GeneNews announces second quarter results

TORONTO, CANADA (August 14, 2009):

GeneNews Limited (TSX: GEN), a company focused on developing blood-based biomarker tests for the early detection of diseases and personalized health management, today reported operational and financial results for the second quarter-ended June 30, 2009.

"Following the end of the second quarter, we completed a financing transaction that will allow us to continue to execute on our commercialization strategy for our lead product ColonSentry™, the world's first blood test for colorectal cancer," said Dr. Heiner Dreismann, Lead Director and Interim CEO of GeneNews. "In the second half of the year, we will focus the majority of our efforts on our ongoing discussions with potential marketing partners in the United States and selected countries in Europe and Asia to expand access to ColonSentry™ outside of Canada."

GeneNews has sufficient funds to continue its operations into the first quarter of 2010. Efforts to secure access to additional capital resources are continuing; however there is no assurance that these initiatives will be successful.

Recent highlights:

• Raised $2,000,000 in a non-brokered private placement, subsequent to the end of the second quarter.
• Entered into an agreement with DundeeWealth Inc., a leading Canadian wealth management firm, to offer ColonSentry™ to its employees.
• Obtained a commitment of MYR 5 million (CDN$1.6 million) from the Malaysian Ministry of Health for the development of diagnostic tests for liver cancer, hepatitis and nasopharyngeal cancer based on the Company's proprietary platform Sentinel Principle technology.
• Appointed Dr. David Sable to the GeneNews Board of Directors. Dr. Sable is the portfolio manager for all Life Sciences investing for the Special Situations Funds based in New York.

Financial results (CDN dollars) for the first quarter-ended June 30,2009:

For the three-month period ended June 30, 2009, the Company recorded revenue of $0.1 million compared with $0.3 million for the three-month period ended June 30, 2008. Revenues in the three-month period for 2009 were attributable to a research collaboration agreement with an Asian biomedical consortium and ColonSentry sales. For the same period 2008, revenues were from the Asian biomedical consortium. For the six-month period ended June 30, 2009, the Company recorded revenue of $0.4 million compared with $0.6 million for the six-month period ended June 30, 2008.

For the three-month period ended June 30, 2009, total operating expenditures were $1.9 million compared to $4.3 million for the same period last year. For the six-month period ended June 30, 2009, total operating expenditures were $4.1 million compared to $7.3 million for the same period last year. Research and development expenses for the quarter were $0.8 million compared to $3.0 million for the same period last year. Research and development expenses for the six-month period ended June 30, 2009 were $1.8 million compared to $5.2 million for the same period last year. These decreases are largely the result of the Company's strategic restructuring of operations announced in November 2008, which lead to the transfer of pipeline research and development activities to the Company's Malaysian and Chinese operations, where they can be conducted in a more cost-effective manner. Sales and marketing expenses for the quarter were $0.1 million compared to nil for the same quarter last year. Sales and marketing expenses for the six-month period ended June 30, 2009, were $0.3 million compared to nil for the same period last year. General and administrative expenses for the quarter were $0.4 million compared to $0.8 million for the corresponding quarter in 2008.

General and administrative expenses for the six-month period ended June 30, 2009, were $1.2 million compared with $1.3 million in the corresponding period last year.

Net loss for the three-month period ended June 30, 2009, totalled $1.8 million or ($0.03) per common share compared to a net loss of $4.0 million or ($0.07) per common share for the three-month period ended June 30, 2008. Net loss for the six-month period ended June 30, 2009, was $3.7 million or ($0.07) per common share compared to a net loss of $6.6 million or ($0.12) per common share the corresponding period last year.

As at June 30, 2009, the Company's unrestricted cash and cash equivalents amounted to $0.4 million compared to $1.4 million as at December 31, 2008, and the Company had 55,883,437 common shares and 8,305,857 stock options outstanding.

Subsequent to quarter-end, the Company raised gross proceeds of $2.0 million in a non-brokered private placement through the issuance of 8,000,000 common shares from treasury at a price of $0.25 per share.

The Company's annual financial statements and management's discussion and analysis will be available on www.sedar.com.

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