ChondroGene reports first quarter 2005 financial results

TORONTO, CANADA (May 16, 2005): ChondroGene™ Limited (TSX Venture: CDG) today announced its financial results for the first quarter ended March 31, 2005. The Company reported revenues of $878,251 for the period compared to $215,477 for the three months ended March 31, 2004. Revenues were attributable to fees for service and amortization of the one time payment under the research collaboration with Pfizer that was announced in December 2004. The net loss for the quarter was $1,126,595 or $0.03 per share, compared to a net loss of $1,425,654 or $0.04 per share for the three-month period ended March 31, 2004. At the end of the quarter, the Company had $9,629,564 in cash and cash equivalents.

"At the beginning of the quarter, we initiated our new 2-year osteoarthritis collaboration with Pfizer that is a continuation of our original 2-year collaboration which was successfully concluded in 2004. During the quarter, we also received funding support from NRC-IRAP to assist in the development of a commercial blood-based assay using the Sentinel Principle™ to detect and stage asymptomatic osteoarthritis," stated K. Wayne Marshall, President and CEO of ChondroGene. "We are also applying the Sentinel Principle to identify disease-specific biomarkers in a number of other diseases. Our primary area of focus is in cancer, with special emphasis on colon, prostate and bladder cancer. Preliminary clinical data for these cancers has been very encouraging. Importantly, these three cancers have tremendous unmet needs for diagnostic biomarkers and represent compelling commercial targets. We plan to develop and pursue commercialization of blood-based biomarker tests for one or more of these conditions this year."

ChondroGene also announced that it has appointed Colin Martin as Vice President Finance and Acting Chief Financial Officer. Mr. Martin brings considerable experience in high growth companies to this position. Prior to joining ChondroGene, he served for four years as the VP Finance and Administration and CFO of Cogency Semiconductor, a private semiconductor company focused on the home networking market. Mr. Martin also spent four years as Manager and later, Director, of Corporate Finance for ATI Technologies Inc. Mr. Martin is a chartered accountant and holds an Honours degree in Mathematics from the University of Waterloo.

Financial statements are available in the attached pdf document:

Forward-Looking Statements