Small-Cap Research. GeoVax Labs Inc. (GOVX-OTC) GOVX: Ebola & HIV Programs Moving Forward OUTLOOK SUMMARY DATA ZACKS ESTIMATES

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1 Small-Cap Research March 23, 2015 Jason Napodano, CFA scr.zacks.com 10 S. Riverside Plaza, Chicago, IL GeoVax Labs Inc. (GOVX-OTC) GOVX: Ebola & HIV Programs Moving Forward Current Recommendation Outperform Prior Recommendation Date of Last Change 01/15/2013 Current Price (03/23/15) $0.26 Twelve- Month Target Price $0.60 OUTLOOK On March 20, 2015, GeoVax Labs, Inc. (GOVX) reported financial results for the fourth quarter and full year ending December 31, Revenue in the fourth quarter totaled $0.2 million and was derived from grants from the U.S. NIH in support of the company s HIV/AIDS vaccine program. As of December 31, 2014, GeoVax reported approximately $0.2 million in unused grant funds remaining and available for use. For the full year 2014, revenues totaled $0.9 million, again earned from NIH grants in support of the ongoing HIV/AIDS vaccine program. We believe the shares are worth $0.60 based on the stage of development and upside potential to the emerging story. SUMMARY DATA 52-Week High $ Week Low $0.13 One-Year Return (%) Beta 1.26 Average Daily Volume (sh) 60,140 Shares Outstanding (mil) 32 Market Capitalization ($mil) $5 Short Interest Ratio (days) Institutional Ownership (%) 38 Insider Ownership (%) 7 Annual Cash Dividend $0.00 Dividend Yield (%) Yr. Historical Growth Rates Sales (%) 10.5 Earnings Per Share (%) Dividend (%) P/E using TTM EPS P/E using 2015 Estimate P/E using 2016 Estimate Risk Level Type of Stock Industry Zacks Rank in Industry ZACKS ESTIMATES Above Avg., Small-Growth Med-Biomed/Gene Revenue (in millions of $) Q1 Q2 Q3 Q4 Year (Mar) (Jun) (Sep) (Dec) (Dec) A 0.18 A 0.32 A 0.22 A 0.88 A E 0.30 E 0.30 E 0.30 E 1.10 E E E Earnings per Share (EPS is operating earnings before non recurring items) Q1 Q2 Q3 Q4 Year (Mar) (Jun) (Sep) (Dec) (Dec) $0.02 A -$0.03 A -$0.02 A -$0.03 A -$0.10 A $0.03 E -$0.03 E -$0.03 E -$0.03 E -$0.13 E $0.09 E $0.08 E Copyright 2015, Zacks Investment Research. All Rights Reserved.

2 WHAT S NEW Financial Update On March 20, 2015, GeoVax Labs, Inc. (GOVX) reported financial results for the fourth quarter and full year ending December 31, Revenue in the fourth quarter totaled $0.2 million and was derived from grants from the U.S. NIH in support of the company s HIV/AIDS vaccine program. As of December 31, 2014, GeoVax reported approximately $0.2 million in unused grant funds remaining and available for use. For the full year 2014, revenues totaled $0.9 million, again earned from NIH grants in support of the ongoing HIV/AIDS vaccine program. Operating loss in 2014 totaled $2.7 million, $0.9 million of which was recorded in the fourth quarter. Loss for the full year was driven by $1.8 million in R&D and $1.8 million in G&A expense. R&D expense in the fourth quarter totaled $0.5 million. R&D expenses include direct costs funded by NIH grants, as well as vaccine manufacturing and testing costs and expenses related to the company s HIV immunotherapy program. G&A in the fourth quarter totaled $0.7 million. For the full year, G&A expense included $0.4 million of stock-based compensation. Net loss for the fourth quarter 2014 was $0.9 million, or $0.03 per share. For the full year 2014, net loss totaled $2.7 million, or $0.10 per share. This was generally consistent with our expectations and similar to the $2.3 million, or $0.11 per share, net loss in As of December 31, 2014, GeoVax reported cash and investments of approximately $1.1 million. Cash burn from operating and investing activities in 2014 totaled $2.3 million. Burn was fairly consistent throughout 2014, averaging around $0.2 million per month. On February 25, 2015, GeoVax announced an equity financing providing up to $6 million in new capital to the company. Under terms of the transaction, the company sold $3.0 million in Series C convertible preferred stock. The Series C preferred stock is convertible at any time into million shares of common stock at $0.18 per share. Investors also received million warrants to purchase GeoVax common stock at any time over the next five years for $0.22 per share. GeoVax also granted the investors a one-year overallotment option to purchase up to an additional $3.0 million in common stock plus warrants under the aforementioned terms. We believe this new cash of approximately $2.8 million net after proceeds, along with the existing balance of $1.1 million as of December 31, 2014, will fund operating activities at the company six quarters or until mid Ebola / Marburg Program Taking Center Stage On October 2, 2014, GeoVax announced that it had initiated a new program for the development of Ebola vaccine to prevent Ebola infection. The news followed a recent Ebola epidemic in Africa and a handful of Ebola case in the U.S. that cause a brief stint of panic in the country. Although early-stage, we are intrigued by the opportunity to develop an Ebola vaccine because there are FDA approved therapies available for treatment of Ebola viral infection. A safe and effective vaccine against Ebola is desperately needed and represents a sizable market opportunity on a global basis. According to the company s news release, GeoVax is developing two Ebola vaccines, GOVX-E301 and GOVX- E302, both recombinant MVA (modified vaccinia Ankara) vaccines designed to produce non-infectious virus-like particles (VLPs) displaying the Ebola virus glycoprotein. GOVX-E301 is being developed as a single-dose vaccine for epidemic response against the ZEBOV strain of Ebola found in Zaire; this is the virus responsible for the outbreak in GOVX-E302 is being developed for routine immunization and is designed to protect against all three versions of Ebola known to be lethal in humans: Zaire, Sudan, and Bundibugyo. GOVX-E302 is anticipated to be used in a two-dose regimen. The development of the new Ebola vaccine program is based on the company s unique recombinant MVA platform. GeoVax is using the platform to develop both preventive and therapeutic HIV vaccines. So far, GeoVax's recombinant MVA vaccines have been successfully evaluated in clinical trials against HIV, in which they have shown excellent safety and immunogenicity. GeoVax's rmva technology also raises highly durable vaccine responses, by far the most durable in the field of HIV vaccines. One more advantage of rmva technology is that GeoVax's rmva vector is based on an attenuated smallpox virus. Following smallpox eradication in 1980, smallpox vaccinations were stopped, leaving all but the elderly unvaccinated and without pre-existing immunity. Zacks Investment Research Page 2 scr.zacks.com

3 Based on these findings from HIV clinical trials, we think the MVA platform is also suited to develop the Ebola vaccine. The company has also just recently expanded the Ebola program to include Marburg virus. MVA-vectored Ebola vaccines have the unique attributes required for success and may offer superior results over other Ebola vaccines in development. GeoVax s goals for 2015 include completion of initial immunogenicity studies in small animals by the end of the third quarter 2015, followed by proof-of-concept challenge studies to take place in early The company expects to begin challenge studies in non-human primates in late Simultaneously, GeoVax will be advancing its vaccine manufacturing and test methods, with the goal of initiating human clinical testing in GeoVax's Ebola vaccine development efforts will be facilitated by the Company's close proximity to, and potential collaboration with, the U.S. Centers for Disease Control (CDC) in Atlanta and its experts and Biosafety Level 4 (BSL-4) facilities for testing vaccine responses against lethal hemorrhagic viruses. We think GeoVax s Ebola vaccine program is a natural extension of its MVA vaccine delivery platform. It is a complementary asset to its HIV vaccine programs and further expands the company s pipeline. HIV Program Development On Track Immunotherapy Program In late October 2014, GeoVax gave an oral presentation entitled Elicitation of Immune Responses by a DNA/MVA Vaccine in ART Treated Patients in a Treatment Interruption Trial at the HIV Research for Prevention 2014: AIDS Vaccine, Microbicide and ARV-based Prevention Science (HIVR4P) conference in Cape Town, South Africa. The presentation was focused on GeoVax s Phase 1 trial (GV-TH-01) investigating the therapeutic potential of its DNA/MVA vaccine regimen (GOVX-B11) in HIV-infected patients, which was completed earlier in GV-TH-01 was an open label Phase 1 treatment interruption trial investigating the safety and immunogenicity of the company's DNA/MVA vaccine in 9 HIV-infected patients who had initiated drug treatment within 18 months of seroconversion and had stably controlled virus for at least 6 months. Patients were vaccinated with two DNA inoculations followed by two MVA inoculations at intervals of two months. Eight weeks following the last inoculation, patients suspended drug therapy for a 12 week period. Vaccinated patients' ability to control the time and temporal height of reemergent virus in the absence of drugs was then observed. Drug treatment was re-instituted after 12 weeks, and trial participants were observed for an additional 6 months. The primary endpoint of this study was to evaluate the safety of GOVX-B11 in HIV-positive patients with well-controlled infections who are being treated with oral HIV medications. A secondary objective evaluated the immunogenicity of the GOVX-B11 vaccine during the vaccination phase of the trial. An exploratory objective of the study also evaluated the ability of the vaccinated patient to control re-emergent virus during a 12-week drug treatment interruption period. In terms of the primary endpoint, excellent safety was observed throughout the trial, with none of the 9 participants needing to reinstate antiretroviral drugs during the 12 week treatment interruption phase of the trial. Final analysis of the Phase 1 showed that GOVX-B11 enhanced CD8+ T cell responses in participants and that most vaccine-elicited CD8+ T cells recognized reemergent virus. CD8+ T cell responses are critical for the recognition and killing of cells harboring a reactivated infection. However, GOVX-B11 did not prevent viral re-emergence or control re-emergent virus to levels that minimize immune escape. Zacks Investment Research Page 3 scr.zacks.com

4 The Company is currently considering the best course of action for advancing its HIV immunotherapy program. GeoVax believes that its DNA/MVA vaccines, or a component subset, may be effective as shock agents, and plans to evaluate the concept in future clinical trial. A major challenge in the development of HIV therapeutics is the ability of HIV to persist in host cells in a latent pro-viral form, invisible to the immune system and inaccessible to antiretroviral drugs. In response to this problem, the NIH and other leaders in the HIV field have developed a new concept: the shock and kill strategy, in which patients remain on standard-of-care anti-retroviral drug therapy while a second drug ( shock agent ) is used to activate latent HIV and a third drug ( kill agent ) is used to recognize and eliminate cells that harbor the latent HIV reservoir. GeoVax believes that GOVX-B11 may be that much need shock agent, and plans to test the drug in in its ability to complement drug therapies with this shock and kill strategy. Management may also look to combine the vaccine with other therapeutic agents to work towards the ability to prevent re-emergence of latent virus in the absence of drugs. The timetable and specific clinical plans will be dependent upon the company s ability to secure external funding for the program, and on the nature of any potential collaboration GeoVax may establish. Preventive HIV Vaccine Update GeoVax s most clinically advanced vaccine development program is a DNA/MVA vaccine regimen for the prevention of clade B HIV infection. The company has completed multiple Phase 1 trials and a Phase 2a trial of various dosing regimens and formulations of its vaccines. These vaccines have been evaluated in nearly 500 humans. All of the clinical trials of GeoVax s preventive vaccines have been conducted by the HIV Vaccine Trials Network, and fully funded by the National Institute of Allergy and Infectious Diseases (NIAID), part of the NIH. GeoVax is actively engaged in discussions with the HVTN and NIAID regarding the design of its next clinical study and various trial designs are being considered. Below is a slide from the company s investor presentation comparing the HVTN-205 Phase 2a data with Phase 3 results from Sanofi-Aventis RV144. We think the data compare very well. GeoVax is actively engaged in discussions with the HVTN and NIAID regarding the design of the next clinical study of its preventive HIV vaccine. The company s vaccine is currently the only vaccine being contemplated for efficacy trials for prevention of clade B HIV infection. However, the HVTN believes the best path forward will be to test the company s vaccine in combination with a protein boost. Protein boosts may augment antibody responses that can both block virus infections and make the virus more susceptible to attack by immune system cells. One partially successful HIV vaccine trial (known as RV144) included a protein boost, which the HVTN believes should be added to the GeoVax vaccine. GeoVax s current expectation is that the next clinical trial will begin in late 2015 and will be a follow-on study to the Phase 2a trial (HVTN 205), in which those trial participants are given a protein boost to evaluate their immune responses. Information from this trial would then inform the design of future, larger clinical trials. Zacks Investment Research Page 4 scr.zacks.com

5 We Maintain Our Outperform Rating We maintain our Outperform rating on GeoVax and reiterate our 12-month price target of $0.60 per share. GeoVax has developed the technology for the development of both preventive and therapeutic HIV/AIDS vaccines. The company s preventive vaccine is one of the most advanced under development, which has completed Phase 2a and will enter the next wave of HVNT funded clinical trials shortly. The company s preventive HIV vaccine is the only HIV vaccines for America/Europe entering efficacy trial. As other HIV vaccines have fallen by the wayside over the past several years, GeoVax continues to move forward with its unique approach to HIV prevention and treatment through effective vaccination. The addition of the new Ebola vaccine program further expands the Company s pipeline. Thanks to a recent financing, we now believe that GeoVax has funding available to mid GeoVax also has strong collaboration with the NIH, HVTN and NIAID. Management will continue to seek non-dilutive government and non-government support for its HIV and Ebola vaccine development. If the data are positive for the next wave of HIV trials with the shock and kill strategy for treatment and the protein boost strategy for prevention, then we believe that the company is likely to sign a major collaboration with a large pharmaceutical company with extensive focus in the anti-viral market. We believe this could be a major valuation inflection for the company in 2016 or Based on the current fundamentals, we believe current valuation is very attractive. With a decent pipeline and midstage candidates, GeoVax is only valued at about $12.0 million in market cap on a fully-diluted basis. This is a deep discount in our view. We understand that HIV/AIDS vaccines are tough to develop and that this is a high risk area for any biotech company especially for smaller ones with limited resources. However, we think GeoVax has done great job so far in the HIV/AIDS vaccine area. With the addition of Ebola vaccine program, the company is well positioned to continue to create shareholder value down the road. We see the business worth closer to $50 million in value. This equates to a target of $0.60 per share. Zacks Investment Research Page 5 scr.zacks.com

6 PROJECTED INCOME STATEMENT GeoVax Labs, Inc. Income Statement GeoVax Labs, Inc A 2014 A Q1 E Q2 E Q3 E Q4 E 2015 E 2016 E 2017 E Product Sales $0 $0 $0 $0 $0 $0 $0 $0 $0 YOY Growth Grant & Licensing Revenue $2.4 $0.9 $0.2 $0.3 $0.3 $0.3 $1.1 $1.5 $2.0 YOY Growth Total Revenues $2.4 $0.9 $0.2 $0.3 $0.3 $0.3 $1.1 $1.5 $2.0 CoGS $0 $0 $0 $0 $0 $0 $0 $0 $0 Product Gross Margin R&D Expense $2.9 $1.8 $0.5 $0.6 $0.6 $0.6 $2.3 $2.5 $3.0 SG&A Expense $1.8 $1.8 $0.8 $0.8 $0.8 $0.9 $3.3 $3.5 $4.0 Other Expenses $0 $0 $0 $0 $0 $0 $0 $0 $0 Operating Income ($2.3) ($2.7) ($1.1) ($1.1) ($1.1) ($1.2) ($4.5) ($4.5) ($5.0) Total Other Income $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 Pre-Tax Income ($2.3) ($2.7) ($1.1) ($1.1) ($1.1) ($1.2) ($4.5) ($4.5) ($5.0) Taxes & Other $0 $0 $0 $0 $0 $0 $0 $0 $0 Tax Rate 0% 0% 0% 0% 0% 0% 0% 0% 100% Net Income ($2.3) ($2.7) ($1.1) ($1.1) ($1.1) ($1.2) ($4.5) ($4.5) ($5.0) Reported EPS ($0.11) ($0.10) ($0.03) ($0.03) ($0.03) ($0.03) ($0.13) ($0.09) ($0.08) YOY Growth Shares Outstanding Source: Zacks Investment Research, Inc. Jason Napodano, CFA Source: Company filings and Zacks Research estimates Copyright 2015, Zacks Investment Research. All Rights Reserved.

7 HISTORICAL ZACKS RECOMMENDATIONS Copyright 2015, Zacks Investment Research. All Rights Reserved.

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