Biotech Inc.

Biotech Inc. Announces Issuance of 33rd U.S.

CALGARY, AB --- October 27,

2009 - Oncolytics Biotech Inc. (TSX: ONC, NASDAQ: ONCY) ("Oncolytics")

today announced that it has been granted its 33rd U.S.

Patent, No. 7,608,257, entitled "Sensitization of Chemotherapeutic Agent

Resistant Neoplastic Cells With a Virus." The patent claims cover methods of

using reovirus in combination with currently approved chemotherapeutic agents to

treat patients that are refractory to those chemotherapeutic agents

patent supports our expanding clinical program, including our first Phase III

study, looking at REOLYSIN in

combination with a range of chemotherapeutic agents," said Mary Ann Dillahunty,

Vice President of Intellectual Property for Oncolytics. "Many

of our studies enroll patients that did not previously respond to chemotherapy,

including our Phase III study in patients with platinum refractory head and neck

Oncolytics Biotech Inc.

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.

news release contains forward-looking statements, within the meaning of Section

21E of the Securities Exchange Act of 1934, as amended. Forward-looking

statements, including among others, the Company's belief as to the importance of

the issuance of this patent, the safety and efficacy of the reovirus, the

Company's expectations as to the potential applications of the patented

technology and other statements relating to anticipated developments in the

Company's business and technologies, involve known and unknown risks and

uncertainties that 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 efficacy of REOLYSIN as a cancer treatment, the

success and timely completion of clinical studies and trials, uncertainties

related to the research and development of pharmaceuticals and uncertainties

related to the regulatory process. 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

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