as
    amended. 51




---



##### 



Exhibit No.

Description

Location31
.2

Certification of Chief Financial
    Officer pursuant to
    Rules 13a-14(a)
    and 15d-14(a) under the Securities Exchange Act of 1934, as
    amended.32
.1

Certification of Chief Executive
    Officer and Chief Financial Officer pursuant to 18 U.S.C.
    Section 1350 as adopted pursuant to Section 906 of the
    Sarbanes-Oxley Act of 2002.     **
    
    Indicates a management contract or compensatory plan.+
    
    Confidential Treatment Requested Under 17 C.F.R.
    §§ 200.80(b)(4) and 230.406. The confidential
    portions of this exhibit have been omitted and are marked by an
    asterisk.(1)
    
    Previously filed as an exhibit to the Companys
    Form S-1/A
    (File
    No. 333-128765)
    and incorporated herein by reference thereto.(2)
    
    Previously filed as an exhibit to the Companys
    Form 8-K
    filed March 24, 2006 and incorporated herein by reference
    thereto. 52




---



##### 



SIGNATURES
      By:
    /s/  Stanley C. Erck    President, Chief Executive Officer,
 Treasurer and Director
      Signature

Title/s/  Stanley
    C. ErckStanley
    C. Erck

Chief Executive Officer,
    President,
    Treasurer and Director
    (Principal Executive Officer)/s/  Russell
    P. WilsonRussell
    P. Wilson

Senior Vice President, Chief
    Financial Officer,
    General Counsel and Secretary
    (Principal Financial and Accounting Officer)/s/  M.
    James BarrettM.
    James Barrett, Ph.D.

Chairman of the Board of Directors/s/  R.
    Gordon DouglasR.
    Gordon Douglas, M.D.

Director/s/  Richard
    DouglasRichard
    Douglas, Ph.D.

Director/s/  Jeff
    HimawanJeff
    Himawan, Ph.D.

Director/s/  James
    YoungJames
    Young, Ph.D.

Director  53




---



##### 



INDEX TO
    FINANCIAL STATEMENTS
  PageReport of
    Independent Registered Public Accounting Firm


F-2Balance Sheets as
    of December 31, 2005 and 2004


F-3Statements of
    Operations for the Years Ended December 31, 2005, 2004, and
    2003


F-4Statements of
    Changes in Redeemable Preferred Stock and Stockholders
    Deficit for the Years Ended December 31, 2005, 2004, and
    2003


F-5Statements of Cash
    Flows for the Years Ended December 31, 2005, 2004, and
    2003


F-6Notes to Financial
    Statements


F-7  F-1




---



##### 



Report of
    Independent Registered Public Accounting Firm               F-2




---



##### 



IOMAI
    CORPORATION



BALANCE SHEETS  December 31,2005


2004ASSETSCurrent assets:Cash and cash equivalents

$
5,190,457


$
6,941,752Marketable securities






15,455,613Accounts receivable


11,515



73,452Prepaid expenses and other current
    assets


257,647



137,444Total current assets


5,459,619



22,608,261Property and equipment, net


4,465,042



5,538,314Restricted cash


49,150



62,638Restricted marketable securities


589,740



595,987Deferred financing costs


1,108,230



Other noncurrent assets


188,847



136,460Total assets

$
11,860,628


$
28,941,660LIABILITIES AND
    STOCKHOLDERS DEFICITCurrent liabilities:Accounts payable


2,011,400


$
997,322Accrued expenses


1,611,108



1,267,740Notes payable, current portion


1,333,369



1,119,418Notes payable to related party,
    current portion


229,226



332,877Capital lease obligation, current
    portion


4,840



13,074Total current liabilities


5,189,943



3,730,431Notes payable, long-term portion


1,396,828



2,308,155Notes payable to related party,
    long-term portion


1,264,457



1,493,683Capital lease obligation,
    long-term portion


1,239



6,080Deferred rent


121,648



80,388Total liabilities


7,974,115



7,618,737Common stock subject to put right


1,958,450



1,958,450Warrant to purchase Series C
    preferred stock


23,100



35,100Series C convertible
    redeemable preferred stock, $0.01 par value;
    150,000,000 shares authorized; 129,590,034 shares
    issued and outstanding at December 31, 2005 and 2004;
    liquidation preference in the aggregate of $113,823,648 at
    December 31, 2005 and $92,589,013 at December 31, 2004


70,363,054



65,322,000Stockholders equity
    (deficit):Series B convertible
    preferred stock; $0.01 par value; 15,200,000 shares
    authorized; 14,734,578 shares issued and outstanding at
    December 31, 2005 and 2004; liquidation preference in the
    aggregate of $8,117,554 at December 31, 2005 and $7,595,949
    at December 31, 2004


147,346



147,346Common stock, $0.01 par
    value; 220,000,000 shares authorized; 795,519 and
    771,921 shares issued and outstanding at December 31,
    2005 and 2004


7,955



7,719Additional paid-in capital






3,847,734Accumulated other comprehensive
    income (loss)


298



(25,612
)Accumulated deficit


(68,613,690
)


(49,969,814
)Total stockholders equity
    (deficit)


(68,458,091
)


(45,992,627
)Total liabilities and
    stockholders equity (deficit)

$
11,860,628


$
28,941,660    F-3




---



##### 



IOMAI
    CORPORATION



STATEMENTS
    OF OPERATIONS  Year Ended
    December 31,2005


2004


2003Revenues

$
2,371,460


$
2,344,773


$
1,601,037Cost and expenses:Research and development


16,529,376



14,349,229



13,331,968General and administrative


3,780,514



3,205,658



3,347,853Total costs and expenses


20,309,890



17,554,887



16,679,821Loss from operations


(17,938,430
)


(15,210,114
)


(15,078,784
)Other income (expense)Interest income


392,232



620,382



952,749Interest expense


(466,927
)


(265,688
)


(127,797
)Other expense, net


(16,603
)


(224,860
)


(448,178
)Total other income (expense), net


(91,298
)


129,834



376,774Net loss


(18,029,728
)


(15,080,280
)


(14,702,010
)Dividends on and accretion of
    convertible preferred stock


(5,562,657
)


(5,525,314
)


(5,466,280
)Net income (loss) available to
    common stockholders

$
(23,592,385
)

$
(20,605,594
)

$
(20,168,290
)Net income (loss) available to
    common stockholders per share of common
    stock  basic and diluted

$
(30.14
)

$
(26.90
)

$
(26.43
)Weighted-average number of shares
    of common stock  basic and diluted


782,715



765,945



763,075    F-4




---



##### 



IOMAI
    CORPORATION



STATEMENTS OF CHANGES IN REDEEMABLE PREFERRED STOCK AND
    STOCKHOLDERS DEFICIT  Stockholders
    DeficitSeries C Convertible

















AccumulatedRedeemable


Series B Convertible








Additional


Other





TotalPreferred Stock


Preferred Stock


Common Stock


Paid-In


Comprehensive


Accumulated


StockholdersShares


Amount


Shares


Amount


Shares


Amount


Capital


Income (Loss)


Deficit


DeficitBalance at December 31, 2002


122,935,926



52,375,850



14,734,578



147,346



757,402



7,574



13,499,397







(20,187,524
)


(6,533,207
)Issuance of Series C
    convertible redeemable preferred stock, net of issuance costs of
    $21,598


4,750,056



2,078,402































Amortization of Series C
    warrants






12,000































Accretion of issuance costs






441,089



















(441,089
)










(441,089
)Accrual of dividends






4,491,587



















(4,491,587
)










(4,491,587
)Refund of issuance costs, net






109,322



















55,490











55,490Issuance of warrants on notes
    payable


























1,062











1,062Stock option compensation


























48,580











48,580Exercise of options


















6,923



69



6,231











6,300Other comprehensive loss:Net loss


































(14,702,010
)


(14,702,010
)Unrealized gain on investments






























18,732







18,732Comprehensive loss






































(14,683,278
)Balance at December 31, 2003


127,685,982



59,508,250



14,734,578



147,346



764,325



7,643



8,678,084



18,732



(34,889,534
)


(26,037,729
)Issuance of Series C
    convertible redeemable preferred stock, net of issuance costs of
    $31,741


1,904,052



810,040































Amortization of Series C
    warrants






12,000































Accretion of issuance costs






437,740



















(437,740
)










(437,740
)Accrual of dividends






4,553,970



















(4,553,970
)










(4,553,970
)Issuance of Common Stock warrants


























818











818Stock option compensation


























153,705











153,705Exercise of options


















7,596



76



6,837











6,913Other comprehensive loss:Net loss


































(15,080,280
)


(15,080,280
)Unrealized loss on investments






























(44,344
)






(44,344
)Comprehensive loss






































(15,124,624
)Balance at December 31, 2004


129,590,034



65,322,000



14,734,578



147,346



771,921



7,719



3,847,734



(25,612
)


(49,969,814
)


(45,992,627
)Amortization of Series C
    warrants






12,000































Accretion of issuance costs






441,567



















(331,173
)






(110,394
)


(441,567
)Accrual of dividends






4,587,487



















(4,083,733
)






(503,754
)


(4,587,487
)Issuance of Common Stock warrants


























8,678











8,678Stock option compensation


























538,144











538,144Cash in lieu of fractional common
    shares


















(60
)


(1
)


(944
)










(945
)Exercise of options


















23,658



237



21,294











21,531Net loss


































(18,029,728
)


(18,029,728
)Unrealized gain on investments






























25,910







25,910Comprehensive loss






































(18,003,818
)Balance at December 31, 2005


129,590,034


$
70,363,053



14,734,578


$
147,346



795,719


$
7,955


$



$
298


$
(68,613,690
)

$
(68,458,091
)    F-5




---



##### 



IOMAI
    CORPORATION



STATEMENTS
    OF CASH FLOWS  Year Ended
    December 31,2005


2004


2003Cash flows from operating
    activitiesNet loss

$
(18,029,728
)

$
(15,080,280
)

$
(14,702,010
)Adjustments to reconcile net loss
    to net cash used in operating activities:Depreciation and amortization


2,670,444



1,626,768



365,909Stock-based compensation expense


538,144



153,705



48,580Non-cash interest expense and
    amortization of premium/discount of marketable securities


28,366



228,615



272,911Deferred rent


(54,411
)


(35,695
)


(18,631
)Provision for doubtful accounts






(135,000
)


135,000Loss on disposal of property and
    equipment


3,896







5,076Changes in operating assets and
    liabilities:Accounts receivable


61,937



264,753



31,178Prepaid expenses and other current
    assets


(40,358
)


135,050



27,079Other noncurrent assets


(45,434
)


29,010



(59,833
)Accounts payable


420,096



(470,894
)


625,422Accrued expenses


143,825



(217,771
)


(230,097
)Net cash used in operating
    activities


(14,303,223
)


(13,501,739
)


(13,499,416
)Cash flows from investing
    activitiesPurchases of property and equipment


(1,338,752
)


(5,074,855
)


(1,264,678
)Restricted cash and marketable
    securities


35,076



(3,685
)


(598,086
)Sales/maturities of marketable
    securities


22,150,000



32,450,000



35,438,000Purchases of marketable securities


(6,790,305
)


(18,509,757
)


(65,453,165
)Net cash provided by (used in)
    investing activities


14,056,019



8,861,703



(31,877,929
)Cash flows from financing
    activitiesProceeds from the exercise of
    stock options


21,531



6,913



6,300Cash in lieu of fractional common
    stock


(945
)






Proceeds from issuance of
    Series C convertible redeemable preferred stock, net






810,040



2,078,402Deferred stock issuance costs


(481,350
)






(2,585
)Proceeds from notes payable


468,367



1,902,386



2,472,920Principal payments on notes payable


(1,165,743
)


(819,746
)


(127,986
)Proceeds from notes payable to
    related party






1,450,500



Principal payments on notes
    payable to related party


(332,877
)


(207,440
)


(67,371
)Payments under capital lease
    obligations


(13,074
)


(18,025
)


(18,176
)Net cash provided by (used in)
    financing activities


(1,504,091
)


3,124,628



4,341,504Net decrease in cash and cash
    equivalents


(1,751,295
)


(1,515,408
)


(41,035,841
)Cash and cash equivalents at
    beginning of year


6,941,752



8,457,160



49,493,001Cash and cash equivalents at end
    of year

$
5,190,457


$
6,941,752


$
8,457,160Supplemental schedule of
    noncash investing and financing activitiesCash paid for interest

$
496,784


$
424,088


$
117,546    F-6




---



##### 



IOMAI
    CORPORATION



NOTES TO
    FINANCIAL STATEMENTS  1.
    ORGANIZATION  E.
    coli
  2.
    SIGNIFICANT
    ACCOUNTING POLICIES  Use of
    estimates
    Cash
    and cash equivalents
    Marketable
    securities
  available-for-sale.
  other-than-temporary. other-than-temporary
   F-7




---



##### 



Restricted
    cash and marketable securities
      Accounts
    receivable
      Concentration
    of credit risk and fair value of financial
    instruments
      Property
    and equipment
      December 31,2005


2004Furniture and equipment

$
769,186


$
695,404Lab equipment


3,327,189



2,164,042Leasehold improvements


5,296,983



4,907,502Construction-in-progress


208,197



355,645Subtotal


9,601,555



8,122,593Accumulated depreciation


(5,136,513
)


(2,584,279
)Property and equipment, net

$
4,465,042


$
5,538,314    F-8




---



##### 



Income
    taxes
      Revenue
    recognition
    Research
    and development costs
    Comprehensive
    loss
  Reporting Comprehensive Income available-for-sale
  Stock-based
    compensation
  Accounting for Stock
    Issued to Employees Accounting for Stock-Based
    Compensation Accounting for Stock-Based
    Compensation  Transition and Disclosure,
  No. 96-18, Accounting for Equity Instruments That are Issued to Other
    Than Employees for Acquiring, or in conjunction with, Selling,
    Goods and Services.
 F-9




---



##### 



F-10




---



##### 



Basic
    and diluted net income (loss) attributable to common
    stockholders per share of common stock
    Recent
    accounting pronouncements
  Share-Based Payment Accounting for Stock-Based
    Compensation. Accounting for Stock Issued to
    Employees Statement of Cash Flows.
    fair-value-based Accounting for Stock-Based
    Compensation  Transition and
    Disclosure.
  Reverse
    stock split
  1-for-13
 F-11




---



##### 



3.
    MARKETABLE
    SECURITIES  available-for-sale
  December 31, 2005Gross


GrossUnrealized


UnrealizedAmortized Cost


Gains


Losses


Fair ValueAvailable for SaleU.S. Treasury and agency
    obligations

$



$



$



$
Accrued interest














Total  Marketable
    securities

$



$



$



$
Restricted Marketable
    SecuritiesU.S. Treasury and agency
    obligations

$
589,442


$
298


$



$
589,740Accrued interest














Total  Restricted
    marketable securities

$
589,442


$
298


$



$
589,740   December 31, 2004Gross


GrossUnrealized


UnrealizedAmortized Cost


Gains


Losses


Fair ValueAvailable for SaleU.S. Treasury and agency
    obligations

$
15,399,148


$
315


$
(23,676
)

$
15,375,787Accrued interest


79,826











79,826Total  Marketable
    securities

$
15,478,974


$
315


$
(23,676
)

$
15,455,613Restricted Marketable
    SecuritiesU.S. Treasury and agency
    obligations

$
598,219


$



$
(2,251
)

$
595,968Accrued interest


19











19Total  Restricted
    marketable securities

$
598,238


$



$
(2,251
)

$
595,987       4.
    LONG-TERM
    DEBT  Notes
    payable
     F-12




---



##### 



December 31,2005


2004Promissory Note dated
    September 26, 2003; 8.93%, maturing March 26, 2007

$
546,625


$
942,201Promissory Note dated
    September 26, 2003; 9.03%, maturing September 26, 2007


34,884



52,487Promissory Note dated
    December 30, 2003; 9.24%, maturing June 30, 2007


464,660



740,644Promissory Note dated
    February 26, 2004; 9.03%, maturing February 26, 2008


123,971



173,530Promissory Note dated
    April 30, 2004; 9.48%, maturing April 30, 2008


212,569



290,277Promissory Note dated
    June 30, 2004; 10.06%, maturing December 30, 2007


62,945



89,992Promissory Note dated
    June 30, 2004; 10.03%, maturing June 30, 2008


519,611



693,743Promissory Note dated
    September 30, 2004; 9.58%, maturing March 30, 2008


19,732



27,231Promissory Note dated
    September 30, 2004; 9.40%, maturing September 30, 2008


135,321



176,508Promissory Note dated
    November 30, 2004; 9.72%, maturing November 30, 2008


187,837



240,960Promissory Note dated
    March 30, 2005; 10.46%, maturing March 30, 2009


59,321



Promissory Note dated
    March 30, 2005; 10.70%, maturing September 30, 2008


20,482



Promissory Note dated
    July 27, 2005; 10.32%, maturing July 27, 2009


172,913



Promissory Note dated
    July 27,2005; 10.66%, maturing January 27, 2009


20,896



Promissory Note dated
    September 30, 2005; 10.31%, maturing September 30, 2009


148,430



Total notes payable


2,730,197



3,427,573Less current portion of notes
    payable


(1,333,369
)


(1,119,418
)Long-term portion of notes payable

$
1,396,828


$
2,308,155  F-13




---



##### 



2005


2004Total related-party notes payable,
    with interest rates ranging from 14.0% to 10.5%, maturing
    May 31, 2013(1)


1,493,683



1,826,560Less current portion of
    related-party notes payable


(229,226
)


(332,877
)Long-term portion of related-party
    notes payable

$
1,264,457


$
1,493,683     (1)
    
    On October 26, 2005, the Company amended its lease
    agreement to, among things, to extend the maturity of the
    related-party notes payable from May 2009 until May 2013. In
    connection with this lease amendment, the then-remaining balance
    owed to the landlord as of May 31, 2006 under the
    related-party notes payable, which the Company expects will
    total $1,342,719, will then be amortized over the seven-year
    period until May 2013 at a revised rate of 10.5%. See
    Note 5  Related Party Transactions.    Notes Payable fromNotes Payable


Related Party(1)


TotalYear ending:2006

$
1,333,369


$
229,226


$
1,562,5952007


930,663



145,785



1,076,4482008


393,110



161,852



554,9622009


73,055



179,688



252,7432010 and thereafter






777,132



777,132$
2,730,197


$
1,493,683


$
4,223,880     (1)
    
    On October 26, 2005, the Company amended its lease
    agreement to, among things, to extend the lease from May 2009
    until May 2013. In connection with this lease amendment, the
    then-remaining balance owed to the landlord as of May 31,
    2006 under the related-party notes payable, which the Company
    expects will total $1,342,719, will then be amortized over the
    seven-year period until May 2013 at a rate of 10.5%. The revised
    debt repayment terms are reflected in the table in long term
    debt and operating lease obligations. See discussion of amended
    lease terms below. See Note 5  Related
    Party Transactions.  5.
    RELATED
    PARTY TRANSACTIONS       F-14




---



##### 



6.
    REDEEMABLE
    PREFERRED STOCK  Series C
    convertible redeemable preferred stock
         F-15




---



##### 



Series C
    preferred stock warrants
    7.
    STOCKHOLDERS
    DEFICIT  Series B
    convertible preferred stock
        1 13
    Stock
    Options
   F-16




---



##### 



1998
    Stock Option Plan
    1999
    Stock Option Plan
      2005
    Stock Option Plan
    2006
    Employee Stock Purchase Plan
     F-17




---



##### 



Weighted-AverageShares


Exercise PriceOutstanding at December 31,
    2002


235,309


$
36.89Granted


1,279,257



0.91Exercised


(6,922
)


0.91Forfeited


(186,664
)


40.11Outstanding at December 31,
    2003


1,320,980



1.78Exercisable at December 31,
    2003


181,112



7.26Granted


277,466



0.92Exercised


(7,591
)


0.91Forfeited


(28,072
)


0.91Outstanding at December 31,
    2004


1,562,783



1.65Exercisable at December 31,
    2004


469,920



3.36Granted


433,637



1.43Exercised


(23,656
)


0.91Forfeited


(79,500
)


0.91Outstanding at December 31,
    2005


1,893,264



1.64Exercisable at December 31,
    2005


784,748



2.38     Options OutstandingWeighted-Average





Options ExercisableRange of

Number


Remaining Contractual


Weighted-Average


Number


Weighted-AverageExercise Prices

Outstanding


Life  Years


Exercise Price


Exercisable


Exercise Price$0.91


1,727,939



7.5



0.91



735,334



0.91$2.86


115,911



9.7



2.86







2.865.85


769



8.9



5.85



769



5.8516.25-22.75


32,690



2.4



20.84



32,690



20.8428.99-34.19


15,955



3.9



32.15



15,955



32.151,893,264











748,748  F-18




---



##### 



December 31,2005


2004


2003Expected dividend yield


0
%


0
%


0
%Expected volatility


60
%


56
%


55
%Risk-free interest rate


3.89
%


3.03
%


2.88
%Expected average life of options


5 years



5 years



4.8 years           December 31,2005


2004


2003Employees and directors

$
508,575


$
152,928


$
48,172Non-employee consultants


29,569



777



408$
538,144


$
153,705


$
48,580   Stock
    warrants
    8.
    COMMITMENTS
    AND CONTINGENCIES   F-19




---



##### 



Capital


Operating


Total2006

$
5,408


$
570,632


$
576,0402007


1,352



584,517



585,8692008






603,607



603,6072009






624,087



624,087Thereafter






2,298,830



2,297,830Total minimum lease payments


6,760


$
4,681,673


$
4,688,433Less: amount representing interest


(680
)Present value of minimum lease
    payments


6,080Less: current portion of capital
    lease obligation


(4,840
)Long-term portion

$
1,240     License
    agreement with the Walter Reed Army Institute of Research
    (WRAIR)
         F-20




---



##### 



9.
    INCOME
    TAXES      December 31,2005


2004NOL carryforward

$
21,238,530


$
14,889,823Research and development credit
    carryforward


1,648,323



1,149,824Deferred temporary differences


1,198,211



283,867Valuation allowance


(24,085,064
)


(16,323,514
)Net deferred tax asset

$



$
       Year Ended
    December 31,2005


2004


2003Federal tax at statutory rates


34.0
%


34.0
%


34.0
%State taxes, net of federal benefit


4.6



4.6



4.6Research and development credit


2.8



2.5



1.7Permanent difference


(1.2
)


(0.1
)


(0.1
)Change in valuation allowance


(40.2
)


(41.0
)


(40.2
)Provision for income taxes


0.0
%


0.0
%


0.0
%   10.
    EMPLOYEE
    BENEFIT PLAN   F-21




---



##### 



11.
    QUARTERLY
    FINANCIAL INFORMATION (UNAUDITED)    1st Quarter


2nd Quarter


3rd Quarter


4th QuarterYear ended December 31, 2004
    Revenue


676,404



1,036,097



531,671



100,601Income (loss) from operations


(3,494,362
)


(2,837,814
)


(4,316,508
)


(4,561,430
)Net income (loss)


(3,400,363
)


(2,737,780
)


(4,353,170
)


(4,588,967
)Net income (loss) per share, basic
    and diluted

$
(4.45
)

$
(3.58
)

$
(5.68
)

$
(5.97
)Year ended December 31, 2005
    Revenue

$
970,895


$
855,604


$
503,705


$
41,256Income (loss) from operations


(3,648,934
)


(3,681,057
)


(4,342,698
)


(6,265,741
)Net income (loss)


(3,669,210
)


(3,694,688
)


(4,364,552
)


(6,301,277
)Net income (loss) per share, basic
    and diluted

$
(4.75
)

$
(4.78
)

$
(5.52
)

$
(7.94
)   12.
    SUBSEQUENT
    EVENTS  Initial
    Public Offering
      Facility
    Sublease
   F-22