Helix BioPharma Corp. Announces Fiscal 2011 Results

Helix BioPharma Corp. (TSX: HBP) (NYSE Amex: HBP) (FRANKFURT: HBP), a
biopharmaceutical company developing drug candidates for the prevention and
treatment of cancer, today announced financial results for the year ended July
31, 2011.


During the 2011 fiscal year, the Company continued to make progress with its
development initiatives for its lead drug candidates, L-DOS47 and Topical
Interferon Alpha-2b. The following are selected highlights during the 2011
fiscal year and subsequent to year-end.


HIGHLIGHTS

DOS47/L-DOS47:


Helix received regulatory approvals to conduct two clinical studies with its
lung cancer drug candidate L-DOS47, a European Phase I/II study and U.S. Phase I
study. Both studies have been designed to examine safety, tolerability and
preliminary efficacy of L-DOS47. Pre-study logistical preparations are still
ongoing for the Polish Phase I/II study and patient recruitment may have to be
postponed from this fall to the upcoming year. Preparations are underway for the
U.S. Phase I study, also with a view to initiating patient recruitment in the
upcoming year. 

Helix announced that a U.S. patent was issued for the lung cancer-specific
antibody used in its drug candidate L-DOS47. The National Research Council of
Canada ("NRC") has granted Helix the right to use this antibody in combination
with Helix's DOS47 technology under a worldwide exclusive license agreement that
extends to the full term of the applicable patents. 



Topical Interferon Alpha-2b:


On October 21, 2010, Helix announced positive efficacy and safety findings from
its Phase II pharmacokinetic study of Topical Interferon Alpha-2b in patients
with low-grade cervical lesions. 

Helix filed an investigational new drug ("IND") application with the U.S. FDA
for its planned Phase II/III efficacy trial of Topical Interferon Alpha-2b in
patients with low-grade cervical lesions. Upon review, the FDA placed the IND on
"clinical hold" pending submission of further product analytical information. 

On October 12, 2011, Helix announced that it filed its "clinical hold" response
with the U.S. FDA. Helix is currently awaiting the FDA's review decision. 



Financing:


Completed several private placement financings for net proceeds of approximately
$15,393,000. 

Trading commenced on the NYSE Amex stock exchange. 


Other:


Helix BioPharma retained U.S.-based Vista Partners LLC as its new investor
relations representative. Vista also provides analyst coverage on Helix as part
of its services. 



Financial Review
For fiscal 2011, the Company recorded a loss of $11,348,000, which represents a
decrease of $3,121,000 when compared to fiscal 2010. The net loss per common
share for fiscal 2011 is $0.17 compared to a net loss per common share of $0.24
for fiscal 2010. The lower loss in fiscal 2011 mainly reflects lower research
and development expenditures and lower foreign exchange losses which were
partially offset by higher operating, general and administrative costs and
stock-based compensation in addition to a gain on sale of certain international
Klean-Prep(R) rights to Helsinn Birex Pharmaceuticals Limited ("Helsinn").


Total revenues in fiscal 2011 were $4,532,000 and represent an increase of
$98,000 or 2.2% when compared to total revenues in fiscal 2010 of $4,434,000.
Product revenue contributed to the increase in revenue in fiscal 2011 when
compared to fiscal 2010 and was offset by a decrease in license fees and
royalties due to an agreement to assign certain international Klean-Prep(R)
rights to Helsinn.


Product revenue in fiscal 2011 totalled $4,406,000 and represents an increase of
$481,000 or 12.3% when compared to product revenue in fiscal 2010 of $3,925,000.
Except for Normacol(R), product revenues were higher across all products, with
the majority of the increase reflected in the sales of Klean-Prep(R) and the
combined product sales of Orthovisc(R) and Monovisc(R).


License fees and royalties in fiscal 2011 totaled $126,000 and represent a
decrease of $383,000 or 75.2% when compared to fiscal 2010. The Company entered
into an agreement to assign certain international Klean-Prep(R) rights to
Helsinn and as a result realized a gain on sale of the license of $1,336,000.
The agreements with Helsinn are effective December 1, 2010 and as a result,
Helix will no longer earn royalty revenue associated with Klean-Prep(R), going
forward.


Cost of sales in fiscal 2011 and fiscal 2010 totalled $1,642,000 and $1,669,000,
respectively. As a percentage of product revenues, cost of sales in fiscal 2011
and fiscal 2010 were 37.3% and 42.5%, respectively. The decrease in cost of
sales on a percentage basis reflects the appreciation of the Canadian dollar
versus both the U.S. dollar and Euro, and for the first two quarters of fiscal
2011 goods sold with a cost base of zero.


Research and development expenditures in fiscal 2011 totalled $7,323,000 and
represent a decrease of $3,392,000 or 31.7% when compared to fiscal 2010. For
fiscal 2011, L-DOS47 expenditures totaled $5,674,000 and represent a 6.2%
decrease when compared to fiscal 2010. Topical Interferon Alpha-2b expenditures
totaled $3,278,000 and represent a 42.8% decrease when compared to fiscal 2010.
For the fiscal 2011 L-DOS47 expenditures, the L-DOS47 research and development
expenditures reflect collaborative scientific research and clinical research
expenditures associated with the applications for a Phase I IND to conduct a
Phase I Clinical Study in the U.S. and a Polish Phase I/II CTA filing. In the
last two fiscal quarters of fiscal 2011, the Company received approval for both
the U.S and Polish applications. For the fiscal 2011 Topical Interferon Alpha-2b
expenditures, lower research and development expenditures are associated with
both of the Company's Topical Interferon Alpha-2b clinical programs having been
completed. The Company has concentrated its efforts on resolving the FDA
clinical hold associated with its application to conduct a U.S. Phase II/III IND
trial for low-grade cervical lesions.


Operating, general and administration expenses in fiscal 2011 totaled $4,434,000
and represent an increase of $1,258,000 or 39.6% when compared to fiscal 2010.
The increase in operating, general and administrative expenditures mainly
reflects higher investor relation fees and associated costs to increase the
Company's visibility and awareness in the U.S. capital markets, higher
accounting and legal fees and additional stock exchange listing fees for both
the Toronto and NYSE Amex stock exchanges.


Sales and marketing expenses in fiscal 2011 totaled $1,124,000 and represent a
decrease of $1,000 or 0.1% when compared to fiscal 2010.


Amortization of capital assets in fiscal 2011 decreased $25,000 when compared to
fiscal 2010.


Stock-based compensation expense in fiscal 2011 totalled $2,082,000 and
represents an increase of $807,000 when compared to fiscal 2010. The stock-based
compensation expense in fiscal 2011 relates to the ongoing amortization of
compensation costs of 1,164,000 stock options granted on July 29, 2011; 893,000
stock options granted on August 17, 2010; 968,000 stock options granted on
December 14, 2009 and 2,070,000 stock options granted on December 17, 2008 over
their vesting period. The stock options vest 25% on the date of grant and 25% at
each anniversary date thereafter.


Interest income totalled $188,000 in 2011 and $49,000 in 2010. The increase in
interest income in fiscal 2011 reflects higher interest rates earned on deposits
as well as increased cash balances.


The Company recorded a foreign exchange loss of $2,000 in fiscal 2011 and
$564,000 in fiscal 2010. Foreign exchange losses are mainly the result of the
foreign currency translation of the Company's integrated foreign operation in
Ireland, cash balances as well as a value added value added tax ("VAT")
receivable, accounts payable and accrued liabilities, which are denominated in
Euros.


Income tax expenses totalled $334,000 in fiscal 2011 and $46,000 in fiscal 2010.
Income taxes are mainly attributable to the Company's operations in Ireland.


Liquidity and Capital Resources
Since inception, the Company has financed its operations from public and private
sales of equity, proceeds received upon the exercise of warrants and stock
options, and, to a lesser extent, from interest income from funds available for
investment, government grants, investment tax credits, and revenues from
distribution, licensing and contract services. Since the Company does not have
net earnings from its operations, the Company's long-term liquidity depends on
its ability to access the capital markets, which depends substantially on the
success of the Company's ongoing research and development programs, as well as
economic conditions relating to the state of the capital markets generally.


At July 31, 2011, 2010 and 2009, the Company had cash and cash equivalents
totalling $19,044,000, $13,125,000 and $14,494,000, respectively. The $5,919,000
increase in cash and cash equivalents in fiscal 2011 reflects financing
activities of $15,431,000, investing activities of $829,000 and a use of cash in
operating activities of $10,339,000, which includes a net loss for the year of
$(11,348,000) with significant adjustments in operating activities related to
stock-based compensation of $2,082,000; amortization of capital assets of
$404,000; other receivables of $(201,000) and $(164,000) in changes to non-cash
working capital.


At July 31, 2011, 2010 and 2009, the total number of common shares issued was
67,164,934, 59,975,335 and 53,175,335, respectively and the Company's working
capital was and $19,470,000, $13,387,000, and $15,296,000, respectively.


Though the Company does not currently have enough cash reserves to fully fund
its planned L-DOS47 clinical studies which the Company has estimated are to last
over approximately a three year period, nor to initiate its Topical Interferon
Alpha-2b clinical studies (assuming regulatory approvals and strategic partner
support are obtained), the Company does have sufficient cash reserves to meet
anticipated cash needs for working capital and capital expenditures through at
least the next twelve months, provided there are no materially negative
unanticipated changes to planned expenditures and revenues. The Company will
therefore continue to seek additional funding to carry out its business plan and
to minimize, to the best of its ability, the risks to its operations.


Equity financing has historically been Helix's primary source of funding,
however, the market for equity financings for companies such as Helix is
challenging, and the ongoing global economic downturn and credit crisis continue
to add further challenges. While the Company has been able to raise equity
financing in recent years, there can be no assurance that additional funding by
way of equity financing will continue to be available. Any additional equity
financing, if secured, would result in dilution to the existing shareholders
which may be significant. The Company may also seek additional funding from
other sources, including technology licensing, co-development collaborations,
and other strategic alliances, which, if obtained, may reduce the Company's
interest in its projects or products. There can be no assurance, however, that
any alternative sources of funding will be available. The failure of the Company
to obtain additional financing on a timely basis may result in the Company
reducing, delaying or cancelling one or more of its planned research,
development and marketing programs, including any ongoing clinical trials, and
reducing related overhead, any of which could impair the current and future
value of the business. It may also have a material adverse effect on the
Company's ability to continue as a going concern.


The Company's consolidated fiscal 2011, 2010, and 2009 financial statements are
summarized below.





Consolidated Statements of Operations
(thousand $, except for per share data)

                                            2011        2010        2009
                                         ----------  ----------  ----------
Revenue:
  Product revenue                             4,406       3,925       3,244
  License fees & royalties                      126         509         597
                                         ----------  ----------  ----------
                                              4,532       4,434       3,841

Expenses:
  Cost of sales                               1,642       1,669       1,516
  Research and development                    7,323      10,715      10,322
  Operating, general and admin                4,434       3,176       3,917
  Sales and marketing                         1,124       1,125         969
  Amortization of intangibles                     -           -          12
  Amortization of capital assets                404         429         274
  Stock-based compensation                    2,082       1,275       1,023
  Interest income                              (188)        (49)       (339)
  Foreign exchange loss                           2         564         133
  Loss on capital asset disposal                 59           -           -
  Realized gain on sale of investment             -         (47)          -
  Impairment of intangible assets                 -           -          98
                                         ----------  ----------  ----------
                                             16,882      18,857      17,925

Realized gain on sale of license:             1,336           -           -
                                         ----------  ----------  ----------
                                            (11,014)    (14,423)    (14,084)

Income taxes                                    334          46          18
                                         ----------  ----------  ----------
Net loss for the year                       (11,348)    (14,469)    (14,102)
                                         ==========  ==========  ==========

      Loss per share:
      Basic                                   (0.17)      (0.24)      (0.27)
      Diluted                                 (0.17)      (0.24)      (0.27)



Consolidated Statements of Cash Flows (thousand $)


                                           2010        2010        2009
                                        ----------  ----------  ----------
Cash provided by (used in):

Loss for the year                          (11,348)    (14,469)    (14,102)

Items not involving cash:
  Amortization of capital assets               404         429         274
  Amortization of intangibles                    -           -          12
  Other receivables                           (201)       (459)          -
  Deferred lease credit                        (24)        (26)        123
  Stock-based compensation                   2,082       1,275       1,023
  Stock-based consideration                    187           -           -
  Realized gain on sale of license          (1,336)          -           -
  Loss on Capital asset disposal                59           -           -
  Realized gain on sale of investment            -         (47)          -
  Impairment of intangibles                      -           -          98
  Foreign exchange loss (gain)                   2         564         133
                                        ----------  ----------  ----------
                                           (10,175)    (12,733)    (12,439)
Change in non-cash working capital            (164)        540        (718)
                                        ----------  ----------  ----------

Operating activities                       (10,339)    (12,193)    (13,157)

Financing activities                        15,431      11,947       9,659

Investing activities                           829        (559)       (932)

Effect of exchange rate changes on cash
 and cash equivalents                           (2)       (564)       (133)
                                        ----------  ----------  ----------

Cash and cash equivalents:
  Increase/(decrease) in the year            5,919      (1,369)     (4,563)
  Beginning of the year                     13,125      14,494      19,057
                                        ----------  ----------  ----------
  End of the year                           19,044      13,125      14,494



Consolidated Balance Sheet (thousand $)
                                                          2011       2010
                                                       ---------- ----------
Current assets:
    Cash and cash equivalents                              19,044     13,125
    Accounts receivable                                     1,906      1,365
    Inventory                                                 528        780
    Prepaid and other                                         202        398
                                                       ---------- ----------
                                                           21,680     15,668
Non current assets                                          2,691      2,446
                                                       ---------- ----------
Total assets                                               24,371     18,114
                                                       ========== ==========


Current liabilities:
    Accounts payable                                        1,085      1,392
    Accrued liabilities                                       804        821
    Income tax payable                                        296         43
    Deferred lease credit                                      25         25
                                                       ---------- ----------
                                                            2,210      2,281
Non current liabilities                                        48         72
                                                       ---------- ----------
Total liabilities                                           2,258      2,353
Shareholders' equity                                       22,113     15,761
                                                       ---------- ----------
  Total liabilities and shareholders'equity                24,371     18,114
                                                       ========== ==========


















































































The Company's complete 2011 Consolidated Financial Statements, Management's
Discussion and Analysis and Annual Information Form on Form 20-F are being filed
today with Canadian securities regulatory authorities and with the US Securities
and Exchange Commission and will be available at www.sedar.com and at
www.sec.gov, respectively, as well as on the Company's website at
www.helixbiopharma.com. Shareholders have the ability to receive a hard copy of
the Company's complete audited financial statements free of charge upon request.


About Helix BioPharma Corp.
Helix BioPharma Corp. is a biopharmaceutical company specializing in the field
of cancer therapy. The Company is actively developing innovative products for
the prevention and treatment of cancer based on its proprietary technologies.
Helix's product development initiatives include its novel L-DOS47 new drug
candidate and its Topical Interferon Alpha- 2b. Helix is listed on the TSX, NYSE
Amex and FSE under the symbol "HBP".


Forward-Looking Statements and Risks and Uncertainties
This News Release contains certain forward-looking statements and information
(collectively, "forward-looking statements") within the meaning of applicable
securities laws, regarding the development of products by Helix for the
prevention and treatment of cancer based on its proprietary technologies;
sufficiency of the Company's cash reserves and expected cash flow from
operations; need for additional financing; the Company's plans to initiate
clinical studies for L-DOS47; and other information in future periods.
Forward-looking statements, including financial outlooks, are intended to
provide information about management's current plans and expectations regarding
future operations, including without limitation, future financing requirements,
and may not be appropriate for other purposes. Although Helix believes that the
expectations reflected in such forward-looking statements are reasonable, such
statements involve risks and uncertainties, and undue reliance should not be
placed on such statements. Certain material factors or assumptions are applied
in making forward-looking statements, including, but not limited to, receipt of
necessary additional funding, strategic partner support and regulatory
approvals; GMP manufacturing and other activities; the timely provision of
services and performance of contracts by third parties; and future revenue,
costs and expenditures. Helix's actual results could differ materially from
those anticipated in these forward-looking statements as a result of numerous
risks and uncertainties including without limitation, Helix's need for
additional capital, which may not be available; uncertainty whether the
Company's products under development, including L-DOS47 and Topical Interferon
Alpha-2b, will be successfully developed and commercialized; the risk that the
Company's expected timelines for meeting certain objectives may not be met;
uncertainty whether clinical trials will proceed as planned or at all, and the
risk that clinical trial results may be negative; the risk that the FDA may not
remove the hold on the IND application, either at all or in a timely manner;
insurance and intellectual property risks; research and development risks; the
need for further regulatory approvals, which may not be obtained; the Company's
dependence on its third-party service providers; upscaling and manufacturing
risks; partnership / strategic alliance risks; the effect of competition; the
risk of technical obsolescence; uncertainty of the size and existence of a
market opportunity for Helix's products; uncertainty whether the Company will be
able to obtain an appropriate pharmaceutical or strategic partner for the drug
candidates, which are not assured; changes in business strategy or plans; and
the risk factors that are discussed under Item 3.D. - "Risk Factors" in the
Company's latest Form 20-F Annual Report or identified in the Company's other
public filings with the Canadian securities administrators at www.sedar.com or
with the SEC at www.sec.gov. Forward-looking statements and information are
based on the beliefs, assumptions and expectations of Helix's management at the
time they are made, and Helix does not assume any obligation to update any
forward-looking statement or information should those beliefs, assumptions or
expectations, or other circumstances change, except as required by law.