Adherex Technologies Reports Third Quarter Results-Company to Meet With Health Canada in July.

Business Editors

OTTAWA--(BUSINESS WIRE)--May 22, 2002

Adherex Technologies Inc. (TSX:AHX), a biotechnology company developing novel therapeutics based on cell adhesion technology, today reported its third quarter and nine-month results for the period ending March 31, 2002. The company also announced its innovative cancer program continues to move forward.

Adherex's Phase I human trials of Exherin, its potentially ground-breaking therapy for arresting the growth of cancer tumors by cutting off its blood supply, is expected to begin before the end of the year, assuming regulatory approval is granted. The initial protocol for the Phase I trial has been written and a meeting is scheduled with Health Canada July 9th to discuss it. The company has arranged for the manufacturing of clinical test batches of Exherin and is in the process of finalizing the site for the trial. The company's reported cash position of over $10 million at the end of March is more than sufficient to fund this important trial.

Corporate Update

Adherex's collaboration agreement with AstraZeneca, one of the world's leading pharmaceutical companies, was extended without the fixed termination date of the initial agreement. Adherex has received considerable support from AstraZeneca and looks forward to its ongoing collaboration.

Together with AstraZeneca, Adherex will be presenting new scientific data at a session on vascular targeting at BIO 2002 in Toronto on June 11. In addition, the company will be presenting at the BIO Investor Forum later that day. BIO is the world's largest biotechnology conference and is expected to draw 15,000 delegates from around the world. "We are fortunate to have a featured place at this important conference," Brooks said.

Adherex Third Quarter Results

Adherex's intellectual property position was strengthened during the quarter with the granting of its 13th US patent. Besides the ongoing work in cancer, the company continues to move forward in its second area of focus, transdermal drug delivery. The company has developed several synthetic compounds capable of disrupting E-cadherin, a protein that regulates skin cell adhesion and maintains the skin permeability barrier. Adherex's aim is to assess the possibility of improving the effectiveness of existing topically applied products as well as developing applications for drugs that previously were deemed unsuitable for transdermal delivery.

"We have had a very active third quarter in both our drug development and business development activities. Our approach in both areas can be largely traced to Dr. Robin Norris, our new Chief Operating Officer, who has demonstrated how he was such a success in the first two public biotechnology companies that he led and his experience and advice have added considerable value to our already strong management team," said John Brooks, President and CEO of Adherex.

Financial Update

Adherex reported a net loss of $1,407,211 or ($0.04) per share for the quarter ending March 31, 2002, compared to $1,116,333 or ($0.05) per share for the third quarter last year. The net loss for the nine months ended March 31, 2002 increased 47% to $3,626,906 or ($0.09) per share compared to $2,473,617 or ($0.10) per share for the same period in 2001. The company's investment in its research and development program, its largest expense, increased by close to 74% over the same period to $3,031,082 for the nine months ended March 31, 2002 from $1,738,001. As the company continues with its preparations for the Phase I clinical trial with Exherin, it is expected that this amount will continue to increase in coming quarters.

The company's cash and cash equivalents were $10,460,453 as at March 31, 2002 compared to $14,152,528 at the end of its last fiscal year, June 30, 2001. Adherex reported a net cash burn of $367,147 per month for the quarter and $410,230 per month for the nine months ended March 31, 2002.

The complete financial results for the third quarter and nine months ending March 31, 2002 are available on the company's website.

This news release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of these 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 such state or jurisdiction.

Certain information contained in this news release is forward-looking and is subject to unknown risks and uncertainties. The actual results, performance or achievements of the company may differ materially from the results, performance or achievements of the company expressed or implied by such forward looking statements.