MBI Med Biogene Inc

Med BioGene Inc. (TSX VENTURE:MBI) today reported its financial results for the
nine months ended September 30, 2012 (all amounts are in United States dollars).


Business Highlights

Commercialization of LungExpress Dx

MBI announced in October 2012 that its commercial partner, Precision
Therapeutics, Inc., expects to commence commercialization of LungExpress Dx, a
proprietary gene expression-based test for early-stage non-small-cell lung
cancer, in its CLIA-certified laboratory by mid-2013.




--  In advance of commercialization, Precision has established an advisory
    board comprised of world leaders in lung cancer research and treatment
    from the United States, Canada, France and Italy. 
--  LungExpress Dx is currently validated for use with frozen tumour tissue.
    Precision is responsible for all costs associated with the development
    and commercialization of LungExpress Dx and is commencing clinical
    studies to validate the use of LungExpress Dx with tissue preserved by
    RNARetain, a molecular fixative. RNARetain eliminates the need to flash-
    freeze specimens and to keep specimens frozen throughout storage and
    transport, a process that can be cumbersome and costly. It also
    eliminates the need for preserving tissue in formalin, which is known to
    cross-link and degrade the nucleic acids rendering them less suitable
    for specific downstream molecular applications. 
--  These clinical studies are being conducted using patient specimens
    collected prospectively by Precision from a consortium of medical
    centers in the United States. This collection is complete and the final
    step of validation using RNARetain has begun.



Erinn Broshko, Executive Chairman of MBI, commented: "The commercial success of
a molecular diagnostic test depends, in large measure, upon the extent of its
integration into current pathological processes. The use of LungExpress Dx with
RNARetain will allow pathologists to avoid the logistics involved with using
flash-frozen tumor specimens and, instead, to handle and ship specimens at room
temperature, thereby simplifying the process significantly. We believe that this
will materially enhance the commercial prospects of our test and are encouraged
by the progress made by Precision."


Restructuring of Milestone Payments Under Commercialization Agreement

Under the terms of MBI's commercialization agreement with Precision, Precision
has paid to MBI license fees and research reimbursement of $2.3 million, half of
which is credited against future royalties that may be owed to MBI by Precision.
In addition, MBI is eligible to receive up to $1 million in payments based on
the achievement of certain milestones, all of which are credited against future
royalties that may be owed to MBI by Precision. MBI and Precision amended in
September 2012, among other things, these milestone payments such that Precision
will now pay to MBI, following the commercial launch of LungExpress Dx, amounts
totaling $500,000 and, following the achievement of $5 million in net revenues
from LungExpress Dx, amounts totaling $500,000.


MBI will also receive royalty payments in the high single digits based on a
percentage of Precision's future net revenues associated with the
commercialization of LungExpress Dx.


Erinn Broshko further commented: "By restructuring the milestone payments in our
commercialization agreement, we expect to extend MBI's cash runway following the
commercialization of LungExpress Dx to allow us the opportunity to demonstrate
increasing clinical and commercial success of our test. As a result of our
focused burn rate, we believe that MBI currently has sufficient cash resources
to continue with operations until approximately the first quarter of 2014. If
Precision commercializes LungExpress Dx around the expected timeframe then, with
receipt of the $500,000 in milestone payments from Precision relating to
commercial launch, we believe that MBI will have sufficient cash resources to
fund operations until approximately the third quarter of 2015."


Third Quarter 2012 Financial Results

MBI incurred a loss of $301,667 ($0.00 per share) for the nine months ended
September 30, 2012 compared to having net income of $1,790,427 ($0.02 per share)
for the nine months ended September 30, 2011. MBI incurred a loss of $78,239
($0.00 per share) in the third quarter of 2012 compared to having net income of
$1,575,650 ($0.02 per share) in the third quarter of 2011. MBI did not generate
any revenue during the nine months ended September 30, 2012, but generated net
licensing revenue of $2,069,773 during the nine months ended September 30, 2011.


Research and Development

Research and development expenses were $nil for the nine months ended September
30, 2012 compared to $123,161 for the nine months ended September 30, 2011.
Comparing the third quarter of 2012 with the corresponding quarter of 2011,
research and development expenses decreased to $nil from $14,511. Under the
terms of MBI's partnership with Precision, Precision is responsible for all
future costs associated with the development and commercialization of
LungExpress Dx.


General and Administrative

General and administrative expenses, including non-cash share-based expenses
associated with the prior issuance of stock options and foreign exchange, were
$301,844 for the nine months ended September 30, 2012 compared to $443,397 for
the nine months ended September 30, 2011, representing a decrease of 32%.
Comparing the third quarter of 2012 with the corresponding quarter from 2011,
general and administrative expenses decreased by 57% to $78,249 from $183,958.


Consistent with MBI's cost saving initiatives, general and administrative
expenses, exclusive of non-cash share-based expenses associated with the prior
issuance of stock options and foreign exchange, were $199,511 for the nine
months ended September 30, 2012 and $59,474 for the three months ended September
30, 2012.


Liquidity and Capital Resources

At September 30, 2012, MBI had cash and equivalents totalling $458,964 and
working capital of $356,614 compared to cash and equivalents of $685,170 and a
working capital of $556,446 at December 31, 2011.


Cash used in operating activities was $226,923 for the nine months ended
September 30, 2012 compared to cash provided by operating activities of $472,724
for the nine months ended September 30, 2011.


Cash provided by investing activities was $nil for the nine months ended
September 30, 2012 compared to $64,499 for the nine months ended September 30,
2011. The cash provided by investing activities consisted of proceeds from the
disposal of capital assets.


Cash provided by financing activities was $nil for the nine months ended
September 30, 2012 compared to $212,930 for the nine months ended September 30,
2011. The cash provided by financing activities consisted of proceeds on
issuance of shares.


About Med BioGene

MBI is a life science company based in Vancouver, British Columbia, that is
currently focused on managing the license and rights to LungExpress Dx, a
proprietary gene expression-based test for early-stage non-small-cell lung
cancer. LungExpress Dx is expected to provide better-informed and personalized
treatment decisions to assist in the selection of patients for adjuvant
chemotherapy. MBI has partnered with Precision Therapeutics for the global
commercialization of LungExpress Dx. MBI's common shares are traded on the TSX
Venture Exchange. For more information regarding MBI, please visit
www.medbiogene.com. For more information regarding Precision, please visit
www.precisiontherapeutics.com.


Certain statements in this press release contain forward-looking statements and
information ("forward-looking statements") under applicable United States and
Canadian securities legislation. Words such as "anticipates," "believes,"
"estimates," "expects," "intends," "may," "plans," "projects," "will," "would"
and similar expressions are intended to identify forward-looking statements,
although not all forward-looking statements contain these identifying words.
Forward looking statements include, but are not limited to, that with respect to
the timing, completion and/or results of clinical trials or studies, the timing
for commercialization of any products, future profits, future product revenues,
future shareholder value, future operations and plans, the completion and use of
proceeds from transactions or financings and the prospects for negotiating
partnerships or collaborations and their timing. These forward-looking
statements are only a prediction based upon the party's current expectations,
and actual events or results may differ materially. A party may not actually
achieve the plans, intentions or expectations disclosed in its forward-looking
statements. Forward-looking statements are subject to known and unknown risks
and uncertainties and are based on uncertain assumptions that could cause a
party's actual results and the timing of events to differ materially from those
anticipated in such forward-looking information. You are cautioned not to place
undue reliance on these forward-looking statements, which speak only as of the
date of this press release. A party's forward-looking statements do not reflect
the potential impact of any future partnerships, collaborations, acquisitions,
mergers, dispositions, joint ventures or investments that that party may make.
All forward-looking statements are qualified in their entirety by this
cautionary statement and a party undertakes no obligation to revise or update
any forward-looking statements as a result of new information, future events or
otherwise after the date of this press release, other than as required by
applicable law. Certain information included in this press release in respect of
Precision and its scientific, clinical and/ or commercialization efforts have
been provided to MBI by Precision. MBI may not have been able to confirm the
accuracy of such information and you should not place undue reliance on any such
information, including any information regarding Precision that would constitute
forward-looking information. A redacted copy of the amended commercialization
agreement between MBI and Precision may be found at www.sedar.com. Each
trademark, trade name or service mark of any entity appearing in this news
release belongs to its holder.


FOR FURTHER INFORMATION PLEASE CONTACT: 
Med BioGene Inc.
Erinn B. Broshko
Executive Chairman
(800) 641-3593
ebroshko@medbiogene.com
www.medbiogene.com

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