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CONSTITUTE A VIOLATION OF U.S. SECURITIES LAW./CALGARY, Dec. 5 /CNW/ - Oncolytics Biotech Inc. ("Oncolytics" or the "Corporation") (TSX:ONC; NASDAQ:ONCY) is pleased to announce that it has closed its previously announced prospectus offering. Oncolytics issued 2.65 million units, each unit being comprised of one common share of Oncolytics and one common share purchase warrant, at a price of $1.50 per unit for gross proceeds of $3.975 million. Each whole common share purchase warrant entitles the holder to acquire one common share of Oncolytics upon payment of $1.80, subject to an acceleration of the expiry date in certain circumstances. Net proceeds after expenses are expected to be approximately $3.5 million.

"We are pleased to conclude a financing in this challenging financial market," said Dr. Brad Thompson, President and CEO of Oncolytics.

The proceeds are expected to 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.

After giving effect to this transaction, Oncolytics has 43,830,748 common shares issued and outstanding.

About Oncolytics Biotech Inc.

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®, 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 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.

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