CALGARY, ALBERTA--Oncolytics Biotech Inc. ("Oncolytics") (ASE: ONC) announced today that the Corporation has closed a previously announced initial public offering of common shares. This offering raised gross proceeds of $3,400,000 through the issuance of 4,000,000 common shares at a price of $.85 per share. Oncolytics also issued 2,899,997 common shares and 1,500,000 common share purchase warrants upon the deemed exercise of previously issued special warrants. Canaccord Capital Corporation acted as agent for the offering which was filed with the securities commissions in Alberta, Ontario and British Columbia.

Net proceeds of the offering will be used primarily for research and development, manufacturing and process development, a Phase I clinical trial examining the use of REOLYSIN in cancer patients, and certain milestone payments.

The common shares of Oncolytics will commence trading today on The Alberta Stock Exchange under the trading symbol "ONC". Oncolytics is a Calgary-based biotechnology company whose focus is the development of the reovirus known as REOLYSIN as a potential cancer therapeutic. The human reovirus infects and kills cancer cells with an activated Ras pathway. Ras is an important component of a pathway controlling normal growth and differentiation of a cell and when activated, may account for a large proportion of all human tumors. Researchers believe that targeting this pathway could have broad potential in the treatment of many cancers. Oncolytics researchers demonstrated that reovirus was selectively able to kill cancer cellswith this particular activation and successfully demonstrated that the virus could kill human cancer cells in vitro derived from breast, prostate, pancreatic and brain tumors, as well as being able to treat tumors successfully in a number of animal models. Oncolytics is anticipating the commencement of a Phase I clinical trial on reovirus in the first part of 2000.

This release contains certain forward-looking statements which involve known and unknown risks, delays, uncertainties and other factors not under the Company's control which may cause actual results, performanceor achievements of the Company to be materially different from the results, performance or expectations implied by these forward-looking statements.