SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                            -------------------------

                                    FORM 8-K

                                 CURRENT REPORT

                         Pursuant to Section 13 or 15(d)
                     of the Securities Exchange Act of 1934

         Date of Report (Date of earliest event reported): July 20, 2004

                                  VAXGEN, INC.
             (Exact name of Registrant as Specified in its Charter)


          DELAWARE                       0-26483                94-3236309
(State or other jurisdiction of  (Commission File Number)   (I.R.S. Employer
 incorporation or organization)                           Identification Number)

            1000 MARINA BLVD., SUITE 200, BRISBANE, CALIFORNIA 94005
                  (Address of Principal Administrative Offices)

       Registrant's Telephone Number, Including Area Code: (650) 624-1000


Item 5.  Other Events and Regulation FD Disclosure.

      On July 19, 2004 VaxGen Inc. announced that it intends to restate its
financial statements for the years ended December 31, 2003 and 2002.
Accordingly, annual and quarterly reports previously filed with the Securities
and Exchange Commission for these periods should not be relied upon. For further
information in this regard, please refer to VaxGen's report on Form 8-K filed on
July 20, 2004.

      On July 20, 2004, VaxGen, Inc. received a letter from its former
independent auditors, KPMG LLP, advising that because of VaxGen's announcement
referred to above, it is KPMG's understanding that the management
representations previously provided in connection with the audit of those
financial statements have been withdrawn and, accordingly, they could no longer
continue to be associated with the 2002 and 2003 financial statements and that
their reports on VaxGen's 2002 and 2003 financial statements should no longer be
relied upon. In its letter to VaxGen, KPMG has asked VaxGen to inform investors
and others that they should not rely on the 2002 and 2003 financial statements
and related reports.

      The letter is attached as Exhibit 99.1 to this report and is incorporated
herein by reference.

Item 7.  Financial Statements, Pro Forma Financial Information and Exhibits.

      (a)   Financial Statements. Not applicable
      (b)   Financial Information. Not applicable
      (c)   Exhibits.

Exhibit No.       Description

99.1              Letter dated July 20, 2004 from KPMG LLP to the Board of
                  Directors, VaxGen, Inc.


                                    SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.


                                                 VaxGen, Inc.
                                                 (Registrant)

Dated: July 20, 2004                           By: /s/ James M. Cunha
                                                   -----------------------------
                                                   James M. Cunha
                                                   Chief Financial Officer