CALGARY, AB - November 18, 2009 -

Biotech Inc. Announces

Terms of Unit Offering

CALGARY, AB - November 18, 2009 -

Oncolytics Biotech Inc. ("Oncolytics" or the

"Company") (TSX:ONC; NASDAQ:ONCY) announced today that it has entered into an

underwriting agreement for an offering of 4,250,000 units, each comprised of one

common share and 0.4 of a common share purchase warrant, at a price of US$3.00

per unit to raise gross proceeds of US$12,750,000. Each whole common share

purchase warrant entitles the holder to acquire one common share of Oncolytics

upon payment of US$3.50, exercisable for a five year period commencing on the

closing date of the offering, subject to an acceleration of the expiry date in

certain circumstances. Oppenheimer & Co. Inc. is acting as the sole

book-running manager for the offering. Canaccord Adams Inc. and Bloom Burton

& Co. are acting as co-managers for the offering.

offering is to be effected in each of the Canadian provinces of British

Columbia, Alberta, Manitoba and Ontario by way of a prospectus supplement to

Oncolytics' base shelf short form prospectus, and in the United States pursuant

to a prospectus supplement to the Oncolytics' Form F-10 registration statement

(File No. 333-151513) as filed with the United States Securities and Exchange

Commission on June 6, 2008, as amended on June 17, 2008, pursuant to the United

States Securities Act of 1933, as amended.

Company has granted the underwriters an over-allotment option to purchase

additional common shares and/or warrants in an amount up to 15% of the number of

common shares and warrants underlying the units sold pursuant to the offering at

the same price as in the offering, exercisable at any time up to 30 days from

the closing of the offering.

intends to use the net proceeds from the offering to fund its previously

announced Phase III combination REOLYSIN and

paclitaxel/carboplatin trial for patients with platinum-failed head and neck

cancers, its other clinical development and research and development activities,

and for general corporate and working capital purposes.

transaction is expected to close on or about November 25, 2009, subject to

satisfaction of customary closing conditions, including the receipt of all

necessary regulatory and stock exchange approvals.

securities are being offered in each of the Canadian provinces of British

Columbia, Alberta, Manitoba and Ontario by way of a prospectus supplement to

Oncolytics' base shelf short form prospectus and in the United States pursuant

to a prospectus supplement to Oncolytics' effective Form F-10 shelf registration

statement (File No. 333-151513) previously filed with the United States

Securities and Exchange Commission on June 6, 2008, as amended on June 17, 2008,

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,

from the System for Electronic Document Analysis and Retrieval (SEDAR) website

at http://www.sedar.com or from the underwriters at:

Syndicate Prospectus Department

Madison Avenue, 5th Floor

number: (212) 667-8563

number (416) 869-3198

you invest, you should read the prospectus supplement and accompanying

prospectus, the registration statement, and the other documents that the Company

has filed with the United States Securities and Exchange Commission for more

complete information about the Company and this offering.

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 of qualification

under the securities laws of any state or jurisdiction.

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.

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 Company's expectations related to timing and closing of the placement of

units, common stock and warrants; 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 2009 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 pricing and completion of the contemplated offering, 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

FURTHER INFORMATION PLEASE CONTACT: