Mr. Roberto Bellini reports

BELLUS HEALTH REPORTS RESULTS FOR SECOND QUARTER ENDED JUNE 30, 2010

Bellus Health Inc. has released its financial results for the second quarter ended June 30, 2010. The company has also provided information on its new initiatives to reduce its annual expenditures (burn rate) by focusing its efforts on existing products as well as on supporting current and future partnerships.

Financial results

For the three-month period ended June 30, 2010, the net loss amounted to $5,816,000 (three cents per share), compared with a net income of $14.27-million (11 cents per share) for the corresponding period of the previous year. For the six-month period ended June 30, 2010, the net loss amounted to $10,009,000 (five cents per share), compared with net income of $1,925,000 (two cents per share) for the same period last year.

The significant variation between the 2010 net loss and the 2009 net income is attributable to unusual items recorded in the second quarter of 2009. During that quarter, the company recorded a gain on extinguishment of debt in the amount of $19,173,000, resulting from amendments to the terms, in April, 2009, of the convertible notes issued in 2006 and 2007, as well as a net credit for vacant space in the amount of $2,474,000 in relation to the vacant portion of the company's premises.

As at June 30, 2010, the company had available cash and cash equivalents of $11.77-million, compared with $14,017,000 at Dec. 31, 2009. This excludes $5-million (U.S.) that the company will receive on Oct. 29, 2010, in connection with the Kiacta asset purchase and licence agreement. The decrease in the six-month period is primarily due to funds used in operating activities, offset by the first instalment of $5-million (U.S.) received in April, 2010, pursuant to the Kiacta asset purchase and licence agreement.

The company's consolidated financial statements as well as its accompanying management's discussion and analysis for the three- and six-month periods ended June 30, 2010, will be available in the coming days on SEDAR and shortly on the company's website.

Second quarter 2010 highlights:

Kiacta asset purchase and licence agreement

On April 29, 2010, the company entered into an asset purchase and licence agreement with Celtic Therapeutics pursuant to which Celtic Therapeutics acquired and licensed worldwide rights related to the phase 3 investigational product candidate, Kiacta (eprodisate), for upfront payments totalling $10-million (U.S.), to be paid in two instalments, with $5-million (U.S.) having been paid on the closing of the transaction and the remaining $5-million (U.S.) payable on the sixth-month anniversary of the closing date. Celtic Therapeutics will finance 100 per cent of Kiacta's development costs through its confirmatory phase 3 clinical study and all other requirements for Kiacta's regulatory approval. Celtic Therapeutics will then conduct an auction process for the commercialization rights of Kiacta. The overall proceeds of the auction process are expected to be shared equally between Celtic Therapeutics and Bellus Health. The company currently expects the confirmatory phase 3 study to begin in the fourth quarter of 2010.

Update on Vivimind

Bellus Health continues to pursue partnership arrangements for the global commercialization activities of its nutraceutical product, Vivimind. Regulatory approvals for the commercialization of Vivimind in Italy and Spain were obtained in 2009.

NC-503 diabetes program

On May 4, 2010, the company announced in Stockwatch its decision to discontinue the NC-503 (eprodisate) diabetes development program due to lack of efficacy in the phase 2 clinical trial.

Initiatives to reduce burn rate

Bellus Health will focus on supporting its current and future partnerships as well as on undertaking less-expensive product development programs for its existing drug candidate in order to further reduce its burn rate and extend its cash resources. The initiatives will allow Bellus Health to use its existing cash as well as cash from future partnerships to finance operations, thereby reducing the risk that the company will require new equity financing for at least the next two years.

From an operating perspective, the signature of the partnership for Kiacta effectively transferred responsibility for developing that product from Bellus Health to its partner, Celtic Therapeutics.

In the case of NRM8499, Bellus Health's pro-drug candidate for the treatment of Alzheimer's disease, a revised development program will be undertaken with a focus on putting in place an eventual partnership for this program. A phase 1 clinical study for NRM8499 was initiated by the company on March 30, 2010.

As a result of these initiatives, Bellus Health will gradually reduce its head count by more than two-thirds over the next 12 months. The remaining employees will manage Bellus Health's obligations under current and future partnerships, oversee the development of NRM8499, and ensure that Bellus Health meets all its obligations as a listed public company. As a result of these initiatives, the monthly burn rate is expected to decrease from more than $1.5-million to less than $500,000 based on the company's current estimates.

"The structure of our strategic partnership relationship provides us with an opportunity to build long-term value while minimizing our expenditures and our burn rate," said Roberto Bellini, president and chief executive officer of Bellus Health. "An intensive focus on limiting our operating costs will preserve substantial value for our shareholders in the medium to long term, particularly the value created from our partnership with Celtic Therapeutics for Kiacta. Our goal is to use our existing capital and to leverage our assets through partnerships as we move our products to commercialization. Once we have implemented today's initiatives, new financings should be unnecessary for the foreseeable future."