Oncolytics Biotech(R) Inc. Announces Public Offering



    
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    CALGARY, May 1 /CNW/ - Oncolytics Biotech Inc. ("Oncolytics") (TSX:ONC;
NASDAQ:  ONCY) announced today that it has entered into an engagement agreement
with Bolder Investment Partners, Inc. ("Bolder") in connection with a proposed
equity financing.
    The proposed offering will consist of up to three million units at $2.00
per unit, for gross proceeds of up to $6.0 million. Each unit will consist of
one common share and one common share purchase warrant. Each common share
purchase warrant will entitle the holder thereof to purchase one common share
at an exercise price of $2.40 per share for a three year period, subject to an
acceleration of the expiry date in certain circumstances.
    Bolder will be granted an over-allotment option to purchase up to an
additional 450,000 units at the same price as the offering. The over-allotment
option will be exercisable on the business day prior to the closing date of
the offering.
    In connection with the offering and upon the entering into of an
underwriting agreement with Bolder, Oncolytics will file in British Columbia,
Alberta, Manitoba and Ontario a prospectus supplement to its base shelf
prospectus dated June 16, 2008. The offering is expected to close the week of
May 11, 2009 and is subject to the receipt of all necessary regulatory and
stock exchange approvals.
    The net proceeds from this offering will be used by Oncolytics for its
clinical trial program, manufacturing activities in support of the clinical
trial program and for the company's general corporate purposes.

    Oncolytics is a Calgary-based biotechnology company focused on the
development of oncolytic viruses as potential cancer therapeutics. Oncolytics'
clinical program includes a variety of Phase I/II and Phase II human trials
using REOLYSIN(R), its proprietary formulation of the human reovirus, alone
and in combination with radiation or chemotherapy. For further information
about Oncolytics, please visit www.oncolyticsbiotech.com

    This press release contains forward-looking statements. Forward-looking
statements, including the Company's expectations related to the placement of
the units, as to progress in the clinical trial program and the Company's
belief as to the potential of REOLYSIN as a cancer therapeutic, involve known
and unknown risks and uncertainties, which could cause the Company's actual
results to differ materially from those in the forward-looking statements.
Such risks and uncertainties include, among others, ability of the Company to
complete the offering on the terms set forth in its agreements, the Company's
ability to obtain regulatory approval for the offering, the availability of
funds and resources to pursue Research and Development projects, the efficacy
of REOLYSIN as a cancer treatment, the success and timely completion of
clinical studies and trials, the Company's ability to successfully
commercialize REOLYSIN, uncertainties related to the research and development
of pharmaceuticals, uncertainties related to the regulatory process and
general changes to the economic environment. Investors should consult the
Company's quarterly and annual filings with the Canadian securities
commissions for additional information on risks and uncertainties relating to
the forward looking statements. Investors are cautioned against placing undue
reliance on forward-looking statements. The Company does not undertake to
update these forward-looking statements, except as may be required pursuant to
applicable securities laws.

    The securities to be issued by Oncolytics have not and will not be
registered under the United States Securities Act of 1933, as amended (the
"1933 Act"), or the securities laws of any state of the United States, and may
not be offered or sold in the United States absent registration or an
applicable exemption therefrom under the 1933 Act and the securities laws of
all applicable states. This press release is not an offer of securities in the
United States.

    %SEDAR: 00013081E




For further information:

For further information: Oncolytics Biotech Inc., Cathy Ward, 210, 1167
Kensington Cr NW, Calgary, Alberta, T2N 1X7, Tel: (403) 670-7377, Fax: (403)
283-0858, cathy.ward@oncolytics.ca; The Equicom Group, Nick Hurst, 600, 205
5th Ave. SW, Calgary, Alberta, T2P 2V7, Tel: (403) 538-4845, Fax: (403)
266-2453, nhurst@equicomgroup.com


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