Dr. Brad Thompson reports

ONCOLYTICS BIOTECH INC. ANNOUNCES 2016 FIRST QUARTER RESULTS

Oncolytics Biotech Inc. has released its financial results and operational highlights for the first quarter ended March 31, 2016.

"We recently reported data from two sponsored, randomized phase 2 studies, highlighting reduced tumour burden in ovarian cancer and improved longer-term survival in pancreatic cancer," said Dr. Brad Thompson. "The data from these studies will be very useful in identifying potential indications and study designs that we could advance into later-stage studies in the future."

Selected highlights

Since Jan. 1, 2016, selected highlights announced by the company follow.

Clinical program:

• Treatment of the first patients in a phase Ib study of pembrolizumab (Keytruda) in combination with Reolysin and chemotherapy in patients with advanced pancreatic adenocarcinoma, the company's first trial examining Reolysin in combination with a checkpoint inhibitor;
• Updated results from a randomized phase 2 clinical trial of its lead product, Reolysin, in combination with paclitaxel in patients with ovarian cancer (GOG-0186H), where an intent-to-treat analysis, as assessed by CA-125 antigen levels, showed statistically significantly reduction in tumour burden;
• Updated results from a randomized phase 2 clinical trial of its lead product, Reolysin, in combination with carboplatin and paclitaxel in patients with pancreatic cancer (NCI-8601), where an intent-to-treat analysis of overall survival on patients with confirmed treatment regimes, as assessed by the percentage of patients surviving for two years, showed a statistically significantly higher percentage of patients surviving two years in the test arm versus the control arm (p equals 0.001), the crossover arm versus the control arm (p equals 0.03) and the test plus crossover arms versus the control arm (p equals 0.0004).

Basic research:

• Two poster presentations covering preclinical work in multiple myeloma and colorectal cancer being made by the company's research collaborators at the 2016 American Association of Cancer Research annual meeting.

Financial:

• Entry into an at-the-market equity distribution agreement with Canaccord Genuity Corp. permitting Oncolytics at its sole discretion, from time to time and until March 16, 2018, to sell common shares having an aggregate offering value of up to $4.6-million;
• At March 31, 2016, the company reported $22.3-million in cash, cash equivalents and short-term investments. At May 5, 2016, the company had approximately $21.4-million in cash, cash equivalents and short-term investments, which is expected to provide sufficient funds to support several small early-stage immunotherapy combination studies, as well as both a run-in and a registration study in muscle-invasive bladder cancer.

                                     
     INTERIM CONSOLIDATED STATEMENTS OF LOSS AND COMPREHENSIVE LOSS 
                 
                                               Three months ending March 31,                    
                                                          2016         2015

Expenses
Research and development                            $2,726,129   $2,425,539
Operating                                            1,360,412    1,182,734
                                                    ----------   ----------
Operating (loss)                                    (4,086,541)  (3,608,273)
Interest                                                69,621       56,435
                                                    ----------   ----------
(Loss) before income taxes                          (4,016,920)  (3,551,838)
Income tax expense                                         145            -
                                                    ----------   ----------
Net (loss)                                          (4,016,775)  (3,551,838)
Other comprehensive income items that
may be reclassified to net (loss)
Translation adjustment                                (170,059)     225,591
                                                    ----------   ----------
Net comprehensive (loss)                            (4,186,834)  (3,326,247)
                                                    ==========   ==========
Basic and diluted (loss) per common share                (0.03)       (0.04)
                                                    ==========   ==========

We seek Safe Harbor.