Oncolytics Biotech® Inc. Receives US$6.8 Million from Exercise of Warrants

CALGARY, Jan. 25 /PRNewswire/ – Oncolytics Biotech Inc. (“Oncolytics” or the
“Corporation”) (TSX:ONC; NASDAQ:ONCY) today announced that pursuant to
the acceleration of the expiry date of those warrants issued on
November 23, 2009, the Corporation has received proceeds of
approximately US$6.8 million resulting from the exercise of 1,943,000
warrants. Oncolytics now has 69,873,568 shares issued and outstanding,
and cash on hand and available for operations of approximately $48.7

The common shares underlying the warrants were offered in the United
pursuant to a prospectus supplement to Oncolytics’ effective
Form F-10 shelf registration statement (File # 333-167250) previously
filed with the United States Securities and Exchange Commission on June
10, 2010
, pursuant to the United States Securities Act of 1933, as
amended. Copies of the prospectus supplement and accompanying base
prospectus relating to the offering may be obtained from the Securities
and Exchange Commission website at http://www.sec.gov, or from the Corporation using the contact information provided below.

This press release does not and shall not constitute an offer to sell or
the solicitation of an offer to buy any of the securities, nor shall
there be any sale of the securities in any state or jurisdiction in
which such offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities laws of any state or

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.  Forward-looking
statements, including the amount of proceeds that were received by the
Corporation pursuant to the exercise of warrants, the Corporation’s
cash resources following the exercise of warrants, the Corporation’s
expectations as to progress in the clinical trial program and the
Corporation’s belief as to the potential of REOLYSIN as a cancer
therapeutic, involve known and unknown risks and uncertainties, which
could cause the Corporation’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 Corporation’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 Corporation’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 Corporation does not undertake to update these forward-looking
statements, except as may be required pursuant to applicable securities

SOURCE Oncolytics Biotech Inc.