The efficacy of Zylexis®, an immunomodulator in horses based on inactivated Parapoxvirus ovis (iPPVO), was assessed using an equine herpesvirus type 1 (EHV-1) challenge model in the presence of a natural infection with Streptococcus equi equi (S. equi). Eleven horses were treated with iPPVO and twelve were kept as controls. Six horses were challenged with EHV-1 and commingled with the horses on study. Animals were dosed on Days −2, 0 (just before commingling) and Day 7. On Day 11 significantly less nasal discharge, enlarged lymph nodes, EHV-1 shedding and lower rectal temperatures were observed in the iPPVO-treated group. In addition, iPPVO-treated horses showed significantly fewer enlarged lymph nodes on Days 17 and 19, significantly less lower jaw swelling on Day 3 and significantly lower rectal temperatures on Days 12 and 13. Dyspnoea, depression and anorexia were only recorded for the control group. Following challenge seven out of 11 horses in the iPPVO treated group shed EHV-1 but on Days 11, 12, 13, 14, 15 and 16 quantitative virus detection in this group was significantly lower as compared to the controls. All animals shed S. equi but the percentage of animals with positive bacterial detection was lower in the iPPVO group than in the control group from Day 14 through Day 28. This difference was significant on Day 24. No injection site reactions or adverse events were observed. In conclusion, Zylexis administration is safe and reduced clinical signs and shedding related to both EHV-1 and S. equi infections.