Item 1.01. Entry into a Material Definitive Agreement.

On May 28, 2009, AVI BioPharma, Inc. (the "Company") entered into a contract amendment to its contract HDTRA 1-07-C-0010 with the U.S. Defense Threat Reduction Agency ("DTRA") to support additional tasks for the continued development of DTRA's programs with the Transformational Medical Technologies Initiative ("TMTI") for the Company's Ebola Virus and Marburg Virus therapeutic product candidates. Under this amendment, DTRA has extended the contract performance period to November 29, 2009 and added a cost modification of an additional $5.9 million, thus increasing the contract amount to $33.9 million. The Company may spend up to 50% of the additional contract amount without further approval but authority to spend up to the full additional amount must be subsequently granted, by DTRA, which is expected to be completed on or before June 30, 2009.

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