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Bioniche Reports Fiscal 2008 First Quarter
Date:11/9/2007

revenues down due to non-recurring event in 2007, net loss stable

(all figures are in Canadian dollars unless otherwise noted)

BELLEVILLE, ON, Nov. 9 /PRNewswire-FirstCall/ - Bioniche Life Sciences Inc. (TSX: BNC), a research-based, technology-driven Canadian biopharmaceutical company, today announced financial results for the first quarter of its 2008 fiscal year, ending September 30, 2007.

"We are also focused on the successful completion of a marketing partnership deal for Urocidin - our bladder cancer therapy, while executing our Phase III clinical program, the first trial of which continues to recruit patients at 25 centres in the U.S. and Canada," said Graeme McRae, President & CEO of Bioniche Life Sciences Inc. "We also continue to be focused on obtaining a full Canadian license for our E. coli O157:H7 cattle vaccine, while seeking an opportunity to clarify statistical analysis methodology with our U.S. regulator."

Fiscal 2008 First Quarter Financial Results Highlights

Consolidated revenues for the first quarter totaled $5.9 million, a decrease of 23% from the $7.7 million recorded in the same period in Fiscal 2007. A one-time promotion of a leading animal health product contributed to higher revenues for the first quarter last year, an event that was not repeated this year.

The overall gross profit margin was 58% for the first quarter of Fiscal 2008, as compared to 59% for the same period in Fiscal 2007.

Expenses totaled $4.1 million for the three months ending September 30, 2007, which compares to $3.8 million recorded in the same period last year. This increase of $0.3 million, or 8%, primarily reflects additional staff, increased expenditures on E. coli O157:H7 development and awareness program and some necessary salary increases.

Gross research and development expenses remained stable at $3.6 million for the 3-month periods ending September 30, 2007 and September 30, 2006 respectively. The majo-----------------------------------------

Basic and diluted net loss per share (0.06) (0.07)

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Weighted-average number of common shares

outstanding 61,880,544 39,293,778

Bioniche Life Sciences Inc.

INTERIM CONSOLIDATED STATEMENTS

OF CASH FLOWS

(Unaudited)

For the three months ended September 30

2007 2007

$ $

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OPERATING ACTIVITIES

Net loss for the period (3,812,759) (2,740,864)

Add (deduct) non cash items:

Amortization 531,082 683,741

Accreted interest on convertible debt 531 143,138

Foreign exchange gain (75,117) (6,133)

Change in fair value of foreign currency

embedded derivatives (182,656) -

Stock-based compensation 84,746 55,780

Employee share ownership plan 147,769 -

Impairment of investment - 175,000

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(3,306,935) (1,689,338)

Net change in non-cash working capital balances 644,938 270,577

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Cash used in operating activities (2,661,997) (1,418,761)

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INVESTING ACTIVITIES

Proceeds from maturity of short-term investments 9,500,000 -

Government incentives received on account

of property, plant and equipment 1,834 -

Purchase of property, plant and equipment (198,709) (107,405)

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Cash used in investing activities 9,303,125 (107,405)

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FINANCING ACTIVITIES

Proceeds from deferred government incentives 31,264 -

Proceeds from revolving credit facility 4,946,959 4,492,048

Repayment of revolving credit facility (5,098,685) (5,157,528)

Repayment of capital lease obligations (35,159) (32,675)

Repayment of senior and other long-term debt (4,751) (277,266)

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Cash used in financing activities (160,372) (975,422)

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Net increase (decrease) in cash and

cash equivalents during the period 6,480,756 (2,501,588)

Cash and cash equivalents,

beginning of period 1,523,597 4,093,293

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Cash and cash equivalents, end of period 8,004,353 1,591,705

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rity of these costs can be attributed to the ongoing Phase III clinical program in bladder cancer and expenditures on the E. coli O157:H7 development program.

The basic net loss per share for the first quarter of Fiscal 2008 was ($0.06), compared to a net loss per share of ($0.07) recorded in the same period last year.

Annual Meeting Highlights

At the Company's Annual and Special Meeting of Shareholders yesterday afternoon in Toronto, Ontario, the Company provided an update on its Phase III clinical program with Urocidin in bladder cancer and its E. coli O157:H7 vaccine program. In the first Phase III trial involving refractory bladder cancer patients treated with Urocidin, it was reported that the Data Safety Monitoring Committee is satisfied with the progress of the trial and that recruitment of the 105 patients should be completed by mid-2008. With its E. coli O157:H7 vaccine, Bioniche is in the process of building industry awareness about this bacterium and in support of sales to high profile early adopters.

About Bioniche Life Sciences Inc.

Bioniche Life Sciences Inc. is a research-based, technology-driven Canadian biopharmaceutical company focused on the discovery, development, manufacturing, and marketing of proprietary products for human and animal health markets worldwide. The fully-integrated company employs approximately 195 skilled personnel and has three operating divisions: Human Health, Animal Health, and Food Safety. The Company's primary goal is to develop proprietary cancer therapies supported by revenues from marketed products in human and animal health. For more information, please visit http://www.Bioniche.com.

Except for historical information, this news release may contain forward-looking statements that reflect the Company's current expectation regarding future events. These forward-looking statements involve risk and uncertainties, which may cause, but are not limited to, changing market conditions, the successful and timely completion of clinical studies, the establishment of corporate alliances, the impact of competitive products and pricing, new product development, uncertainties related to the regulatory approval process, and other risks detailed from time to time in the Company's ongoing quarterly and annual reporting.

Bioniche Life Sciences Inc.

Amalgamated under the laws of Ontario

CONSOLIDATED BALANCE SHEETS

(Unaudited)

As at As at

September 30, June 30,

2007 2007

$ $

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ASSETS

Current

Cash and cash equivalents 8,004,353 1,523,597

Short-term investments - 9,500,000

Accounts receivable 5,137,800 5,495,836

Inventories 5,486,543 5,480,167

Prepaid expenses and deposits 554,160 658,867

Foreign currency embedded derivatives 231,579 -

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19,414,435 22,658,467

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Long-term

Property, plant and equipment 9,513,696 9,557,359

Intangible assets 8,331,086 8,545,215

Goodwill 456,155 456,155

Deferred financing fees - 209,578

Foreign currency embedded derivatives 137,758 -

Other assets 80,613 100,000

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37,933,743 41,526,774

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LIABILITIES AND SHAREHOLDERS' EQUITY

Current

Revolving credit facility 503,443 895,619

Accounts payable and accrued liabilities 6,537,404 6,399,382

Income and other taxes payable 323,827 283,845

Deferred government incentives 573,116 541,282

Current portion of long-term debt and

obligations under capital leases 129,014 123,769

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8,066,804 8,243,897

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Long-term

Long-term debt 408,158 421,396

Obligations under capital leases 765,187 764,933

Deferred government incentives 2,986,572 2,986,572

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12,226,721 12,416,798

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Shareholders' equity

Share capital 90,228,909 90,038,524

Special warrants 2,174,008 2,174,008

Other paid-in capital 5,612,805 5,528,059

Deficit (72,308,700) (68,630,615)

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25,707,022 29,109,976

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37,933,743 41,526,774

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Bioniche Life Sciences Inc.

INTERIM CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

(Unaudited)

Preferred shares -

Common shares Series 1

# $ # $

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Balance, June 30,

2006 39,198,140 60,794,185 167 161,000

Net loss for the

period - -

Issued under employee

share ownership plan 54,332 41,291 - -

Stock-based

compensation - - - -

Revolving debt

principal payments

made in shares 266,712 155,434 - -

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Balance, Sept. 30,

2006 39,519,184 60,990,910 167 161,000

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Balance, June 30,

2007 61,711,867 81,078,737 167 161,000

Transition adjustment - - - -

Net loss for the

period - - - -

Issued under employee

share ownership plan 171,920 113,883 - -

Stock-based

compensation - - - -

Shares issued to

directors 73,560 76,502 - -

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Balance, Sept. 30,

2007 61,957,347 81,269,122 167 161,000

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Other

Preferred shares - Special paid-in

Series ll Warrants capital

# $ $ $

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Balance, June 30,

2006 12,000,000 11,731,716 - 4,556,290

Net loss for the

period - - - -

Issued under employee

share ownership plan - - - (41,291)

Stock-based

compensation - - - 55,780

Revolving debt

principal payments

made in shares - - - -

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Balance, Sept. 30,

2006 12,000,000 11,731,716 - 4,570,779

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Balance, June 30,

2007 9,000,000 8,798,787 2,174,008 5,528,059

Transition adjustment - - - -

Net loss for the

period - - - -

Issued under employee

share ownership plan - - - -

Stock-based

compensation - - - 84,746

Shares issued to

directors - - - -

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Balance, Sept. 30,

2007 9,000,000 8,798,787 2,174,008 5,612,805

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Cumulative

translation

Deficit adjustment Total

$ $ $

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Balance, June 30,

2006 (53,869,621) (23,379) 23,350,19

Net loss for the

period (2,740,864) - (2,740,864)

Issued under employee

share ownership plan - - -

Stock-based

compensation - - 55,780

Revolving debt

principal payments

made in shares - - 155,434

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Balance, Sept. 30,

2006 (56,610,485) (23,379) 20,820,54

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Balance, June 30,

2007 (68,630,615) - 29,109,976

Transition adjustment 134,674 - 134,674

Net loss for the

period (3,812,759) - (3,812,759)

Issued under employee

share ownership plan - - 113,883

Stock-based

compensation - - 84,746

Shares issued to

directors - - 76,502

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Balance, Sept. 30,

2007 (72,308,700) - 25,707,022

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Bioniche Life Sciences Inc.

NOTES TO INTERIM CONSOLIDATED

FINANCIAL STATEMENTS

September 30, 2007 and 2006 Unaudited

Bioniche Life Sciences Inc.

INTERIM CONSOLIDATED STATEMENTS OF LOSS

(Unaudited)

For the three months ended September 30

2007 2007

$ $

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REVENUE

Sales 5,904,784 7,744,626

Cost of sales 2,479,305 3,190,845

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Gross profit 3,425,479 4,553,781

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EXPENSES

Administration 1,629,414 1,130,291

Marketing and selling 1,640,123 1,421,464

Quality assurance 170,430 168,507

Interest on long-term debt 37,950 160,509

Other interest (income) (62,820) 73,204

Accreted interest on convertible term note - 143,138

Amortization of property, plant and equipment 281,787 295,284

Amortization of intangible assets 214,129 214,129

Amortization of deferred financing fees 35,166 174,328

Foreign exchange loss (gain) 197,973 (12,186)

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4,144,152 3,768,668

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Income (loss) before research and

development expenses and other items (718,673) 785,113

Research and development expenses, gross 3,566,667 3,589,748

Less: government incentives, net (343,848) (422,627)

Unrealized gain on foreign currency

embedded derivatives (182,656) -

Impairment of investment - 175,000

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Loss before income taxes (3,758,836) (2,557,008)

Provision for income taxes 53,923 183,856

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Net loss for the period (3,812,759) (2,740,864)

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SOURCE Bioniche Life Sciences Inc.
Copyright©2007 PR Newswire.
All rights reserved

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