WARRANT ToPurchase Shares of Common Stock of AVI BIOPHARMA, INC. June20, 2001

Exhibit 10.37

THIS WARRANT, AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE HEREOF, HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS AND MAY NOT BE REOFFERED OR SOLD, TRANSFERRED, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF, EXCEPT PURSUANT TO (1) REGISTRATION OR (2) AN OPINION OF COUNSEL FOR THE COMPANY OR OTHER COUNSEL REASONABLY ACCEPTABLE TO THE COMPANY TO THE EFFECT THAT SUCH REGISTRATION IS NOT REQUIRED.  THIS WARRANT IS ALSO SUBJECT TO THE TERMS OF AN INVESTMENT AGREEMENT DATED MAY 22, 2001.

WARRANT

To Purchase Shares of Common Stock of

AVI BIOPHARMA, INC.

June 20, 2001

             AVI BioPharma, Inc., an Oregon corporation (the “Company”), for value received, hereby certifies that Medtronic Asset Management, Inc., a Minnesota corporation, or its registered assigns (the “Holder”) is entitled, subject to the terms set forth below, upon exercise of this Warrant to purchase from the Company 3,000,000 shares of Common Stock, $0.0001 par value, of the Company (as further defined in Section 5 below, “Common Stock”). Until adjusted as provided by the terms of this Warrant, the exercise price per share (the “Exercise Price”) shall be $10.  The shares issuable upon exercise of this Warrant, as adjusted from time to time pursuant to the provisions of this Warrant, are hereinafter referred to as the “Warrant Shares.”

             This Warrant is further subject to the following provisions, terms and conditions:

             1.          Term. Subject to Section 13 below, this Warrant may be exercised by the Holder, in whole or in part, at any time before the close of business on the date five years after the date hereof.

             2.          Manner of Exercise.  This Warrant may be exercised by the Holder, in whole or in part (but not as to any fraction of a share of Common Stock), by surrendering this Warrant, with the Exercise Form attached hereto as Exhibit A filled in and duly executed by such Holder or by such Holder’s duly authorized attorney, to the Company at its principal office accompanied by payment of the Exercise Price in the amount of the Exercise Price multiplied by the number of shares as to which the Warrant is being exercised.  The Exercise Price may be paid in the form of a check or wire transfer of funds.

             3.          Effective Date of Exercise.  Each exercise of this Warrant shall be deemed effective as of the close of business on the day on which this Warrant is surrendered to the Company as provided in Section 2 or Section 3(a) above.  At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise shall be deemed to have become the holder or holders of record of the Warrant Shares represented by such certificates.  Within 10 days after the exercise of this Warrant in full or in part, the Company will, at its expense, cause to be issued in the name of and delivered to the Holder or such other person as the Holder may (upon payment by such Holder of any applicable transfer taxes) direct:  (i) a certificate or certificates for the number of full Warrant Shares to which such Holder is entitled upon such exercise, and (ii) unless this Warrant has expired, a new Warrant or Warrants (dated the date hereof and in form identical hereto) representing the right to purchase the remaining number of shares of Common Stock, if any, with respect to which this Warrant has not then been exercised.

             4.          Adjustments to Exercise Price.  The above provisions are, however, subject to the following:

                                        E¹ = E x (O x M) - F
                                                         O x M

             5.          Common Stock.  As used herein, the term “Common Stock” shall mean and include the Company’s presently authorized shares of common stock and shall also include any capital stock of any class of the Company hereafter authorized that is not limited to a fixed sum or percentage in respect of the rights of the holders thereof to participate in dividends or in the distribution, dissolution or winding up of the Company.

             6.          No Voting Rights.  This Warrant shall not entitle the Holder to any voting rights or other rights as a shareholder of the Company unless and until exercised or converted pursuant to the provisions hereof.

             7.          Exercise or Transfer of Warrant or Resale of Common Stock.  The Holder, by acceptance hereof, agrees to give written notice to the Company before exercising this Warrant, or transferring this Warrant, in whole or in part, or transferring any shares of Common Stock issued upon the exercise hereof, of such Holder’s intention to do so, describing briefly the manner of any proposed transfer.  Such notice shall include an opinion of counsel reasonably satisfactory to the Company that (i) the proposed exercise or transfer may be effected without registration or qualification under the Securities Act of 1933, as amended (the “Act”), and any applicable state securities or blue sky laws, or (ii) the proposed exercise or transfer has been registered under such laws.  Upon delivering such notice, such Holder shall be entitled to exercise or transfer this Warrant or such Warrant Shares, all in accordance with the terms of the notice delivered by such Holder to the Company; provided, that an appropriate legend may be endorsed on the certificates for such shares respecting restrictions upon transfer thereof necessary or advisable in the opinion of counsel to the Company to prevent further transfer that would be in violation of Section 5 of the Act and applicable state securities or blue sky laws.

             If in the opinion of counsel to the Company or other counsel reasonably acceptable to the Company the proposed exercise, transfer or disposition of this Warrant or the Warrant Shares described in the written notice given pursuant to this Section 8 may not be effected without registration of this Warrant or the Warrant Shares, the Company shall promptly give written notice thereof to the Holder within 10 days after the Company receives such notice, and such holder will limit its activities in respect to such as, in the opinion of such counsel, is permitted by law.

             Further, notwithstanding anything above to the contrary, this Warrant may not be transferred by the Holder hereof in warrant form except to a subsidiary of the Holder.

             8.          Covenants of the Company.  The Company covenants and agrees that all shares that may be issued upon exercise of this Warrant will, upon issuance, be duly authorized and issued, fully paid, nonassessable and free from all taxes, liens and charges with respect to the issuance thereof.  The Company further covenants and agrees that the Company will at all times have authorized, and reserved for the purpose of issuance upon exercise hereof, a sufficient number of shares of its Common Stock to provide for the exercise of this Warrant.

             9.          Certain Notices.  The Holder shall be entitled to receive from the Company immediately upon declaration thereof and at least 20 days prior to the record date for determination of shareholders entitled thereto or to vote thereon (or, if no record date is set, prior to the event), written notice of any event that could require an adjustment pursuant to Section 5 hereof or of the dissolution or liquidation of the Company.  All notices under this Warrant shall be in writing and shall be delivered personally or by telecopy (receipt confirmed) to such party (or, in the case of an entity, to an executive officer of such party) or shall be sent by a reputable express delivery service or by certified mail, postage prepaid with return receipt requested, addressed as follows:

if to the Holder, to:

             Medtronic, Inc.
             710 Medtronic Parkway NE
             Minneapolis, MN ###-###-####

             with separate copies thereof addressed to

if to the Company to:

             AVI BioPharma, Inc.
             One SW Columbia
             Portland, OR 97258
             Attn: President

With separate copies to:

             Robert A. Stout, Esq.
             HURLEY, LYNCH & RE, P,.C.
             747 SW Industrial Way
             Bend, OR  97702

             Any party may change the above–specified recipient and/or mailing address by notice to all other parties given in the manner herein prescribed.  All notices shall be deemed given on the day when actually delivered as provided above (if delivered personally or by telecopy) or on the day shown on the return receipt (if delivered by mail or delivery service).

             10.        Registration Rights.  The Holders of this Warrant and the Warrant Shares are entitled to the rights and benefits of all of the terms, provisions and conditions of that certain  Registration Rights Agreement dated of even date herewith between the Company and Medtronic Asset Management, Inc., provided an express sharing or assignment of such rights and benefits is made to each such Holder by such Holder’s transferor.  Notwithstanding the foregoing or any provisions of the Registration Rights Agreement to the contrary, the Holder agrees not to sell or transfer any Warrant Shares for at least thirty-two (32) days after conversion or exercise of this Warrant which resulted in the issuance of such Warrant Shares.

             11.        Miscellaneous.

             12.        Cancellation Rights.  The Company may cancel this Warrant, to the extent it remains unexercised, at any time if the Daily Price has exceeded $20.00 for 20 consecutive trading days immediately preceding the date of notice of such cancellation, upon 190 days' notice given in accordance with Section 10 and Holder’s failure to exercise this Warrant within such notice period.  No consideration or price shall be payable by the Company for such cancellation.  For the purpose of the foregoing sentence, the term "Daily Price" shall mean, for any relevant day, the closing bid price on that day as reported by the principal exchange or quotation system on which prices for the Common Stock are reported, and such $20.00 shall be subject to adjustment in the same manner in which the Exercise Price is subject to adjustment under Section 4 and the Holder is entitled to notice thereof under Section 4(d).  The Holder may exercise this Warrant in whole or in part at any time during such 190-day notice period.  This Warrant shall no longer be exercisable in whole or in part from and after the 191^st day after such notice.

             IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by its authorized officer and dated as of the date stated above.