Edgar Filing: HEMISPHERX BIOPHARMA INC

As filed with the Securities and Exchange Commission on April 09, 2009
Registration No. 333-152727
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------
POST EFFECTIVE
AMENDMENT NO. 1
ON FORM S-1 TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
--------------------

HEMISPHERX BIOPHARMA, INC.
(Exact name of registrant as specified in its charter)

Delaware 2836 52-0845822
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(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) Identification
Number)
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1617 JFK Boulevard
Philadelphia, Pennsylvania 19103
(215) 988-0080
(Address, including zip code, and telephone number, including area
code, of registrant's principal executive offices)
--------------------

William A. Carter, M.D., Chief Executive Officer
Hemispherx Biopharma, Inc.
1617 JFK Boulevard
Philadelphia, Pennsylvania 19103
(215) 988-0080
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(Name, address, including zip code, and telephone number, including area code,
of agent for service)

Copies of all communications to:
Richard Feiner, Esq.
Silverman Sclar Shin & Byrne PLLC
381 Park Avenue South, Suite 1601
New York, New York, 10016
(212) 779-8600
Fax (212) 779-8858

Approximate date of proposed sale to the public: From time to time or at one
time after the effective date of this Registration Statement.

If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933 ("Securities Act"), check the following box. [X]

If this form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]

If this form is a post-effective amendment filed pursuant to 462(c) under the
Securities Act, check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for the same
offering.[ ]

If this form is a post-effective amendment filed pursuant to 462(d) under the
Securities Act, check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for the same
offering.[ ]

Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer or a smaller reporting company. See
definition of "large accelerated filer," "accelerated filer" and "smaller
reporting company" in Rule 12b-2 of the Exchange Act. (Check one): Large
accelerated filer ( ) Accelerated filer (X) Non-accelerated filer ( ) Smaller
Reporting Company ( ).

The Registrant hereby amends this registration statement on the date or dates as
may be necessary to delay its effective date until the Registrant shall file a
further amendment which specifically states that this registration statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933, as amended, or until the registration statement shall
become effective on a date as the Securities and Exchange Commission, acting
pursuant to said Section 8(a), may determine.

EXPLANATORY NOTE

This Post-Effective Amendment No. 1 on Form S-1 to the Registration Statement on
Form S-3 (File No. 333-152727) is being filed for the purposes of: (A) changing
the form of registration statement from Form S-3 to S-1 because the Registrant's
outstanding voting and non-voting common equity held by non-affiliates was less
than $75 million as of the date the Registrant filed its annual report on Form
10-K (and as of each date within the prior 60 days of such filing); (B)
including the Registrant's audited financial statements for the year ended
December 31, 2008; and (C) reflecting information disclosed in the Registrant's
annual report on Form 10-K for the year ended December 31, 2008, as filed with
the SEC on March 16, 2009.

The information in this Prospectus is not complete and may be amended. Neither
we nor the selling stockholder may sell these securities until the registration
statement filed with the Securities and Exchange Commission is effective. This
Prospectus is not an offer to sell these securities and it is not soliciting an
offer to buy these securities in any state where an offer or sale is not
permitted.
Subject to Completion
Preliminary Prospectus Dated April 9, 2009

HEMISPHERX BIOPHARMA, INC.

21,300,000 Shares of Common Stock

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The Offering:

This Prospectus relates to the sale of up to 21,300,000 shares of our
common stock by Fusion Capital Fund II, LLC. Fusion Capital is sometimes
referred to in this Prospectus as the selling stockholder. The prices at
which Fusion Capital may sell the shares will be determined by the
prevailing market price for the shares or in negotiated transactions. We
will not receive proceeds from the sale of our shares by Fusion Capital,
but we will receive proceeds from sales of shares to Fusion Capital.

Our common stock is registered under Section 12(g) of the Securities
Exchange Act of 1934 and quoted on the NYSE AMEX (formerly, the American
Stock Exchange) under the symbol "HEB." On April 6, 2009, the last reported
sale price for our common stock as reported on the NYSE AMEX was $0.51 per
share.

The selling stockholder may sell its shares from time to time on the NYSE
AMEX or otherwise, in one or more transactions at fixed prices, at
prevailing market prices at the time of sale or at prices negotiated with
purchasers. The selling stockholder will be responsible for any commissions
or discounts due to brokers or dealers. We will pay substantially all
expenses of registration of the shares covered by this Prospectus.

-----------------------------------------

Please see the risk factors beginning on page 7 to read about certain
factors you should consider before buying shares of common stock.

The selling stockholder is an "underwriter" within the meaning of the
Securities Act of 1933.

Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined that
this Prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.

The date of this Prospectus is April _, 2009

TABLE
OF CONTENTS

Page

Where You Can Find More Information 2
Information Incorporated By Reference 3
Prospectus Summary 4
Risk Factors 7
Special Note Regarding Forward-Looking Statements 23
Business 24
Selling Stockholder 24
Plan of Distribution 30
Use of Proceeds 31
SEC Position On Indemnification For Securities Act Liabilities 31
Description of Securities Being Registered 32
Legal Matters 34
Experts 34

WHERE YOU CAN FIND MORE INFORMATION

This Prospectus is part of a registration statement on Form S-1 that we
filed with the SEC. This Prospectus does not contain all of the information
included in the registration statement. For further information about us and our
securities, you should refer to the registration statement and the exhibits
filed with the registration statement. Statements contained in this Prospectus
as to the contents of any contract or other document are not necessarily
complete and, in each instance, we refer you to the copy of that contract or
document filed as an exhibit to the Registration Statement.

We are subject to the information requirements of the Securities Exchange
Act of 1934 and file annual, quarterly and current reports, proxy
statements and other information with the SEC. You can read our SEC
filings, including the registration statement, over the Internet at the
SEC's website at www.sec.gov or through our website at www.hemispherx.net.
Information contained on our website is not considered to be a part of, nor
incorporated by reference in, this Prospectus. You may also read and copy
any document we file with the SEC at its Public Reference Room at 100 F
Street, NE, Washington, D.C. 20549.

You may also obtain copies of the documents at prescribed rates by writing to
the Public Reference Room of the SEC at 100 F Street, NE, Washington, D.C.
20549. Please call the SEC at 1-800-SEC-0330 for further information on the
operation of the Public Reference Room.

INFORMATION INCORPORATED BY REFERENCE

The SEC allows us to "incorporate by reference" the information that we
file with them, which means that we can disclose important information to
you by referring you to those documents. The information incorporated by
reference is an important part of this Prospectus, and you should review
that information in order to understand the nature of any investment by you
in our common stock. Information contained in this Prospectus automatically
updates and supersedes previously filed information. We are incorporating
by reference the following documents:

(a) Our annual report on Form 10-K for our fiscal year ended December 31,
2008, SEC File No. 1-13441.

(b) Our current report on Form 8-K, SEC File No. 1-13441 filed with the SEC
on February 19, 2009.

(c) All of our filings pursuant to Sections 13(a) or 15(d) under the
Securities Exchange Act of 1934, as amended, since the date of the
filing of our Annual Report on Form 10-K for the fiscal year ended
December 31, 2008 through the date of this Prospectus.

We will provide to each person, including any beneficial owner, to whom
a Prospectus is delivered, a copy of any or all of the reports or documents that
we have incorporated by reference in this Prospectus, at no cost. To obtain any
such documents please write or telephone us at the following address: Hemispherx
Biopharma, Inc., 1617 JFK Boulevard, Philadelphia, Pennsylvania 19103, telephone
number 215-988-0080. In addition, these documents may be accessed at our website
at www.hemispherx.net via a link to the SEC's website. Information contained on
our website is not considered to be a part of, nor incorporated by reference in,
this Prospectus.

You should rely only on the information incorporated by reference or
provided in this Prospectus or any supplement. We have not authorized anyone
else to provide you with different information. We and the selling stockholder
will not make offers to sell these shares in any state where the offer is not
permitted. You should not assume that the information in this Prospectus or any
supplement is accurate as of any date other that the date on the front of those
documents.

PROSPECTUS SUMMARY

This Prospectus provides you with a general description of the common stock
being offered. You should read this Prospectus, including all documents
incorporated herein by reference, together with additional information
described under the heading "Where You Can Find More Information."

The registration statement that contains this Prospectus, including the
exhibits to the registration statement, contains additional information about us
and the securities being offered under this Prospectus. You should read the
registration statement and the accompanying exhibits for further information.
The registration statement and exhibits can be read and are available to the
public over the Internet at the SEC's website at http://www.sec.gov as described
under the heading "Where You Can Find More Information."

About Hemispherx

We are a biopharmaceutical company engaged in the clinical development,
manufacture, marketing and distribution of new drug therapies based on natural
immune system enhancing technologies for the treatment of viral and immune based
chronic disorders. We were founded in the early 1970s doing contract research
for the National Institutes of Health. Since that time, we have established a
strong foundation of laboratory, pre-clinical, and clinical data with respect to
the development of nucleic acids to enhance the natural antiviral defense system
of the human body and to aid the development of therapeutic products for the
treatment of certain chronic diseases.

Our current strategic focus is derived from four applications of our
two core pharmaceutical technology platforms Ampligen(R) and Alferon N
Injection(R). The commercial focus for Ampligen includes application as a
treatment for Chronic Fatigue Syndrome ("CFS") and as a vaccine enhancer
(adjuvant) for both therapeutic and preventative vaccine development. Alferon N
Injection(R) is an FDA approved product with an indication for refractory or
recurring genital warts. Alferon LDO (Low Dose Oral) is an application currently
under early stage development targeting influenza and viral diseases both as an
adjuvant as well as a single entity anti-viral.

Ampligen(R) is an experimental drug currently undergoing clinical
development for the treatment of CFS. In August 2004, we completed a Phase III
clinical trial ("AMP 516") treating over 230 CFS patients with Ampligen(R) and
are presently in the registration process for a new drug application ("NDA")
with the Food and Drug Administration ("FDA"). Ampligen represents the first
drug in the class of RNA (nucleic acid) molecules to apply for NDA review.

On July 7, 2008, the FDA accepted our NDA for review. On February 18,
2009, we were notified by the FDA that the originally scheduled Prescription
Drug User Fee Act date of February 25, 2009 has been extended to May 25, 2009.

We own and operate a 43,000 sq. ft. FDA approved facility in New
Brunswick, NJ primarily designed to produce Alferon N Injection(R). In 2006, we
completed the installation of a polymer production line to produce Ampligen(R)
raw materials on a more reliable and consistent basis.

Our principal executive offices are located at One Penn Center, 1617 JFK
Boulevard, Philadelphia, Pennsylvania 19103, and our telephone number is
215-988-0080. We maintain a website at "http://www.hemispherx.net."
Information contained on our website is not considered to be a part of, nor
incorporated by reference in, this Prospectus.

Fusion Capital Transaction

On July 2, 2008, we entered into a Common Stock Purchase Agreement with
Fusion Capital Fund II, LLC, an Illinois limited liability company. Under
the Purchase Agreement, Fusion Capital is obligated, under certain
conditions, to purchase shares from us in an aggregate amount of up to $30
million from time to time over a 25 month period from August 21, 2008.
Under the terms of the Purchase Agreement, Fusion Capital has received a
commitment fee consisting of 650,000 shares of our common stock. Also, we
will issue to Fusion Capital up to an additional 650,000 shares as a
commitment fee pro rata as we receive the $30 million of future funding. We
originally registered herein 21,300,000 shares in the aggregate, consisting
of 20,000,000 shares which we may sell to Fusion Capital and 1,300,000
shares we have issued or may issue to Fusion Capital as a commitment fee.
As of April 6, 2009 we have sold an aggregate of 3,027,795 shares to Fusion
Capital (exclusive of any shares issued as a commitment fee) under the
Purchase Agreement for gross proceeds of approximately $1,260,000.

Our common stock is quoted on the NYSE AMEX (formerly, the American Stock
Exchange) under the symbol "HEB." In connection with this transaction,
under the rules of the AMEX, we may not issue more than 14,823,651 shares
(19.99% of our outstanding shares as of July 2, 2008, the date of the
Purchase Agreement) without first obtaining the approval of our
stockholders. Under the Purchase Agreement and a Registration Rights
Agreement with Fusion Capital we are required to register and have included
in the offering pursuant to this Prospectus (1) 650,000 shares which have
already been issued, (2) an additional 650,000 shares which we may issue in
the future as a commitment fee pro rata as we receive up to the $30 million
of future funding and (3) at least 13,523,651 shares which we may sell to
Fusion Capital after this registration statement is declared effective. In
the aggregate, this is 14,823,651 or 19.99% of our outstanding shares on
July 2, 2008, the date of the Purchase Agreement.

Under the Purchase Agreement, we have the right but not the obligation to
sell more than the 20,000,000 shares to Fusion Capital (excluding the
1,300,000 shares we have issued or may issue to Fusion Capital as a
commitment fee). This 21,300,000 shares is greater than 19.99% of our
outstanding shares of common stock as of the date of the Purchase
Agreement. On November 11, 2008, at our Annual Meeting of Stockholders, we
received stockholder approval of the Purchase Agreement in order to be in
compliance with the AMEX rules permitting us to sell more than 14,823,651
or 19.99% of our outstanding shares on July 2, 2008, the date of the
Purchase Agreement.

As of the date hereof, we do not have any plans or intent to sell to Fusion
Capital any shares beyond the 20,000,000 shares offered hereby (excluding
the 1,300,000 shares we have issued or may issue to Fusion Capital as a
commitment fee). However, if we elect to sell more than the 20,000,000
shares, which we have the right but not the obligation to do, we must first
register under the Securities Act any additional shares we may elect to
sell to Fusion Capital before we can sell such additional shares, which
could cause substantial dilution to our stockholders.

Generally, we have the right but not the obligation from time to time to
sell our shares to Fusion Capital in amounts between $120,000 and $1.0
million depending on certain conditions. We have the right to control the
timing and amount of any sales of our shares to Fusion Capital. The
purchase price of the shares will be determined based upon the market price
of our shares without any fixed discount at the time of each sale. Fusion
Capital does not have the right nor the obligation to purchase any shares
of our common stock on any business day that the price of our common stock
is below $0.40. There are no negative covenants, restrictions on future
fundings, penalties or liquidated damages in the Purchase Agreement or the
Registration Rights Agreement. The Purchase Agreement may be terminated by
us at any time at our discretion without any cost to us.

The number of shares ultimately offered for sale by Fusion Capital is
dependent upon the number of shares purchased by Fusion Capital under the
Purchase Agreement.

RISK FACTORS

The following cautionary statements identify important factors that
could cause our actual results to differ materially from those projected in the
forward-looking statements made in this Prospectus. Among the key factors that
have a direct bearing on our results of operations are:

Risks Associated With Our Business

No assurance of successful product development.

Ampligen(R) and related products. The development of Ampligen(R) and
our other related products is subject to a number of significant risks.
Ampligen(R) may be found to be ineffective or to have adverse side effects, fail
to receive necessary regulatory clearances, be difficult to manufacture on a
commercial scale, be uneconomical to market or be precluded from
commercialization by proprietary right of third parties. Our products are in
various stages of clinical and pre-clinical development and, require further
clinical studies and appropriate regulatory approval processes before any such
products can be marketed. We do not know when, if ever, Ampligen(R) or our other
products will be generally available for commercial sale for any indication.
Generally, only a small percentage of potential therapeutic products are
eventually approved by the FDA for commercial sale. Please see the next risk
factor.

Alferon N Injection(R). Although Alferon N Injection(R) is approved for
marketing in the United States for the intra-lesional treatment of refractory or
recurring external genital warts in patients 18 years of age or older, to date
it has not been approved for other indications. We face many of the risks
discussed above, with regard to developing this product for use to treat other
ailments.

Our drug and related technologies are investigational and subject to regulatory
approval. If we are unable to obtain regulatory approval, our operations will be
significantly adversely affected.

All of our drugs and associated technologies, other than Alferon N
Injection(R), are investigational and must receive prior regulatory approval by
appropriate regulatory authorities for general use and are currently legally
available only through clinical trials with specified disorders. At present,
Alferon N Injection(R) is only approved for the intra-lesional treatment of
refractory or recurring external genital warts in patients 18 years of age or
older. Use of Alferon N Injection(R) for other indications will require
regulatory approval.

Our products, including Ampligen(R), are subject to extensive
regulation by numerous governmental authorities in the U.S. and other countries,
including, but not limited to, the FDA in the U.S., the Health Protection Branch

("HPB") of Canada, and the Agency for the Evaluation of Medicinal Products
("EMEA") in Europe. Obtaining regulatory approvals is a rigorous and lengthy
process and requires the expenditure of substantial resources. In order to
obtain final regulatory approval of a new drug, we must demonstrate to the
satisfaction of the regulatory agency that the product is safe and effective for
its intended uses and that we are capable of manufacturing the product to the
applicable regulatory standards. We require regulatory approval in order to
market Ampligen(R) or any other proposed product and receive product revenues or
royalties. We cannot assure you that Ampligen(R) will ultimately be demonstrated
to be safe or efficacious. In addition, while Ampligen(R) is authorized for use
in clinical trials including a cost recovery program in the United States and
Europe, we cannot assure you that additional clinical trial approvals will be
authorized in the United States or in other countries, in a timely fashion or at
all, or that we will complete these clinical trials.

We filed an NDA with the FDA for treatment of CFS on October 10, 2007.
On December 5, 2007 we received an RTF letter from the FDA as our NDA filing was
deemed "not substantially complete". We responded to the FDA's concerns by
filing amendments to our NDA on April 25, 2008. These amendments should allow
the FDA reviewers to better evaluate independently the statistical
efficacy/safety conclusions of our NDA for the use of Ampligen(R) in treating
CFS. On July 7, 2008 the FDA accepted our NDA filing for review. However, there
are no assurances that upon review of the NDA that it will be approved by the
FDA. On February 18, 2009, we were notified by the FDA that the originally
scheduled Prescription Drug User Fee Act date of February 25, 2009 has been
extended to May 25, 2009.

If Ampligen(R) or one of our other products does not receive regulatory
approval in the U.S. or elsewhere, our operations most likely will be materially
adversely affected.

We may continue to incur substantial losses and our future profitability is
uncertain.

We began operations in 1966 and last reported net profit from 1985
through 1987. Since 1987, we have incurred substantial operating losses, as we
pursued our clinical trial effort to get our experimental drug, Ampligen(R),
approved. As of December 31, 2008, our accumulated deficit was approximately
$197,409,000. We have not yet generated significant revenues from our products
and may incur substantial and increased losses in the future. We cannot assure
that we will ever achieve significant revenues from product sales or become
profitable. We require, and will continue to require, the commitment of
substantial resources to develop our products. We cannot assure that our product
development efforts will be successfully completed or that required regulatory
approvals will be obtained or that any products will be manufactured and
marketed successfully, or be profitable.

We may require additional financing which may not be available.

The development of our products will require the commitment of
substantial resources to conduct the time-consuming research, preclinical
development, and clinical trials that are necessary to bring pharmaceutical
products to market. As of December 31, 2008, we had approximately $6,119,000 in
cash and cash equivalents and short-term investments. Given the harsh economic
conditions, we have reviewed every aspect of our operations for cost and
spending reductions to assure the long term survival of our Company while
maintaining the resources necessary to achieve our primary objectives of
obtaining NDA approval of Ampligen(R) and securing a strategic partner. Based on
these actions, we anticipate, but cannot assure, that these funds will be
sufficient to meet our operating cash requirements for the next 16 months.

We have in place two potential sources of financing: 1) the Common Stock
Purchase Agreement (the "Purchase Agreement") with Fusion Capital Fund II,
LLC ("Fusion") pursuant to which we have the right to sell shares of our
Common Stock to Fusion; and 2) a Standby Financing Agreement with certain
of our executives, directors and strategic consultants.

We anticipate, but cannot assure, that we will be able to raise
additional capital from the sale of shares to Fusion Capital under the Purchase
Agreement. Pursuant to the Purchase Agreement, we only have the right to receive
$120,000 every two business days unless our stock price equals or exceeds $0.80,
in which case we can sell greater amounts to Fusion Capital as the price of our
common stock increases. Fusion Capital does not have the right nor the
obligation to purchase any shares of our common stock on any business day that
the market price of our common stock is less than $0.40. As of April 6, 2009, we
have sold an aggregate of 3,027,795 shares to Fusion Capital (exclusive of any
shares issued as a commitment fee) under the Purchase Agreement for gross
proceeds of approximately $1,260,000. Since we registered an aggregate of
20,000,000 shares for sale to Fusion Capital pursuant to this Prospectus
(exclusive of the 1,300,000 shares issued or to be issued as a commitment fee),
the selling price of the remaining 16,972,205 shares we can sell to Fusion
Capital will have to average at least $1.69 per share for us to receive the
maximum proceeds of $30 million. Assuming a purchase price of $0.51 per share
(the closing sale price of the common stock on April 6, 2009) and the purchase
by Fusion Capital of the full 16,972,205 shares remaining under the Purchase
Agreement, proceeds to us would only be $8,655,825. Subject to approval by our
board of directors, we have the right but not the obligation to issue more than
20,000,000 shares to Fusion Capital. In the event we elect to issue more than
20,000,000 shares offered hereby, we will be required to file a new registration
statement and have it declared effective by the Securities and Exchange
Commission.

The extent we rely on Fusion Capital as a source of funding will depend
on a number of factors including, the prevailing market price of our common

stock and the extent to which we are able to secure working capital from other
sources. Specifically, Fusion Capital does not have the right nor the obligation
to purchase any shares of our common stock on any business days that the market
price of our common stock is less than $0.40. While the current market price is
in excess of $0.40 per share, during the past month, the price of our common
stock often has been below $0.40.

In February 2009, we entered into a Standby Financing Agreement pursuant to
which certain individuals ("Individuals"), consisting of Dr. Carter and Thomas
Equels, agreed to loan us up to an aggregate of $1,000,000 in funds should we be
unable to obtain additional financing, if needed. Under the Standby Financing
Agreement, we will use our best efforts in 2009 to obtain one or more additional
financing agreements on such terms as our Board deems to be reasonable and
appropriate in order to maintain our operations. If at any time after December
1, 2009 and prior to June 30, 2010 a majority of our independent Directors deems
that in the event a financing of at least $2.5 Million has not been obtained and
additional funds are needed to maintain our operations, we will send a written
notice to each of the Individuals informing them of the total amount of
additional funds required and the specific amount that will be required from
each Individual. Within fifteen calendar days after receipt of the notice, the
Individuals will be required to pay us their respective amount. We will then
issue to them one year 15% senior secured notes for their respective amounts
(the "Notes"). Interest will be paid monthly in our Common Stock. Repayment of
the principal and interest under the Notes will be secured by all of our assets.
We will not, without the consent of the Individuals, (i) incur any new debt
senior or pari passu to the Notes or (ii) encumber or grant a security interest
in any assets. Upon 20 business days written notice, we may prepay the Notes in
cash at any time at 105% of the then outstanding principal amount of the Notes,
plus any accrued but unpaid interest.

For agreeing to be obligated to loan us money, each Individual received 10 year
warrants (the "Commitment Warrants") to purchase our common stock at the rate of
$50,000 worth in warrants per $100,000 committed. The exercise price of these
warrants is $0.51 (125% of the market closing price of our Common Stock on the
date that Agreement was executed). These warrants vested immediately. If and
when we notify the Individuals that we are consummating the Standby Financing,
upon each Individual's payment of his committed amount, he will receive
additional 10 year warrants to purchase our Common Stock at the rate of $50,000
worth in warrants per $100,000 paid. The exercise price of the warrants will be
the closing market price of our Common Stock on the day we receive the funds
from the Individuals. These warrants will vest immediately. While any portion of
the Notes are outstanding, Individuals will have weighted average anti-dilution
rights with regard to the exercise price of all warrants issued pursuant to the
Standby Financing, except that these rights will not apply if the securities are
issued to employees, Board members, corporate and scientific advisors, select
vendors, pursuant to the Purchase Agreement with Fusion Capital or part of a
corporate or strategic alliance.

If we are unable to obtain sufficient financing from the sale of securities to
Fusion Capital and/or the Standby Financing Agreement and if we are unable to
commercialize and sell Ampligen(R), Alferon N Injection(R) or other products, we
will need to secure other sources of funding through additional equity or debt
financing or from other sources in order to satisfy our working capital needs
and to complete the necessary clinical trials and the regulatory approval
processes including the commercializing of Ampligen(R) products. In this regard
we previously registered $50,000,000 worth of our securities in a universal
shelf registration statement, none of which has been designated or issued. We
are unable to estimate the amount, timing or nature of future sales of
outstanding common stock or instruments convertible into or exercisable for our
common stock. Should the financing we require be unavailable or prohibitively
expensive when we require it, the consequences could be a material adverse
effect on our ability to develop our products or continue our operations.

Our Alferon N Injection(R) Commercial Sales have halted due to lack of finished
goods inventory.

Our finished goods inventory of Alferon N Injection(R) reached it's
expiration date in March 2008. As a result, we have no product to sell at this
time. The FDA has declined to respond to our requests for an extension of the
expiration date, therefore we consider the request to be denied. Since our
testing of the product indicates that it is not impaired and could be safely
utilized, the finished goods inventory of 2,745 Alferon N Injection(R) 5ml vials
may be used to produce approximately 11,000,000 sachets of Low Dose Oral Alferon
(LDO) for future clinical trials.

Production of Alferon N Injection(R) from our work-in-progress
inventory, which has an approximate expiration date of 2012, has been put on
hold at this time due to the resources needed to prepare our New Brunswick
facility for the FDA preapproval inspection with respect to our Ampligen(R) NDA.
Work on the Alferon N Injection(R) is expected to resume in mid-2009 under the
condition that adequate funding is obtained, which means that we may not have
any Alferon N Injection(R) product commercially available until 2010.

In 2007, we averaged Alferon N Injection(R) sales of approximately
$77,000 per month. However with no FDA approval to extend the expiration date of
our finished good inventory, we will no longer receive these monthly revenues.
In addition, if there is a significant absence of the product from the market
place, no assurance can be given that sales will return to prior levels.

Although preliminary in vitro testing indicates that Ampligen(R) enhances the
effectiveness of different drug combinations on avian influenza, preliminary
testing in the laboratory is not necessarily predictive of successful results in
clinical testing or human treatment.

Ampligen(R) continues to undergo pre-clinical testing for possible
treatment of avian flu. Although preliminary in vitro testing indicates that
Ampligen(R) enhances the effectiveness of different drug combinations on avian
flu, preliminary testing in the laboratory is not necessarily predictive of
successful results in clinical testing or human treatment. No assurance can be
given that similar results will be observed in clinical trials. Use of
Ampligen(R) in the treatment of avian flu requires prior regulatory approval.
Only the FDA can determine whether a drug is safe, effective or promising for
treating a specific application. As discussed in the prior risk factor,
obtaining regulatory approvals is a rigorous and lengthy process.

In addition, Ampligen(R) is currently being tested on strains of avian
influenza virus. There are a number of strains and strains mutate. No assurance
can be given that Ampligen(R) will be effective on any strains that might infect
humans.

We may not be profitable unless we can protect our patents and/or receive
approval for additional pending patents.

We need to preserve and acquire enforceable patents covering the use of
Ampligen(R) for a particular disease in order to obtain exclusive rights for the
commercial sale of Ampligen(R) for such disease. We obtained all rights to
Alferon N Injection(R), and we plan to preserve and acquire enforceable patents
covering its use for existing and potentially new diseases. Our success depends,
in large part, on our ability to preserve and obtain patent protection for our
products and to obtain and preserve our trade secrets and expertise. Certain of
our know-how and technology is not patentable, particularly the procedures for
the manufacture of our experimental drug, Ampligen(R), which is carried out
according to standard operating procedure manuals. We also have been issued
patents on the use of Ampligen(R) in combination with certain other drugs for
the treatment of chronic Hepatitis B virus, chronic Hepatitis C virus, and a
patent which affords protection on the use of Ampligen(R) in patients with
Chronic Fatigue Syndrome. We have not yet been issued any patents in the United
States for the use of Ampligen(R) as a sole treatment for any of the cancers,
which we have sought to target. With regard to Alferon N Injection(R), we have
acquired from ISI its patents for natural alpha interferon produced from human
peripheral blood leukocytes and its production process and we have filed a
patent application for the use of Alferon(R) LDO in treating viral diseases
including avian influenza. We cannot assure that our competitors will not seek
and obtain patents regarding the use of similar products in combination with
various other agents, for a particular target indication prior to our doing
such. If we cannot protect our patents covering the use of our products for a
particular disease, or obtain additional patents, we may not be able to
successfully market our products.

The patent position of biotechnology and pharmaceutical firms is highly
uncertain and involves complex legal and factual questions.

To date, no consistent policy has emerged regarding the breadth of
protection afforded by pharmaceutical and biotechnology patents. There can be no
assurance that new patent applications relating to our products or technology
will result in patents being issued or that, if issued, such patents will afford
meaningful protection against competitors with similar technology. It is
generally anticipated that there may be significant litigation in the industry
regarding patent and intellectual property rights. Such litigation could require
substantial resources from us and we may not have the financial resources
necessary to enforce the patent rights that we hold. No assurance can be made
that our patents will provide competitive advantages for our products or will
not be successfully challenged by competitors. No assurance can be given that
patents do not exist or could not be filed which would have a materially adverse
effect on our ability to develop or market our products or to obtain or maintain
any competitive position that we may achieve with respect to our products. Our
patents also may not prevent others from developing competitive products using
related technology.

There can be no assurance that we will be able to obtain necessary licenses if
we cannot enforce patent rights we may hold. In addition, the failure of third
parties from whom we currently license certain proprietary information or from
whom we may be required to obtain such licenses in the future, to adequately
enforce their rights to such proprietary information, could adversely affect the
value of such licenses to us.

If we cannot enforce the patent rights we currently hold we may be
required to obtain licenses from others to develop, manufacture or market our
products. There can be no assurance that we would be able to obtain any such
licenses on commercially reasonable terms, if at all. We currently license
certain proprietary information from third parties, some of which may have been
developed with government grants under circumstances where the government
maintained certain rights with respect to the proprietary information developed.
No assurances can be given that such third parties will adequately enforce any
rights they may have or that the rights, if any, retained by the government will
not adversely affect the value of our license.

There is no guarantee that our trade secrets will not be disclosed or
known by our competitors.

To protect our rights, we require certain employees and consultants to
enter into confidentiality agreements with us. There can be no assurance that
these agreements will not be breached, that we would have adequate and
enforceable remedies for any breach, or that any trade secrets of ours will not
otherwise become known or be independently developed by competitors.

We have limited marketing and sales capability. If we are unable to obtain
additional distributors and our current and future distributors do not market
our products successfully, we may not generate significant revenues or become
profitable.

We have limited marketing and sales capability. We are dependent upon
existing and, possibly future, marketing agreements and third party distribution
agreements for our products in order to generate significant revenues and become
profitable. As a result, any revenues received by us will be dependent in large
part on the efforts of third parties, and there is no assurance that these
efforts will be successful.

Our commercialization strategy for Ampligen(R)-CFS may include
licensing/co-marketing agreements utilizing the resources and capacities of a
strategic partner(s). We are currently seeking worldwide marketing partner(s),
with the goal of having a relationship in place before approval is obtained. In
parallel to partnering discussions, appropriate pre-marketing activities will be
undertaken. We intend to control manufacturing of Ampligen on a world-wide
basis.

We cannot assure that our U.S. or foreign marketing strategy will be
successful or that we will be able to establish future marketing or third party
distribution agreements on terms acceptable to us, or that the cost of
establishing these arrangements will not exceed any product revenues. Our
inability to establish viable marketing and sales capabilities would most likely
have a materially adverse effect on us.

There are no long-term agreements with suppliers of required materials. If we
are unable to obtain the required raw materials, we may be required to scale
back our operations or stop manufacturing Alferon N Injection(R) and/or
Ampligen(R).

A number of essential materials are used in the production of Alferon N
Injection(R), including human white blood cells. We do not have long-term
agreements for the supply of any of such materials. There can be no assurance we
can enter into long-term supply agreements covering essential materials on
commercially reasonable terms, if at all.

There are a limited number of manufacturers in the United States
available to provide the polymers for use in manufacturing Ampligen(R). At
present, we do not have any agreements with third parties for the supply of any
of these polymers. We have established relevant manufacturing operations within
our New Brunswick, New Jersey facility for the production of Ampligen(R)
polymers from raw materials in order to obtain polymers on a more consistent
manufacturing basis.

If we are unable to obtain or manufacture the required polymers, we may
be required to scale back our operations or stop manufacturing. The costs and
availability of products and materials we need for the production of Ampligen(R)
and the commercial production of Alferon N Injection(R) and other products which
we may commercially produce are subject to fluctuation depending on a variety of

factors beyond our control, including competitive factors, changes in
technology, and FDA and other governmental regulations and there can be no
assurance that we will be able to obtain such products and materials on terms
acceptable to us or at all.

There is no assurance that successful manufacture of a drug on a limited scale
basis for investigational use will lead to a successful transition to
commercial, large-scale production.

Small changes in methods of manufacturing, including commercial
scale-up, may affect the chemical structure of Ampligen(R) and other RNA drugs,
as well as their safety and efficacy, and can, among other things, require new
clinical studies and affect orphan drug status, particularly, market exclusivity
rights, if any, under the Orphan Drug Act. The transition from limited
production of pre-clinical and clinical research quantities to production of
commercial quantities of our products will involve distinct management and
technical challenges and will require additional management and technical
personnel and capital to the extent such manufacturing is not handled by third
parties. There can be no assurance that our manufacturing will be successful or
that any given product will be determined to be safe and effective, capable of
being manufactured economically in commercial quantities or successfully
marketed.

We have limited manufacturing experience and capacity.

Ampligen(R) has been only produced in limited quantities for use in our
clinical trials and we are dependent upon a third party supplier for
substantially all of the production process. The failure to continue these
arrangements or to achieve other such arrangements on satisfactory terms could
have a material adverse affect on us. Also to be successful, our products must
be manufactured in commercial quantities in compliance with regulatory
requirements and at acceptable costs. To the extent we are involved in the
production process, our current facilities are not adequate for the production
of our proposed products for large-scale commercialization, and we currently do
not have adequate personnel to conduct commercial-scale manufacturing. We intend
to utilize third-party facilities if and when the need arises or, if we are
unable to do so, to build or acquire commercial-scale manufacturing facilities.
We will need to comply with regulatory requirements for such facilities,
including those of the FDA pertaining to current Good Manufacturing Practices
("cGMP") regulations. There can be no assurance that such facilities can be
used, built, or acquired on commercially acceptable terms, or that such
facilities, if used, built, or acquired, will be adequate for our long-term
needs. Please refer to the Risk Factor "Our Alferon N Injection(R) commercial
sales have halted due to lack of finished goods inventory."

We may not be profitable unless we can produce Ampligen(R) or other products in
commercial quantities at costs acceptable to us.

We have never produced Ampligen(R) or any other products in large
commercial quantities. We must manufacture our products in compliance with
regulatory requirements in large commercial quantities and at acceptable costs
in order for us to be profitable. We intend to utilize third-party manufacturers
and/or facilities if and when the need arises or, if we are unable to do so, to
build or acquire commercial-scale manufacturing facilities. If we cannot
manufacture commercial quantities of Ampligen(R) or enter into third party
agreements for its manufacture at costs acceptable to us, our operations will be
significantly affected. Also, each production lot of Alferon N Injection(R) is
subject to FDA review and approval prior to releasing the lots to be sold. This
review and approval process could take considerable time, which would delay our
having product in inventory to sell.

Rapid technological change may render our products obsolete or non-competitive.

The pharmaceutical and biotechnology industries are subject to rapid
and substantial technological change. Technological competition from
pharmaceutical and biotechnology companies, universities, governmental entities
and others diversifying into the field is intense and is expected to increase.
Most of these entities have significantly greater research and development
capabilities than us, as well as substantial marketing, financial and managerial
resources, and represent significant competition for us. There can be no
assurance that developments by others will not render our products or
technologies obsolete or noncompetitive or that we will be able to keep pace
with technological developments.

Our products may be subject to substantial competition.

Ampligen(R). Competitors may be developing technologies that are, or in
the future may be, the basis for competitive products. Some of these potential
products may have an entirely different approach or means of accomplishing
similar therapeutic effects to products being developed by us. These competing
products may be more effective and less costly than our products. In addition,
conventional drug therapy, surgery and other more familiar treatments may offer
competition to our products. Furthermore, many of our competitors have
significantly greater experience than us in pre-clinical testing and human
clinical trials of pharmaceutical products and in obtaining FDA, HPB and other
regulatory approvals of products. Accordingly, our competitors may succeed in
obtaining FDA, HPB or other regulatory product approvals more rapidly than us.
There are no drugs approved for commercial sale with respect to treating ME/CFS
in the United States. The dominant competitors with drugs to treat disease
indications in which we plan to address include Gilead Pharmaceutical, Pfizer,
Bristol-Myers, Abbott Labs, GlaxoSmithKline, Merck and Schering-Plough Corp.
These potential competitors are among the largest pharmaceutical companies in

the world, are well known to the public and the medical community, and have
substantially greater financial resources, product development, and
manufacturing and marketing capabilities than we have. Although we believe our
principal advantage is the unique mechanism of action of Ampligen(R) on the
immune system, we cannot assure that we will be able to compete.

ALFERON N Injection(R). Our competitors are among the largest
pharmaceutical companies in the world, are well known to the public and the
medical community, and have substantially greater financial resources, product
development, and manufacturing and marketing capabilities than we have. Alferon
N Injection(R) currently competes with Schering's injectable recombinant alpha
interferon product (INTRON(R) A) for the treatment of genital warts. 3M
Pharmaceuticals also offer competition from its immune-response modifier,
Aldara(R), a self-administered topical cream, for the treatment of external
genital and perianal warts. In addition, Medigene has FDA approval for a
self-administered ointment, VeregenTM, which is indicated for the topical
treatment of external genital and perianal warts. Alferon N Injection(R) also
competes with surgical, chemical, and other methods of treating genital warts.
We cannot assess the impact products developed by our competitors, or advances
in other methods of the treatment of genital warts, will have on the commercial
viability of Alferon N Injection(R). If and when we obtain additional approvals
of uses of this product, we expect to compete primarily on the basis of product
performance. Our competitors have developed or may develop products (containing
either alpha or beta interferon or other therapeutic compounds) or other
treatment modalities for those uses. There can be no assurance that, if we are
able to obtain regulatory approval of Alferon N Injection(R) for the treatment
of new indications, we will be able to achieve any significant penetration into
those markets. In addition, because certain competitive products are not
dependent on a source of human blood cells, such products may be able to be
produced in greater volume and at a lower cost than Alferon N Injection(R).
Currently, our wholesale price on a per unit basis of Alferon N Injection(R) is
higher than that of the competitive recombinant alpha and beta interferon
products.

General. Other companies may succeed in developing products earlier
than we do, obtaining approvals for such products from the FDA more rapidly than
we do, or developing products that are more effective than those we may develop.
While we will attempt to expand our technological capabilities in order to
remain competitive, there can be no assurance that research and development by
others or other medical advances will not render our technology or products
obsolete or non-competitive or result in treatments or cures superior to any
therapy we develop.

Possible side effects from the use of Ampligen(R) or Alferon N Injection(R)
could adversely affect potential revenues and physician/patient acceptability of
our product.

Ampligen(R). We believe that Ampligen(R) has been generally well
tolerated with a low incidence of clinical toxicity, particularly given the
severely debilitating or life threatening diseases that have been treated. A
mild flushing reaction has been observed in approximately 15-20% of patients

treated in our various studies. This reaction is occasionally accompanied by a
rapid heart beat, a tightness of the chest, urticaria (swelling of the skin),
anxiety, shortness of breath, subjective reports of "feeling hot", sweating and
nausea. The reaction is usually infusion-rate related and can generally be
controlled by reducing the rate of infusion. Other adverse side effects include
liver enzyme level elevations, diarrhea, itching, asthma, low blood pressure,
photophobia, rash, transient visual disturbances, slow or irregular heart rate,
decreases in platelets and white blood cell counts, anemia, dizziness,
confusion, elevation of kidney function tests, occasional temporary hair loss
and various flu-like symptoms, including fever, chills, fatigue, muscular aches,
joint pains, headaches, nausea and vomiting. These flu-like side effects
typically subside within several months. One or more of the potential side
effects might deter usage of Ampligen(R) in certain clinical situations and
therefore, could adversely affect potential revenues and physician/patient
acceptability of our product.

Alferon N Injection(R). At present, Alferon N Injection(R) is only
approved for the intra-lesional (within the lesion) treatment of refractory or
recurring external genital warts in adults. In clinical trials conducted for the
treatment of genital warts with Alferon N Injection(R), patients did not
experience serious side effects; however, there can be no assurance that
unexpected or unacceptable side effects will not be found in the future for this
use or other potential uses of Alferon N Injection(R) which could threaten or
limit such product's usefulness.

We may be subject to product liability claims from the use of Ampligen(R),
Alferon N Injection(R), or other of our products which could negatively affect
our future operations. We have temporarily discontinued product liability
insurance.

We face an inherent business risk of exposure to product liability
claims in the event that the use of Ampligen(R) or other of our products results
in adverse effects. This liability might result from claims made directly by
patients, hospitals, clinics or other consumers, or by pharmaceutical companies
or others manufacturing these products on our behalf. Our future operations may
be negatively affected from the litigation costs, settlement expenses and lost
product sales inherent to these claims. While we will continue to attempt to
take appropriate precautions, we cannot assure that we will avoid significant
product liability exposure.

On November 28, 2008, as we disclosed in an 8-K, we suspended product
liability insurance for Alferon(R) N and Ampligen(R) until we receive regulatory
clearance for Ampligen(R). We now require third parties to indemnify us in
conjunction with all overseas emergency sales of Ampligen(R) and Alferon(R) LDO.
We concluded that years of successfully addressing the limited number of product
liability claims filed against Ampligen(R) and Alferon(R) LDO, combined with the
mandatory patient waivers completed as an element of clinical trials and lack of
any commercial sales since April 2008, that temporarily discontinuing the
liability insurance was an acceptable risk given our financial condition and
need to conserve cash.

Currently, without product liability coverage for Ampligen(R) and
Alferon(R) LDO, a claim against the products could have a materially adverse
effect on our business and financial condition.

The loss of services of key personnel including Dr. William A. Carter could hurt
our chances for success.

Our success is dependent on the continued efforts of our staff,
especially certain doctors and researchers along with the continued efforts of
Dr. William A. Carter because of his position as a pioneer in the field of
nucleic acid drugs, his being the co-inventor of Ampligen(R), and his knowledge
of our overall activities, including patents and clinical trials. As a result of
our implementation of the Employee Wage Or Hours Reduction Program, our staff
has agreed to take a portion of their compensation in shares of our Common
Stock. While we believe that our employees are dedicated to us and while we have
incentivised them to remain with us through the establishment of a Bonus Pool
that would award them money in the event that the FDA approves our NDA for
Ampligen(R), we cannot assure that they will remain with us. The loss of the
services of personnel key to our operations or Dr. Carter could have a material
adverse effect on our operations and chances for success. As a cash conservation
measure, we have elected to discontinue the key man life insurance in the amount
of $2,000,000 on the life of Dr. Carter until we receive regulatory clearance
for Ampligen(R). An employment agreement continues to exist with Dr. Carter
that, as amended, runs until December 31, 2010. However, Dr. Carter has the
right to terminate his employment upon not less than 30 days prior written
notice. The loss of Dr. Carter or other personnel or the failure to recruit
additional personnel as needed could have a materially adverse effect on our
ability to achieve our objectives.

Uncertainty of health care reimbursement for our products.

Our ability to successfully commercialize our products will depend, in
part, on the extent to which reimbursement for the cost of such products and
related treatment will be available from government health administration
authorities, private health coverage insurers and other organizations.
Significant uncertainty exists as to the reimbursement status of newly approved
health care products, and from time to time legislation is proposed, which, if
adopted, could further restrict the prices charged by and/or amounts
reimbursable to manufacturers of pharmaceutical products. We cannot predict
what, if any, legislation will ultimately be adopted or the impact of such
legislation on us. There can be no assurance that third party insurance
companies will allow us to charge and receive payments for products sufficient
to realize an appropriate return on our investment in product development.

There are risks of liabilities associated with handling and disposing of
hazardous materials.

Our business involves the controlled use of hazardous materials,
carcinogenic chemicals, flammable solvents and various radioactive compounds.
Although we believe that our safety procedures for handling and disposing of
such materials comply in all material respects with the standards prescribed by
applicable regulations, the risk of accidental contamination or injury from
these materials cannot be completely eliminated. In the event of such an
accident or the failure to comply with applicable regulations, we could be held
liable for any damages that result, and any such liability could be significant.
We do not maintain insurance coverage against such liabilities.

Risks Associated With an Investment in Our Common Stock

The market price of our stock may be adversely affected by market volatility.

The market price of our common stock has been and is likely to be
volatile. This is especially true given the current significant instability in
the financial markets. In addition to general economic, political and market
conditions, the price and trading volume of our stock could fluctuate widely in
response to many factors, including:

o announcements of the results of clinical trials by us or our
competitors;
o adverse reactions to products;
o governmental approvals, delays in expected governmental approvals or
withdrawals of any prior governmental approvals or public or regulatory
agency concerns regarding the safety or effectiveness of our products;
o changes in U.S. or foreign regulatory policy during the period of
product development;
o developments in patent or other proprietary rights, including any third
party challenges of our intellectual property rights;
o announcements of technological innovations by us or our competitors;
o announcements of new products or new contracts by us or our
competitors;
o actual or anticipated variations in our operating results due to the
level of development expenses and other factors;
o changes in financial estimates by securities analysts and whether our
earnings meet or exceed the estimates;
o conditions and trends in the pharmaceutical and other industries;
o new accounting standards;
o overall investment market fluctuation; and
o occurrence of any of the risks described in these "Risk Factors."

Our common stock is listed for quotation on the NYSE AMEX (formerly,
the American Stock Exchange). For the 12-month period ended December 31, 2008,
the price of our common stock has ranged from $0.25 to $1.20 per share. We

expect the price of our common stock to remain volatile. The average daily
trading volume of our common stock varies significantly. Our relatively low
average volume and low average number of transactions per day may affect the
ability of our stockholders to sell their shares in the public market at
prevailing prices and a more active market may never develop.

In the past, following periods of volatility in the market price of the
securities of companies in our industry, securities class action litigation has
often been instituted against companies in our industry. If we face securities
litigation in the future, even if without merit or unsuccessful, it would result
in substantial costs and a diversion of management attention and resources,
which would negatively impact our business.

The sale of our common stock to Fusion Capital may cause dilution and the sale
of the shares of common stock acquired by Fusion Capital could cause the price
of our common stock to decline.

In connection with entering into the Purchase Agreement with Fusion
Capital, we registered 21,300,000 shares in the aggregate, consisting of
20,000,000 shares which we may sell to Fusion Capital and 1,300,000 shares we
have issued or may issue to Fusion Capital as a commitment fee. As of the date
of this Prospectus we have sold an aggregate of 3,027,795 shares to Fusion
Capital (exclusive of any shares issued as a commitment fee) under the Purchase
Agreement for gross proceeds of approximately $1,260,000, leaving 16,972,205
shares (exclusive of additional shares issuable as a commitment fee). The number
of shares ultimately offered for sale by Fusion Capital under this Prospectus is
dependent upon the number of shares purchased by Fusion Capital under the
agreement. The purchase price for the common stock to be sold to Fusion Capital
pursuant to the Purchase Agreement will fluctuate based on the price of our
common stock. It is anticipated that shares offered pursuant to this Prospectus
could be sold over a period of up to 16 months after the date hereof. Depending
upon market conditions at the time, a sale of shares by Fusion Capital at any
given time could cause the trading price of our common stock to decline. Fusion
Capital may ultimately purchase all, some or none of the 16,972,205 shares
(exclusive of additional shares issued or to be issued as a commitment fee)
registered herein but not yet issued. After it has acquired such shares, it may
sell all, some or none of such shares. Therefore, sales to Fusion Capital by us
under the Purchase Agreement may result in substantial dilution to the interests
of other holders of our common stock. The sale of a substantial number of shares
of our common stock by Fusion Capital, or anticipation of such sales, could make
it more difficult for us to sell equity or equity-related securities in the
future at a time and at a price that we might otherwise wish to effect sales.
However, we have the right to control the timing and amount of any sales of our
shares to Fusion Capital and the agreement may be terminated by us at any time
at our discretion without any cost to us.

In addition to the shares registered for Fusion Capital, we have
previously registered 135% of 3,615,514 shares issuable upon exercise of

Warrants related to our former convertible debentures and 14,442,294 shares
issuable upon exercise of certain other warrants. To the extent the exercise
price of the warrants is less than the market price of the common stock, the
holders of the warrants are likely to exercise them and sell the underlying
shares of common stock and to the extent that the conversion price and exercise
price of these securities are adjusted pursuant to anti-dilution protection, the
securities could be exercisable or convertible for even more shares of common
stock. We also may issue shares to be used to meet our capital requirements or
use shares to compensate employees, consultants and/or directors. In this
regard, we previously registered $50,000,000 worth of our securities in a
universal shelf registration statement, none of which has been designated or
issued. We are unable to estimate the amount, timing or nature of future sales
of outstanding common stock or instruments convertible into or exercisable for
our common stock.

Sales of substantial amounts of our common stock in the public market
could cause the market price for our common stock to decrease. Furthermore, a
decline in the price of our common stock would likely impede our ability to
raise capital through the issuance of additional shares of common stock or other
equity securities.

Provisions of our Certificate of Incorporation and Delaware law could defer a
change of our management which could discourage or delay offers to acquire us.

Provisions of our Certificate of Incorporation and Delaware law may
make it more difficult for someone to acquire control of us or for our
stockholders to remove existing management, and might discourage a third party
from offering to acquire us, even if a change in control or in management would
be beneficial to our stockholders. For example, our Certificate of Incorporation
allows us to issue shares of preferred stock without any vote or further action
by our stockholders. Our Board of Directors has the authority to fix and
determine the relative rights and preferences of preferred stock. Our Board of
Directors also has the authority to issue preferred stock without further
stockholder approval. As a result, our Board of Directors could authorize the
issuance of a series of preferred stock that would grant to holders the
preferred right to our assets upon liquidation, the right to receive dividend
payments before dividends are distributed to the holders of common stock and the
right to the redemption of the shares, together with a premium, prior to the
redemption of our common stock. In this regard, in November 2002, we adopted a
stockholder rights plan and, under the Plan, our Board of Directors declared a
dividend distribution of one Right for each outstanding share of Common Stock to
stockholders of record at the close of business on November 29, 2002. Each Right
initially entitles holders to buy one unit of preferred stock for $30.00. The
Rights generally are not transferable apart from the common stock and will not
be exercisable unless and until a person or group acquires or commences a tender
or exchange offer to acquire, beneficial ownership of 15% or more of our common
stock. However, for Dr. Carter, our Chief Executive Officer, who already
beneficially owns 8.9% of our common stock, the Plan's threshold will be 20%,

instead of 15%. The Rights will expire on November 19, 2012, and may be redeemed
prior thereto at $.01 per Right under certain circumstances.

Because the risk factors referred to above could cause actual results
or outcomes to differ materially from those expressed in any forward-looking
statements made by us, you should not place undue reliance on any such
forward-looking statements. Further, any forward-looking statement speaks only
as of the date on which it is made and we undertake no obligation to update any
forward-looking statement or statements to reflect events or circumstances after
the date on which such statement is made or reflect the occurrence of
unanticipated events. New factors emerge from time to time, and it is not
possible for us to predict which will arise. In addition, we cannot assess the
impact of each factor on our business or the extent to which any factor, or
combination of factors, may cause actual results to differ materially from those
contained in any forward-looking statements. Our research in clinical efforts
may continue for the next several years and we may continue to incur losses due
to clinical costs incurred in the development of Ampligen(R) for commercial
application Possible losses may fluctuate from quarter to quarter as a result of
differences in the timing of significant expenses incurred and receipt of
licensing fees and/or cost recovery treatment revenue.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain statements in this Prospectus constitute "forwarding-looking statements"
within the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities and Exchange Act of 1995 (collectively, the
"Reform Act"). Certain, but not necessarily all, of such forward-looking
statements can be identified by the use of forward-looking terminology such as
"believes," "expects," "may," "will," "should," or "anticipates" or the negative
thereof or other variations thereon or comparable terminology, or by discussions
of strategy that involve risks and uncertainties. All statements other than
statements of historical fact, included in this Prospectus regarding our
financial position, business strategy and plans or objectives for future
operations are forward-looking statements. Without limiting the broader
description of forward-looking statements above, we specifically note that
statements regarding potential drugs, their potential therapeutic effect, the
possibility of obtaining regulatory approval, our ability to manufacture and
sell any products, market acceptance or our ability to earn a profit from sales
or licenses of any drugs or our ability to discover new drugs in the future are
all forward-looking in nature.

Such forward-looking statements involve known and unknown risks,
uncertainties and other factors, including but not limited to, the risk factors
discussed above, which may cause the actual results, performance or achievements
of Hemispherx and its subsidiaries to be materially different from any future
results, performance or achievements expressed or implied by such
forward-looking statements and other factors referenced in this Prospectus. We
do not undertake and specifically decline any obligation to publicly release the
results of any revisions which may be made to any forward-looking statement to
reflect events or circumstances after the date of such statements or to reflect
the occurrence of anticipated or unanticipated events.

BUSINESS

Our Annual Report on Form 10-K for the fiscal year ended December 31, 2008,
incorporated by reference into this Prospectus, contains information about
us, including audited financial statements for our fiscal year ended
December 31, 2008. Please refer to this report for additional information.

SELLING STOCKHOLDER

The following table presents information regarding the selling stockholder,
Fusion Capital. Neither the selling stockholder nor any of its affiliates has
held a position or office, or had any other material relationship, with us.
However, in July 2005 we entered into a prior common stock purchase agreement
with Fusion Capital, pursuant to which we sold an aggregate of 8,791,838 shares
for total gross proceeds of $20,000,000. In April 2006 we entered into a prior
common stock purchase agreement with Fusion Capital, pursuant to which we sold
an aggregate of 10,682,032 shares for total gross proceeds of approximately
$19,739,000 through November, 2007. Each of these transactions was substantially
similar to the transaction set forth herein.

------------------------- ------------------- ----------------- --------------------------- ----------------------
Percentage of Shares to be Sold in the
Outstanding Offering Assuming The
Shares Shares Company Issues The Percentage of
Beneficially Beneficially Maximum Remaining Number Outstanding Shares
Owned Before Owned Before of Shares Under the Beneficially Owned
Selling Stockholder Offering Offering (1) Purchase Agreement (1) After Offering
------------------------- ------------------- ----------------- --------------------------- ----------------------
------------------------- ------------------- ----------------- --------------------------- ----------------------
Fusion Capital Fund II,
LLC (2) 1,098,814 (3) 1.5% 21,300,000 (3) Less than 1%
------------------------- ------------------- ----------------- --------------------------- ----------------------

(1) Applicable percentage of ownership is based on 74,960,278 shares of our
common stock outstanding as of August 1, 2008 (prior to the
commencement of the offering), together with securities exercisable or
convertible into shares of Common Stock within sixty (60) days of that
date for the selling stockholder. Beneficial ownership is determined in
accordance with the rules of the SEC and generally includes voting or
investment power with respect to securities. Shares of common stock are
deemed to be beneficially owned by the person holding such securities
for the purpose of computing the percentage of ownership of such
person, but are not treated as outstanding for the purpose of computing
the percentage ownership of any other person.

(2) Steven G. Martin and Joshua B. Scheinfeld, the principals of Fusion
Capital, are deemed to be beneficial owners of all of the shares of
common stock owned by Fusion Capital. Messrs. Martin and Scheinfeld
have shared voting and disposition power over the shares being offered
under this Prospectus.

(3) We have included in this Prospectus 21,300,000 shares in the aggregate.
The numbers in the above table are as of August 1, 2008, prior to the
commencement of the offering. As of the date of the Prospectus, the
21,300,000 shares consist of the following: 3,027,795 shares which we
have issued and sold to Fusion Capital, 16,972,205 shares which are not
presently issued and which we may sell to Fusion Capital at our
discretion, 677,299 shares we have issued to Fusion Capital as a
commitment fee and 622,701 shares we may issue to Fusion Capital as a
commitment fee. Therefore, we may issue to Fusion Capital up to an
additional 17,594,906 shares under the Purchase Agreement but Fusion
Capital does not presently beneficially own those shares as determined
in accordance with the rules of the SEC. Prior to entering into the
Purchase Agreement Fusion Capital owned 448,814 of our shares that it
previously acquired.

The Fusion Transaction

General

On July 2, 2008, we entered into a Common Stock Purchase Agreement with Fusion
Capital Fund II, LLC, an Illinois limited liability company. Under the Purchase
Agreement, Fusion Capital is obligated, under certain conditions, to purchase
shares from us in an aggregate amount of up to $30 million from time to time
over a 25 month period from August 21, 2008. Under the terms of the Purchase
Agreement, Fusion Capital has received a commitment fee consisting of 650,000
shares of our common stock. Also, we will issue to Fusion Capital up to an
additional 650,000 shares as a commitment fee pro rata as we receive the $30
million of future funding. We originally registered herein 21,300,000 shares in
the aggregate, consisting of 20,000,000 shares which we may sell to Fusion
Capital and 1,300,000 shares we have issued or may issue to Fusion Capital as a
commitment fee. As of April 6, 2009, we have sold an aggregate of 3,027,795
shares to Fusion Capital (exclusive of any shares issued as a commitment fee)
under the Purchase Agreement for gross proceeds of approximately $1,260,000.

required to register and have included in the offering pursuant to this
Prospectus (1) 650,000 shares which have already been issued, (2) an additional
650,000 shares which we may issue in the future as a commitment fee pro rata as
we receive up to the $30 million of future funding and (3) at least 13,523,651
shares which we may sell to Fusion Capital after this registration statement is
declared effective. In the aggregate, this is 14,823,651 or 19.99% of our
outstanding shares on July 2, 2008, the date of the Purchase Agreement.

Under the Purchase Agreement, we have the right but not the obligation to sell
more than the 20,000,000 shares to Fusion Capital (excluding the 1,300,000
shares we have issued or may issue to Fusion Capital as a commitment fee). This
21,300,000 shares is greater than 19.99% of our outstanding shares of common
stock as of the date of the Purchase Agreement. The number of shares ultimately
offered for sale by Fusion Capital is dependent upon the number of shares
purchased by Fusion Capital under the Purchase Agreement. On November 11, 2008,
at our Annual Meeting of Stockholders we received stockholder approval of the
Purchase Agreement in order to be in compliance with the NYSE AMEX rules
permitting us to sell more than 14,823,651 or 19.99% of our outstanding shares
on July 2, 2008, the date of the Purchase Agreement.

As of the date hereof, we do not have any plans or intent to sell to Fusion
Capital any shares beyond the 20,000,000 shares offered hereby (excluding the
1,300,000 shares we have issued or may issue to Fusion Capital as a commitment
fee). However, if we elect to sell more than the 20,000,000 shares, which we
have the right but not the obligation to do, we must first register under the
Securities Act any additional shares we may elect to sell to Fusion Capital
before we can sell such additional shares, which could cause substantial
dilution to our stockholders.

Generally, we have the right but not the obligation from time to time to sell
our shares to Fusion Capital in amounts between $120,000 and $1.0 million
depending on certain conditions. We have the right to control the timing and
amount of any sales of our shares to Fusion Capital. The purchase price of the
shares will be determined based upon the market price of our shares without any
fixed discount at the time of each sale. Fusion Capital does not have the right
nor the obligation to purchase any shares of our common stock on any business
day that the price of our common stock is below $0.40. There are no negative
covenants, restrictions on future fundings, penalties or liquidated damages in
the Purchase Agreement or the Registration Rights Agreement. The Purchase
Agreement may be terminated by us at any time at our discretion without any cost
to us.

The number of shares ultimately offered for sale by Fusion Capital is dependent
upon the number of shares purchased by Fusion Capital under the Purchase
Agreement.

Purchase Of Shares Under The Purchase Agreement

Under the common stock purchase agreement, on any business day selected
by us, we may direct Fusion Capital to purchase up to $120,000 of our common
stock. The purchase price per share is equal to the lesser of:

o the lowest sale price of our common stock on the purchase date; or

o the average of the three (3) lowest closing sale prices of our common
stock during the twelve (12) consecutive business days prior to the
date of a purchase by Fusion Capital.

The purchase price will be equitably adjusted for any reorganization,
recapitalization, non-cash dividend, stock split, or other similar transaction
occurring during the business days used to compute the purchase price. We may
direct Fusion Capital to make multiple purchases from time to time in our sole
discretion; no sooner then every two business days.

Our Right To Increase the Amount to be Purchased

In addition to purchases of up to $120,000 from time to time,
we may also from time to time elect on any single business day selected by us to
require Fusion Capital to purchase our shares in an amount up to $150,000
provided that our share price is not below $0.80 during the two business days
prior to and on the purchase date. We may increase this amount to up to $250,000
if our share price is not below $1.25 during the two business days prior to and
on the purchase date. This amount may also be increased to up to $500,000 if our
share price is not below $1.75 during the two business days prior to and on the
purchase date. This amount may also be increased to up to $1,000,000 if our
share price is not below $4.00 during the two business days prior to and on the
purchase date. We may direct Fusion Capital to make multiple large purchases
from time to time in our sole discretion; however, at least two business days
must have passed since the most recent large purchase was completed. The price
at which our common stock would be purchased in this type of larger purchases
will be the lesser of (i) the lowest sale price of our common stock on the
purchase date and (ii) the lowest purchase price (as described above) during the
previous ten business days prior to the purchase date.

Minimum Purchase Price

Under the common stock purchase agreement, we have set a minimum
purchase price ("floor price") of $0.40. However, Fusion Capital does not have
the right nor the obligation to purchase any shares of our common stock in the
event that the purchase price would be less the floor price. Specifically,

Fusion Capital does not have the right or the obligation to purchase shares of
our common stock on any business day that the market price of our common stock
is below $0.40.

Events of Default

Generally, Fusion Capital may terminate the common stock purchase
agreement without any liability or payment to us upon the occurrence of any of
the following events of default:

o the effectiveness of the registration statement of which this
Prospectus is a part of lapses for any reason (including, without
limitation, the issuance of a stop order) or is unavailable to Fusion
Capital for sale of our common stock offered hereby and such lapse or
unavailability continues for a period of ten consecutive business days
or for more than an aggregate of 30 business days in any 365-day
period;

o suspension by the NYSE AMEX of our common stock from trading for a
period of three consecutive business days;

o the de-listing of our common stock from the NYSE AMEX provided our
common stock is not immediately thereafter trading on the Nasdaq OTC
Bulletin Board Market, the Nasdaq Global Market, the Nasdaq Capital
Market, or the New York Stock Exchange;

o the transfer agent`s failure for five business days to issue to Fusion
Capital shares of our common stock which Fusion Capital is entitled to
under the common stock purchase agreement;

o any material breach of the representations or warranties or covenants
contained in the common stock purchase agreement or any related
agreements which has or which could have a material adverse effect on
us subject to a cure period of five business days; or

o any participation or threatened participation in insolvency or
bankruptcy proceedings by or against us.

Our Termination Rights

We have the unconditional right at any time for any reason to give
notice to Fusion Capital terminating the Purchase Agreement without any cost to
us.

No Short-Selling or Hedging by Fusion Capital

Fusion Capital has agreed that neither it nor any of its affiliates
shall engage in any direct or indirect short-selling or hedging of our common
stock during any time prior to the termination of the common stock purchase
agreement.

Effect of Performance of the Purchase Agreement on Our Stockholders

All 21,300,000 shares offered in this Prospectus are expected to be
freely tradable and will be sold over a period of up to 16 months from the date
of this Prospectus. The sale by Fusion Capital of a significant amount of shares
at any given time could cause the market price of our common stock to decline
and to be highly volatile. We may sell to Fusion Capital all, some or none of
the remaining 16,972,205 shares of common stock not yet sold or issued but part
of this offering. After Fusion Capital has acquired any of such shares, it may
sell all, some or none of such shares. Therefore, sales to Fusion Capital by us
under the agreement may result in substantial dilution to the interests of other
holders of our common stock. However, we have the right to control the timing
and amount of any sales of our shares to Fusion Capital and the agreement may be
terminated by us at any time at our discretion without any cost to us. The
number of shares ultimately offered for sale by Fusion Capital under this
Prospectus is dependent upon the number of shares purchased by Fusion Capital
under the Purchase Agreement. The following table sets forth the amount of
proceeds we would receive from Fusion Capital from the sale of the remaining
16,972,205 shares at varying purchase prices:

-----------------------------------------------------------------------------------------------------------
Percentage of Outstanding Proceeds from the Sale of Shares
Number of Shares After Giving Effect to Fusion Capital Listed in the
Assumed Average Remaining Shares to be to the Issuance of Such Second Column Under the
Purchase Price Issued if Full Purchase Shares to Fusion Capital(1) Purchase Agreement

-----------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------
$0.40 16,972,205 17.1% $ 6,788,882
-----------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------
$0.51 (2) 16,972,205 17.1% $ 8,655,825
-----------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------
$0.75 16,972,205 17.1% $ 12,729,154
-----------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------
$1.00 16,972,205 17.1% $ 16,972,205
-----------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------
$1.50 16,972,205 17.1% $ 25,458,308
-----------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------
$2.00 14,370,000 14.9% $ 28,740,000
-----------------------------------------------------------------------------------------------------------

--------------------

(1) The denominator is based on the number of remaining shares to be issued as
listed in the second column plus the 82,142,226 shares outstanding as of
April 6, 2009, which includes 3,705,094 shares previously issued to Fusion
Capital in connection with the Purchase Agreement. The numerator is based
on the number of remaning shares sold under the Purchase Agreement at the
corresponding assumed purchase price set forth in the adjacent column.

(2) Closing sale price of our shares on April 06, 2009.

PLAN OF DISTRIBUTION

The common stock offered by this Prospectus is being offered by Fusion
Capital Fund II, LLC, the selling stockholder. The common stock may be sold or
distributed from time to time by the selling stockholder directly to one or more
purchasers or through brokers, dealers, or underwriters who may act solely as
agents at market prices prevailing at the time of sale, at prices related to the
prevailing market prices, at negotiated prices, or at fixed prices, which may be
changed. The sale of the common stock offered by this Prospectus may be effected
in one or more of the following methods:

o ordinary brokers' transactions;
o transactions involving cross or block trades;
o through brokers, dealers, or underwriters who may act solely as agents;
o "at the market" into an existing market for the common stock;
o in other ways not involving market makers or established business
markets, including direct sales to purchasers or sales effected through
agents;
o in privately negotiated transactions; or
o any combination of the foregoing.

In order to comply with the securities laws of certain states, if
applicable, the shares may be sold only through registered or licensed brokers
or dealers. In addition, in certain states, the shares may not be sold unless
they have been registered or qualified for sale in the state or an exemption
from the registration or qualification requirement is available and complied
with.

Brokers, dealers, underwriters, or agents participating in the
distribution of the shares as agents may receive compensation in the form of
commissions, discounts, or concessions from the selling stockholder and/or
purchasers of the common stock for whom the broker-dealers may act as agent. The
compensation paid to a particular broker-dealer may be less than or in excess of
customary commissions.

Fusion Capital is an "underwriter" within the meaning of the Securities
Act.

Neither we nor Fusion Capital can presently estimate the amount of
compensation that any agent will receive. We know of no existing arrangements
between Fusion Capital, any other stockholder, broker, dealer, underwriter, or
agent relating to the sale or distribution of the shares offered by this
Prospectus. At the time a particular offer of shares is made, a prospectus
supplement, if required, will be distributed that will set forth the names of
any agents, underwriters, or dealers and any compensation from the selling
stockholder, and any other required information.

We will pay all of the expenses incident to the registration, offering,
and sale of the shares to the public other than commissions or discounts of
underwriters, broker-dealers, or agents. We have also agreed to indemnify Fusion
Capital and related persons against specified liabilities, including liabilities
under the Securities Act.

Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to our directors, officers, and controlling persons, we
have been advised that in the opinion of the SEC this indemnification is against
public policy as expressed in the Securities Act and is therefore,
unenforceable.

Fusion Capital and its affiliates have agreed not to engage in any
direct or indirect short selling or hedging of our common stock during the term
of the common stock purchase agreement.

We have advised Fusion Capital that while it is engaged in a
distribution of the shares included in this Prospectus it is required to comply
with Regulation M promulgated under the Securities Exchange Act of 1934, as
amended. With certain exceptions, Regulation M precludes the selling
stockholder, any affiliated purchasers, and any broker-dealer or other person
who participates in the distribution from bidding for or purchasing, or
attempting to induce any person to bid for or purchase any security which is the
subject of the distribution until the entire distribution is complete.
Regulation M also prohibits any bids or purchases made in order to stabilize the
price of a security in connection with the distribution of that security. All of
the foregoing may affect the marketability of the shares offered hereby this
Prospectus.

This offering will terminate on the date that all shares offered by
this Prospectus have been sold by Fusion Capital.

USE OF PROCEEDS

We will not receive any proceeds from the sale of the shares of common
stock offered by the selling stockholder. However, we may receive proceeds from
the sale of shares of our common stock to Fusion Capital under the Purchase
Agreement. We will apply such proceeds, if any, to fund infrastructure growth
including manufacturing, regulatory compliance, market development or general
operating costs.

SEC POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES

Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers or persons controlling the company
pursuant to the foregoing provisions, we have been informed that in the opinion
of the Securities and Exchange Commission such indemnification is against public
policy as expressed in the Securities Act and is therefore unenforceable.

DESCRIPTION OF SECURITIES BEING REGISTERED

The following section does not purport to be complete and is qualified
in all respects by reference to the detailed provisions of our certificate of
incorporation and by-laws, as amended and restated, copies of which have been
filed with the Securities and Exchange Commission.

Our authorized capital stock consist of: (i) 200,000,000 shares of
common stock, $.001 par value; and (ii) 5,000,000 shares of preferred stock,
$.01 par value. 82,142,226 shares of common stock were issued and outstanding as
of the date of this Prospectus.

Common Stock

Shares of our common stock are entitled to one vote per share, either
in person or by proxy, on all matters that may be voted upon by the owners of
our shares at meetings of our stockholders. There is no provision for cumulative
voting with respect to the election of directors by the holders of common stock.
Therefore, the holder of more than 50% of our shares of outstanding common stock
can, if they choose to do so, elect all of our directors. In this event, the
holders of the remaining shares of common stock will not be able to elect any
directors.

The holders of common stock:

o have equal rights to dividends from funds legally available therefore,
when and if declared by our board of directors;

o are entitled to share ratably in all of our assets available for
distribution to holders of common stock upon liquidation, dissolution
or winding up of our affairs; and

o do not have preemptive rights, conversion rights, or redemption of
sinking fund provisions.

The outstanding shares of our common stock are duly authorized, validly
issued, fully paid and nonassessable.

Anti-Takeover Provisions

Delaware Law

We are subject to the provisions of Section 203 of the Delaware General
Corporation Law, as amended, which restricts certain business combinations with
interested stockholders even if such a combination would be beneficial to all

stockholders. In general, Section 203 would require a two-thirds vote of
stockholders for any business combination (such as a merger or sale of all or
substantially all of our assets) between us and an "interested stockholder"
unless such transaction is approved by a majority of the disinterested directors
or meets certain other requirements. An "interested stockholder" is a person
who, together with affiliates and associates, owns (or within three years, did
own) 15% or more of our voting stock. These provisions could deprive
stockholders of an opportunity to receive a premium for their common stock as
part of a sale of us or may otherwise discourage a potential acquirer from
attempting to obtain control of us.

Certificate of Incorporation

Provisions of our Certificate of Incorporation may make it more
difficult for someone to acquire control of us or for our stockholders to remove
existing management, and might discourage a third party from offering to acquire
us, even if a change in control or in management would be beneficial to our
stockholders. For example, our Certificate of Incorporation allows us to issue
shares of preferred stock without any vote or further action by our
stockholders. Our Board of Directors has the authority to fix and determine the
relative rights and preferences of preferred stock. Our Board of Directors also
has the authority to issue preferred stock without further stockholder approval.
As a result, our Board of Directors could authorize the issuance of a series of
preferred stock that would grant to holders the preferred right to our assets
upon liquidation, the right to receive dividend payments before dividends are
distributed to the holders of common stock and the right to the redemption of
the shares, together with a premium, prior to the redemption of our common
stock.

Shareholder rights plan

In November, 2002 we adopted a shareholder rights plan and, under the
Plan, our Board of Directors declared a dividend distribution of one Right for
each outstanding share of Common Stock to stockholders of record at the close of
business on November 29, 2002. Each Right initially entitles holders to buy one
unit of preferred stock for $30.00. The Rights generally are not transferable
apart from the common stock and will not be exercisable unless and until a
person or group acquires or commences a tender or exchange offer to acquire,
beneficial ownership of 15% or more of our common stock. However, for William A.
Carter, M.D., our chief executive officer, who already beneficial owns 8.9% of
our common stock, the Plan's threshold will be 20%, instead of 15%. The Rights
will expire on November 19, 2012, and may be redeemed prior thereto at $.01 per
Right under certain circumstances.

The rights have certain anti-takeover effects. The rights will cause
substantial dilution to a person or group that attempts to acquire us on terms
not approved by our Board of Directors. The rights should not interfere with any
merger or business combination approved by the Board of Directors.

LEGAL MATTERS

The validity of the common stock offered in this Prospectus has been
passed upon for us by Silverman Sclar Shin & Byrne PLLC, 381 Park Avenue South,
Suite 1601, New York, New York 10016.

EXPERTS

The financial statements, the related financial statement schedule, and
the effectiveness of internal control over financial reporting incorporated by
reference in this Prospectus and Registration Statement have been audited by
McGladrey & Pullen, LLP, an independent registered public accounting firm, as
stated in their report incorporated herein by reference, and are incorporated in
reliance upon such report and upon the authority of such firm as experts in
accounting and auditing.

HEMISPHERX BIOPHARMA, INC.

21,300,000 Shares of
Common Stock

---------------------------

PROSPECTUS
----------------------------
April __, 2009

II-1

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

The following table sets forth the costs and expenses payable by the registrant
in connection with resales of the securities being registered, including the
preparation and filing of this registration statement. All amounts are estimates
subject to future contingencies except the SEC registration statement filing
fee.

SEC Filing Fees...............................................$ 1,211
NYSE AMEX Listing Fee.........................................$ 30,000
Printing and Engraving Expenses...............................$ 2,000
Accounting Fees and Expenses..................................$ 35,000
Legal Fees and Expenses.......................................$ 25,000
Transfer Agent and Registrar Fees.............................$ 1,000
Miscellaneous.................................................$ 1,000
-----
Total Expenses...............................................$ 95,211
======

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS.

The Registrant's Amended and Restated Certificate of Incorporation provides that
the Registrant shall indemnify to the extent permitted by Delaware law any
person whom it may indemnify thereunder, including directors, officers,
employees and agents of the Registrant. Such indemnification (other than an
order by a court) shall be made by the Registrant only upon a determination that
indemnification is proper in the circumstances because the individual met the
applicable standard of conduct. Advances for such indemnification may be made
pending such determination. In addition, the Registrant's Amended and Restated
Certificate of Incorporation eliminates, to the extent permitted by Delaware
law, personal liability of directors to the Registrant and its stockholders for
monetary damages for breach of fiduciary duty as directors.

The Registrant's authority to indemnify its directors and officers is governed
by the provisions of Section 145 of the Delaware General Corporation Law, as
follows:

(a) A corporation shall have the power to indemnify any person who was or
is a party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (other than action by or in
the right of the corporation) by reason of the fact that he is or was a
director, officer, employee or agent of the corporation, or is or was
serving at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture,
trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred by the person in connection with such action, suit
or proceeding if he acted in good faith and in a manner he reasonably

II-2

believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceeding,
had no reasonable cause to believe his conduct was unlawful. The
termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its
equivalent, shall not, of itself, create a presumption that the person
did not act in good faith and in a manner which he reasonably believed
to be in or not opposed to the best interests of the corporation, and,
with respect to any criminal action or proceeding, had reasonable cause
to believe that the person's conduct was unlawful.

(b) A corporation shall have the power to indemnify any person who was or
is a party or is threatened to be made a party to any threatened,
pending or completed action or suit by or in the right of the
corporation to procure a judgment in its favor by reason of the fact
that he is or was a director, officer, employee or agent of the
corporation, or is or was serving at the request of the corporation as
a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise against expenses
(including attorneys' fees) actually and reasonably incurred by the
person in connection with the defense or settlement of such action or
suit if he acted in good faith and in a manner he reasonably believed
to be in or not opposed to the best interests of the corporation and
except that no indemnification shall be made in respect of any claim,
issue or matter as to which such person shall have been adjudged to be
liable to the corporation unless and only to the extent that the Court
of Chancery or the court in which such action or suit was brought shall
determine upon application that, despite the adjudication of liability
but in view of all the circumstances of the case, such person is fairly
and reasonably entitled to indemnity for such expenses which the Court
of Chancery or such other court shall deem proper.

(c) To the extent that a present or former director or officer of a
corporation has been successful on the merits or otherwise in defense
of any action, suit or proceeding referred to in subsections (a) and
(b) of this section, or in defense of any claim, issue or matter
therein, such person shall be indemnified against expenses (including
attorneys' fees) actually and reasonably incurred by such person in
connection therewith.

(d) Any indemnification under subsections (a) and (b) of this section
(unless ordered by a court) shall be made by the corporation only as
authorized in the specific case upon a determination that
indemnification of the present or former director, officer, employee or
agent is proper in the circumstances because he has met the applicable
standard of conduct set forth in subsections (a) and (b) of this
section. Such determination shall be made, with respect to a person who
is a director or officer at the time of such determination (1) by a
majority vote of the directors who are not parties to such action, suit
or proceeding, even though less than a quorum, or (2) by a committee of
such directors designated by majority vote of such directors, even
though less than a quorum, or (3) if there are no such directors, or if
such directors so direct, by independent legal counsel in a written
opinion, or (4) by the stockholders.

(e) Expenses (including attorneys' fees) incurred by an officer or director
in defending a civil or criminal action, suit or proceeding may be paid
by the corporation in advance of the final disposition or such action,
suit or proceeding upon receipt of an undertaking by or on behalf of
such director or officer to repay such amount if it shall ultimately be
determined that such person is not entitled to be indemnified by the
corporation as authorized in this section. Such expenses incurred by
former directors and officers and other employees and agents may be so
paid upon such terms and conditions, if any, as the corporation deems
appropriate.

II-3

(f) The indemnification and advancement of expenses provided by, or granted
pursuant to, the other subsections of this section shall not be deemed
exclusive of any other rights to which those seeking indemnification or
advancement of expenses may be entitled under any by, agreement, vote
of stockholders or disinterested directors or otherwise, both as to
action in such person's official capacity and as to action in another
capacity while holding such office.

(g) A corporation shall have power to purchase and maintain insurance on
behalf of any person who is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise
against any liability asserted against such person and incurred by such
person in any such capacity, or arising out of his status as such,
whether or not the corporation would have the power to indemnify such
person against such liability under this section.

(h) For purposes of this section, references to the "corporation" shall
include, in addition to the resulting corporation, any constituent
corporation (including any constituent of a constituent) absorbed in a
consolidation or merger which, if its separate existence had continued,
would have had the power and authority to indemnify its directors,
officers, and employees or agents, so that any person who is or was a
director, officer, employee or agent of such constituent corporation,
or is or was serving at the request of such constituent corporation as
a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, shall stand in
the same position under this section with respect to the resulting or
surviving corporation as such person would have with respect to such
constituent corporation if its separate existence had continued.

(i) For purposes of this section, references to "other enterprises" shall
include employee benefit plans, references to "fines" shall include any
excise taxes assessed on a person with respect to any employee benefit
plan, and references to "serving at the request of the corporation"
shall include any service as a director, officer, employee, or agent
with respect to any employee benefit plan, its participants or
beneficiaries, and a person who acted in good faith and in a manner
such person reasonably believed to be in the interest of the
participants and beneficiaries of any employee benefit plan shall be
deemed to have acted in a manner "not opposed to the best interests of
the corporation" as referred to in this section.

(j) The indemnification and advancement of expenses provided by, or granted
pursuant to, this section shall, unless otherwise provided when
authorized or ratified, continue as to a person who has ceased to be a
director, officer, employee or agent and shall inure to the benefit of
the heirs, executors and administrators of such a person.

(k) The Court of Chancery is hereby vested with exclusive jurisdiction to
hear and determine all actions for advancement of expenses or
indemnification brought under this section, or under any bylaw,
agreement, vote of stockholders or disinterested directors, or
otherwise. The Court of Chancery may summarily determine a
corporation's obligation to advance expenses (including attorneys'
fees).

II-4

ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES.

Since January 1, 2006, we have issued and sold the following
securities:

In the period of January 2006 through April 2009, we issued 4,196,448
shares for payment of fees due to service providers. The issuance of these
securities was deemed to be exempt from registration under the Securities Act in
reliance on Section 4(2) of the Securities Act as a transaction by an issuer not
involving a public offering.

On June 23, 2004, the shareholders approved the Company's 2004 Equity
Incentive Plan. This plan authorizes the Board of Directors to grant
non-qualified and incentive stock options, stock appreciation rights,
restricited stock and other stock awards to officers, key employees, consultants
and advisors of the Company. A maximum of 8,000,000 shares of stock is reserved
for use under this plan. Unless sooner terminated, this equity plan will
continue in effect for 10 years. As of April 6, 2009 the Board of Directors had
authorized the grant of 7,226,090 options to the Officers, Directors and
Employees of the Company.

On June 20, 2007 the stockholders approved the Company's 2007 Equity
incentive plan. This plan authorizes the Board of Directors to grant
non-qualified and incentive tock options, stock appreciation rights, restricted
stock and other stock awards to officers, key employees, consultants and
advisors of the Company. A maximum of 8,000,000 shares of stock is reserved for
use under this plan. Unless sooner terminated, this equity plan will continue in
effect for 10 years. As of April 6, 2009, the Board of Directors has authorized
the grant of 1,450,000 options to CEO of the Company and 20,000 options to the
former CFO as part of his severance agreement.

On April 3, 2006, the Company issued five year options to a consultant
to purchase 5,000 shares exercisable at $3.60 per share.

On April 12, 2006, the Company issued 321,751 shares as a commitment
fee pursuant to a second common stock purchase agreement.

On July 3, 2006, the Company issued 61,728 shares of common stock to
Paul Griffin in exchange for the rights to certain patents and patents pending.

On July 26, 2006, the Company issued 250,000 shares to Stem Cell
Innovations, Inc. in exchange for the return of the rights to a 6% royalty on
sales of Interferon Products.

Since July 26, 2008, the Company has issued 330,356 shares of stock to
the Directors of the Company in accordance with the compensation package of the
Directors of the Company.

The above mentioned issuances of securities were deemed to be exempt
from registration under the Securities Act in reliance on Section 4(2) of the
Securities Act as a transaction by an issuer not involving a public offering.

II-5

ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

(a) Exhibits.

Except as disclosed in the footnotes, the following exhibits were filed with the
Securities and Exchange Commission as exhibits to our Form S-1 Registration
Statement (No. 33-93314) or amendments thereto and are hereby incorporated by
reference.

Exhibit
No. Description

2.1 First Asset Purchase Agreement dated March 11, 2003, by and between the
Company and ISI.(1) 2.2 Second Asset Purchase Agreement dated March 11, 2003, by
and between the Company and ISI.(1) 3.1 Amended and Restated Certificate of
Incorporation of the Company, as amended, along with Certificates of
Designations. (3) 3.1.1 Series E Preferred Stock.

3.2 Amended and Restated By-laws of Registrant. (17)
4.1 Specimen certificate representing our Common Stock.
4.2 Rights Agreement, dated as of November 19, 2002, between the Company
and Continental Stock Transfer & Trust Company. The Right Agreement
includes the Form of Certificate of Designation, Preferences and Rights
of the Series A Junior Participating Preferred Stock, the Form of
Rights Certificate and the Summary of the Right to Purchase Preferred
Stock.(2)
4.3 Form of 6% Convertible Debenture of the Company issued in March 2003.
(1)
4.4 Form of Warrant for Common Stock of the Company issued in March 2003.
(1)
4.5 Form of Warrant for Common Stock of the Company issued in June 2003.
(3)
4.6 Form of 6% Convertible Debenture of the Company issued in July 2003.
(4)
4.7 Form of Warrant for Common Stock of the Company issued in July 2003.
(4)
4.8 Form of 6% Convertible Debenture of the Company issued in October 2003.
(5)
4.9 Form of Warrant for Common Stock of the Company issued in October 2003.
(5)
4.10 Form of 6% Convertible Debenture of the Company issued in January 2004.
(6)
4.11 Form of Warrant for Common Stock of the Company issued in January 2004.
(6)
4.12 Form of Warrant for Common Stock of the Company. (9)
4.13 Amendment Agreement, effective October 6, 2005, by and among the
Company and debenture holders. (11)
4.14 Form of Series A amended 7% Convertible Debenture of the Company
(amending Debenture due October 31, 2005). (11)
4.15 Form of Series B amended 7% Convertible Debenture of the Company
(amending Debenture issued on January 26, 2004 and due January 31,
2006). (11)
4.16 Form of Series C amended 7% Convertible Debenture of the Company
(amending Debenture issued on July 13, 2004 and due January 31, 2006).
(11)
4.17 Form of Warrant issued effective October 6, 2005 for Common Stock of
the Company. (11)

II-6

4.18 Form of Commitment Warrant issued in February 2009 under the Standby
Financing Agreement. (22)
4.19 Form of Indenture filed with Universal shelf registration statement.
(18)
5.1 Opinion of Silverman Sclar Shin & Byrne PLLC, legal counsel.*
10.1 1990 Stock Option Plan.
10.2 1992 Stock Option Plan.
10.3 1993 Employee Stock Purchase Plan.
10.4 Form of Confidentiality, Invention and Non-Compete Agreement.
10.5 Form of Clinical Research Agreement.
10.6 Form of Collaboration Agreement.
10.7 Amended and Restated Employment Agreement by and between the Company
and Dr. William A. Carter, dated as of July 1, 1993. (7)
10.8 Employment Agreement by and between the Registrant and Robert E.
Peterson, dated April 1, 2001.
10.9 License Agreement by and between the Company and The Johns Hopkins
University, dated December 31, 1980.
10.10 Technology Transfer, Patent License and Supply Agreement by and between
the Company, Pharmacia LKB Biotechnology Inc., Pharmacia P-L
Biochemicals Inc. and E.I. du Pont de Nemours and Company, dated
November 24, 1987.
10.11 Pharmaceutical Use Agreement, by and between the Company and Temple
University, dated August 3, 1988.
10.12 Assignment and Research Support Agreement by and between the Company,
Hahnemann University and Dr. David Strayer, Dr. lsadore Brodsky and Dr.
David Gillespie, dated June 30, 1989.
10.13 Lease Agreement between the Company and Red Gate Limited Partnership,
dated November 1, 1989, relating to the Company's Rockville, Maryland
facility.
10.14 Agreement between the Company and Bioclones (Proprietary) Limited.
10.15 Amendment, dated August 3, 1995, to Agreement between the Company and
Bioclones (Proprietary) Limited (contained in Exhibit 10.14).
10.16 Licensing Agreement with Core BioTech Corp.
10.17 Licensing Agreement with BioPro Corp.
10.18 Licensing Agreement with BioAegean Corp.
10.16 Agreement with Esteve.
10.17 Agreement with Accredo (formerly Gentiva) Health Services.
10.18 Agreement with Biovail Corporation International.
10.22 Forbearance Agreement dated March 11, 2003, by and between ISI, the
American National Red Cross and the Company. (1)
10.23 Forbearance Agreement dated March 11, 2003, by and between ISI, GP
Strategies Corporation and the Company. (1)
10.24 Securities Purchase Agreement, dated March 12, 2003, by and among the
Company and the Buyers named therein. (1)

II-7

10.25 Registration Rights Agreement, dated March 12, 2003, by and among the
Company and the Buyers named therein. (1)
10.23 Securities Purchase Agreement, dated July 10, 2003, by and among the
Company and the Buyers named therein. (4)
10.24 Registration Rights Agreement, dated July 10, 2003, by and among the
Company and the Buyers named therein. (4)
10.25 Securities Purchase Agreement, dated October 29, 2003, by and among the
Company and the Buyers named therein.(5)
10.26 Registration Rights Agreement, dated October 29, 2003, by and among the
Company and the Buyers named therein.(5)
10.27 Securities Purchase Agreement, dated January 26, 2004, by and among the
Company and the Buyers named therein.(6)
10.28 Registration Rights Agreement, dated January 26, 2004, by and among the
Company and the Buyers named therein.(6)
10.29 Memorandum of Understanding with Fujisawa. (8)
10.30 Securities Purchase Agreement, dated July 30, 2004, by and among the
Company and the Purchasers named therein.(9)
10.31 Registration Rights Agreement, dated July 30, 2004, by and among the
Company and the Purchasers named therein. (9)
10.32 Agreement for services of R. Douglas Hulse, (12)
10.33 Amended and Restated Employment Agreement of Dr. William A. Carter.
(10)
10.34 Engagement Agreement with Dr. William A. Carter. (10)
10.35 Amended and restated employment agreement of Dr. William A. Carter (12)
10.36 Amended and restated engagement agreement with Dr. William A. Carter
(12)
10.37 Amended and restated engagement agreement with Robert E. Peterson (12)
10.38 Engagement Agreement with Ransom W. Etheridge (12)
10.39 Change in control agreement with Dr. William A. Carter (12)
10.40 Change in control agreement with Dr. William A. Carter (12)
10.41 Change in control agreement with Robert E. Peterson (12)
10.42 Change in control agreement with Ransom Etheridge (12)
10.43 Supply Agreement with Hollister-Stier Laboratories LLC
10.47 Manufacturing and Safety Agreement with Hyaluron, Inc.
10.48 Common Stock Purchase Agreement, dated July 8, 2005, by and among the
Company and Fusion Capital Fund II, LLC.(13)
10.49 Registration Rights Agreement, dated July 8, 2005, by and among the
Company and Fusion Capital Fund II, LLC.(13)
10.48 Common Stock Purchase Agreement, dated April 12, 2006, by and among the
Company and Fusion Capital Fund II, LLC.(14)z
10.49 Registration Rights Agreement, dated April 12, 2006, by and among the
Company and Fusion Capital Fund II, LLC.(14)
10.50 Supply Agreement with Hollister-Stier Laboratories LLC. (15)
10.51 Manufacturing and Safety Agreement with Hyaluron, Inc. (15)
10.52 April 19, 2006 Amendment to Common Stock Purchase Agreement by and
among the Company and Fusion Capital Fund II, LLC.(15)
10.53 July 21, 2006 Letter Amendment to Common Stock Purchase Agreement by
and among the Company and Fusion Capital Fund II, LLC.(15)
10.54 Royalty Purchase Agreement with Stem Cell Innovations, Inc. (15)
10.55 Biken Activating Agreement. (16)
10.56 Biken Material Evaluation Agreement. (16)
10.57 Common Stock Purchase Agreement, dated July 2, 2008, by and among the
Company and Fusion Capital.(19)

II-8

10.58 Registration Rights Agreement, dated July 2, 2008, by and among the
Company and Fusion Capital.(19)
10.59 Amendment to Common Stock Purchase Agreement, dated July 23, 2008, by
and among the Company and Fusion Capital.(20)
10.60 Employee Wage Or Hours Reduction Program. (22)
10.61 Standby Financing Agreement. (22)
10.62 Engagement Agreement with Charles T. Bernhardt, CPA. (22)
10.63 Goal Achievement Incentive Award Program. (21)
21 Subsidiaries of the Registrant.
23.1 McGladrey & Pullen, LLP consent.**
23.3 Consent of Silverman Sclar Shin & Byrne PLLC, legal counsel (included
in Exhibit 5.1).
24.1 Powers of Attorney (included in Signature Pages to this Registration
Statement).*
---------------------------------
* Previously filed.
** Filed herewith.

(1) Filed with the Securities and Exchange Commission as an exhibit to the
Company's Current Report on Form 8-K (No. 1-13441) dated March 12, 2003 and is
hereby incorporated by reference.

(2) Filed with the Securities and Exchange Commission on November 20, 2002 as an
exhibit to the Company's Registration Statement on Form 8-A (No. 0-27072) and is
hereby incorporated by reference.

(3) Filed with the Securities and Exchange Commission as an exhibit to the
Company's Current Report on Form 8-K (No. 1-13441) dated June 27, 2003 and is
hereby incorporated by reference.

(4) Filed with the Securities and Exchange Commission as an exhibit to the
Company's Current Report on Form 8-K (No. 1-13441) dated July 14, 2003 and is
hereby incorporated by reference.

(5) Filed with the Securities and Exchange Commission as an exhibit to the
Company's Current Report on Form 8-K (No. 1-13441) dated October 30, 2003 and is
hereby incorporated by reference.

(6) Filed with the Securities and Exchange Commission as an exhibit to the
Company's Current Report on Form 8-K (No. 1-13441) dated January 27, 2004 and is
hereby incorporated by reference.

(7) Filed with the Securities and Exchange Commission as an exhibit to the
Company's quarterly report on Form 10-Q (No. 1-13441) for the period ended
September 30, 2001 and is hereby incorporated by reference.

(8) Filed with the Securities and Exchange Commission as an exhibit to the
Company's Form S-1 Registration Statement (No. 333-113796) and is hereby
incorporated by reference.

II-9

(9) Filed with the Securities and Exchange Commission as an exhibit to the
Company's Current Report on Form 8-K (No. 1-13441) dated August 6, 2004 and is
hereby incorporated by reference.

(10) Filed with the Securities and Exchange Commission as an exhibit to the
Company's Current Report on Form 8-K (No. 1-13441) dated September 15, 2004 and
is hereby incorporated by reference.

(11) Filed with the Securities and Exchange Commission as an exhibit to the
Company's Current Report on Form 8-K/A-1 (No. 1-13441) filed on October 28, 2005
and is hereby incorporated by reference.

(12) Filed with the Securities and Exchange Commission as an exhibit to the
Company's annual report on Form 10-K (No. 1-13441) for the year ended December
31, 2004 and is hereby incorporated by reference.

(13) Filed with the Securities and Exchange Commission as an exhibit to the
Company's Current Report on Form 8-K (No. 1-13441) dated September 15, 2005 and
is hereby incorporated by reference.

(14) Filed with the Securities and Exchange Commission as an exhibit to the
Company's Current Report on Form 8-K (No. 1-13441) dated April 12, 2006 and is
hereby incorporated by reference.

(15) Filed with the Securities and Exchange Commission on July 31, 2006 as an
exhibit to the Company's Form S-1 Registration Statement (No. 333-136187) and is
hereby incorporated by reference.

(16) Filed with the Securities and Exchange Commission as an exhibit to the
Company's Current Report on Form 8-K (No. 1-13441) dated December 13, 2007 and
is hereby incorporated by reference.

(17) Filed with the Securities and Exchange Commission as an exhibit to the
Company's Current Report on Form 8-K (No. 1-13441) filed October 22, 2008 and is
hereby incorporated by reference.

(18) Filed with the Securities and Exchange Commission as an exhibit to the
Company's Form S-3 Registration Statement (No. 333-151696) and is hereby
incorporated by reference.

(19) Filed with the Securities and Exchange Commission as an exhibit to the
Company's Current Report on Form 8-K (No. 1-13441) filed July 8, 2008 and is
hereby incorporated by reference.

(20) Filed with the Securities and Exchange Commission as an exhibit to the
Company's quarterly report on Form 10-Q (No. 1-13441) for the period ended June
30, 2008 and is hereby incorporated by reference.

II-10

(21) Filed with the Securities and Exchange Commission as an exhibit to the
Company's Current Report on Form 8-K (No. 1-13441) filed November 28, 2008 and
is hereby incorporated by reference.

(22) Filed with the Securities and Exchange Commission as an exhibit to the
Company's annual report on Form 10-K (No. 1-13441) for the year ended December
31, 2008 and is hereby incorporated by reference.

(b) Financial Statements and Schedules - See index to financial statements on
page F-1 of the Company's Annual Report on Form 10-K for the year ended December
31, 2008, incorporated by reference herein. All other schedules called for under
regulation S-X are not submitted because they are not applicable or not
required, or because the required information is included in the financial
statements or notes thereto.

ITEM 17. UNDERTAKINGS

(a) The undersigned registrant hereby undertakes:

(1) To file, during any period in which offers or sales of securities are
being made, a post-effective amendment to this registration statement:

i. To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;

ii. To reflect in the prospectus any facts or events which,
individually or in the aggregate, represent a fundamental change in the
information in the registration statement; and notwithstanding the
foregoing, any increase or decrease in volume of securities offered (if
the total dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in the
aggregate, the changes in the volume and price represent no more than a
20 percent change in the maximum aggregate offering price set forth in
the "Calculation of Registration Fee" table in the effective
registration statement.

iii. To include any additional or changed material information on the
plan of distribution.

(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.

(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination
of the offering.

(4) That, for determining liability under the Securities Act of 1933 to
any purchaser:

II-11

i. If the registrant is relying on Rule 430B:

(A) Each prospectus filed by the registrant pursuant to Rule
424(b)(3) shall be deemed to be part of the registration statement
as of the date the filed prospectus was deemed part of and included
in the registration statement; and

(B) Each prospectus required to be filed pursuant to Rule
424(b)(2), (b)(5), or (b)(7) as part of a registration statement in
reliance on Rule 430B relating to an offering made pursuant to Rule
415(a)(1)(i), (vii), or (x) for the purpose of providing the
information required by section 10(a) of the Securities Act of 1933
shall be deemed to be part of and included in the registration
statement as of the earlier of the date such form of prospectus is
first used after effectiveness or the date of the first contract of
sale of securities in the offering described in the prospectus. As
provided in Rule 430B, for liability purposes of the issuer and any
person that is at that date an underwriter, such date shall be
deemed to be a new effective date of the registration statement
relating to the securities in the registration statement to which
that prospectus relates, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering
thereof. Provided, however, that no statement made in a
registration statement or prospectus that is part of the
registration statement or made in a document incorporated or deemed
incorporated by reference into the registration statement or
prospectus that is part of the registration statement will, as to a
purchaser with a time of contract of sale prior to such effective
date, supersede or modify any statement that was made in the
registration statement or prospectus that was part of the
registration statement or made in any such document immediately
prior to such effective date; or

ii. If the registrant is subject to Rule 430C, each prospectus filed
pursuant to Rule 424(b) as part of a registration statement relating to
an offering, other than registration statements relying on Rule 430B or
other than prospectuses filed in reliance on Rule 430A, shall be deemed
to be part of and included in the registration statement as of the date
it is first used after effectiveness. Provided, however, that no
statement made in a registration statement or prospectus that is part
of the registration statement or made in a document incorporated or
deemed incorporated by reference into the registration statement or
prospectus that is part of the registration statement will, as to a
purchaser with a time of contract of sale prior to such first use,
supersede or modify any statement that was made in the registration
statement or prospectus that was part of the registration statement or
made in any such document immediately prior to such date of first use.

(5) That, for the purpose of determining liability of the registrant under
the Securities Act of 1933 to any purchaser in the initial distribution of
the securities: The undersigned registrant undertakes that in a primary
offering of securities of the undersigned registrant pursuant to this
registration statement, regardless of the underwriting method used to sell
the securities to the purchaser, if the securities are offered or sold to
such purchaser by means of any of the following communications, the
undersigned registrant will be a seller to the purchaser and will be
considered to offer or sell such securities to such purchaser:

II-12

i.Any preliminary prospectus or prospectus of the undersigned registrant
relating to the offering required to be filed pursuant to Rule 424;

ii.Any free writing prospectus relating to the offering prepared by or on
behalf of the undersigned registrant or used or referred to by the
undersigned registrant;

iii.The portion of any other free writing prospectus relating to the
offering containing material information about the undersigned
registrant or its securities provided by or on behalf of the
undersigned registrant; and

iv.Any other communication that is an offer in the offering made by the
undersigned registrant to the purchaser.

(b) Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the provisions described herein, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.

(d) The undersigned registrant hereby undertakes that:

(1) For purposes of determining any liability under the Securities Act of
1933, the information omitted from the form of prospectus filed as part of
this registration statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.

(2) For the purpose of determining liability under the Securities Act to
any purchaser, each prospectus filed pursuant to Rule 424(b) as part of
this registration statement relating to the offering, shall be deemed to
be part of and included in the registration statement as of the date it is
first used after effectiveness. Provided, however, that no statement made
in the registration statement or prospectus that is part of the
registration statement or made in a document incorporated or deemed
incorporated by reference into the registration statement or prospectus
that is part of the registration statement will, as to a purchaser with a
time of contract of sale prior to such first use, supersede or modify any
statement that was made in the registration statement or prospectus that
was part of the registration statement or made in any such document
immediately prior to such date of first use.

II-13

SIGNATURES

Pursuant to the requirement of the Securities Act of 1933, this Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-1 and has duly caused this Post-Effective
amendment No. 1 to the Registrant's registration statement to be signed on its
behalf by the undersigned, thereunto duly authorized in the City of
Philadelphia, Commonwealth of Pennsylvania, on the eighth day of April, 2009.

HEMISPHERX BIOPHARMA, INC.
(Registrant)

By: /s/ William A. Carter
----------------------
William A. Carter, M.D.,
Chief Executive Officer

Pursuant to the requirements of the Securities Act of 1933, this Post-Effective
Amendment No. 2 to the Registrant's registration statement has been signed by
the following persons in the capacities indicated on the dates indicated.

Signature Title Date
---------------------- ------------------------- ---------------

/s/ William A. Carter Chairman of the Board,
---------------------- Chief Executive Officer
William A. Carter, M.D. (Principal Executive) and Director April 08, 2009

*
--------------------- Director
Richard C. Piani
April 08, 2009

/s/ Charles T. Bernhardt Chief Financial Officer and
------------------------ Chief Accounting
Charles T. Bernhardt Officer April 08, 2009

/s/ Thomas K. Equels Director
--------------------
Thomas K. Equels April 08, 2009

* Director
-----------------
William M. Mitchell, M.D., Ph.D. April 08, 2009

*
----------------- Director
Iraj-Eqhbal Kiani, Ph.D. April 08, 2009

* By:/s/ William A. Carter
----------------------
William A. Carter, M.D.,
Attorney-in-Fact

Hemispherx Biopharma, Inc.
Post-Effective Amendment No. 1 on Form S-1
to Registration Statement on Form S-3
Index to Exhibits

Exhibit No. Description

21 Subsidiaries of the Registrant.

23.1 Consent of McGladrey & Pullen, LLP, independent registered public
accounting firm.

Exhibit 21

Subsidiaries

Jurisdiction
Name of incorporation Status
---- ---------------- -------

US Subsidiaries:
---------------

BioPro Corp. Delaware Dormant

BioAegean Corp. Delaware Dormant

Core BioTech Corp. Delaware Dormant

Foreign Subsidiaries:
--------------------

Hemispherx Biopharma Europe N.V./S.A. Belgium Inactive

Hemispherx Biopharma Europe S.A. (Luxembourg) Dissolved

Exhibit 23.1

Consent of Independent Registered Public Accounting Firm

Hemispherx Biopharma, Inc.
Philadelphia, Pennsylvania

We consent to the incorporation by reference in Post-Effective Amendment No. 1
on Form S-1 to the Registration Statement (No. 333-152727) on Form S-3 of
Hemispherx Biopharma, Inc. and Subsidiaries of our reports dated March 13, 2009
relating to our audit of the consolidated financial statements and the financial
statement schedule, and internal control over financial reporting, which appear
in the Annual Report on Form 10-K of Hemispherx Biopharma, Inc. and Subsidiaries
for the year ended December 31, 2008.

We also consent to the reference to our firm under the caption "Experts" in the
Prospectus, which is part of this Registration Statement.

/s/ McGladrey & Pullen LLP
McGladrey & Pullen, LLP
Blue Bell, Pennsylvania
April 08, 2009