ChondroGene reports second quarter 2005 financial results

TORONTO, CANADA (August 12, 2005): ChondroGene™ Limited (TSX Venture: CDG) today announced its financial results for the second quarter ended June 30, 2005. The Company reported revenues of $1,498,472 for the period, compared to $223,174 for the three months ended June 30, 2004. Revenues were attributable to fees for service, amortization of the one time payment under the research collaboration with Pfizer that was announced in December 2004 and the receipt of the first of four milestone payments in the amount of $612,600. The net loss for the quarter was $731,545 or $0.02 per share, compared to a net loss of $1,946,668 or $0.06 per share for the three-month period ended June 30, 2004. Revenues for the first six months of 2005 were $2,376,723 with a net loss of $1,858,140 or $0.05 per share, compared to revenues of $438,651 with a net loss of $3,372,322 or $0.10 per share, for the corresponding period in 2004. At the end of the quarter, the Company had $8,455,848 in cash and cash equivalents.

"During the quarter we continued to make progress in applying the Sentinel Principle™ to a variety of diseases with particular emphasis in colon, prostate and bladder cancer," stated K. Wayne Marshall, President and CEO of ChondroGene. "We are pleased to be working with a number of world renowned academic institutions as evidenced by our recent announcement of a broad alliance with the University of California, San Francisco (UCSF), one of the leading biomedical research and health science education centers in the world. This important alliance provides a framework for ChondroGene to enter into collaborations with UCSF scientific researchers and clinicians and outlines the intellectual property rights of new inventions stemming from the use of the Sentinel Principle in such collaborations. Also during the quarter, we achieved our first publication in cancer when the results from our bladder cancer clinical study conducted with researchers from the New York University School of Medicine and Memorial Sloan-Kettering Cancer Center were presented in a poster entitled Gene Expression Profiling in Blood Cells Reveals Novel Biomarkers of Human Urinary Bladder Cancer at the American Society of Clinical Oncology (ASCO) meeting. Our success in establishing collaborations with these international leaders in biomedical research have come in parallel with our continuing collaboration with Pfizer. Revenues for this quarter reflect our achievement of the first of four milestones in accordance with our second Pfizer collaboration agreement".

This press release contains forward-looking statements, which reflect the Company's current expectations regarding future events. The forward-looking statements involve risks and uncertainties. Actual events could differ materially from those projected herein. Investors should consult the Company's ongoing quarterly filings and annual reports for additional information on risks and uncertainties relating to these forward-looking statements. The reader is cautioned not to rely on these forward-looking statements. The Company disclaims any obligation to update these forward-looking statements.

Financial statements are available in the attached pdf document:

About GeneNews

GeneNews is focused on the application of functional genomics to enable early diagnosis and personalized therapeutic intervention based on disease-specific biomarkers. The Company has developed a novel approach, the Sentinel Principle™, to detect and stage virtually any disease or medical condition from a simple blood sample. GeneNews is currently applying the Sentinel Principle™ in major areas with unmet clinical needs such as cancer, arthritis, cardiovascular disease and neurological disorders. GeneNews' first product, ColonSentry™, is a convenient and patient-friendly blood-based test that can assess an individual's current risk for colorectal cancer. For more information on GeneNews, visit www.genenews.com.

This press release contains forward-looking statements, which reflect the Company's current expectations regarding future events. The forward-looking statements involve risks and uncertainties. Actual events could differ materially from those projected herein. Investors should consult the Company's ongoing quarterly filings and annual reports for additional information on risks and uncertainties relating to these forward-looking statements. The reader is cautioned not to rely on these forward-looking statements. The Company disclaims any obligation to update these forward-looking statements.