Concerned Shareholders of Bioniche Respond to Board and Management Plan to Dilute Shareholders

• Board's decision to dilute shareholders an offensive attempt to add votes at upcoming Special Meeting of Shareholders
• Decision comes in the face of overwhelming shareholder opposition and after Bioniche's CFO told shareholders that a dilutive equity issue "would be disastrous for our shareholders at today's prices…"
• Concerned Shareholders commit that a new Board will investigate the historical actions of the previous regime in an effort to recover shareholder value
• Bioniche misleading shareholders on the risks and timing associated with Urocidin
• Join the Concerned Shareholder Campaign for A Better Future for Bioniche by visiting www.savebioniche.com

TORONTO, Aug. 8, 2013 /CNW/ - The Concerned Shareholders of Bioniche Life Sciences Inc. ("Bioniche"), William (Bill) M. Wells, former Chief Executive Officer of Biovail Corporation, and Greg Gubitz, former General Counsel and Senior Vice President of Corporate Development at Biovail Corporation (the "Concerned Shareholders"), today commented on Bioniche's plans to undertake an expensive and highly dilutive equity financing, days after telling the Ontario Superior Court that it would carry on only in the normal course of business prior to the Special Meeting of Shareholders, scheduled to take place on November 5, 2013.

"Having delayed the shareholder vote, Bioniche now plans to dilute shareholders in the face of overwhelming shareholder opposition," said Bill Wells. "On repeated occasions, the Bioniche Board and its CEO have demonstrated their disregard for corporate governance and disdain for shareholders. A plan that could see shareholders diluted by up to approximately 30% (without taking into account the further dilution associated with the Paladin transaction) ahead of a shareholder vote is an affront to shareholder democracy and is indefensible."

Continued Wells: "In addition to the Board's sudden desire to raise equity, a number of other troubling actions have come to light. Following the election of new directors on November 5, and at the urging of its fellow shareholders, the Concerned Shareholders will engage third-party experts to conduct a thorough investigation into the current and past actions of Bioniche's Board and management. The objective would be to recover as much value as possible for shareholders."

The Concerned Shareholders also note the following:

• Following two requisitions for a Special Meeting from the Concerned Shareholders that Bioniche fought in Court using shareholders' money, the Company reassured the Ontario Superior Court that there was no need for an early meeting by stating that management would continue to carry on business only in the 'normal course' until the November 5 annual meeting. The Court allowed the Company to hold the Special Meeting on November 5, but warned the Company not to deviate from its commitments to the Court

• The plan to raise equity directly contradicts Bioniche's previous assurance to shareholders regarding the need to raise capital. In response to a shareholder question regarding the Company's cash needs, Bioniche Chief Financial Officer Brian Ford responded via email with the following:
  
  "As we have reported in the past during conference calls and at the AGM, we are acutely aware of the need to refresh our cash resources. At present, we have plans in place to bring in new funds to satisfy our short- and long-term requirements. None of these plans involve dilutive equity issues, which, we are sure you would agree, would be disastrous for our shareholders at today's prices - even for very small amounts of capital." (Emphasis added)

Email to a shareholder from Jennifer Shea, VP Communications, Investor &
Government Relations, Bioniche, on behalf of Brian Ford, February 8, 2013

        BNC shares closed at $0.28/share on February 8, 2013. The pending equity raise has been priced at $0.29/unit that includes one share and one half warrant.

• Bioniche's announcement of its plan to raise no more than $7.5 million via a highly dilutive offering is far from business in the 'normal course.' The Board's decision:
• follows a delay of the Shareholder Meeting to November 5, comes in the face of overwhelming opposition from shareholders and, conveniently for the besieged directors, could dilute these shareholders by up to approximately 30%
• follows the recent highly dilutive deal with Paladin, which, when taken into account today, could drive the total dilution of shares much higher than 30% (shareholders have now suffered from two highly dilutive deals done by current management in the past month alone, with absolutely no positive benefit or return to shareholders)
• would not materially impact the Company's financial position or provide any tangible long-term benefit to the Company or its shareholders, calling into question the need for a $7.5 million financing

Misleading Shareholders on Urocidin

Shareholders are also being misled about the risks and timing associated with Urocidin. No one can predict the outcome of a drug development program or whether the FDA will ultimately grant approval. The facts are that until the FDA provides guidance, no one can say what the timeline or costs will be for Urocidin to access the US market.

The Concerned Shareholders' belief, based on years of experience in human health drug development, is that Urocidin is a high-risk program and it's reasonable to assume it will take years, possibly five years or longer, for it to get to the market in the U.S., which assumes a successful Phase III trial, something no one can predict. The cost before that time could easily be in the tens of millions of dollars. By the Company's own admission that number could be $40 million.

"The Concerned Shareholders are not going away," added Greg Gubitz. "We will continue to work on behalf of our fellow shareholders to ensure that this Board, its terrible performance and its horrific governance practices will come to an end on November 5, so that long-suffering shareholders may finally realize the value of their investment in Bioniche."

The Concerned Shareholders will mail important materials, with a proxy enclosed, well in advance of the November 5 Special Meeting of Shareholders. Shareholders are advised to NOT execute any proxies received from Bioniche until they have a chance to review the Concerned Shareholders' materials.

The Concerned Shareholders' Plan

Over the past 25 years, the Bioniche Board and CEO have presided over a dramatic destruction of shareholder value with Bioniche shares losing 96% of their value since 1996. Now, the Bioniche Board and management are taking another gamble with shareholder money with an ill-advised plan to divest its primary revenue generating business, Animal Health, and completely transform Bioniche into an ultra high-risk entry stage biotech company.

Bioniche shareholders deserve better. The Concerned Shareholders have proposed an alternative strategy to retain and grow the Animal Health business while pursuing transactions for the remaining businesses that would maximize shareholder value. Credible new directors and an experienced management team that has a track record of value creation would oversee the alternative strategy.

The Concerned Shareholders' value creation plan stands in stark contrast to the value destroying divestment of the Animal Health business that Bioniche is pursuing. More important information on our plans for the Company, including FAQs that are routinely updated as we receive good questions from shareholders and answers to the Bioniche Board's distracting and baseless attacks against the Concerned Shareholders campaign, can be found at www.savebioniche.com.

With shareholder support, this sorry chapter in Bioniche's history will soon be behind it, and long-suffering shareholders will finally realize the value of their investment in Bioniche.

Information in Support of Public Broadcast Solicitation

William (Bill) M. Wells and Greg Gubitz (the "Concerned Shareholders") are relying on the exemptions under section 150(1.2) of the CBCA and section 9.2(4) of National Instrument 51-102 - Continuous Disclosure Obligations of the Canadian Securities Administrators to make this public broadcast solicitation. The following information is provided in accordance with corporate and securities laws applicable to public broadcast solicitations.

This solicitation is being made by the Concerned Shareholders, and not by or on behalf of the management of Bioniche Life Sciences Inc. ("Bioniche").

Bioniche's address is 231 Dundas Street East, Belleville, Ontario, K8N 1E2.

The Concerned Shareholders have filed an information circular containing the information required by the CBCA and Form 51-102F5 - Information Circular of the Canadian Securities Administrators in respect of its proposed nominees. Such circular is available under Bioniche's company profile on SEDAR at www.sedar.com.

All costs incurred for the solicitation will be borne by the Concerned Shareholders, subject to reimbursement by Bioniche in accordance with the provisions of the CBCA.

To the knowledge of the Concerned Shareholders, none of the proposed nominees as directors, or their respective associates or affiliates, had or has any material interest, direct or indirect, in (i) any transaction since the beginning of Bioniche's most recently completed financial year; or (ii) in any proposed transaction which has materially affected or would materially affect Bioniche or any of its subsidiaries.

As no matters other than the election of directors are currently contemplated to be acted upon at the called meeting of Bioniche shareholders, none of the Concerned Shareholders or their respective associates or affiliates has any material interest, direct or indirect, by way of beneficial ownership of securities or otherwise, in any matter to be acted upon at the meeting of Bioniche shareholders other than the election of directors.

Information Regarding Bioniche

The information herein concerning Bioniche has been taken from or is based upon publicly available documents or records of Bioniche on file with Canadian securities regulatory authorities.

Forward Looking Information

Certain statements contained herein are "forward-looking statements". Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects", "expected", "scheduled", "estimates", "intends", "anticipates", or "believes", or variations of such words and phrases, or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. The Concerned Shareholders cannot give any assurance that such forward-looking statements will prove to have been correct. The reader is cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this document.

SOURCE: William (Bill) M. Wells and Greg Gubitz

www.savebioniche.com

Greg Gubitz
416.624.6568
[email protected]

Bill Wells
[email protected]