| x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|---|-----------------------------------------------------------------------------------------|

|   | For the quarterly period ended March 31, 2011 |
|--------|-----------------------------------------------|

| o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|---|------------------------------------------------------------------------------------------|

|   | For the transition period from _____ to _____ |
|--------|-----------------------------------------------|

|                                                                               |
|------------------------------------------------------------------------------------|
| Tengion, Inc.                                                                      |
| (Exact name of registrant as specified in its charter)                             |
| Delaware                                                                           |   | 20-0214813 |
| (State or other jurisdiction ofincorporation or organization)                      |   | (I.R.S. Employer Identification No.) |
|  2900 Potshop Lane, Suite 100East Norriton, PA 19403                          |   | (610) 292-8364 |
| (Address of principal executive offices)                                           |   | (Registrant’s telephone number,including area code) |
| Not Applicable                                                                     |
| (Former name, former address and former fiscal year, if changed since last report) |
|                                                                               |   |   |

----

| Item 1. |   | Financial Statements                                                                                    |   |
|---------|--------|---------------------------------------------------------------------------------------------------------|--------|
|    |   | Condensed Balance Sheets                                                                                | 1      |
|    |   | Condensed Statements of Operations                                                                      | 2      |
|    |   | Condensed Statements of Redeemable Convertible Preferred Stock and Stockholders’ Equity (Deficit) | 3      |
|    |   | Condensed Statements of Cash Flows                                                                      | 6      |
|    |   | Notes to Condensed Financial Statements                                                                 | 7      |
| Item 2. |   | Management’s Discussion and Analysis of Financial Condition and Results of Operations             | 16     |
| Item 3. |   | Quantitative and Qualitative Disclosures About Market Risk                                              | 22     |
| Item 4. |   | Controls and Procedures                                                                                 | 22     |

| Item 1.        |   | Legal Proceedings                                           | 23     |
|----------------|--------|-------------------------------------------------------------|--------|
| Item 1A.       |   | Risk Factors                                                | 23     |
| Item 2.        |   | Unregistered Sales of Equity Securities and Use of Proceeds | 23     |
| Item 3.        |   | Defaults Upon Senior Securities                             | 23     |
| Item 4.        |   | (Removed and Reserved)                                      | 24     |
| Item 5.        |   | Other Information                                           | 24     |
| Item 6.        |   | Exhibits                                                    | 25     |
|           |   |                                                        |   |
| Signature Page | 26     |

----

Item 1. 

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |         |             |                                                                                                    |                |         |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------|------------------|---------------------------------------------------------------------------------------------------------|---------------------|--------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |         | December 31,2010 |                                                                                                    | March 31, 2011 |
| ASSETS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| Current assets:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |    |             |                                                                                                    |                |         |   |   |   |
| Cash and cash equivalents                                                                                                                                 |    | $                | 11,971,660                                                                                              |                |    | $      | 31,478,421 |   |
| Deferred equity offering costs                                                                                                                            |    |             | 40,900                                                                                                  |                |    |   |                 — |   |
| Prepaid expenses and other                                                                                                                                |    |             | 492,205                                                                                                 |                |    |   | 362,858 |   |
| Total current assets                                                                                                                                                                         |    |             | 12,504,765                                                                                              |                |    |   | 31,841,279 |   |
| Property and equipment, net of accumulated depreciation of         $19,830,473 and $20,941,628 as of December 31, 2010 andMarch 31, 2011, respectively                                                                                                                                                                                                                                                                                                                                                                                      |    |             | 11,492,577                                                                                              |                |    |   | 10,373,075 |   |
| Other assets                                                                                                                          |    |             | 147,091                                                                                                 |                |    |   | 1,105,500 |   |
| Total assets                                                                                                                          |    | $                | 24,144,433                                                                                              |                |    | $      | 43,319,854 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |    |             |                                                                                                    |                |         |   |   |   |
| LIABILITIES AND STOCKHOLDERS’ EQUITY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| Current liabilities:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |    |             |                                                                                                    |                |         |   |   |   |
| Current portion of long-term debt                                                                                                                         |    | $                | 4,016,174                                                                                               |                |    | $      | 1,408,408 |   |
| Current portion of lease liability                                                                                                                        |    |             |                 — |                |    |   | 217,812 |   |
| Accounts payable                                                                                                                                          |    |             | 1,193,625                                                                                               |                |    |   | 1,201,736 |   |
| Accrued expenses                                                                                                                                          |         |             | 2,843,056                                                                                               |                |         |   | 1,889,852 |   |
| Warrant liability                                                                                                                                         |         |             | —                                                                                                 |                |         |   | 16,528,000 |   |
| Other current liabilities                                                                                                                                 |    |             | 205,000                                                                                                 |                |    |   | 205,000 |   |
| Total current liabilities                                                                                                                                                                    |    |             | 8,257,855                                                                                               |                |    |   | 21,450,808 |   |
| Long-term debt                                                                                                                        |    |             | 4,585,493                                                                                               |                |    |   | 4,535,215 |   |
| Lease liability                                                                                                                       |    |             |             —                         |                |    |   | 705,496 |   |
| Other liabilities                                                                                                                     |    |             | 241,165                                                                                                 |                |    |   | 238,084 |   |
| Total liabilities                                                                                                                                                                            |    |             | 13,084,513                                                                                              |                |    |   | 26,929,603 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |    |             |                                                                                                    |                |         |   |   |   |
| Commitments and contingencies (note 12)                                                                                               |    |             |             —                         |                |    |   |                 — |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |    |             |                                                                                                    |                |         |   |   |   |
| Stockholders’ equity:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |    |             |                                                                                                    |                |         |   |   |   |
| Common stock, $0.001 par value; 90,000,000 shares authorized;           12,385,793, and 23,471,249 shares issued and outstanding at           December 31, 2010 and March 31, 2011, respectively                                                                                                                                                                                                                                                                                     |    |             | 12,386                                                                                                  |                |    |   | 23,471 |   |
| Additional paid-in capital                                                                                                                                |    |             | 222,230,864                                                                                             |                |         |   | 234,579,570 |   |
| Deficit accumulated during the development stage                                                                                                          |    |             | (211,183,330                                                                                            | )                   |         |   | (218,212,790 | ) |
| Total stockholders’ equity                                                                                                                                                             |    |             | 11,059,920                                                                                              |                |    |   | 16,390,251 |   |
| Total liabilities and stockholders’ equity                                                                                      |    | $                | 24,144,433                                                                                              |                |         | $      | 43,319,854 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |         |             |                                                                                                    |                |         |   |   |   |

----

TENGION, INC.

|                                                                                                                                                                                                                                                                                                                                                                                          |   |                         |                                                                            |                                                          |   |   |                                                                                                    |         |   |   |         |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------|---------------------------------------------------------------------------------|---------------------------------------------------------------|--------|--------|---------------------------------------------------------------------------------------------------------|--------------|--------|--------|--------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                          |   | Three Months Ended March 31, |                                                                            | Period fromJuly 10, 2003(inception)throughMarch 31, 2011 |
|                                                                                                                                                                                                                                                                                                                                                                                          |   | 2010                         |                                                                            | 2011                                                          |   |
| Operating expenses:                                                                                                                                                                                                                                                                                                                                                                           |   |                         |                                                                            |                                                          |   |   |                                                                                                    |         |   |   |         |   |
| Research and development                                                                                   |   | $                            | 3,316,126                                                                       |                                                     |   | $      | 3,345,173                                                                                               |         |   | $      | 107,909,292  |   |
| General and administrative                                                                                 |   |                         | 1,412,412                                                                       |                                                     |   |   | 1,775,979                                                                                               |         |   |   | 36,478,177   |   |
| Depreciation                                                                                               |   |                         | 1,226,809                                                                       |                                                     |   |   | 1,126,573                                                                                               |         |   |   | 21,137,221   |   |
| Other expense                                                                                              |   |                         |             — |                                                          |   |   | 942,567                                                                                                 |         |   |   | 942,567      |   |
| Total operating expenses                                                                                                  |   |                         | (5,955,347                                                                      | )                                                        |   |   | (7,190,292                                                                                              | )            |   |   | (166,467,257 | )      |
| Interest income                                                              |   |                         | 10,469                                                                          |                                                     |   |   | 13,735                                                                                                  |         |   |   | 8,472,115    |   |
| Interest expense                                                                                                                                                                                                                                                                                                                                                                              |   |                         | (681,439                                                                        | )                                                             |   |   | (271,903                                                                                                | )            |   |   | (14,312,078  | )      |
| Change in fair value of warrant liability                                                                                                                                                                                                                                                                                                                                                     |   |                         | 191,527                                                                         |                                                          |   |   |                419,000       |         |   |   | 2,481,454    |   |
|                                                                                                                                                                                                                                                                                                                                                                                          |   |                         |                                                                            |                                                          |   |   |                                                                                                    |         |   |   |         |   |
| Net loss                                                                                                                                                                                                                                                                                                                                                        |   | $                            | (6,434,790                                                                      | )                                                        |   | $      | (7,029,460                                                                                              | )            |   | $      | (169,825,766 | )      |
| Accretion of redeemable convertible preferred stock to redemption value                                                                                                                                                                                                                                                                                                                       |   |                         | (3,628,841                                                                      | )                                                        |   |   |                 — |         |   |   |         |   |
| Net loss attributable to common stockholders                                                                                                                                                                                                                                                                                                                                                  |   | $                            | (10,063,631                                                                     | )                                                        |   | $      | (7,029,460                                                                                              | )            |   |   |         |   |
| Basic and diluted net loss attributable to common stockholders per share                                                                                                                                                                                                                                                                                                                      |   | $                            | (14.33                                                                          | )                                                        |   | $      | (0.45                                                                                                   | )            |   |   |         |   |
| Weighted average common stock outstanding-basic and diluted                                                                                                                                                                                                                                                                                                                                   |   |                         | 702,144                                                                         |                                                     |   |   | 15,710,671                                                                                              |    |   |   |         |   |

----

TENGION, INC.

|                                                                                                                                                                                     |                                 |   |   |                |         |   | Stockholders' equity (deficit) |                     |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------|--------|--------|---------------------|--------------|--------|--------------------------------|--------------------------|
|                                                                                                                                                                                     | Redeemableconvertiblepreferred stock |   |   |                | Common stock |   |                           | Additionalpaid-incapital |   |   | Deferredcompensation |   | Deficitaccumulatedduring thedevelopmentstage |   |   | Total |   |
|                                                                                                                                                                                     | Shares                               |   | Amount |                |         |   | Shares                         |                     |   | Amount |   |   |   |   |
| Balance, July 10, 2003                                                                                                                                                                   | —                    |   | $      | —   |         |   |                           | —        |    |   | $ | —   |    |   | $ |          —   |    |   | $ |         —   |    | $ |             —   |    |   | $ |             —   |    |
| Issuance of common stock to initial stockholder                                                                                                                                          | —                    |   |   | —   |         |   |                           | 2,000,000                |    |   |   | 2,000 |    |   |   | (1,999 | )  |   |   | —   |    |   | —   |    |   |   | 1 |    |
| Effect of reverse stock split (see Note 3)                                                                                                                                               | —                    |   |   | —   |         |   |                           | (1,862,068               | )  |   |   | (1,862 | )  |   |   | 1,862 |    |   |   | —   |    |   | —   |    |   |   | —   |    |
| Net loss                                                                                                                                                                                 | —                    |   |   | —   |         |   |                           | —        |    |   |   | —   |    |   |   | —   |    |   |   | —   |    |   | (1,031,756 | )  |   |   | (1,031,756 | )  |
|                                                                                                                                                                                     |                                 |   |   |                |         |   |                           |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance, December 31, 2003                                                                                                                                                               | —                    |   |   | —   |         |   |                           | 137,932                  |    |   |   | 138 |    |   |   | (137 | )  |   |   | —   |    |   | (1,031,756 | )  |   |   | (1,031,755 | )  |
| Issuance of Series A Redeemable Convertible         Preferred stock at $1.61683 per share, net of         expenses | 18,740,371                           |   |   | 30,125,610          |         |   |                           | —        |    |   |   | —   |    |   |   | —   |    |   |   | —   |    |   | —   |    |   |   | —   |    |
| Conversion of notes payable, including interest                                                                                                                                          | 2,203,206                            |   |   | 3,562,211           |         |   |                           | —        |    |   |   | —   |    |   |   | —   |    |   |   | —   |    |   | —   |    |   |   | —   |    |
| Issuance of restricted common stock to employees         and nonemployees                                                                             | —                    |   |   | —   |         |   |                           | 240,318                  |    |   |   | 240 |    |   |   | 336,041 |    |   |   | (335,474 | )  |   | —   |    |   |   | 807 |    |
| Issuance of common stock to consultants                                                                                                                                                  | —                    |   |   | —   |         |   |                           | 140,003                  |    |   |   | 140 |    |   |   | 20,960 |    |   |   | —   |    |   | —   |    |   |   | 21,100 |    |
| Issuance of common stock to convertible noteholders                                                                                                                                      | —                    |   |   | —   |         |   |                           | 92,682                   |    |   |   | 93 |    |   |   | 67,098 |    |   |   | —   |    |   | —   |    |   |   | 67,191 |    |
| Issuance of options to purchase common stock to         consultants for services rendered                                                                  | —                    |   |   | —   |         |   |                           | —        |    |   |   | —   |    |   |   | 14,105 |    |   |   | (14,105 | )  |   | —   |    |   |   | —   |    |
| Amortization of deferred compensation                                                                                                                                                    | —                    |   |   | —   |         |   |                           | —        |    |   |   | —   |    |   |   | —   |    |   |   | 22,554 |    |   | —   |    |   |   | 22,554 |    |
| Change in value of restricted common stock subject         to vesting                                                                                 | —                    |   |   | —   |         |   |                           | —        |    |   |   | —   |    |   |   | 11,400 |    |   |   | (11,400 | )  |   | —   |    |   |   | —   |    |
| Accretion of Series A Redeemable Convertible         Preferred stock to redemption value                                                              | —                    |   |   | 1,035,205           |         |   |                           | —        |    |   |   | —   |    |   |   | —   |    |   |   | —   |    |   | (1,035,205 | )  |   |   | (1,035,205 | )  |
| Net loss                                                                                                                                                                                 | —                    |   |   | —   |         |   |                           | —        |    |   |   | —   |    |   |   | —   |    |   |   | —   |    |   | (2,438,912 | )  |   |   | (2,438,912 | )  |
| Balance, December 31, 2004                                                                                                                                                               | 20,943,577                           |   |   | 34,723,026          |         |   |                           | 610,935                  |    |   |   | 611 |    |   |   | 449,467 |    |   |   | (338,425 | )  |   | (4,505,873 | )  |   |   | (4,394,220 | )  |
| Issuance of Series A Redeemable Convertible         Preferred stock at $1.61683 per share, net of         expenses | 3,247,095                            |   |   | 5,222,430           |         |   |                           | —        |    |   |   | —   |    |   |   | —   |    |   |   | —   |    |   | —   |    |   |   | —   |    |
| Issuance of restricted common stock to employees         and nonemployees at $2.32 per share                                                          | —                    |   |   | —   |         |   |                           | 60,477                   |    |   |   | 60 |    |   |   | 140,241 |    |   |   | (139,424 | )  |   | —   |    |   |   | 877 |    |
| Issuance of warrants to purchase preferred stock to         noteholders                                                                               | —                    |   |   | —   |         |   |                           | —        |    |   |   | —   |    |   |   | 681,026 |    |   |   | —   |    |   | —   |    |   |   | 681,026 |    |
| Issuance of options to purchase common stock to         consultants for services rendered                                                             | —                    |   |   | —   |         |   |                           | —        |    |   |   | —   |    |   |   | 6,693 |    |   |   | (6,693 | )  |   | —   |    |   |   | —   |    |
| Amortization of deferred compensation                                                                                                                                                    | —                    |   |   | —   |         |   |                           | —        |    |   |   | —   |    |   |   | —   |    |   |   | 111,688 |    |   | —   |    |   |   | 111,688 |    |
| Accretion of Series A Redeemable Convertible         Preferred stock to redemption value                                                              | —                    |   |   | 3,164,308           |         |   |                           | —        |    |   |   | —   |    |   |   | —   |    |   |   | —   |    |   | (3,164,308 | )  |   |   | (3,164,308 | )  |
| Net loss                                                                                                                                                                                 | —                    |   |   | —   |         |   |                           | —        |    |   |   | —   |    |   |   | —   |    |   |   | —   |    |   | (9,626,910 | )  |   |   | (9,626,910 | )  |
|                                                                                                                                                                                     |                                 |   |   |                |         |   |                           |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance, December 31, 2005                                                                                                                                                               | 24,190,672                           |   | $      | 43,109,764          |         |   |                           | 671,412                  |    |   |  $ | 671 |    |   | $ | 1,277,427 |    |   |  $ | (372,854 | )  | $ | (17,297,091 | )  |   | $ | (16,391,847 | )  |

----

|                                                                                                                                                                                                |                                 |   |    |                            |   | Stockholders' equity (deficit) |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------|--------|---------|---------------------------------|--------|--------------------------------|
|                                                                                                                                                                                                | Redeemableconvertiblepreferred stock |   |    | Common stock                    |   |                           | Additionalpaid-incapital |   |   | Deferredcompensation | Deficitaccumulatedduring thedevelopmentstage |   |   | Total |   |   |
|                                                                                                                                                                                                | Shares                               |   | Amount  |                            |   | Shares                         |   |   | Amount |   |   |   |   |   |
| Issuance of Series B Redeemable Convertible         Preferred stock at $1.82 per share, net of         expenses               | 27,637,363                           |   |  $ | 50,040,289                      |   |                           | —     |    |   |  $ | —     |    |   |  $ | —     |    |   |  $ | —     |  $ | —     |    |   |  $ | —     |    |   |
| Issuance of restricted common stock to employees                                                                                                                                                    | —          |   |    | —     |   |                           | 3,449 |    |   |   | 3 |    |   |   | 47 |    |   |   | —     |   | —     |    |   |   | 50 |    |   |
| Issuance of common stock upon exercise of         options                                                                                                        | —          |   |    | —     |   |                           | 3,665 |    |   |   | 4 |    |   |   | 8,496 |    |   |   | —     |   | —     |   |   |   | 8,500 |    |   |
| Repurchased nonvested restricted stock                                                                                                                                                              | —          |   |    | —     |   |                           | (14,120 | )  |   |   | (14 | )  |   |   | (191 | )  |   |   | —     |   | —     |    |   |   | (205 | )  |   |
| Reclassification of deferred compensation                                                                                                                                                           | —          |   |    | —     |   |                           | —     |    |   |   | —     |    |   |   | (372,854 | )  |   |   | 372,854 |   | —     |    |   |   | —     |    |   |
| Reclassification of warrants to purchase preferred         stock                                                                                                 | —          |   |    | —     |   |                           | —     |    |   |   | —     |    |   |   | (681,026 | )  |   |   | —     |   | —     |    |   |   | (681,026 | )  |   |
| Stock-based compensation expense                                                                                                                                                                    | —          |   |    | —     |   |                           | —     |    |   |   | —     |    |   |   | 399,559 |    |   |   | —     |   | —     |    |   |   | 399,559 |    |   |
| Accretion of Series A and Series B Redeemable         Convertible Preferred stock to redemption         value                 | —          |   |    | 5,639,599                       |   |                           | —     |    |   |   | —     |    |   |   | —     |    |   |   | —     |   | (5,639,599 | )  |   |   | (5,639,599 | )  |   |
| Net loss                                                                                                                                                                                            | —          |   |    | —     |   |                           | —     |    |   |   | —     |    |   |   | —     |    |   |   | —     |   | (20,872,911 | )  |   |   | (20,872,911 | )  |   |
|                                                                                                                                                                                                |                                 |   |    |                            |   |                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance, December 31, 2006                                                                                                                                                                          | 51,828,035                           |   |    | 98,789,652                      |   |                           | 664,406 |    |   |   | 664 |    |   |   | 631,458 |    |   |   | —     |   | (43,809,601 | )  |   |   | (43,177,479 | )  |   |
| Issuance of Series C Redeemable Convertible         Preferred stock at $1.82 per share, net of         expenses               | 18,332,965                           |   |    | 33,219,379                      |   |                           | —     |    |   |   | —     |    |   |   | —     |    |   |   | —     |   | —     |    |   |   |     —     |    |   |
| Issuance of common stock upon exercise of         options                                                                                                        | —          |   |    | —     |   |                           | 15,952 |    |   |   | 16 |    |   |   | 60,145 |    |   |   | —     |   | —     |    |   |   | 60,161 |    |   |
| Repurchased vested restricted stock                                                                                                                                                                 | —          |   |    | —     |   |                           | (5,492 | )  |   |   | (5 | )  |   |   | (93,947 | )  |   |   | —     |   | —     |    |   |   | (93,952 | )  |   |
| Stock-based compensation expense                                                                                                                                                                    | —          |   |    | —     |   |                           | —     |    |   |   | —     |    |   |   | 663,948 |    |   |   | —     |   | —     |    |   |   | 663,948 |    |   |
| Accretion of Series A, Series B, and Series C         Redeemable Convertible Preferred stock to         redemption value | —          |   |    | 8,742,100                       |   |                           | —     |    |   |   | —     |    |   |   | —     |    |   |   | —     |   | (8,742,100 | )  |   |   | (8,742,100 | )  |   |
| Net loss                                                                                                                                                                                            | —          |   |    | —     |   |                           | —     |    |   |   | —     |    |   |   | —     |    |   |   | —     |   | (30,987,544 | )  |   |   | (30,987,544 | )  |   |
| Balance, December 31, 2007                                                                                                                                                                          | 70,161,000                           |   |    | 140,751,131                     |   |                           | 674,866 |    |   |   | 675 |    |   |   | 1,261,604 |    |   |   | —     |   | (83,539,245 | )  |   |   | (82,276,966 | )  |   |
| Issuance of Series C Redeemable Convertible         Preferred stock at $1.82 per share, net of         expenses               | 11,793,127                           |   |    | 21,351,814                      |   |                           | —     |    |   |   | —     |    |   |   | —     |    |   |   | —     |   | —     |    |   |   |     —     |    |   |
| Issuance of common stock upon exercise of         options                                                                                                        | —          |   |    | —     |   |                           | 7,531 |    |   |   | 8 |    |   |   | 28,487 |    |   |   | —     |   | —     |    |   |   | 28,495 |    |   |
| Repurchased vested restricted stock                                                                                                                                                                 | —          |   |    | —     |   |                           | (821 | )  |   |   | (1 | )  |   |   | (11 | ) |   |   | —     |   | —     |    |   |   | (12 | )  |   |
| Stock-based compensation expense                                                                                                                                                                    | —          |   |    | —     |   |                           | —     |    |   |   | —     |    |   |   | 1,316,724 |    |   |   | —     |   | —     |    |   |   | 1,316,724 |    |   |
| Accretion of Series A, Series B, and Series C         Redeemable Convertible Preferred stock to         redemption value | —          |   |    | 11,753,958                      |   |                           | —     |    |   |   | —     |    |   |   | —     |    |   |   | —     |   | (11,753,958 | )  |   |   | (11,753,958 | )  |   |
| Net loss                                                                                                                                                                                            | —          |   |    | —     |   |                           | —     |    |   |   | —     |    |   |   | —     |    |   |   | —     |   | (42,392,968 | )  |   |   | (42,392,968 | )  |   |
| Balance, December 31, 2008                                                                                                                                                                          | 81,954,127                           |   |    | 173,856,903                     |   |                           | 681,576 |    |   |   | 682 |    |   |   | 2,606,804 |    |   |   | —     |   | (137,686,171 | )  |   |   | (135,078,685 | )  |   |
| Issuance of common stock upon exercise of         options                                                                                                        | —          |   |    | —     |   |                           | 20,005 |    |   |   | 20 |    |   |   | 54,091 |    |   |   | —     |   | —     |    |   |   | 54,111 |    |   |
| Stock-based compensation expense                                                                                                                                                                    | —          |   |    | —     |   |                           | —     |    |   |   | —     |    |   |   | 855,136 |    |   |   | —     |   | —     |    |   |   | 855,136 |    |   |
| Accretion of Series A, Series B, and Series C         Redeemable Convertible Preferred stock to         redemption value | —          |   |    | 14,059,265                      |   |                           | —     |    |   |   | —     |    |   |   | —     |    |   |   | —     |   | (14,059,265 | )  |   |   | (14,059,265 | )  |   |
| Net loss                                                                                                                                                                                            | —          |   |    | —     |   |                           | —     |    |   |   | —     |    |   |   | —     |    |   |   | —     |   | (29,845,036 | )  |   |   | (29,845,036 | )  |   |
| Balance, December 31, 2009                                                                                                                                                                          | 81,954,127                           |   | $       | 187,916,168                     |   |                           | 701,581 |    |   | $ | 702 |    |   | $ | 3,516,031 |    |   | $ |    —     | $ | (181,590,472 | )  |   | $ | (178,073,739 | )  |   |

----

|                                                                                                                                                                                                |                                 |   |    |                            |   | Stockholders' equity (deficit) |                            |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------|--------|---------|---------------------------------|--------|--------------------------------|---------------------------------|
|                                                                                                                                                                                                | Redeemableconvertiblepreferred stock |   |    | Common stock                    |   |                           | Additionalpaid-incapital        |   | Deferredcompensation | Deficitaccumulatedduring thedevelopmentstage |   |   |
|                                                                                                                                                                                                | Shares                               |   | Amount  |                            |   | Shares                         |                            | Amount |   |   |   | Total |   |
| Issuance of common stock upon exercise of         options                                                                                                        | —          |   |  $ | —     |   |                           | 32,257                          |   | $ | 32 |    |   |  $ | 14,153 |    | $ | —     |  $ | —     |    |  $ | 14,185 |    |
|  Stock-based compensation expense                                                                                                                                                              | —          |   |    | —     |   |                           | —     |   |   | —     |    |   |   | 953,858 |    |   | —     |   | —     |    |   | 953,858 |    |
| Accretion of Series A, Series B, and Series C         Redeemable Convertible Preferred         stock to redemption value | —          |   |    | 3,992,589                       |   |                           | —     |   |   | —     |    |   |   | —     |    |   | —     |   | (3,992,589 | ) |   | (3,992,589 | )  |
| Conversion of preferred stock to common         stock                                                                                                            | (81,954,127                          | )      |    | (191,908,757                    | )      |                           | 5,651,955                       |   |   | 5,652 |   |   |   | 191,903,105 |   |   | —     |   | —     |   |   | 191,908,757 |   |
| Conversion of preferred stock warrants to         common stock warrants                                                                                          | —               |   |    | —     |   |                           | —          |   |   | —    |   |   |   | 122,904 |   |   | —     |   | —     |   |   | 122,904 |   |
| Proceeds from initial public offering, net of      offering expenses                                                                                                            | —               |   |    | —     |   |                           | 6,000,000                       |   |   | 6,000 |   |   |   | 25,720,813 |   |   | —     |   | —     |   |   | 25,726,813 |   |
|  Net loss                                                                                                                                                                                      | —                    |   |    | —     |   |                           | —     |   |   | —     |    |   |   | —     |    |   | —     |   | (25,600,269 | )  |   | (25,600,269 | )  |
| Balance, December 31, 2010                                                                                                                                                                          | —                    |   |    | —     |   |                           | 12,385,793                      |   |   | 12,386 |   |   |   | 222,230,864 |   |   | —    |   | (211,183,330 | ) |   | 11,059,920 |   |
| Proceeds from equity financing, net of      offering expenses                                                                                                                   | —               |   |    | —     |   |                           | 11,079,250                      |   |   | 11,079 |   |   |   | 28,930,394 |   |   | —     |   | —     |   |   | 28,941,473 |   |
| Issuance of warrants to purchase common      stock in connection with equity      financing                                                                 | —          |   |    | —     |   |                           | —     |   |   | —     |    |   |   | (16,947,000 | ) |   | —     |   | —     |    |   | (16,947,000 | ) |
| Issuance of common stock upon exercise of      options                                                                                                                          | —          |   |    | —     |   |                           | 6,206                           |   |   | 6 |    |   |   | 2,724 |    |   | —     |   | —     |    |   | 2,730 |    |
| Issuance of warrants to purchase common      stock in connection with debt financing                                                                                            | —          |   |    | —     |   |                           | —     |   |   | —     |    |   |   | 105,342 |   |   | —     |   | —     |    |   | 105,342 |   |
|  Stock-based compensation expense                                                                                                                                                              | —          |   |    | —     |   |                           | —     |   |   | —     |    |   |   | 257,246 |    |   | —     |   | —     |    |   | 257,246 |    |
| Net loss                                                                                                                                                                                            | —                    |   |    | —     |   |                           | —     |   |   | —     |    |   |   | —     |    |   | —     |   | (7,029,460 | )  |   | (7,029,460 | )  |
| Balance, March 31, 2011                                                                                                                                                                             | —                    |   | $       | —     |   |                           | 23,471,249                      |   | $ | 23,471 |   |   | $ | 234,579,570 |   | $ | —    | $ | (218,212,790 | ) | $ | 16,390,251 |   |

----

TENGION, INC.

|                                                                            |   |                        |                                                                                  |                                                          |   |   |         |   |   |   |                |   |
|---------------------------------------------------------------------------------|--------|-----------------------------|---------------------------------------------------------------------------------------|---------------------------------------------------------------|--------|--------|--------------|--------|--------|--------|---------------------|--------|
|                                                                            |   | Three Months EndedMarch 31, |                                                                                  | Period fromJuly 10, 2003(inception)throughMarch 31, 2011 |
|                                                                            |   | 2010                        |                                                                                  | 2011                                                          |   |
| Cash flows from operating activities:                                           |   |                        |                                                                                  |                                                          |   |   |         |   |   |   |                |   |
| Net loss                                                                        |   | $                           | (6,434,790                                                                            | )                                                             |   | $      | (7,029,460   | )      |   | $      | (169,825,766        | )      |
| Adjustments to reconcile net loss to net cash used in operating activities:     |   |                        |                                                                                  |                                                          |   |   |         |   |   |   |                |   |
| Depreciation                                                                    |   |                        | 1,226,809                                                                             |                                                          |   |   | 1,126,573    |   |   |   | 21,137,221          |   |
| Change in fair value of warrant liability                                       |   |                        | (191,527                                                                              | )                                                             |   |   | (419,000     | )      |   |   | (2,481,454          | )      |
| Change in value of lease liability                                              |   |                        | —                                                                               |                                                          |   |   | 942,567      |   |   |   | 942,567             |   |
| Loss on disposition of property and equipment                                   |   |                        | 1,618                                                                                 |                                                          |   |   | —      |   |   |   | 119,116             |   |
| Amortization of net discount on short-term investments                          |   |                        | —                                                                               |                                                          |   |   | —      |   |   |   | (149,150            | )      |
| Noncash interest expense                                                        |   |                        | 83,049                                                                                |                                                          |   |   |  69,219 |   |   |   | 2,455,586           |   |
| Noncash rent expense (income)                                                   |   |                        |  2,710                                                                           |                                                          |   |   | (3,083       | )      |   |   | 238,083             |   |
| Stock-based compensation expense                                                |   |                        |  198,266                                                                         |                                                          |   |   | 257,246      |   |   |   | 4,601,808           |   |
| Changes in operating assets and liabilities:                                    |   |                        |                                                                                  |                                                          |   |   |         |   |   |   |                |   |
| Prepaid expenses and other assets                                               |   |                        |  (98,663                                                                         | )                                                             |   |   | (748,243     | )      |   |   | (1,573,655          | )      |
| Accounts payable                                                                |   |                        |  (320,287                                                                        | )                                                             |   |   | 39,322       |   |   |   | 1,191,992           |   |
| Accrued expenses and other                                                      |   |                        | (143,518                                                                              | )                                                             |   |   | (1,069,669   | )      |   |   | 2,188,655           |   |
| Net cash used in operating activities                                           |   |                        | (5,676,333                                                                            | )                                                             |   |   | (6,834,528   | )      |   |   | (141,154,997        | )      |
| Cash flows from investing activities:                                           |   |                        |                                                                                  |                                                          |   |   |         |   |   |   |                |   |
| Purchases of short-term investments                                             |   |                        |  (1,499,160                                                                      | )                                                             |   |   | —      |   |   |   | (311,441,850        | )      |
| Sales and redemption of short-term investments                                  |   |                        | 2,998,668                                                                             |                                                          |   |   | —      |   |   |   | 311,591,000         |   |
| Cash paid for property and equipment                                            |   |                        |  (88,167                                                                         | )                                                             |   |   | (48,057      | )      |   |   | (31,640,647         | )      |
| Proceeds from the sale of property and equipment                                |   |                        | —                                                                               |                                                          |   |   | —      |   |   |   | 11,306              |   |
| Net cash provided by (used in) investing activities                             |   |                        | 1,411,341                                                                             |                                                          |   |   | (48,057      | )      |   |   | (31,480,191         | )      |
| Cash flows from financing activities:                                           |   |                        |                                                                                  |                                                          |   |   |         |   |   |   |                |   |
| Proceeds from sales of redeemable convertible preferred stock and warrants, net |   |                        | —                                                                               |                                                          |   |   | —      |   |   |   | 139,959,522         |   |
| Proceeds (offering costs) from sales of common stock and warrants, net          |   |                        | (1,271,952                                                                            | )                                                             |   |   | 29,092,085   |   |   |   | 54,986,091          |   |
| Repurchase of restricted stock                                                  |   |                        |              — |                                                          |   |   | —      |   |   |   | (94,169             | )      |
| Proceeds from long-term debt, net                                               |   |                        | —                                                                               |                                                          |   |   | 4,907,628    |   |   |   | 39,516,585          |   |
| Payments on long-term debt                                                      |   |                        | (3,139,924                                                                            | )                                                             |   |   | (7,610,367   | )      |   |   | (30,254,420         | )      |
| Net cash provided by (used in) financing activities                             |   |                        | (4,411,876                                                                            | )                                                             |   |   | 26,389,346   |   |   |   | 204,113,609         |   |
| Net increase (decrease) in cash and cash equivalents                            |   |                        | (8,676,868                                                                            | )                                                             |   |   | 19,506,761   |   |   |   | 31,478,421          |   |
| Cash and cash equivalents, beginning of period                                  |   |                        | 16,804,129                                                                            |                                                          |   |   | 11,971,660   |   |   |   | —             |   |
| Cash and cash equivalents, end of period                                        |   | $                           | 8,127,261                                                                             |                                                          |   | $      | 31,478,421   |   |   | $      | 31,478,421          |   |
|                                                                            |   |                        |                                                                                  |                                                          |   |   |         |   |   |   |                |   |
| Supplemental cash flow disclosures:                                             |   |                        |                                                                                  |                                                          |   |   |         |   |   |   |                |   |
| Noncash investing and financing activities:                                     |   |                        |                                                                                  |                                                          |   |   |         |   |   |   |                |   |
| Conversion of note principal to redeemable convertible preferred stock          |   | $                           | —                                                                               |                                                          |   | $      | —      |   |   | $      | 3,562,211           |   |
| Convertible note issued to stockholder for consulting expense                   |   |                        | —                                                                               |                                                          |   |   | —      |   |   |   |   210,372 |   |
| Fair value of warrants issued with long-term debt                               |   |                        | —                                                                               |                                                          |   |   | 105,342      |   |   |   | 2,290,700           |   |
| Fair value of warrants issued with sale of common stock                         |   |                        | —                                                                               |                                                          |   |   | 16,947,000   |   |   |   | 16,947,000          |   |
| Noncash property and equipment additions                                        |   |                        | 25,227                                                                                |                                                          |   |   | 70           |   |   |   | 70                  |   |

----

Tengion, Inc.

----

|                                             |   | March 31, |       |
|--------------------------------------------------|--------|-----------|------------|
|                                             |   | 2010      |       |   | 2011 |   |
| Shares of redeemable convertible preferred stock |   |      | 81,954,127 |   |   |   | — |   |
| Shares underlying options outstanding            |   |      | 709,755    |   |   |   | 1,370,263 |   |
| Shares underlying warrants outstanding           |   |      | 216        |   |   |   | 10,645,888 |   |
| Unvested restricted stock                        |   |      | 1,605,439  |   |   |   | — |   |

| ·   | Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Level 2: Quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability; |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity). |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                      |   |                                                           |       |   |                                         |   |    |                                     |   |   |       |   |
|---------------------------|--------|----------------------------------------------------------------|------------|--------|----------------------------------------------|--------|---------|------------------------------------------|--------|--------|------------|--------|
|                      |   | Fair value measurement at reporting date using                 |       |
|                      |   | Quoted prices in active markets for identical assets (Level 1) |       |   | Significant other observable inputs(Level 2) |   |    | Significant unobservable inputs(Level 3) |   |   | Total      |   |
|                      |   |                                                           |       |   |                                         |   |    |                                     |   |   |       |   |
| At December 31, 2010:     |   |                                                           |       |   |                                         |   |    |                                     |   |   |       |   |
| Assets:                   |   |                                                           |       |   |                                         |   |    |                                     |   |   |       |   |
| Cash and cash equivalents |   | $                                                              | 11,971,660 |   |                                         | $      | — |                                     |   | $      | —    |   |   | $ | 11,971,660 |   |
|                      |   |                                                           |       |   |                                         |   |    |                                     |   |   |       |   |   |   |   |   |
| At March 31, 2011:        |   |                                                           |       |   |                                         |   |    |                                     |   |   |       |   |   |   |   |   |
| Assets:                   |   |                                                           |       |   |                                         |   |    |                                     |   |   |       |   |   |   |   |   |
| Cash and cash equivalents |   | $                                                              | 31,478,421 |   |                                         | $      | — |                                     |   | $      | —    |   |   | $ | 31,478,421 |   |
| Liabilities:              |   |                                                           |       |   |                                         |   |    |                                     |   |   |       |   |   |   |   |   |
| Warrant liability    |   | $                                                              | —    |   |                                         | $      | — |                                     |   | $      | 16,528,000 |   |   | $ | 16,528,000 |   |
|                      |   |                                                           |       |   |                                         |   |    |                                     |   |   |       |   |   |   |   |   |

|                                      |         | Warrant liability |
|-------------------------------------------|--------------|-------------------|
|                                      |         |              |   |   |
| Balance at December 31, 2010              |         | $                 | — |   |
| Issuance of warrants                      |         |              | 16,947,000 |   |
| Change in fair value of warrant liability |    |              | (419,000 | ) |
| Balance at March 31, 2011                 |    | $                 | 16,528,000 |   |
|                                      |         |              |   |   |

| (7)  | Lease Liability |
|-----------|-----------------|

----

|            |   | Initial fair value as ofMarch 1, 2011 |    |   | Payments |   |    | Additional Charges to Operations |   |   | Balance atMarch 31, 2011 |   |
|-----------------|--------|---------------------------------------|---------|--------|----------|--------|---------|----------------------------------|--------|--------|--------------------------|--------|
| Lease liability |   | $                                     | 933,427 |   |     | $      | (19,259 | )                                |   | $      | 9,140                    |   |   | $ | 923,308 |   |

| (8)   | Debt |
|-----------------|------|

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |         |             |       |                |         |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------|------------------|------------|---------------------|--------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |         | December 31,2010 |       | March 31, 2011 |
| Working Capital Note                                                                                        |    | $                | 7,257,159  |                |    | $      | 5,000,000 |   |
| Equipment and Supplemental Working Capital Notes                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |    |             | 1,015,474  |                |    |   | 779,444 |   |
| Machinery and Equipment Loan                                                                                |    |             | 477,609    |                |    |   | 360,432 |   |
| Unamortized debt discount                                                                                   |    |             | (148,575   | )                   |    |   | (196,253 | ) |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |    |             | 8,601,667  |                |    |   | 5,943,623 |   |
| Less current portion                                                                                        |    |             | (4,016,174 | )                   |    |   | (1,408,408 | ) |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |    | $                | 4,585,493  |                |    | $      | 4,535,215 |   |

----

----

|                                                              |             |   |           |   |       |                                 |
|-------------------------------------------------------------------|------------------|--------|----------------|--------|------------|--------------------------------------|
|                                                              | Number of shares |   | Exercise price |   | Expiration |
| Equity–classified warrants                                  |             |   |           |   |       |                                 |
| Issued to vendors                                                 | 3,890            |   | $              | 2.32   |       | September 2015 through December 2016 |
| Issued pursuant to March 2011 refinancing of Working Capital Note | 70,671           |   | $              | 2.88   |       | March 2016                           |
| Issued to lenders                                                 | 64,409           |   | $              | 23.44  |       | August 2013 through December 2016    |
| Issued to lenders                                                 | 46,043           |   | $              | 26.39  |       | October 2015 through September 2019  |
|                                                              | 185,013          |   |           |   |       |                                 |
| Liability–classified warrants                               |             |   |           |   |       |                                 |
| Issued pursuant to March 2011 equity financing                    | 10,460,875       |   | $              | 2.88   |       | March 2016                           |
|                                                              | 10,645,888       |   |           |   |       |                                 |
|                                                              |             |   |           |   |       |                                 |

----

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |              |       |   |                                          |   |       |   |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------|------------|--------|-----------------------------------------------|--------|------------|--------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                      |   | Fair value as of: |       |   | Net cash settlement value as ofMarch 31, 2011 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                      |   | March 4, 2011     |       |   | March 31, 2011                                |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |              |       |   |                                          |   |       |   |   |
| Calculated aggregate value                                                                           |   | $                 | 16,947,000 |   |                                          | $      | 16,528,000 |   |   | $ | 19,946,000 |  (1) |
| Exercise price per share of warrant                                                                  |   | $                 | 2.88       |   |                                          | $      | 2.88       |   |   | $ | 2.88 |   |
| Closing price per share of common stock                                                                                                                                                                                                                                                                                                                                                                                                   |   | $                 | 2.60       |   |                                          | $      | 2.55       |   |   | $ | 2.55 |   |
| Volatility                                                                                           |   |              | 65.0       | %      |                                          |   | 65.0       | %      |   |   | 103.5 | % (2) |
| Probability of Fundamental Transaction or Delisting                                                                                                                                                                                                                                                                                                                                                                                       |   |              | 48.9       | %      |                                          |   | 48.9       | %      |   | Not applicable |   |
| Expected term (years)                                                                                |   | Not applicable    |       |   | Not applicable                                |   |       |   | 4.9    |   |
| Risk-free interest rate                                                                              |   |              | 2.2        | %      |                                          |   | 2.3        | %      |   |   | 2.3 | % |
| Dividend yield                                                                                       |   | None              |       |   | None                                          |   |       | None   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |              |       |   |                                          |   |       |   |   |   |   |   |

----

----

|                                          |   Number of shares |   |   | Weighted-average exercise price |    |   Weighted-average remaining contractual term (in years) |   | Aggregate intrinsic value |
|-----------------------------------------------|-------------------------|--------|--------|---------------------------------|---------|---------------------------------------------------------------|--------|---------------------------|
| Outstanding at December 31, 2010              | 1,377,710               |   |   | $                               | 2.49    |                                                          |   |                      |   |
| Granted                                       | —                 |   |   | $                               | — |                                                          |   |                      |   |
| Exercised                                     | (6,206                  | )      |   | $                               | 0.44    |                                                          |   |                      |   |
| Forfeited                                     | (1,241                  | )      |   | $                               | 0.44    |                                                          |   |                      |   |
| Outstanding at March 31, 2011                 | 1,370,263               |   |   | $                               | 2.50    |                                                          | 8.40   |                      | $ | 1,178,990 |
|                                          |                    |   |   |                            |    |                                                          |   |                      |   |
| Vested and expected to vest at March 31, 2011 | 1,289,689               |   |   | $                               | 2.48    |                                                          | 8.36   |                      | $ | 1,143,367 |
|                                          |                    |   |   |                            |    |                                                          |   |                      |   |
| Exercisable at March 31, 2011                 | 417,936                 |   |   | $                               | 1.51    |                                                          | 6.74   |                      | $ | 755,660 |
|                                          |                    |   |   |                            |    |                                                          |   |                      |   |

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |         |   |      |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------|--------|-----------|--------|
| 2011                                                                                                     |         | $      | 705,282   |   |
| 2012                                                                                                     |         |   | 836,668   |   |
| 2013                                                                                                     |         |   | 856,669   |   |
| 2014                                                                                                     |         |   | 876,670   |   |
| 2015                                                                                                     |         |   | 896,671   |   |
| 2016                                                                                                     |         |   | 150,001   |   |
| Total minimum lease payments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |    | $      | 4,321,961 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |         |   |      |   |

----

Item 2. 

----

| ·   | personnel related expenses, including salaries, benefits, travel and other related expenses including stock-based compensation; |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------|

| ·   | payments made to third-party contract research organizations for preclinical studies, investigative sites for clinical trials and consultants; |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | costs associated with regulatory filings and the advancement of our product candidates through preclinical studies and clinical trials; |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------|

| ·   | laboratory and other supplies; |
|--------------------|--------------------------------|

| ·   | manufacturing development costs; and |
|--------------------|--------------------------------------|

| ·   | facility maintenance. |
|--------------------|-----------------------|

----

|                                      |   |                         |   |   |         |   |   |   |
|-------------------------------------------|--------|------------------------------|--------|--------|--------------|--------|--------|--------|
|                                      |   | Three months ended March 31, |   |
|                                      |   | 2010                         |   |   | 2011         |   |
|                                      |   | (in thousands)               |   |
| Third-party direct program expenses:      |   |                         |   |   |    |   |   |   |
| Urologic                                  |   | $                            | 124    |   |    | $      | 278    |   |
| Renal                                     |   |                         | 438    |   |    |   | 464    |   |
| Total third-party direct program expenses |   |                         | 562    |   |    |   | 742    |   |
| Other research and development expense    |   |                         | 2,754  |   |    |   | 2,603  |   |
| Total research and development expense    |   | $                            | 3,316  |   |    | $      | 3,345  |   |

| ·   | the number of sites included in the trials; |
|--------------------|---------------------------------------------|

| ·   | the length of time required to enroll suitable patients; |
|--------------------|----------------------------------------------------------|

| ·   | the number of patients that participate in the trials; |
|--------------------|--------------------------------------------------------|

| ·   | the duration of patient follow-up; |
|--------------------|------------------------------------|

| ·   | the development stage of the product candidate; and |
|--------------------|-----------------------------------------------------|

| ·   | the efficacy and safety profile of the product candidate. |
|--------------------|-----------------------------------------------------------|

----

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |              |       |   |                                          |   |       |   |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------|------------|--------|-----------------------------------------------|--------|------------|--------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                      |   | Fair value as of: |       |   | Net cash settlement value as ofMarch 31, 2011 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                      |   | March 4, 2011     |       |   | March 31, 2011                                |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |              |       |   |                                          |   |       |   |   |
| Calculated aggregate value                                                                           |   | $                 | 16,947,000 |   |                                          | $      | 16,528,000 |   |   | $ | 19,946,000 |  (1) |
| Exercise price per share of warrant                                                                  |   | $                 | 2.88       |   |                                          | $      | 2.88       |   |   | $ | 2.88 |   |
| Closing price per share of common stock                                                                                                                                                                                                                                                                                                                                                                                                   |   | $                 | 2.60       |   |                                          | $      | 2.55       |   |   | $ | 2.55 |   |
| Volatility                                                                                           |   |              | 65.0       | %      |                                          |   | 65.0       | %      |   |   | 103.5 | % (2) |
| Probability of Fundamental Transaction or Delisting                                                                                                                                                                                                                                                                                                                                                                                       |   |              | 48.9       | %      |                                          |   | 48.9       | %      |   | Not applicable |   |
| Expected term (years)                                                                                |   | Not applicable    |       |   | Not applicable                                |   |       |   | 4.9    |   |
| Risk-free interest rate                                                                              |   |              | 2.2        | %      |                                          |   | 2.3        | %      |   |   | 2.3 | % |
| Dividend yield                                                                                       |   | None              |       |   | None                                          |   |       | None   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |              |       |   |                                          |   |       |   |   |   |   |   |

----

| (1) | Represents the net cash settlement value of the warrant as of March 31, 2011, which value was calculated utilizing the Black-Scholes model specified in the warrant. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | Represents the volatility assumption used to calculate the net cash settlement value as of March 31, 2011. |
|-----|------------------------------------------------------------------------------------------------------------|

|                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   | Three months endedMarch 31, |   | Increase(Decrease) |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------------------|--------|--------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   | 2010                             |   | 2011               |   | $ |   | % |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |  (in thousands)             |   | (in thousands)     |   |   |   |
| Compensation and related expense                                                                                 |   | $                                | 1,799  |          | $ | 1,808 |    | $ | 9 |   |   | 1 | %  |
| External services – direct third parties                                                                   |   |                             | 562    |          |   | 742 |    |   | 180 |   |   | 32 | %  |
| External services – other                                                                                  |   |                             | 126    |          |   | 68 |    |   | (58 | ) |   | (46) | %  |
| Research materials and related expense                                                                           |   |                             | 326    |          |   | 279 |    |   | (47 | ) |   | (14) | %  |
| Facilities and related expense                                                                                   |   |                             | 503    |          |   | 448 |    |   | (55 | ) |   | (11) | %  |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                             |   |          |   |   |    |   |   |   |   |   |   |
| Total research and development expense                                                                           |   | $                                | 3,316  |          | $ | 3,345 |   | $ | 29 |   |   | 1 | %  |

----

| Issue                                                    |   | Year   |            |   | Number of Shares |   |       |   |   | Net Proceeds(in thousands) (1) |   |
|----------------------------------------------------------|--------|--------|-----------------|--------|------------------|--------|------------|--------|--------|-------------------------------------|--------|
| Series A Redeemable Convertible Preferred Stock(2)  |   |   | 2004, 2005 |   |             |   | 1,668,311  |   |   |                                |   | $ | 38,910 |   |
| Series B Redeemable Convertible Preferred Stock(2)  |   |   | 2006            |   |             |   | 1,906,009  |   |   |                                |   |   | 50,040 |   |
| Series C Redeemable Convertible Preferred Stock(2)  |   |   | 2007, 2008      |   |             |   | 2,077,635  |   |   |                                |   |   | 54,571 |   |
| Initial Public Offering                                  |   |   | 2010            |   |             |   | 6,000,000  |   |   |                                |   |   | 25,721 |   |
| Private Placement                                        |   |   | 2011            |   |             |   | 11,079,250 |   |   | (3)                                 |   |   | 28,941 |   |
|                                                     |   |   |            |   |             |   | 22,731,205 |   |   |                                |   | $ | 198,183 |   |

----

| (1) | Net proceeds represent gross proceeds received net of transaction costs associated with each equity offering. |
|-----|---------------------------------------------------------------------------------------------------------------|

| (2) | Number of shares represents the number of shares of common stock into which each series of preferred stock converted at the time of our initial public offering. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | Excludes issuance of warrants to purchase 10,460,875 shares of common stock in connection with the private placement transaction. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------|

----

Cash Flows

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   | Three Months Ended March 31, |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   | 2010                         |   |   | 2011 |   |
| Statement of Cash Flows Data:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   | (in thousands)               |   |
| Total cash provided by (used in):                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |                         |   |   |   |   |
|      Operating activities                                                                                             |   | $                            | (5,676 | ) |   | $ | (6,834 | ) |
|      Investing activities                                                                                             |   |                         | 1,411  |   |   |   | (48 | ) |
|      Financing activities                                                                                             |   |                         | (4,412 | ) |   |   | 26,389 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |                         |   |   |   |   |   |   |
| (Decrease) increase in cash and cash equivalents                                                                                               |   | $                            | (8,677 | ) |   | $ | 19,507 |   |

----

OTHER INFORMATION

----

  (Removed and Reserved)

| Name and Title                                                                                  | Number of Shares underOption Grant  | Restricted Stock Awards  |
|------------------------------------------------------------------------------------------------------|------------------------------------------|-------------------------------|
| Steven Nichtberger, MD, President and Chief Executive Officer                                   | 130,000                                  | 86,667                        |
| A. Brian Davis, Chief Financial Officer and Vice President, Finance                             | 35,000                                   | 23,333                        |
| Timothy Bertram, Chief Scientific Officer and Executive Vice President, Science and Technology  | 60,000                                   | 40,000                        |
| Sunita Sheth, MD, Chief Medical Officer and Vice President Clinical and Regulatory Affairs      | 40,000                                   | 26,667                        |
| Mark Stejbach, Chief Commercial Officer and Vice President                                           | 40,000                                   | 26,667                        |

----

| Exhibit Number |   | Description                                                                                                                 |   | Reference No.                                            |
|----------------|--------|-----------------------------------------------------------------------------------------------------------------------------|--------|----------------------------------------------------------|
|           |   |                                                                                                                        |   |                                                     |
| 4.1            |   | Warrant issued to Horizon Technology Finance Corporation, dated as of March 14, 2011                                   |   | Exhibit 4.1 to the Form 8-K filed on March 16, 2011      |
| 4.2            |   | Form of Warrant issued March 4, 2011                                                                                   |   | Exhibit 4.1 to the Form 8-K filed on March 1, 2011  |
|           |   |                                                                                                                        |   |                                                     |
| 10.1           |   | Loan Agreement by and between the Company and Horizon Technology Finance Corporation, dated as of March 14, 2011       |   | Exhibit 10.1 to the Form 8-K filed on March 16, 2011     |
| 10.2           |   | Secured Promissory Note in favor of Horizon Technology Finance Corporation, dated as of March 14, 2011                 |   | Exhibit 10.2 to the Form 8-K filed on March 16, 2011     |
| 10.3           |   | Form of Securities Purchase Agreement, among the Company and the purchasers thereto, dated March 1, 2011               |   | Exhibit 10.1 to the Form 8-K filed on March 1, 2011      |
| 10.4           |   | Form of the Registration Rights Agreement, between the Company and the Holders thereto                                 |   | Exhibit 10.2 to the Form 8-K filed on March 1, 2011      |
| 10.5           |   | Right of First Refusal and Right of First Negotiation between the Company and Medtronic, Inc., dated March 1, 2011     |   | Exhibit 10.3 to the Form 8-K filed on March 1, 2011      |
| 10.6           | #      | Tengion, Inc. Change in Control Payment Plan                                                                                |   | *                                                        |
|           |   |                                                                                                                        |   |                                                     |
| 10.7           | #      | Tengion, Inc. Management Severance Pay Plan                                                                                 |   | *                                                        |
|           |   |                                                                                                                        |   |                                                     |
| 31.1           |   | Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                 |   | *                                                        |
| 31.2           |   | Certification of Principal Financial and Accounting Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002  |   | *                                                        |
| 32.1           |   | Certification of Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                 |   | *                                                        |
| 32.2           |   | Certification of Principal Financial and Accounting Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002       |   | *                                                        |
|           |   |                                                                                                                        |   |                                                     |

----

SIGNATURES

|                          |   | TENGION, INC. |
|-------------------------------|--------|---------------|
|                          |   |          |   |   |
|                          |   |          |   |   |
| Date:  May 16, 2011 |   | By:           | /s/ Steven Nichtberger, MD |
|                          |   |          |   | Steven Nichtberger, MDPresident and Chief Executive Officer (Principal Executive Officer) |
|                          |   |          |   |   |
|                          |   |          |   |   |
| Date:  May 16, 2011 |   | By:           | /s/ A. Brian Davis |
|                          |   |          |   | A. Brian DavisChief Financial Officer and Vice President, Finance(Principal Financial and Accounting Officer) |
|                          |   |          |   |   |

----