Oncolytics Biotech® Inc. Announces Phase 2 Clinical Trial of REOLYSIN® in Combination with Gemcitabine in Pancreatic Cancer Reaches Primary Endpoint

CALGARY, Dec. 2, 2011 /PRNewswire/ – Oncolytics Biotech Inc. (TSX:ONC)
(NASDAQ:ONCY) (“Oncolytics”) today announced that interim data from a
Phase 2 clinical trial using intravenous administration of REOLYSIN® in combination with gemcitabine (Gemzar®) in patients with advanced pancreatic cancer (REO 017) indicated that
the clinical study had successfully reached its primary endpoint, and
that the drug combination is active.

To date, eight patients of 13 evaluable patients in the study had stable
disease (SD) for 12 weeks or longer, for a clinical benefit rate
(complete response (CR) + partial response (PR) + SD) of 62%. An
additional patient had an unconfirmed PR of less than six weeks.

The study is using a one sample, two-stage design. In the first stage,
17 patients were to be enrolled, and best response noted.  If less than
three responses (defined as CR or PR or SD for 12 weeks or more) were
observed, the study would have concluded that the combination was
inactive and been terminated. If three or more responses were observed
among the 17 patents, the study would enroll an additional 16 patients
for a total of 33 evaluable patients.  As previously disclosed, this
initial endpoint was met after six evaluable patients were enrolled. If
at least eight responses were observed out of 33 patients, the study
would have reached its primary endpoint and conclude that the drug
combination is active.

“These results far exceeded our initial expectations, having met the
primary endpoint in a study designed to enroll 33 patients with just
over a third of enrolment completed,” said Dr. Matt Coffey, Chief
Operating Officer of Oncolytics. “We will continue to enroll in this
study to evaluate the progression free survival of the patient group,
and will continue testing REOLYSIN with various chemotherapeutic agents
including gemcitabine and carboplatin/paclitaxel across multiple trials
to further understand its potential in the treatment of pancreatic

About Pancreatic Cancer

The American Cancer Society estimates that 44,030 Americans will be
diagnosed with pancreatic cancer and 37,660 Americans will die from the
disease in 2011, making this type of cancer the fourth leading cause of
cancer death for both men and women in the United States. For more
information about pancreatic cancer, please go to www.cancer.org.

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 human trials
including a Phase III trial in head and neck cancers using REOLYSIN,
its proprietary formulation of the human reovirus. For further
information about Oncolytics, please visit: www.oncolyticsbiotech.com.

This press release contains forward-looking statements, within the
meaning of Section 21E of the Securities Exchange Act of 1934, as
amended.  Forward-looking statements, including the implication of the
results generated to date with respect to REOLYSIN in the treatment of
pancreatic cancer; the Company’s belief as to the potential of REOLYSIN
as a cancer therapeutic; the Company’s expectations as to the success
of its research and development programs in 2011 and beyond, the
Company’s planned operations, the value of the additional patents and
intellectual property; the Company’s expectations related to the
applications of the patented technology; the Company’s expectations as
to adequacy of its existing capital resources; the design, timing,
success of planned clinical trial programs; and other statements
related to anticipated developments in the Company’s business and
technologies 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, 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 and U.S.
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 required by applicable laws.

SOURCE Oncolytics Biotech Inc.