Intercell AG Signs License Agreement with Merck & Co., Inc. for Bacterial Vaccines

Vienna, Austria, May 26 2004 - Intercell AG today announced the signing of an exclusive commercial license agreement with Merck & Co., Inc. for the development of certain bacterial vaccines and an option to develop antibody products.

This license agreement is a continuation of a research collaboration that began in 2001. During that collaboration, Intercell applied its Antigen Identification Program (AIP) to identify relevant antigens directed towards a specific bacterial target. As a result of this extended agreement, Intercell will receive significant upfront, license, and milestone payments for a vaccine product. Intercell will receive additional payments if Merck exercises the option for an antibody product. In addition, Intercell would also receive royalty payments on product sales. Merck receives exclusive worldwide rights to commercialize any products that may be developed under the agreement. Further details of the agreement were not disclosed.

'Merck is a leader and innovator in the vaccine field, and this collaboration underscores our capabilities in the identification of novel and improved vaccine antigens,' said Alexander von Gabain, CEO of Intercell. 'Intercell's AIP is a novel, comprehensive and rapid genomic technology for use in identifying protective pathogen antigens for many infectious disease vaccines, using the human immune response as a discovery engine.'

'Merck is delighted to extend our highly productive relationship with Intercell into this commercial license agreement,' said Mervyn Turner, Ph. D., senior vice president, Worldwide Licensing and External Research, at Merck. 'We believe that this agreement will help in Merck's efforts to address a significant unmet need in the area of bacterial infection. It also demonstrates our ongoing commitment to access the most promising research from the biotech community in building the Merck pipeline."

About Intercell AG

Intercell is a biotechnology company focused on the development of vaccines against infectious diseases. Intercell's lead products are a therapeutic hepatitis C vaccine, which entered Phase II clinical testing in November 2002, and a vaccine against Japanese encephalitis that has successfully undergone a Phase II clinical study. A Phase III clinical study is planned for early 2005. Intercell's proprietary Antigen Identification Program has led to the discovery of relevant vaccine antigens against various bacterial infections. Such antigens will be the basis for Intercell's own development programs, and will also be partnered with major vaccine players in selected indications. Intercell has developed, in addition, a novel synthetic Immunizer (adjuvant) IC31 for vaccine formulations. IC31 is an important component of Intercell's vaccine technology. To date, Intercell has succeeded in raising venture capital totalling more than 100 million since becoming operational.

Contact Intercell AG:

Katharina Wieser

Corporate Communication

Campus Vienna Biocenter 2

A-1030 Vienna

P: +43-1-20620-303

Mail to: kwieser@intercell.com

Be invited to: www. intercell.com

For Intercell

This press release contains forward-looking statements that involve inherent risks and uncertainties. We have identified certain important factors that may cause actual results to differ materially from those contained in such forward-looking statements.

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