Targeted Genetics Presents Additional Data from Its Inflammatory Arthritis Program at the 13th Annual Congress of the European Society of Gene Therapy

-- Results demonstrate safety and reduction of mean tenderness and swelling scores of the treated joint; results support continued study of tgAAC94 in conjunction with TNF-alpha antagonists in inflammatory arthritis

Targeted Genetics Corporation (Nasdaq:TGEN) presents additionalresults from its initial Phase I clinical trial of tgAAC94 in patientswith inflammatory arthritis, in a poster session during the 13thAnnual Congress of the European Society of Gene Therapy in Prague,Czech Republic, October 29-November 1. Barrie J. Carter, Ph.D.,Executive Vice President and Chief Scientific Officer at TargetedGenetics, is presenting the data in a poster session at theconference. This presentation highlights data from the Phase Iclinical study evaluating the safety of intra-articular injection oftwo escalating dose levels of tgAAC94 in patients not on concomitantsystemic TNF-alpha antagonist therapy.

The Phase I clinical trial was designed to evaluate safety of asingle dose of tgAAC94 injected locally into the arthritic joint ofsubjects suffering from inflammatory arthritis. Enrollment was limitedto those not currently on concomitant TNF-alpha antagonist therapies.Fifteen subjects who enrolled in the trial were randomized to receiveeither one of two escalating dose levels of tgAAC94 (n=11) or aplacebo (n=4). The trial contained a placebo arm at each dose level,which was included to assess safety and determine whether any adverseevents were attributable to an intra-articular injection itself, asopposed to an intra-articular injection of tgAAC94.

Preliminary safety data were previously reported by the Companyafter all subjects had been evaluated for 4 weeks after injection.Secondary endpoints were also reported on a subset of subjects thathad completed up to eight weeks of follow-up. In those treated withtgAAC94 and followed for up to eight weeks, there was an indication ofsustained improvement in signs and symptoms of disease in injectedjoints. The trial is closed for enrollment and patients will continueto be followed for 24 weeks after injection.

All subjects have now been followed for at least 12 weeks afterinjection of tgAAC94 or placebo. Data presented at this time pointdemonstrate that:

-- Intra-articular injections of tgAAC94 were safe and well-tolerated at doses up to 1x10(11) DRP per mL of joint volume among patients currently taking conventional disease modifying anti-rheumatic drugs (DMARDS).

-- No drug-related serious adverse events have been reported to date (n=11).

-- Although the study is not powered to show efficacy, in those treated with a single dose of tgAAC94, continued measurable improvements in swelling and tenderness were observed (n=11). The reduction in mean scores appears to be greater at the higher dose, suggesting a dose to response correlation (n=6). There was some improvement noted in mean tenderness and swelling scores in subjects receiving placebo (n=4). These subjects were primarily included for safety analysis.

-- In the non-injected joints of the tgAAC94 treated groups there also appears to be a trend in the decrease in mean tenderness and swelling scores over time, which was not observed in the subjects receiving placebo.

"I am very encouraged that the results from later time points inthe study continue to demonstrate the safety of injecting tgAAC94directly into affected joints, and the observed trends in improvementsin tenderness and swelling scores of treated joints persist," saidCarter. "We believe that the data presented today support thepotential of our experimental therapeutic product, tgAAC94, to treatpatients who suffer with inflammatory arthritis. We are excited tohave recently initiated our next Phase I clinical study in patientswith inflammatory arthritis who have not experienced an adequateresponse to anti-TNF-alpha therapy and who might have ongoingdestructive inflammation in select joints."

About the Follow-on Phase I Clinical Trial of tgAAC94

In October, 2005, Targeted Genetics initiated a follow-on Phase Iclinical trial of tgAAC94 administered directly to affected joints ofpatients with inflammatory arthritis who may be receiving concomitantsystemic TNF-alpha antagonist therapy. The study is designed to enrollup to 40 subjects and will evaluate tgAAC94 at two dose levels inpatients with rheumatoid arthritis, psoriatic arthritis or ankylosingspondylitis and who may be receiving concomitant treatments ofanti-TNF-alpha therapy. tgAAC94 is being developed initially as acomplementary therapy for patients who may not achieve adequate reliefwith existing arthritis treatments or others who have disease limitedto a few joints and therefore, may not need systemic proteintherapies. This targeted, localized approach to treatment is intendedto provide therapeutic benefit that will enable patients to achievebetter control and relief of the signs and symptoms of their disease.

In the first segment of the double-blind, placebo-controlledstudy, subjects will receive a single intra-articular injection oftgAAC94 or placebo in the affected joint and be monitored untilswelling in the target joint reaches pre-determined criteria forre-injection. At that time, both tgAAC94-injected subjects and thoseinitially injected with placebo will receive a second injection oftgAAC94 in the affected joint as part of the open-label segment of thestudy. The primary endpoint of the study is to establish the safety ofa higher dose and of repeat administration of tgAAC94 into the jointsof subjects with or without concomitant TNF-alpha inhibitor therapy.Secondary endpoints include evaluation of pain, swelling, duration ofresponse, and overall disease activity following intra-articularadministration of tgAAC94 to affected joints, as well as molecularmarkers of disease. Additionally, changes in joint inflammation andjoint damage will be assessed in a subset of patients using magneticresonance imaging.

About tgAAC94

tgAAC94 uses Targeted Genetics' recombinant AAV (rAAV) vectortechnology and contains a gene that encodes a soluble form of theTNF-alpha receptor (TNFR:Fc). Soluble TNFR inhibits the immunestimulating activity of TNF-alpha. Direct injection of tgAAC94 intoaffected joints leads to the localized production of soluble TNFR bythe patient's joint cells. Localized production of TNFR reduces theactivity of TNF-alpha within the joint, potentially leading to adecrease in the signs and symptoms of inflammatory disease andinhibition of joint destruction. Preclinical studies have demonstratedthe efficacy of tgAAC94 in reducing inflammation and joint damage.Data from preclinical studies conducted in an animal model ofinflammatory arthritis demonstrated that a single injection of rAAVencoding a soluble form of the rat TNFR:Fc vector into the ankles ofarthritic rats resulted in a significant reduction in ankle and hindpaw swelling as measured by arthritis index scores.

tgAAC94 is being developed as a potential supplement to systemicanti-TNF-alpha protein therapy for use in patients with inflammatoryarthritis who have one or more joints that do not respond to systemicprotein therapy. Local administration of a DNA sequence encoding asoluble TNFR potentially may supplement currently used drugs in anumber of inflammatory conditions. In addition, a locally administeredanti-TNF-alpha therapy could also be useful in patients who have alimited number of joints affected by inflammatory arthritis that areat a risk for progressive joint damage but who may not requiresystemic therapy. The characteristics of AAV vectors make them wellsuited for delivery of genetic material to joints and other organs.The Company's rAAV technology platform is used to deliver genes and isbased on AAV, a naturally-occurring virus that has not been associatedwith any disease in humans.

About Targeted Genetics

Targeted Genetics Corporation is a biotechnology company committedto the development and commercialization of innovative targetedmolecular therapies for the prevention and treatment of inflammatoryarthritis and other acquired and inherited diseases with significantunmet medical need. We use our considerable knowledge and capabilitiesin the development and manufacturing of gene delivery technologies toadvance a diverse product development pipeline. Our productdevelopment efforts target inflammatory arthritis, AIDS prophylaxis,congestive heart failure, Huntington's disease and hyperlipidemia. Tolearn more about Targeted Genetics, visit our website at:www.targetedgenetics.com.

Safe Harbor Statement under the Private Securities LitigationReform Act of 1995:

This release contains forward-looking statements regarding ourintellectual property, research programs and clinical trials, ourproduct development and our potential development platforms includingtgAAC94 and other statements about our plans, objectives, intentionsand expectations. In particular, the statements regarding theCompany's pipeline, ability to maintain patients in the trial forfollow-up and future clinical trial plans are forward-lookingstatements. These statements, involve current expectations, forecastsof future events and other statements that are not historical facts.Inaccurate assumptions and known and unknown risks and uncertaintiescan affect the accuracy of forward-looking statements. Factors thatcould affect our actual results include, but are not limited to,initial trial results not indicative of results from the completion ofthe trial, the timing, nature and results of our clinical trials,potential development of alternative technologies or more effectiveproducts by competitors, our ability to obtain and maintain regulatoryor institutional approvals, our ability to obtain, maintain andprotect our intellectual property and our ability to raise capitalwhen needed, as well as other risk factors described in the sectionentitled "Factors Affecting Our Operating Results, Our Business andOur Stock Price" in our Quarterly Report on Form 10-Q for the periodended June 30, 2005. You should not rely unduly on theseforward-looking statements, which apply only as of the date of thisrelease. We undertake no duty to publicly announce or report revisionsto these statements as new information becomes available that maychange our expectations.