UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

Under the Securities Exchange Act of 1934

(Amendment No. 2)*

Marina Biotech, Inc.

(Name of Issuer)

Common Stock, par value $0.006 per share

(Title of Class of Securities)

56804Q102

(CUSIP Number)

Ford S. Worthy, Esq.

Pappas Ventures

2520 Meridian Parkway

Suite 400

Durham, NC 27713

(919) 998-3300

(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)

July 6, 2011

(Date of Event which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box:  ¨

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7 for other parties to whom copies are to be sent.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

Schedule 13D

EXPLANATORY NOTE: The following constitutes Amendment No. 2 to the Schedule 13D filed by the Reporting Persons (“Amendment No. 2”). This Amendment No. 2 amends and supplements the Schedule 13D filed with the Securities and Exchange Commission on August 2, 2010, as amended by Amendment No. 1 on May 31, 2011 (the “Schedule 13D”), as specifically set forth herein. Capitalized terms used in this Amendment No. 2 but not otherwise defined herein have the meanings set forth in the Schedule 13D.

Item 3 of the Schedule 13D is hereby amended and supplemented by adding the following:

On July 6, 2011, the Pappas Funds exercised all their Series B Warrants at a price of $0.128 per warrant, which resulted in the acquisition of 1,600,000 shares of Common Stock of the Issuer and 1,600,000 Series A Warrants. The aggregate exercise price was $204,800, the source of which was available working capital and investment capital in the Pappas Funds. The Series A Warrants are not exercisable within the next 60 days. Therefore, the underlying shares of Common Stock of the Issuer for which the Series A Warrants are exercisable are not reported as shares beneficially owned by the Reporting Persons herein.

Item 4 of the Schedule 13D is hereby amended and restated in its entirety by the following:

The Reporting Persons acquired the shares of Common Stock for investment purposes. Subject to, among other things, the Issuer’s business prospects, prevailing prices, and market conditions, the Reporting Persons may dispose of or purchase additional shares of Common Stock and/or other securities of the Issuer from time to time in the open market, in privately negotiated transactions, or otherwise.

Additionally, the Pappas Funds plan to dispose of 32,897 shares of Common Stock of the Issuer by transferring them to Employees pursuant to the Transfer and Sale Agreements. This disposition is expected to occur by August 2011.

Except as may be set forth in this Schedule 13D, the Reporting Persons have no plans or proposals which would relate or result in any of the matters set forth below:

Subparagraphs (a) and (b) of Item 5 of the Schedule 13D are hereby amended and restated in their entirety by the following:

As of the date of this Amendment No. 2:

(i) Pappas Ventures III directly owns, and has shared power to vote or to direct the vote of, and shared power to dispose or to direct the disposition of, 5,005,195 shares of Common Stock of the Issuer, which represents approximately 8.5% of the Issuer’s outstanding Common Stock;

(ii) CEO III directly owns, and has shared power to vote or to direct the vote of, and shared power to dispose or to direct the disposition of, 311,178 shares of Common Stock of the Issuer, which represents approximately 0.5% of the Issuer’s outstanding Common Stock;

(iii) Management III is the general partner of each of the Pappas Funds, and has a management agreement with Pappas whereby Pappas provides management services for the Pappas Funds. Consequently Management III may be deemed to be the beneficial owner of any shares owned directly by the Pappas Funds. Management III disclaims beneficial ownership of the shares held by the Pappas Funds, except to the extent of its pecuniary interest therein; and

(iv) Due to its arrangements with the Pappas Funds, Pappas’s investment committee has sole power to vote or to direct the vote of, and sole power to dispose or to direct the disposition of, 5,316,373 shares of Common Stock of the Issuer, which represents approximately 9.1% of the Issuer’s outstanding Common Stock.

Subparagraph (c) of Item 5 of the Schedule 13D is hereby amended and supplemented by adding the following:

(c) In the past 60 days, the Reporting Persons effected the following additional transactions in the Common Stock of the Issuer:

SIGNATURES

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

Dated: July 20, 2011