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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 FORM 10-K
 þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
 For the fiscal year ended December 31, 2009
 Or
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 Commission File Number 000-21243
 OncoGenex Pharmaceuticals, Inc.
  Delaware
    
    95-4343413(State or other jurisdiction of 
incorporation or organization)
    
    (I.R.S. Employer
Identification No.)
 1522 217 th Place SE, Suite 100, Bothell, Washington 98021
 (425) 686-1500
 Securities registered pursuant to Section 12(b) of the Act:
 Title of Each Class
    
    Name of Exchange on Which RegisteredCommon Stock, par value $0.001 per share
    
    The NASDAQ Capital Market
 None
 Yes o No þ
 Yes o No þ
 þ o
 o o
 þ
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
    
    Smaller reporting company o
 Yes o No þ
  DOCUMENTS INCORPORATED BY REFERENCE




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OncoGenex Pharmaceuticals, Inc.
 Table of Contents
 PART IITEM 1. BUSINESS
    
    
    3ITEM 1A. RISK FACTORS
    
    
    26ITEM 1B. UNRESOLVED STAFF COMMENTS
    
    
    46ITEM 2. PROPERTIES
    
    
    46ITEM 3. LEGAL PROCEEDINGS
    
    
    46ITEM 4. RESERVED
    
    
    46PART IIITEM 5. MARKET FOR THE REGISTRANTS COMMON EQUITY,
RELATED STOCKHOLDER MATTERS AND ISSUER
PURCHASES OF EQUITY SECURITIES
    
    
    47ITEM 6. SELECTED FINANCIAL DATA
    
    
    49ITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
    
    
    50ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
MARKET RISK
    
    
    64ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
    
    
    65ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ON ACCOUNTING AND FINANCIAL DISCLOSURE
    
    
    99ITEM 9A. CONTROLS AND PROCEDURES
    
    
    99ITEM 9B. OTHER INFORMATION
    
    
    99PART IIIITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE
GOVERNANCE
    
    
    100ITEM 11. EXECUTIVE COMPENSATION
    
    
    100ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER
MATTERS
    
    
    100ITEM 13. CERTAIN RELATIONSHIPS AND RELATED
TRANSACTIONS, AND DIRECTOR INDEPENDENCE
    
    
    101ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
    
    
    101PART IVITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
    
    
    101Exhibit 10.36Exhibit 10.37Exhibit 10.40Exhibit 10.44Exhibit 21.1Exhibit 23.1Exhibit 31.1Exhibit 31.2Exhibit 32.1Exhibit 32.2
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PART I
 References in this Form 10-K to OncoGenex Pharmaceuticals, OncoGenex, the Company, we, us
or our refer to OncoGenex Pharmaceuticals, Inc. and its wholly owned subsidiaries. The
information in this Form 10-K contains certain forward-looking statements, including statements
related to clinical trials, regulatory approvals, markets for the Companys products, new product
development, capital requirements and trends in its business that involve risks and uncertainties.
The Companys actual results may differ materially from the results discussed in the
forward-looking statements. Factors that might cause such a difference include those discussed in
Business, Risk Factors and Managements Discussion and Analysis of Financial Condition and
Results of Operations as well as those discussed elsewhere in this Form 10-K .
 
 ITEM 1. BUSINESS
 Overview of Our Business
  Product Candidates Overview and Recent Developments
  OGX-011
  
    
    a phase 3 clinical trial of OGX-011 in approximately 300 patients with second-line
castrate resistant prostate cancer (CRPC), expected to initiate in the second quater of 2010 subject to institutional review board approval and patient screening. OncoGenex will
have primary responsibility for the oversight of this trial;
 
    
    a phase 3 clinical trial of OGX-011 in approximately 800 patients with first-line CRPC,
expected to initiate in the third quater of 2010. Teva will have primary responsibility for the oversight of
this trial; and
 
    
    a phase 3 clinical trial of OGX-011 in at least 700 patients with first-line non-small
cell lung cancer (NSCLC), expected to initiate by early 2011. Teva will have primary
responsibility for the oversight of this trial.
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
    
    We are required to contribute $30 million towards development of OGX-011 which will
include our personnel costs for certain development activities; and
 
    
    Teva is required to fund all other expenses under the Clinical Development Plan.
 Teva Pharmaceutical Industries Ltd.
  OGX-427
    4




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SN2310, OGX-225 and CSP-9222
    Financial Overview
     Recent Corporate History
    Our Product Candidates
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OGX-011
 Overview of OGX-011
     
    
    longer survival duration when adding OGX-011 to first-line docetaxel compared to
first-line docetaxel alone in patients with CRPC within a randomized phase 2 trial;
 
    
    longer survival duration when adding OGX-011 to either mitoxantrone or docetaxel as
second-line chemotherapy compared to survival duration observed in two published studies
of CRPC patients receiving second-line chemotherapy (One is a study in patients with
better prognostic risk factors who received docetaxel as second-line chemotherapy which
was conducted at the British Columbia Cancer Agency and presented at the American Society
of Clinical Oncology (ASCO) Genitourinary Conference in 2008 (BCCA Study) and the
second study is the follow-up evaluation of patients on the TAX 327 Study (the TAX 327
Study) who later received second-line chemotherapy. The TAX 327 Study was the key
registration study that showed a survival benefit for docetaxel over mitoxantrone for
first-line chemotherapy treatment of patients with metastatic CRPC);
 
    
    increased frequency and duration of pain palliation when adding OGX-011 to either
mitoxantrone or docetaxel as second-line chemotherapy compared to the frequency and
duration of pain palliation observed in the TAX 327 Study for first-line chemotherapy
alone in patients with CRPC; and
 
    
    longer survival duration when adding OGX-011 to gemcitabine and a platinum-containing
chemotherapy compared to the survival duration reported in prior published results from
randomized clinical trials in NSCLC patients receiving gemcitabine and a
platinum-containing chemotherapy.
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>
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Summary of OGX-011 Product Registration Strategy
  
    
    Evaluating a survival benefit for OGX-011 in combination with first-line docetaxel
treatment in approximately 800 men with CRPC, expected to initiate in the third quarter
of 2010. Teva will have primary responsibility of the oversight of this trial;
 
    
    Evaluating a durable pain palliation benefit for OGX-011 in combination with docetaxel
as second-line chemotherapy in approximately 300 men with CRPC, expected to initiate
in the second quarter of 2010 subject to institutional review board approval and patient screening.
OncoGenex will have primary responsibility for the oversight of this trial; and
 
    
    Evaluating a survival benefit for OGX-011 in combination with first-line chemotherapy
in at least 700 patients with NSCLC, expected to initiate in 2011. Teva will have primary
responsibility for the oversight of this trial.
 Summary of Results of OGX-011 Phase 2 Clinical Trials
  Summary of Final Results of OGX-011 Phase 2 Clinical Trial in First-Line Hormone Refractory
Prostate Cancer
   
    
    The median overall survival in patients who were treated with OGX-011 plus docetaxel
trial was 23.8 months compared to 16.9 months for patients treated with docetaxel alone,
indicating a 6.9 month survival advantage in the OGX-011 arm;
 
    
    The unadjusted hazard ratio (HR), a measure used to compare the death rates between
treatment groups, was 0.61, representing a 39% lower rate of death for patients treated
with OGX-011; and
 
    
    A prospectively defined multivariate analysis indicated that the significant predictors
of overall survival were treatment arm, performance status and presence of metastases
other than in bone or lymph nodes. In the multivariate analysis, patients treated with
OGX-011 had a rate of death of 51% lower than patients treated with docetaxel alone
(HR=0.49; p=0.012). Additional exploratory analyses found that the lower rate of death was
associated with the effect of OGX-011 treatment even when varying amounts of chemotherapy
were administered (i.e. OGX-011 treatment resulted
in a lower rate of death when compared to the control arm for patients receiving 6 or less
cycles of chemotherapy as well as for patients receiving 10 cycles of chemotherapy).
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Summary of Results of OGX-011 Phase 2 Clinical Trial in Second-Line CRPC
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
    
    survival duration is longer than the survival duration observed in the follow-up
evaluation of patients on the TAX 327 Study who later received second-line chemotherapy
and were available for long-term follow-up. In the follow-up evaluation of TAX 327, 237
patients received either docetaxel or mitoxantrone as second-line chemotherapy. The median
(50%) survival duration from the start of second-line chemotherapy was 10 months for both
groups of patients (patients receiving mitoxantrone as second-line chemotherapy after
receiving docetaxel as first-line chemotherapy or patients receiving docetaxel as
second-line chemotherapy after receiving mitoxantrone as first-line chemotherapy). As of
June 9, 2009, the estimated median over survival duration for the custirsen plus
mitoxantrone arm was 11.4 months (95% C.I.: 6.5-15.2 months) based on a median follow-up
of 30 months. For the custirsen plus docetaxel retreatment arm, the median overall
survival is estimated at 15.8 months (95% C.I.:9.9-23.3 months) for the 20 randomized
patients, based on a median follow-up of 30 months, and 12.8 months (95% C.I.:9.9-17.0
months) for the combined 45 patients, based on a median follow-up of 23 months;
 
    
    the survival data from this clinical trial also compares favorably to the median
survival duration of 9.6 months for patients who received second-line docetaxel after
first-line docetaxel in the retrospective BCCA Study. The patients in the BCCA Study had a
better prognosis than the patients in OncoGenex clinical trial;
 
    
    preliminary analyses have shown that treatment with OGX-011 in combination with
chemotherapy significantly lowers serum clusterin levels and that average serum clusterin
levels were predictive of survival with low serum clusterin levels correlating to longer
survival; and
 
    
    durable pain responses (defined as a duration of 12 weeks or greater) were observed in
46% of evaluable patients in the docetaxel retreatment plus OGX-011 arm and in 46% of
patients in the mitoxantrone arm.
 Summary of Preliminary Results of OGX-011 Phase 2 Clinical Trial in NSCLC
  
    
    the median overall survival was 14.1 months and 54% of patients survived at least 1
year;
 
    
    in January 2009, we reported that at two years, 30% of patients who had received
OGX-011 with first-line chemotherapy were alive;
 
    
    for comparison, published studies using a platinum-based regimen plus gemcitabine as
first-line chemotherapy for advanced NSCLC reported median survivals of 8 to 11 months and
one-year survival rates of 33% to 43%. Market approval for Avastin plus paclitaxel and
carboplatin chemotherapy for NSCLC was based on results showing a median survival of 12.3
months compared to 10.3 months for patients treated with chemotherapy alone. Survival
rates for Avastin plus chemotherapy versus chemotherapy alone were reported as 51% versus
44% at one year and 23% versus 15% at two years, respectively;
 
    
    73% of patients achieved disease control; and
 
    
    preliminary analyses have shown that treatment with OGX-011 in combination with
gemcitabine and a platinum chemotherapy significantly lowers serum clusterin levels and
that average serum clusterin levels were predictive of survival with low serum clusterin
levels correlating to longer survival.
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Summary of Preliminary Results of OGX-011 Phase 2 Clinical Trial in Advanced Breast Cancer
  OGX-427
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SN2310
    12




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OGX-225
    CSP-9222
  Summary of Product Development Programs
  Cancer Indication and
    
    
    
    
    
    Recent and Expected Near Term DataProduct Candidate
    
    Study
    
    Treatment Combination(1)
    
    Development Phase/Status
    
    ReleasesOGX-011 phase 3 (2)
    
    Castrate Resistant Prostate Cancer  Survival Endpoint
(OGX-011-11)
    
    First-line docetaxel with and without OGX-011 (~800 patients)
    
         Initiation pending; SPA approved by the FDA
and EMA in agreement with development plan
    
         Expected to initiate in the third quarter of 2010. Teva has primary responsibility
for the oversight of this trialCastrate Resistant Prostate Cancer  Durable Pain
Palliation Endpoint
(OGX-011-10)
    
    Docetaxel as second-line chemotherapy with and without OGX-011(~300
patients)
    

     Initiation pending; SPA approved by the FDA
and EMA in agreement with development plan
    
         Expected to initiate in the second quarter of 2010. OncoGenex has primary
responsibility for the oversight of this trialAdvanced Non-Small Cell Lung Cancer  Survival
Endpoint
    
    Chemotherapy with or without OGX-011 (~ 700 patients)
(Protocol to be determined)
    
         Initiation pending
    
         Expected to initiate in early 2011. Teva has primary
responsibility for the oversight of this trialOGX-011 phase 2
    
    Castrate Resistant Prostate Cancer
    
    First-line docetaxel with and without OGX-011
    
         Phase 2 completed
    
         Final survival data presented at 2009 ASCO Annual Meeting(OGX-011-03)
    
    
    
    
    
         Manuscript submittedCastrate Resistant Prostate Cancer
(OGX-011-07)
    
    OGX-011 with second-line chemotherapy (docetaxel or mitoxantrone)
    
         Phase 2 completed
    
         Interim data presented at ASCO GU Symposium 2008 Manuscript in
preparation     Manuscript in preparationCastrate Resistant Prostate Cancer
(OGX-011-07A)
    
    OGX-011 with docetaxel as second-line chemotherapy
    
         Phase 2 completed
    
         Manuscript in preparationAdvanced Non-Small Cell Lung Cancer (OGX-011-05)
    
    OGX-011 with first-line chemotherapy (gemcitabine and cisplatin or
gemcitabine and carboplatin)
    
         Phase 2 completed
    
         2-year survival data presented Feb 2009
     Manuscript in preparationLocalized Prostate Cancer
(OGX-011-04)
    
    OGX-011 with hormone ablation therapy
    
         Phase 2 completed
    
         Results presented at ASCO GU 2008Advanced Breast Cancer
(OGX-011-06)
    
    OGX-011 with docetaxel as second-line chemotherapy
    
         Phase 2 completed
    
         Data published in Clinical Cancer Research 2009OGX-011 phase 1
    
    Localized Prostate Cancer
(OGX-011-01)
    
    OGX-011 with hormone ablation therapy
    
         Phase 1 completed
    
         Data published in Journal of National Cancer Institute 2005Solid Tumors
(prostate, breast, NSCL, ovarian, renal, bladder,
peritoneum)
(OGX-011-02)
    
    OGX-011 with docetaxel
    
         Phase 1 completed
    
         Data published in Clinical Cancer Research 2008OGX-427 phase 2
    
    Castrate Resistant Prostate Cancer
    
    OGX-427 as monotherapy
    
         Not yet initiated
    
         Expected to initiate in 2010OGX-427 phase 1
    
    Solid Tumors
    
    OGX-427 with and without chemotherapy
    
         Phase 1 ongoing- accrual and treatment
complete for evaluation of OGX-427 as monotherapy. On-going accrual
and treatment ongoing for evaluation of OGX-427 with chemotherapy
    
         Monotherapy evaluation complete  maximum tolerated dose not
determined at highest dose level.     Data presented at 2009 ASCO Annual Meeting     Complete study in 2010 and present data if selected at ASCO
2010Bladder Cancer
    
    OGX-427 as monotherapy
    
         Phase 1 ongoing
    
         NoneSN2310
    
    Solid Tumors
    
    SN2310 administered to heavily pre-treated patients with advanced cancer
    
         Phase 1 completed
    
         Enrollment and treatment completed  maximum tolerated dose determinedOGX-225
    
    Solid Tumors
    
    OGX-225 with and without chemotherapy
    
         Pre-clinical proof-of-concept studies completed
    
         NoneCSP-9222
    
    Solid Tumors
    
    To be determined
    
         Formulation to be determined
    
         None
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(1)
    
    In all of our prostate cancer clinical trials and in clinical practice for prostate cancer,
docetaxel is administered in combination with prednisone.(2)
    
    We have designed two phase 3 clinical trials to evaluate the clinical benefit of OGX-011 in
metastatic CRPC. OncoGenex believes that two phase 3 trials will be required for initial product
marketing approval. Overview of Market and Treatment
   Our Strategy
 
    
    Focus on gaining market approval for OGX-011 by conducting registration trials, in both
prostate and lung cancer, in collaboration with Teva, that demonstrate efficacy and
safety. As a result of the Collaboration Agreement with Teva, committed funding is
available for phase 3 trials in 1st line CRPC, 2nd line CRPC, and
1st line NSCLC. The prostate trials are intended to begin in 2010 and the NSCLC
trial is expected to begin in early 2011. Currently, both mitoxantrone and docetaxel are
approved for use in patients with CRPC, but docetaxel was shown to improve patient
survival when compared to mitoxantrone. Currently, Avastin, carboplatin, gemcitabine and
cisplatin are approved for use in patients with NSCLC, but Avastin in combination with
paclitaxel and carboplatin chemotheraphy was shown to improve patient survival when
compared to carboplatin chemotherapy alone.
 
    
    Advance OGX-427 by conducting clinical trials across multiple cancer indications for
OGX-427 including, but not limited to, bladder cancer and CRPC. Consistent with the
strategy OncoGenex is following for OGX-011, OncoGenex intends to conduct parallel
clinical trials to evaluate OGX-427 in several cancer indications and treatment
combinations to accelerate its assessment of this product candidate for further
development.
  14




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
    
    Focus on developing and commercializing new cancer therapies to inhibit treatment
resistance in cancer patients. OncoGenex plans to leverage its expertise in discovery and
development to bring new products to market as fast as possible. OncoGenex intends to
maintain and develop its relationships with the Vancouver Prostate Centre, and develop relationships
with other research institutions in order to identify and source additional product
candidates.
 
    
    Optimize the development of our product candidates through use of outsourcing and
internal expertise. In order to increase efficiency and lower its overhead, OncoGenex
outsources, and plans to continue to outsource, pre-clinical and manufacturing activities.
OncoGenex has chosen to establish critical product development functions in-house,
including clinical trial management and regulatory affairs.
 Second Generation Antisense Technology
  License and Collaboration Agreements
 Teva Pharmaceutical Industries Ltd.
 OGX-011
    15




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
    
    a phase 3 clinical trial of OGX-011 in approximately 300 patients with second-line
castrate resistant prostate cancer, expected to initiate in the second quarter of 2010 subject to institutional review board approval and patient screening. OncoGenex will have
primary responsibility for the oversight of this trial;
 
    
    a phase 3 clinical trial of OGX-011 in approximately 800 patients with first-line
castrate resistant prostate cancer, expected to initiate in the third quarter of 2010. Teva will have primary
responsibility for the oversight of this trial; and
 
    
    a phase 3 clinical trial of OGX-011 in at least 700 patients with first-line NSCLC,
expected to initiate by early 2011. Teva will have primary responsibility for the
oversight of this trial.
  
    
    We will be required to contribute $30 million towards the development of OGX-011 which
will include personnel costs for certain development activities; and
 
    
    Teva will be required to fund all other expenses under the Clinical Development Plan.
      16




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Isis Pharmaceuticals, Inc.
 OGX-011
       17




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OGX-427
      University of British Columbia
 OGX-011
   18




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OGX-427
    19




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OGX-225 and CSP-9222
   Contractual Obligations,
 Summary of Milestone Obligations by Product Candidate
  Milestone Obligations to Third Parties
    
    Amount PayableOGX-011
    
    31%  of non-royalty revenueOGX-427
    
    Up to $5,813,000 (1)(2)(3)OGX-225(3)
    
    Up to $4,313,000 (2)(3)CSP-9222
    
    Up to $14,000,000 (4)
 (1)
    
    Additional milestone payments may be required in respect of OGX-427 for product approvals
outside the field of oncology.(2)
    
    Payable in connection with the initiation of certain clinical trials and obtaining certain
market approvals.(3)
    
    Certain milestone payments are payable in Canadian dollars, which are translated based on the
December 31, 2009 exchange rate of US$1.00 = CAD$1.047, and rounded to the nearest $1,000.(4)
    
    Payable in connection with the initiation of certain clinical trials, making certain regulatory
filings and obtaining certain market approvals. Government RegulationsDrug Approval Process
   
    
    preclinical studies including laboratory evaluation and animal studies to test for
initial safety and efficacy;
 
    
    submission to national health authorities of an Investigational New Drug (IND) IND,
or Clinical Trials Application (CTA) or equivalent dossier, which must be accepted by
each national health authority before human clinical trials may commence in that country;
 
    
    adequate and well-controlled clinical trials to establish the safety and efficacy of
the drug in its intended population and use(s);
 
    
    submission to appropriate national and/or regional regulatory health authorities of a
NDA, or equivalent marketing authorization application, which application is not
automatically accepted for review; and
 
    
    approval by appropriate regulatory health authorities of the marketing authorization
application prior to any commercial sale or shipment of the drug in each country or
jurisdiction.
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Contract Research Agreements
   Research and Development Expenditures
  Manufacturing
   Intellectual Property
      22




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Competition
   23




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
    
    establish that our product candidates are well tolerated and result in a clinical
benefit when administered to cancer patients;
 
    
    advance the development of our lead programs, including the enrollment of patients for
our clinical trials;
 
    
    gain regulatory approval for our product candidates in their respective first
indications as well as expand into additional indications;
 
    
    commercialize our lead product candidates successfully, including convincing
physicians, insurers and other third-party payors of the advantages of its products, when
and if it has any, over current therapies;
 
    
    obtain intellectual property protection and protect the exclusivity for our product
candidates and products, when and if it has any; and
 
    
    acquire other product candidates to expand our pipeline.
 Trademarks
    Employees
   24




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Company Information
 th
  Available Information
   25




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ITEM 1A. RISK FACTORS
 Risks Related to Our Business
 Investing in our common shares involves a high degree of risk. You should consider carefully the
risks and uncertainties described below, together with all of the other information contained in this Form
10-K, before deciding to invest in our common shares. If any of the following risks materialize,
our business, financial condition, results of operation and future prospects will likely be
materially and adversely affected. In that event, the market price of our common shares could
decline and you could lose all or part of your investment.
 We have a limited operating history, have incurred losses since inception and anticipate that we
will continue to incur losses for the foreseeable future. We have never had any products available
for commercial sale and we may never achieve or sustain profitability.
  Because we depend on financing from third parties for our operations, our business may fail if such
financing becomes unavailable or is offered on commercially unreasonable terms.
  
    
    maintaining our partnership with Teva and Tevas ongoing commitment to develop OGX-011
in a timely fashion;
 
    
    the scope and results of our preclinical and clinical trials;
 
    
    whether we experience delays in our preclinical and clinical development programs, or
slower than anticipated product development;
 
    
    whether opportunities to acquire additional product candidates arise and the costs of
acquiring and developing those product candidates;
 
    
    whether we are able to enter into additional third party collaborative partnerships to
develop and/or commercialize any of our other product candidates on terms that are
acceptable to us;
 
    
    the timing and requirements of, and the costs involved in, conducting studies required
to obtain regulatory approvals for our product candidates from the FDA and comparable
foreign regulatory agencies;
 
    
    the availability of third parties to perform the key development tasks for our product
candidates, including conducting preclinical and clinical studies and manufacturing our
product candidates to be tested in those studies and the associated costs of those
services; and
 
    
    the costs involved in preparing, filing, prosecuting, maintaining, defending the
validity of and enforcing, patent claims and other costs related to patent rights and
other intellectual property rights, including litigation costs and the results of such
litigation.
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We are dependent upon our collaborative relationship with Teva to further develop and commercialize
OGX-011, and if our relationship were not to be successful or were to be terminated, we may not be
able to effectively develop and/or commercialize OGX-011, which would have a material adverse
effect on the Company.
   
    
    adverse decisions by Teva or the Joint Steering Committee regarding the development and
commercialization of OGX-011;
 
    
    possible disagreements as to the timing, nature and extent of our development plans,
including clinical trials or regulatory approval strategy;
 
    
    loss of significant rights if we fail to meet our obligations under the Collaboration
Agreement;
 
    
    our limited control over clinical trials with respect to OGX-011;
 
    
    changes in key management personnel at Teva that are members of the Joint Steering
Committee; and
 
    
    possible disagreements with Teva regarding the Collaboration Agreement or ownership of
proprietary rights.
  If Tevas business strategy changes, it may adversely affect the development and commercialization
of OGX-011.
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We are highly dependent on the success of our lead product candidate, OGX-011, and we cannot give
any assurance that OGX-011 or any of our other product candidates will receive regulatory approval.
  Clinical trials may not demonstrate a clinical benefit of our product candidates.
    28




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Our clinical trials may be suspended or terminated at any time, including by the FDA, other
regulatory authorities, the Institutional Review Board (IRB) overseeing the clinical trial at
issue, any of our clinical trial sites with respect to that site, by Teva in the case of OGX-011,
or by us. Any failure or significant delay in completing clinical trials for our product candidates
could materially harm our financial results and the commercial prospects for our product
candidates.
  
    
    decrease in Tevas level of focus and efforts to develop OGX-011;
 
    
    delay or failure to obtain sufficient manufacturing supply of OGX-011;
 
    
    delay or failure to obtain acceptance from the FDAs of Avecia as our
manufacturer for OGX-011;
 
    
    limited number of, and competition for, suitable patients with the
particular types of cancer required for enrollment in our clinical
trials;
 
    
    limited number of, and competition for, suitable sites to conduct clinical trials;
 
    
    delay or failure to obtain required future additional funding, when
needed, through private or public offerings of our equity securities,
debt financings, or executing a licensing, partnership or
collaboration agreement with a third party for any of our product
candidates;
 
    
    introduction of new product candidates to the market in therapeutic
areas similar to those which we are developing our product candidates;
 
    
    concurrent evaluation of new investigational product candidates in
therapeutic areas similar to those which we are developing our product
candidates;
 
    
    delay or failure to obtain the FDAs or non-U.S. regulatory agencies
approval or agreement to commence a clinical trial, including our
phase 3 or registration clinical trials under a Special Protocol
Assessment;
 
    
    delay or failure to obtain sufficient supplies of the product candidate for its clinical trials;
 
    
    delay or failure to reach agreement on acceptable clinical trial
agreement terms or clinical trial protocols with prospective sites or
investigators; and
 
    
    delay or failure to obtain the approval of the IRB to conduct a
clinical trial at a prospective site.
  
    
    slower than expected rates of patient recruitment and enrollment;
 
    
    failure of patients to complete the clinical trial;
 
    
    unforeseen safety issues;
 
    
    lack of efficacy evidenced during clinical trials;
 
    
    termination of our clinical trials by one or more clinical trial sites;
 
    
    inability or unwillingness of patients or medical investigators to
follow its clinical trial protocols;
 
    
    inability to monitor patients adequately during or after treatment;
    
    introduction of competitive products that may impede its ability to
retain patients in its clinical trials; and
 
    
    delay or failure to obtain future additional funding through private
or public offerings of our equity securities, debt financings, or
executing a licensing, partnership or collaboration agreement with a
third party for any of our product candidates in the event of material
unforeseen costs relating to our clinical trials currently in
progress.
  29




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Our product candidates may cause undesirable and potentially serious side effects during clinical
trials that could delay or prevent their regulatory approval or commercialization.
 >
     
    
    Teva may elect to terminate the ongoing clinical trials and cease development of OGX-011;
 
    
    regulatory authorities may withdraw their approval of the product;
  30




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##### Table of Contents




    
    we may be required to recall the product, change the way the product
is administered, conduct additional clinical trials or change the
labeling of the product;
 
    
    a product may become less competitive and product sales may decrease; or
 
    
    our reputation may suffer.
   Even if we or Teva receive regulatory approval to market our product candidates, the market may not
be receptive to our products.
  
    
    timing of market introduction of competitive products;
 
    
    safety and efficacy of our products;
 
    
    prevalence and severity of any side effects;
 
    
    potential advantages or disadvantages over alternative treatments;
 
    
    strength of marketing and distribution support;
 
    
    price of our products, both in absolute terms and relative to alternative treatments;
and
 
    
    availability of coverage and reimbursement from government and other third-party
payors.
  We may not be able to negotiate the exit or sublease of excess office and laboratory space
currently leased in Bothell, Washington, on terms acceptable to us or at all.
   31




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##### Table of Contents



Although we have entered into a Collaboration Agreement with Teva for OGX-011, we have not yet
partnered with third party collaborators with respect to any of our other product candidates, and
we cannot control whether we will be able to do so on favorable terms or at all.
  If our competitors develop and market products that are more effective, safer or less expensive
than our future product candidates, our clinical trials and commercial opportunities will be
negatively impacted.
  If new therapies become broadly used, we may need to conduct clinical trials of our product
candidates in combination with these new therapies to demonstrate safety and efficacy of the
combination. Additional trials will delay the development of our product candidates and increase
our costs. The failure of certain of our product candidates to work in combination with these new
therapies would have an adverse effect on our business.
    32




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If we were to be successfully sued related to our products or operations, we could face substantial
liabilities that may exceed our resources.
  If we fail to acquire and develop products or product candidates at all or on commercially
reasonable terms, we may be unable to grow our business.
     33




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##### Table of Contents



We will need to retain additional personnel and expand our other resources in order to complete
development of OGX-011, promote OGX-011 in the event we exercise our co-promotion option and
develop our other product candidates. If we fail to effectively expand our operations, including
attracting and retaining key management and scientific personnel, we may be unable to successfully
develop or commercialize our product candidates and our business may be materially adversely
affected.
    We may encounter difficulties in managing our expected growth and in expanding our operations
successfully.
  
  34




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##### Table of Contents



We may need to further develop our financial and reporting processes, procedures and controls to
support our anticipated growth.
  We may be adversely impacted if our controls over external financial reporting fail or are
circumvented.
  We rely, in part, on third parties to conduct clinical trials for our product candidates and plan
to rely on third parties to conduct future clinical trials. If these third parties do not
successfully carry out their contractual duties or meet expected deadlines, we may be unable to
obtain regulatory approval for or commercialize our current and future product candidates.
   35




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We rely on third parties to manufacture and supply our product candidates.
        36




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##### Table of Contents



Global credit and financial market conditions could negatively impact the value of our current
portfolio of cash equivalents and investment securities
  Risks Related to Our Intellectual Property
 Our proprietary rights may not adequately protect our technologies and product candidates.
   
    
    we or our licensors were the first to make the inventions covered by
each of our issued patents and pending patent applications;
 
    
    we or our licensors were the first to file patent applications for these inventions;
 
    
    others will not independently develop similar or alternative
technologies or duplicate any of our technologies;
 
    
    any of our or our licensors pending patent applications will result in issued patents;
 
    
    any of our or our licensors patents will be valid or enforceable;
  37




---



##### Table of Contents




    
    any patents issued to us or our licensors and collaboration partners
will provide us with any competitive advantages, or will not be
challenged by third parties;
 
    
    we will develop additional proprietary technologies that are patentable; or
 
    
    the patents of others will not have an adverse effect on our business.
   We and our collaborators, including Teva, may not be able to protect our intellectual property
rights throughout the world.
   The intellectual property protection for our product candidates is dependent on third parties.
   38




---



##### Table of Contents



We may become involved in disputes with Teva or potential future collaborators over intellectual
property ownership, and publications by our research collaborators and scientific advisors could
impair our ability to obtain patent protection or protect our proprietary information, which, in
either case, could have a significant impact on our business.
  The patent protection for our product candidates or products may expire before we are able to
maximize their commercial value which may subject us to increased competition and reduce or
eliminate our opportunity to generate product revenue.
    39




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##### Table of Contents



We may incur substantial costs as a result of litigation or other proceedings relating to patent
and other intellectual property rights and we may be unable to protect our rights to, or use of,
our technology.
    
    
    patent infringement and other intellectual property claims, which
would be costly and time consuming to defend, whether or not the
claims have merit, and which could delay the regulatory approval
process and divert managements attention from our business;
    
    substantial damages for past infringement, which we may have to pay if
a court determines that our product candidates or technologies
infringe a competitors patent or other proprietary rights;
    
    a court prohibiting us from selling or licensing our technologies or
future drugs unless the third party licenses its patents or other
proprietary rights to us on commercially reasonable terms, which it is
not required to do; and
    
    if a license is available from a third party, we may have to pay
substantial royalties or lump sum payments or grant cross licenses to
our patents or other proprietary rights to obtain that license.
     40




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##### Table of Contents



If we breach any of the agreements under which we license rights to our product candidates or
technology from third parties, we could lose license rights that are important to our business.
Certain of our license agreements may not provide an adequate remedy for their breach by the
licensor.
   We may be subject to damages resulting from claims that we, or our employees or consultants, have
wrongfully used or disclosed alleged trade secrets of third parties.
   41




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##### Table of Contents



Risks Related to our Common Stock and Other Securities
 If we raise additional financing, the terms of such transactions may cause dilution to existing
shareholders or contain terms that are not favorable to us.
  The price for our common stock is volatile.
   An increase in the market price of our common shares, which is uncertain and unpredictable, may be
your sole source of gain from an investment in our common shares. An investment in our common
shares may not be appropriate for investors who require dividend income.
  Anti-takeover provisions in our shareholder rights plan, our constating documents and under
Delaware law could make a third party acquisition of the Company difficult.
   42




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##### Table of Contents



Risks Related to Our Industry
 The regulatory approval process is expensive, time consuming and uncertain and may prevent us from
obtaining approvals for the commercialization of some or all of our product candidates.
  
    
    restrictions on the products, manufacturers or manufacturing process;
 
    
    warning letters;
 
    
    civil and criminal penalties;
 
    
    injunctions;
 
    
    suspension or withdrawal of regulatory approvals;
 
    
    product seizures, detentions or import bans;
 
    
    voluntary or mandatory product recalls and publicity requirements;
 
    
    total or partial suspension of production;
 
    
    imposition of restrictions on operations, including costly new manufacturing
requirements; and
 
    
    refusal to approve pending NDAs or supplements to approved NDAs.
  
    
    a drug candidate may not be deemed safe or effective;
 
    
    the FDA may not find the data from pre-clinical studies and clinical trials sufficient;
 
    
    the FDA might not approve our third-party manufacturers processes or facilities;
 
    
    the FDA may change its approval policies or adopt new regulations; or
 
    
    third party products may enter the market and change approval requirements.
  43




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##### Table of Contents



Even if we obtain regulatory approvals for our product candidates, the terms of approvals and
ongoing regulation of our product candidates may limit how we manufacture and market our product
candidates, which could materially impair our ability to generate revenue.
  
    
    restrictions on the products, manufacturers or manufacturing process;
    
    warning letters;
    
    civil or criminal penalties or fines;
    
    injunctions;
    
    product seizures, detentions or import bans;
    
    voluntary or mandatory product recalls and publicity requirements;
    
    suspension or withdrawal of regulatory approvals;
    
    total or partial suspension of production;
    
    imposition of restrictions on operations, including costly new
manufacturing requirements; and
    
    refusal to approve pending NDAs or supplements to approved NDAs.
  There is a high risk that our drug development activities will not result in commercial products.
   44




---



##### Table of Contents



If government and third-party payors fail to provide coverage and adequate reimbursement rates for
our product candidates, our revenues and potential for profitability will be reduced.
    Failure to obtain regulatory approval outside the United States would prevent us or Teva from
marketing our product candidates abroad.
   45




---



##### Table of Contents



We are at risk of securities class action litigation.
  
 ITEM 1B. UNRESOLVED STAFF COMMENTS
  
 ITEM 2. PROPERTIES
   
 ITEM 3. LEGAL PROCEEDINGS
  
 ITEM 4. Reserved
  46




---



##### Table of Contents



PART II
 
 ITEM 5. MARKET FOR THE REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER
PURCHASES OF EQUITY SECURITIES
   OncoGenex Pharmaceuticals, Inc
    
    HIGH (1)
    
    
    LOW (1)YEAR ENDED DECEMBER 31, 2008:First quarter
    
    
    10.26
    
    
    
    6.12Second quarter
    
    
    9.00
    
    
    
    4.50Third quarter
    
    
    8.22
    
    
    
    3.02Fourth quarter
    
    
    9.38
    
    
    
    2.00YEAR ENDED DECEMBER 31, 2009:First quarter
    
    
    5.94
    
    
    
    2.90Second quarter
    
    
    27.05
    
    
    
    3.90Third quarter
    
    
    42.99
    
    
    
    19.30Fourth quarter
    
    
    37.88
    
    
    
    20.10
 (1)
    
    All amounts reported herein are presented on a post-one-for-eighteen reverse stock
split basis.  Recent Sales of Unregistered Securities
   47




---



##### Table of Contents



Stock Performance Graph
  The stock price performance included in this graph is not necessarily indicative of future stock
price performance.
 
 12/04
    
    
    12/05
    
    
    12/06
    
    
    12/07
    
    
    8/20/08
    
    
    12/08
    
    
    12/09OncoGenex Pharmaceuticals, Inc.
    
    
    100.00
    
    
    
    142.49
    
    
    
    173.09
    
    
    
    12.32
    
    
    
    7.93
    
    
    
    4.72
    
    
    
    35.06NASDAQ Composite
    
    
    100.00
    
    
    
    101.33
    
    
    
    114.01
    
    
    
    123.71
    
    
    
    106.91
    
    
    
    73.11
    
    
    
    105.61NASDAQ Pharmaceutical
    
    
    100.00
    
    
    
    102.23
    
    
    
    105.16
    
    
    
    99.56
    
    
    
    113.74
    
    
    
    91.99
    
    
    
    98.21
 (1)
    
    August 20, 2008 represents the day before the date of the completion of the
Arrangement.  48




---



##### Table of Contents



ITEM 6. SELECTED FINANCIAL DATA
   December 31,2009
    
    
    2008
    
    
    2007
    
    
    2006
    
    
    2005(in thousands except share and per share amounts)Statements of Operations Data:Collaboration revenue
    
    $
    25,539
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Operating expenses
    
    $
    28,121
    
    
    $
    11,112
    
    
    $
    7,675
    
    
    $
    11,302
    
    
    $
    4,666Net loss
    
    $
    5,476
    
    
    $
    4,204
    
    
    $
    8,536
    
    
    $
    11,594
    
    
    $
    4,929Redeemable
convertible
preferred share
accretion
    
    $
    
    
    
    $
    1,973
    
    
    $
    2,944
    
    
    $
    2,604
    
    
    $
    1,843Loss attributable to
common shareholders
    
    $
    5,476
    
    
    $
    6,177
    
    
    $
    11,480
    
    
    $
    14,198
    
    
    $
    6,772Basic and diluted
loss per common
share
    
    $
    (0.95
    )
    
    $
    (3.38
    )
    
    $
    (96.63
    )
    
    $
    (119.51
    )
    
    $
    (58.71
    )Shares used in calculation of net loss
per shareBasic
    
    
    5,766,850
    
    
    
    1,829,276
    
    
    
    118,801
    
    
    
    118,801
    
    
    
    115,350Diluted
    
    
    5,766,850
    
    
    
    1,829,276
    
    
    
    118,801
    
    
    
    118,801
    
    
    
    115,350
 December 31,2009
    
    
    2008
    
    
    2007
    
    
    2006
    
    
    2005(in thousands)Balance Sheet Data:Cash, cash equivalents
and marketable
securities
    
    $
    64,568
    
    
    $
    12,419
    
    
    $
    5,131
    
    
    $
    8,012
    
    
    $
    13,785Total assets
    
    $
    68,980
    
    
    $
    14,790
    
    
    $
    7,350
    
    
    $
    9,395
    
    
    $
    19,750Current liabilities
    
    $
    25,781
    
    
    $
    2,884
    
    
    $
    8,200
    
    
    $
    2,532
    
    
    $
    1,752Series preferred shares
    
    $
    
    
    
    $
    
    
    
    $
    37,373
    
    
    $
    34,429
    
    
    $
    31,825Common shares
    
    $
    73,804
    
    
    $
    56,076
    
    
    $
    399
    
    
    $
    399
    
    
    $
    399Accumulated deficit
    
    $
    (53,485
    )
    
    $
    (48,009
    )
    
    $
    (41,832
    )
    
    $
    (30,352
    )
    
    $
    (16,154
    )Shareholders equity
    
    
    22,959
    
    
    
    10,707
    
    
    
    (38,223
    )
    
    
    (27,566
    )
    
    
    (13,827
    )
  49




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##### Table of Contents



ITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 Forward-Looking Statements
  
    
    our anticipated future capital requirements and the terms of any capital financing
agreements;
 
    
    progress and preliminary and future results of clinical trial conducted by us or our
collaborators;
 
    
    anticipated regulatory filings, requirements and future clinical trials conducted by
us or our partners;
 
    
    timing and amount of future contractual payments, product revenue and operating
expenses; and
 
    
    market acceptance of our products and the estimated potential size of these markets.
  
    
    uncertainties regarding our future operating results, and the risk that our product
candidates will not obtain the requisite regulatory approvals to commercialize or that
the future sales of our product candidates may be less than expected or nil;
 
    
    future capital requirements and uncertainty of obtaining additional funding through
debt or equity financings on terms acceptable to us;
 
    
    dependence on Tevas ongoing commitment and ability to develop and commercialize
OGX-011;
 
    
    dependence on the development and commercialization of our product candidates,
particularly on OGX-011;
 
    
    the risk that previous clinical trial results may not be indicative of results in
future studies;
 
    
    the risk that results of research and preclinical studies may not be indicative of
results in humans;
 
    
    uncertainty relating to the timing and results of clinical trials;
 
    
    uncertainties regarding the safety and effectiveness of our products and technologies;
 
    
    the timing, expense and uncertainty associated with the development and regulatory
approval process for products;
 
    
    acceptance of our products by the medical community;
 
    
    the uncertainty associated with exiting or subleasing our excess office and laboratory
space;
 
    
    our ability to build out our product candidate pipeline through product in-licensing
or acquisition activities;
 
    
    our future dependence on Teva to market and promote OGX-011 and to provide us with
accurate financial data;
 
    
    general competitive conditions within the drug development and pharmaceutical industry
and new
development s or therapies that may not work in combination with our product candidates;
 
    
    our dependence on key employees;
  50




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##### Table of Contents




    
    proper management of our operations will be critical to the success of the Company;
 
    
    the potential for product liability issues and related litigation;
 
    
    the potential for claims arising from the use of hazardous materials in our business;
 
    
    the potential inability to successfully protect and enforce our intellectual property
rights;
 
    
    the reliance on third parties who license intellectual property rights to us to comply
with the terms of such agreements and to enforce, prosecute and defend such intellectual
property rights;
 
    
    the impact of current, pending or future legislation, regulations and legal actions in
the United States, Canada and elsewhere affecting the pharmaceutical and healthcare
industries;
 
    
    volatility in the value of our common stock; and
 
    
    general economic conditions.
   MD&A Overview
  
    
    an overview of our business;
 
    
    results of operations and why those results are different from the prior year; and
 
    
    capital resources we currently have and possible sources of additional funding for
future capital requirements.
 Arrangement Agreement
  Overview of the Company and 2009 Developments
   51




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##### Table of Contents



Product Candidate OGX-011
   
    
    Evaluating a survival benefit for OGX-011 in combination with first-line docetaxel
treatment in approximately 800 men with CRPC;
 
    
    Evaluating a durable pain palliation benefit for OGX-011 in combination with docetaxel
as second-line chemotherapy in approximately 300 men with CRPC; and
 
    
    Evaluating a survival benefit for OGX-011 in combination with first-line chemotherapy
in at least 700 patients with NSCLC.
 Teva
Pharmaceutical Industries Ltd.
     52




---



##### Table of Contents



Product Candidate OGX-427
       53




---



##### Table of Contents



Product Candidates OGX-225, SN2310 and CSP-9222
  Collaboration Revenue
  Research and Development Expenses
    54




---



##### Table of Contents



General and Administrative Expenses
  Restructuring Activities
    55




---



##### Table of Contents



Results of Operations
  Years Ended December 31, 2009 and December 31, 2008
     Years Ended December 31, 2008 and December 31, 2007
   56




---



##### Table of Contents



Liquidity and Capital Resources
   Cash Flows
 Cash Used in Operations
   Cash Provided by Financing Activities
   57




---



##### Table of Contents



Cash Used/Provided by Investing Activities
   Operating Capital and Capital Expenditure Requirements
  
    
    completing patient accrual in a phase 3 clinical trial
evaluating a durable pain palliation benefit for OGX-011 in
combination with docetaxel as second-line chemotherapy in approximately 300 men with CRPC
which we expect to initiate in the second quarter of 2010;
 
    
    completing patient accrual in a phase 3 clinical trial evaluating a survival benefit for
OGX-011 in combination with docetaxel as first-line chemotherapy in approximately
800 men with CRPC which we expect to initiate in the third quarter of 2010;
 
    
    completing follow-up monitoring visits related to our completed phase 2 clinical
trials of OGX-011;
 
    
    completing follow-up monitoring visits related to the phase 1 clinical trial
evaluating OGX-427 as a monotherapy in patients with solid tumors and continuing
evaluation of OGX-427 in combination with docetaxel in patients with solid tumors;
 
    
    continuing an investigator-sponsored phase 1 clinical trial evaluating OGX-427
treatment in patient with bladder cancer;
 
    
    initiating an investigator-sponsored phase 3 clinical trial evaluating OGX-427
treatment in patients with prostate cancer; and
 
    
    meeting working capital needs, capital expenditures and general corporate purposes.
   
    
    maintaining Teva relationship and Tevas ongoing level of focus and efforts to develop
OGX-011;
 
    
    our ability to obtain additional funding through a partnership or collaboration
agreement with a third party or licenses of certain of our product candidates, or through
private or public offerings of our equity securities or debt financings;
 
    
    timing and costs of clinical trials, preclinical development and regulatory approvals;
 
    
    timing and cost of drug discovery and research and development;
 
    
    entering into new collaborative or product license agreements for products in our
pipeline; and
 
    
    costs related to obtaining, defending and enforcing patents.
  58




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Contractual Obligations
  Less than
    
    
    
    
    
    
    
    
    
    
    More thanContractual Obligations
    
    Total
    
    
    1 year
    
    
    1-3 years
    
    
    3-5 years
    
    
    5 yearsBothell office operating lease (1)
    
    $
    17,743,000
    
    
    $
    1,995,000
    
    
    $
    4,172,000
    
    
    $
    4,426,000
    
    
    $
    7,150,000Vancouver office operating lease
(2)
    
    $
    226,000
    
    
    $
    181,000
    
    
    $
    45,000
    
    
    
    
    
    
    
    Bayer license maintenance fees (3)
    
    $
    875,000
    
    
    $
    125,000
    
    
    $
    325,000
    
    
    $
    425,000
    
    
    
    UBC license maintenance fees (4)
    
    $
    38,200
    
    
    $
    7,600
    
    
    $
    15,300
    
    
    $
    15,300
    
    
    
    Leased equipment
    
    $
    67,300
    
    
    $
    41,800
    
    
    $
    20,200
    
    
    
    5,300
    
    
    
    Total
    
    $
    18,949,500
    
    
    $
    2,350,400
    
    
    $
    4,577,500
    
    
    $
    4,871,600
    
    
    $
    7,150,000
 (1)
    
    This operating lease, which commenced in 2007, is for a term of ten years and
contains a provision for two additional five-year renewals.(2)
    
    This operating lease expires in 2011.(3)
    
    Under the terms of our agreement with Bayer, OncoGenex will make annual payments to
Bayer on June 27 of each year (Anniversary Payments), with an initial payment of $100,000 in
2008. The payments will increase annually by $25,000 until the initiation of the first phase 3
clinical trial related relating to CSP-9222, at which point the Anniversary Payments reset to
$100,000 and increase by $25,000, until such time as the Company achieves either the first NDA
filing in the United States or the European Union related to CSP-9222. For the purposes of this
table we assume no reset in pricing resulting from initiation of phase 3 trials. OncoGenex has the
option to terminate this contract upon 60 days written notice to Bayer.(4)
    
    The Company is obligated to pay an annual license maintenance fee of CAD $8,000 to
UBC, which has been translated based on the December 31, 2009 exchange rate of US$1.00 =
CAD$1.224, and rounded to the nearest $100. Off-Balance Sheet Arrangements
  Inflation
  Contingencies and Commitments
 Teva Pharmaceutical Industries Ltd.
    59




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Isis Pharmaceuticals Inc. and University of British Columbia
       Bayer HealthCare LLC
    60




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Lease Arrangements
   2010
    
    $
    1812011
    
    
    45Total
    
    $
    226
   2010
    
    $
    1,9952011
    
    
    2,0552012
    
    
    2,1172013
    
    
    2,1802014
    
    
    2,245remainder
    
    
    7,150Total
    
    $
    17,742
  Guarantees and Indemnifications
     61




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##### Table of Contents



Material Changes in Financial Condition
 (in thousands)
    
    December 31, 
2009
    
    
    December 31, 
2008Total Assets
    
    $
    68,980
    
    
    $
    14,790Total Liabilities
    
    $
    46,021
    
    
    $
    4,083Total Equity
    
    $
    22,959
    
    
    $
    10,707
  Critical Accounting Policies and Estimates
 Significant Accounting Policies
 Revenue Recognition
  Multiple-Element Arrangements
    62




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Revenue Recognition
  Income Taxes
  Research and Development Costs
    63




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##### Table of Contents



Stock-Based Compensation
 Short-Term
Investments
  Fair value of financial instruments
  Recent accounting pronouncements
  
 ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 Interest Rate Risk
  Foreign Currency Exchange Risk
   64




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##### Table of Contents



ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
 INDEX TO FINANCIAL STATEMENTS:
 Report of Independent Registered Public Accounting Firm
    
    
    66Consolidated Balance Sheets as of December 31, 2009 and 2008
    
    
    68Consolidated Statements of Loss for the years ended December 31, 2009, 2008, and 2007
    
    
    69Consolidated Statements of Shareholders Equity for the years ended December 31,
2009, 2008, and 2007
    
    
    70Consolidated Statements of Cash Flows for the years ended December 31, 2009, 2008,
and 2007
    
    
    71Notes to the Consolidated Financial Statements
    
    
    72
  65




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##### Table of Contents



Report of Independent Registered Public Accounting Firm
 OncoGenex Pharmaceuticals, Inc.
 OncoGenex Pharmaceuticals, Inc.
    Vancouver, Canada,
March 8, 2010
    
    /s/ ERNST & YOUNG LLP
  66




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##### Table of Contents



Report of Independent Registered Public Accounting Firm
 OncoGenex Pharmaceuticals, Inc.
 OncoGenex Pharmaceuticals, Inc.s
      Vancouver, Canada
March 8, 2010
    
    /s/ ERNST & YOUNG LLP    67




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##### Table of Contents



OncoGenex Pharmaceuticals, Inc.
 
 Consolidated Balance Sheets
 (In thousands of U.S. dollars)
 December 31,
    
    
    December 31,2009
    
    
    2008$
    
    
    $ASSETSCurrentCash and cash equivalents
    
    
    62,051
    
    
    
    7,618Short-term investments [note 6]
    
    
    2,517
    
    
    
    4,801Amounts receivable [note 4]
    
    
    3,109
    
    
    
    153Investment tax credit recoverable
    
    
    
    
    
    
    1,090Prepaid expenses
    
    
    722
    
    
    
    587Total current assets
    
    
    68,399
    
    
    
    14,249Property and equipment, net [note 7]
    
    
    72
    
    
    
    44Other assets
    
    
    509
    
    
    
    497Total assets
    
    
    68,980
    
    
    
    14,790LIABILITIES AND SHAREHOLDERS EQUITYCurrentAccounts payable and accrued liabilities
    
    
    14,453
    
    
    
    2,252Deferred Collaboration Revenue
    
    
    10,000
    
    
    
    Current portion of long-term obligations [note 8]
    
    
    1,328
    
    
    
    632Total current liabilities
    
    
    25,781
    
    
    
    2,884Deferred Collaboration Revenue, net of current
    
    
    16,528
    
    
    
    Long-term obligation, less current portion [note 8]
    
    
    3,712
    
    
    
    1,199Total liabilities
    
    
    46,021
    
    
    
    4,083Commitments and contingencies [note 13]Shareholders equity:Common shares:$0.001 par value 11,019,930 shares authorized and
6,324,033 issued and
outstanding at December 31, 2009
    
    
    6
    
    
    
    6Additional paid-in capital
    
    
    73,798
    
    
    
    56,070Accumulated deficit
    
    
    (53,485
    )
    
    
    (48,009
    )Accumulated other comprehensive income
    
    
    2,640
    
    
    
    2,640Total shareholders equity
    
    
    22,959
    
    
    
    10,707Total liabilities and shareholders equity
    
    
    68,980
    
    
    
    14,790Subsequent events [note 16]
  68




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##### Table of Contents



OncoGenex Pharmaceuticals, Inc.
 
 Consolidated Statements of Loss
 (In thousands of U.S. dollars, except share and per share amounts)
 Years EndedDecember 31,2009
    
    
    2008
    
    
    2007$
    
    
    $
    
    
    $COLLABORATION REVENUE
    
    
    25,539
    
    
    
    
    
    
    
    EXPENSESResearch and development
    
    
    24,160
    
    
    
    7,819
    
    
    
    4,135General and administrative
    
    
    3,961
    
    
    
    3,293
    
    
    
    3,540Total expenses
    
    
    28,121
    
    
    
    11,112
    
    
    
    7,675OTHER INCOME (EXPENSE)Interest income
    
    
    47
    
    
    
    210
    
    
    
    177Other
    
    
    70
    
    
    
    211
    
    
    
    (325
    )Total other income (expense)
    
    
    117
    
    
    
    421
    
    
    
    (148
    )Loss for the period before taxes and
extraordinary gain
    
    
    (2,465
    )
    
    
    (10,691
    )
    
    
    (7,823
    )Income tax expense (recovery) [note 10]
    
    
    3,011
    
    
    
    (2,059
    )
    
    
    713Loss before extraordinary gain
    
    
    (5,476
    )
    
    
    (8,632
    )
    
    
    (8,536
    )Extraordinary gain [note 5]
    
    
    
    
    
    
    4,428
    
    
    
    Net loss
    
    
    (5,476
    )
    
    
    (4,204
    )
    
    
    (8,536
    )Redeemable convertible preferred share accretion
    
    
    
    
    
    
    1,973
    
    
    
    2,944Loss attributable to common shareholders
    
    
    (5,476
    )
    
    
    (6,177
    )
    
    
    (11,480
    )Basic and diluted loss per common share
[note 11[h]]
    
    
    (.95
    )
    
    
    (3.38
    )
    
    
    (96.63
    )Weighted average number of common shares [note
11[h]]
    
    
    5,766,850
    
    
    
    1,829,276
    
    
    
    118,801
   69




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##### Table of Contents



OncoGenex Pharmaceuticals, Inc.
 
 Consolidated Statements of Shareholders Equity
 (In thousands of U.S. dollars, except share amounts)
 Accumulated
    
    
    
    
    
    
    
    
    
    
    TotalOther
    
    
    
    
    
    
    
    
    
    
    ShareholdersCommon
    
    
    
    
    
    
    Comprehensive
    
    
    Comprehensive
    
    
    Accumulated
    
    
    EquityShares
    
    
    Amount
    
    
    Income (Loss)
    
    
    Income (Loss)
    
    
    deficit
    
    
    (Deficiency)(in thousands of U.S. dollars, except share amounts)Balance, December 31, 2006
    
    
    118,801
    
    
    
    703
    
    
    
    2,083
    
    
    
    
    
    
    
    (30,352
    )
    
    
    (27,566
    )Stock-based compensation expense
    
    
    
    
    
    
    263
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    263Cumulative translation adjustment from application of US
dollar reporting
    
    
    
    
    
    
    
    
    
    
    557
    
    
    
    557
    
    
    
    
    
    
    
    557Reclassification of unrealized loss on marketable securities
    
    
    
    
    
    
    
    
    
    
    2
    
    
    
    2
    
    
    
    
    
    
    
    2Unrealized gain on marketable securities
    
    
    
    
    
    
    
    
    
    
    1
    
    
    
    1
    
    
    
    
    
    
    
    1Redeemable convertible preferred share accretion
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,944
    )
    
    
    (2,944
    )Loss for the year
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (8,536
    )
    
    
    (8,536
    )
    
    
    (8,536
    )Comprehensive loss for the year
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (7,976
    )Balance, December 31, 2007
    
    
    118,801
    
    
    
    966
    
    
    
    2,643
    
    
    
    
    
    
    
    (41,832
    )
    
    
    (38,223
    )Stock-based compensation expense
    
    
    
    
    
    
    174
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    174Shares held by Sonus shareholders
    
    
    2,059,898
    
    
    
    10,456
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    10,456Shares issued in exchange for convertible debentures
    
    
    1,036,586
    
    
    
    5,012
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,012Shares issued in exchange for preferred shares
    
    
    905,131
    
    
    
    39,345
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    39,345Escrow shares released on achievement of milestones
    
    
    1,388,875Stock option exercises
    
    
    34,601
    
    
    
    122
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    122Issuance of common stock under employee benefit plans
    
    
    222
    
    
    
    1
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1Cumulative translation adjustment from application of US
dollar reporting
    
    
    
    
    
    
    
    
    
    
    (3
    )
    
    
    (3
    )
    
    
    
    
    
    
    (3
    )Redeemable convertible preferred share accretion
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,973
    )
    
    
    (1,973
    )Loss for the period
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (4,204
    )
    
    
    (4,204
    )
    
    
    (4,204
    )Comprehensive loss for the period
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (4,207
    )Balance, December 31, 2008
    
    
    5,544,114
    
    
    
    56,076
    
    
    
    2,640
    
    
    
    
    
    
    
    (48,009
    )
    
    
    10,707Stock-based compensation expense
    
    
    
    
    
    
    380
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    380Shares issued in July 2009 financing
    
    
    475,000
    
    
    
    9,304
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9,304Shares issued in Teva share purchase agreement
    
    
    267,531
    
    
    
    7,903
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,903Stock option exercises
    
    
    37,388
    
    
    
    141
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    141Loss for the period
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (5,476
    )
    
    
    (5,476
    )
    
    
    (5,476
    )Comprehensive loss for the period
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (5,476
    )Balance, December 31, 2009
    
    
    6,324,033
    
    
    
    73,804
    
    
    
    2,640
    
    
    
    
    
    
    
    (53,485
    )
    
    
    22,959
  70




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##### Table of Contents



OncoGenex Pharmaceuticals, Inc.
 
 Consolidated Statements of Cash Flows
 (In thousands of U.S. dollars)
 Years endedDecember 31,2009
    
    
    2008
    
    
    2007$
    
    
    $
    
    
    $OPERATING ACTIVITIESLoss for the period
    
    
    5,476
    
    
    
    4,204
    
    
    
    8,536Add items not involving cashExtraordinary gain
    
    
    
    
    
    
    (4,428
    )
    
    
    Depreciation and amortization
    
    
    50
    
    
    
    89
    
    
    
    83Stock-based compensation [note 11[c]]
    
    
    380
    
    
    
    174
    
    
    
    263Accrued interest on convertible debenture [note 11]
    
    
    
    
    
    
    313
    
    
    
    193Changes in non-cash working capital itemsAmounts receivable
    
    
    (2,955
    )
    
    
    204
    
    
    
    181Investment tax credit recoverable
    
    
    1,090
    
    
    
    646
    
    
    
    (993
    )Prepaid expenses
    
    
    (136
    )
    
    
    
    
    
    
    (68
    )Other assets
    
    
    (12
    )
    
    
    (117
    )
    
    
    (1
    )Accounts payable and accrued liabilities
    
    
    12,200
    
    
    
    (2,244
    )
    
    
    (2
    )Lease obligation
    
    
    3,210
    
    
    
    (253
    )
    
    
    Deferred collaboration revenue
    
    
    26,527
    
    
    
    
    
    
    
    Taxes payable on preferred shares
    
    
    
    
    
    
    (2,487
    )
    
    
    1,001Cash provided by (used in) operating activities
    
    
    34,878
    
    
    
    (12,307
    )
    
    
    (7,879
    )FINANCING ACTIVITIESCash paid on fractional shares eliminated on reverse share split
    
    
    
    
    
    
    (3
    )
    
    
    Proceeds from issuance of common stock under stock option and
employee purchase plans
    
    
    141
    
    
    
    124
    
    
    
    Issuance of common shares, net of share issue costs
    
    
    17,206
    
    
    
    
    
    
    
    Issuance of convertible debentures net of issue costs
    
    
    
    
    
    
    
    
    
    
    4,442Cash provided by financing activities
    
    
    17,347
    
    
    
    121
    
    
    
    4,442INVESTING ACTIVITIESPurchase of investments
    
    
    (4,036
    )
    
    
    (4,843
    )
    
    
    (6,763
    )Proceeds from sale of investments
    
    
    6,280
    
    
    
    15,276
    
    
    
    13,058Purchase of property and equipment
    
    
    (15
    )
    
    
    (3
    )
    
    
    (17
    )Cash received on reverse takeover of Sonus
    
    
    
    
    
    
    5,464
    
    
    
    Transaction fees on reverse takeover of Sonus
    
    
    
    
    
    
    (807
    )
    
    
    Cash provided by investing activities
    
    
    2,229
    
    
    
    15,087
    
    
    
    6,278Effect of exchange rate changes on cash
    
    
    (21
    )
    
    
    90
    
    
    
    (68
    )Increase in cash and cash equivalents during the period
    
    
    54,433
    
    
    
    2,992
    
    
    
    2,773Cash and cash equivalents, beginning of the period
    
    
    7,618
    
    
    
    4,626
    
    
    
    1,853Cash and cash equivalents, end of the period
    
    
    62,051
    
    
    
    7,618
    
    
    
    4,626Supplemental cash flow informationProperty and equipment acquired under lease obligation
    
    
    65
    
    
    
    
    
    
    
    
   71




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##### Table of Contents



OncoGenex Pharmaceuticals, Inc.
 
 Notes to Consolidated Financial Statements
 1. NATURE OF BUSINESS AND BASIS OF PRESENTATION
    Basis of Presentation
  Liquidity
   2. ACCOUNTING POLICIES
 Significant Accounting Policies
 Use of Estimates
   72




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##### Table of Contents



Cash Equivalents
  Short-Term Investments
  Fair value of financial instruments
  Intellectual Property
  Revenue Recognition
  Multiple-Element Arrangements
  73




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##### Table of Contents



Revenue Recognition
  Property and Equipment
  Computer equipment
    
    3 yearsComputer software
    
    3 yearsFurniture and fixtures
    
    5 yearsLeasehold improvements
    
    Over the term of the lease
  74




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##### Table of Contents



Reporting Currency and Foreign Currency Translation
   Income Taxes
  Scientific Research and Development Tax Credits
  Research and Development Costs
   Stock-Based Compensation
   75




---



##### Table of Contents



Segment Information
  Comprehensive Income (Loss)
  Loss per Common Share
  Recently Adopted Accounting Policies
      76




---



##### Table of Contents



Recent Accounting Pronouncements
  3. FINANCIAL INSTRUMENTS AND RISK
   77




---



##### Table of Contents



4. COLLABORATION AGREEMENT
      78




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##### Table of Contents




    
    a phase 3 clinical trial of the Licensed Product for second-line castrate resistant
prostate cancer, expected to initiate in the second quarter of 2010 subject to institutional review board approval and patient screening. The Company will have primary responsibility
for the oversight of this trial;
 
    
    a phase 3 clinical trial of the Licensed Product for first-line castrate resistant
prostate cancer, expected to initiate in the third quarter of 2010; and
 
    
    a phase 3 clinical trial of the Licensed Product for first-line NSCLC, expected to
initiate by early 2011.
   
    
    the Company will be required to spend $30 million in direct and indirect development
costs, and
 
    
    Teva will fund all other expenses under the Clinical Development Plan.
    79




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##### Table of Contents



Amendment to Isis and UBC License Agreements
   5. REVERSE TAKEOVER
     80




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##### Table of Contents



Sonus common stock
    
    $
    10,385Fair value of options and warrants assumed
    
    
    71Transaction costs of OncoGenex
    
    
    807Total purchase price
    
    $
    11,263
  Cash
    
    $
    5,464Marketable securities
    
    
    14,808Accounts receivable
    
    
    6Interest receivable
    
    
    273Other current assets
    
    
    175Furniture and equipment
    
    
    1,186Other long term assets
    
    
    497Intangible assets
    
    
    280Accounts payable
    
    
    (35
    )Accrued expenses excluding severance payable
    
    
    (652
    )Severance payable to employees as part of restructuring
    
    
    (1,322
    )Severance payable to senior executives
    
    
    (1,440
    )Excess facility loss
    
    
    (2,083
    )Negative goodwill
    
    
    (5,894
    )Total purchase price
    
    $
    11,263
   Negative goodwill
    
    $
    (5,894
    )Furniture and equipment
    
    
    1,186Intangible assets
    
    
    280Excess negative goodwill
    
    $
    (4,428
    )
  81




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##### Table of Contents



Pro Forma Results of Operations
  For the year endedDecember 31,(in thousands except shareholder and per share amounts)
    
    2008Revenue
    
    
    Net loss applicable to common shareholders
    
    $
    (28,102
    )Net loss per share  basic and diluted
    
    $
    (15.36
    )Weighted average shares
    
    
    1,829,276
 6. FAIR VALUE MEASUREMENTS
   
    
    Level 1  Quoted prices in active markets for identical securities;
 
    
    Level 2  Other significant observable inputs that are observable through corroboration
with market data (including quoted prices in active markets for similar securities);
 
    
    Level 3  Significant unobservable inputs that reflect managements best estimate of
what market participants would use in pricing the asset or liability.
     Financial Instruments
 Cash
  U.S. Government and Agency Securities
 U.S. Government Securities
  82




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##### Table of Contents



U.S. Agency Securities
 Corporate and Other Debt
 Corporate Bonds and Commercial Paper
  (in thousands)
    
    Level 1
    
    
    Level 2
    
    
    Level 3
    
    
    2009Marketable SecuritiesMoney market securities
    
    $
    5,941
    
    
    $
    
    
    
    $
    
    
    
    $
    5,941U.S. treasury securities
    
    
    6,033
    
    
    
    
    
    
    
    
    
    
    
    6,033Other government debt securities
    
    
    401
    
    
    
    1,103
    
    
    
    
    
    
    
    1,504Corporate bonds and commercial
paper
    
    
    
    
    
    
    3,500
    
    
    
    
    
    
    
    3,500$
    12,375
    
    
    $
    4,603
    
    
    $
    
    
    
    $
    16,978
 (in thousands)
    
    Level 1
    
    
    Level 2
    
    
    Level 3
    
    
    2008Marketable SecuritiesMoney market securities
    
    $
    4,667
    
    
    $
    
    
    
    $
    
    
    
    $
    4,667Corporate bonds and commercial
paper
    
    
    
    
    
    
    5,594
    
    
    
    
    
    
    
    5,594Other government debt securities
    
    
    
    
    
    
    1,009
    
    
    
    
    
    
    
    1,009$
    4,667
    
    
    $
    6,603
    
    
    $
    
    
    
    $
    11,270
  83




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##### Table of Contents



Gross
    
    
    GrossAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    Estimated(in thousands)
    
    Cost
    
    
    Gain
    
    
    Loss
    
    
    Fair Value2009Money market securities
    
    $
    5,941
    
    
    $
    
    
    
    $
    
    
    
    $
    5,941U.S. treasury securities
    
    
    6,033
    
    
    
    1
    
    
    
    (2
    )
    
    
    6,032Other government debt securities
    
    
    1,504
    
    
    
    1
    
    
    
    
    
    
    
    1,505Corporate bonds and commercial
paper
    
    
    3,500
    
    
    
    
    
    
    
    
    
    
    
    3,500$
    16,978
    
    
    $
    2
    
    
    $
    (2
    )
    
    $
    16,9782008Money market securities
    
    $
    4,667
    
    
    $
    
    
    
    $
    
    
    
    $
    4,667Corporate bonds and commercial
paper
    
    
    5,599
    
    
    
    2
    
    
    
    (7
    )
    
    
    5,594Other government debt securities
    
    
    1,007
    
    
    
    2
    
    
    
    
    
    
    
    1,009$
    11,273
    
    
    $
    4
    
    
    $
    (7
    )
    
    $
    11,270
    7. PROPERTY AND EQUIPMENT
 Accumulated
    
    
    Net Book(In thousands)
    
    Cost
    
    
    Amortization
    
    
    Value$
    
    
    $
    
    
    $December 31, 2009Computer equipment
    
    
    276
    
    
    
    271
    
    
    
    5Furniture and fixtures
    
    
    113
    
    
    
    90
    
    
    
    23Leasehold improvements
    
    
    42
    
    
    
    42
    
    
    
    Equipment under capital lease
    
    
    66
    
    
    
    22
    
    
    
    44497
    
    
    
    425
    
    
    
    72December 31, 2008Computer equipment
    
    
    268
    
    
    
    248
    
    
    
    20Furniture and fixtures
    
    
    94
    
    
    
    70
    
    
    
    23Leasehold improvements
    
    
    38
    
    
    
    38
    
    
    
    400
    
    
    
    356
    
    
    
    44
  84




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##### Table of Contents



8. SEVERANCE CHARGES AND OTHER RESTRUCTURING ACTIVITIES
    Remaining
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    RemainingLiability at
    
    
    
    
    
    
    Amortization
    
    
    Additional
    
    
    Liability atDecember 31,
    
    
    Payments
    
    
    of excess
    
    
    Liability
    
    
    December 31,(in thousands)
    
    2008
    
    
    made
    
    
    lease facility
    
    
    Recorded
    
    
    2009Employee severance
    
    $
    137
    
    
    $
    137
    
    
    
    
    
    
    
    
    
    
    
    0Current portion of excess lease facility
    
    $
    632
    
    
    
    
    
    
    
    (884
    )
    
    $
    1,549
    
    
    $
    1,297Long-term portion of excess lease
facility
    
    $
    1,090
    
    
    
    
    
    
    
    (144
    )
    
    $
    2,402
    
    
    $
    3,348
 9. OTHER ASSETS
  10. INCOME TAX
   85




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##### Table of Contents



(In thousands)
    
    2009
    
    
    2008
    
    
    2007Income taxes at statutory rates
    
    
    (838
    )
    
    
    (3,635
    )
    
    
    (2,669
    )Expenses not deducted for tax purposes(1)
    
    
    151
    
    
    
    3,991
    
    
    
    389Effect of tax rate changes on deferred tax assets and liabilities
    
    
    
    
    
    
    
    
    
    
    Effect of foreign tax (Canadian) rate changes on deferred tax assets and liabilities
    
    
    (130
    )
    
    
    974
    
    
    
    1,721Reduction in benefit of operating losses
    
    
    542
    
    
    
    339
    
    
    
    Reduction in the benefit of other tax attributes
    
    
    367
    
    
    
    
    
    
    
    Impact of Withholding Tax
    
    
    3,000
    
    
    
    
    
    
    
    Foreign exchange effect on valuation allowance
    
    
    (1,437
    )
    
    
    2,244
    
    
    
    (1,643
    )Investment tax credits
    
    
    (180
    )
    
    
    (180
    )
    
    
    Research and development tax credits
    
    
    (32
    )
    
    
    
    
    
    
    (96
    )Change in valuation allowance
    
    
    1,628
    
    
    
    1,643
    
    
    
    2,685Reversal of tax effect of income of Sonus prior to the Arrangement (2)
    
    
    
    
    
    
    (5,310
    )
    
    
    Canadian Part VI.1 tax on redeemable convertible preferred shares (3)
    
    
    
    
    
    
    (2,125
    )
    
    
    676Part VI.I tax deduction
    
    
    
    
    
    
    
    
    
    
    (519
    )Book to tax return adjustments
    
    
    (60
    )
    
    
    
    
    
    
    Other
    
    
    
    
    
    
    
    
    
    
    169Income tax expense
    
    
    3,011
    
    
    
    (2,059
    )
    
    
    713
 (1)
    
    The increase in 2008 from 2007 was primarily attributable to amounts recognized in connection
with the reverse takeover by OncoGenex Technologies Inc. of Sonus Pharmaceuticals, Inc. (which
subsequently changed its name to OncoGenex Pharmaceuticals, Inc.) (Sonus) during 2008 (the
Arrangement), including facility-related charges and the conversion of redeemable convertible
preferred shares into equity following the Arrangement.(2)
    
    This line item represents the adjustment required to the 2008 tax provision for amounts
associated with Sonus during the portion of the year prior to the Arrangement. The amount of $5,310
represents the pre-arrangement loss of Sonus of $15,617 multiplied by the US Federal Statutory tax
rate of 34%. Offsetting the $5,310 was $5,310 included in line item Change in valuation
allowance.(3)
    
    Canadian Part VI.1 tax on redeemable convertible preferred shares was accrued during each year
such shares were outstanding. This tax would have been payable upon retraction of redeemable
convertible preferred shares. These shares would have been retractable at any time after August
10. 2010. In 2008, subsequent to the completion of the Arrangement, all convertible redeemable
preferred shares were converted into equity and as a result the associated aggregate tax liability
was reversed.    86




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Non-capitaland NetInvestment
    
    
    OperatingTax Credits
    
    
    Losses$
    
    
    $2010
    
    
    
    
    
    
    5,7022011
    
    
    
    
    
    
    472012
    
    
    
    
    
    
    442013
    
    
    
    
    
    
    10,7952014
    
    
    
    
    
    
    1,6242015
    
    
    
    
    
    
    2016
    
    
    
    
    
    
    2017
    
    
    
    
    
    
    2018
    
    
    7
    
    
    
    2019
    
    
    64
    
    
    
    322020
    
    
    
    
    
    
    2,7452021
    
    
    2
    
    
    
    4002022
    
    
    2
    
    
    
    11,7662023
    
    
    1
    
    
    
    10,7852024
    
    
    
    
    
    
    16,8142025
    
    
    232
    
    
    
    9,1012026
    
    
    67
    
    
    
    31,7132027
    
    
    
    
    
    
    27,4402028
    
    
    23
    
    
    
    14,9382029
    
    
    111
    
    
    
    4,535509
    
    
    
    148,481
   2009
    
    
    2008$
    
    
    $Deferred tax assets:Tax basis in excess of book value of assets
    
    
    1,202
    
    
    
    692Non-capital loss carryforwards
    
    
    48,588
    
    
    
    48,923Research and development deductions and
credits
    
    
    4,210
    
    
    
    3,777Part VI.1 tax deduction
    
    
    
    
    
    
    Share issue costs
    
    
    119
    
    
    
    144Stock options
    
    
    1,689
    
    
    
    1,560Capital loss carryforward
    
    
    51
    
    
    
    268Deferred rent
    
    
    1,697
    
    
    
    494Foreign tax credit
    
    
    3,273
    
    
    
    Other
    
    
    27
    
    
    
    Total deferred tax assets
    
    
    60,856
    
    
    
    55,858Valuation allowance
    
    
    (60,856
    )
    
    
    (55,858
    )
  87




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(in thousands)
    
    $Balance as of December 31, 2007
    
    
    614Additions based on the reverse takeover of Sonus
    
    
    1,355Additions based on tax positions related to the current year
    
    
    342Deductions based on tax positions related to the current year
    
    
    (355
    )Balance as of December 31, 2008
    
    
    1,956Additions based on tax positions related to the current year
    
    
    143Deductions based on tax positions related to the current year
    
    
    (90
    )Balance as of December 31, 2009
    
    
    2,009
    Tax
    
    Years open toJurisdiction
    
    examinationCanada
    
    
    2003 to 2009US
    
    
    2003 to 2009
 11. COMMON STOCK
 [a] Authorized
   88




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##### Table of Contents



[b] Issued and outstanding shares
   Escrow shares
      July 2009 Financing
   89




---



##### Table of Contents



2009 Teva Share Purchase Agreement
  [c] Stock options
 OncoGenex Technologies Inc. Stock Option Plan
    Sonus Option Plans
     90




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##### Table of Contents



ASC 718 Compensation  Stock Compensation
  Share-Based Payment
  Years endedDecember 31,2009
    
    
    2008
    
    
    2007Risk-free interest rates
    
    
    2.85
    %
    
    
    1.71
    %
    
    
    4.63
    %Expected dividend yield
    
    
    0
    %
    
    
    0
    %
    
    
    0
    %Expected life
    
    6.1 years
    
    
    5.2 years
    
    
    5 yearsExpected volatility
    
    
    74
    %
    
    
    77
    %
    
    
    100
    %
    Years endedDecember 31,(in thousands)
    
    2009
    
    
    2008
    
    
    2007$
    
    
    $
    
    
    $Research and development
    
    
    88
    
    
    
    65
    
    
    
    93General and administrative
    
    
    292
    
    
    
    109
    
    
    
    170Total share-based compensation
    
    
    380
    
    
    
    174
    
    
    
    263
  91




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##### Table of Contents



Numberof
    
    
    WeightedOptioned
    
    
    AverageCommon
    
    
    ExerciseShares
    
    
    Price#
    
    
    $Balance, December 31, 2006
    
    
    309,919
    
    
    
    3.95Option grants
    
    
    15,984
    
    
    
    18.93Option cancellations
    
    
    (1,672
    )
    
    
    18.93Balance, December 31, 2007
    
    
    324,231
    
    
    
    4.61Additions from Sonus Option Plans
    
    
    98,249
    
    
    
    27.89Option grants
    
    
    397,150
    
    
    
    2.93Option exercises
    
    
    (34,601
    )
    
    
    3.57Option cancellations
    
    
    (61,886
    )
    
    
    28.08Balance, December 31, 2008
    
    
    723,143
    
    
    
    4.88Option grants
    
    
    130,400
    
    
    
    17.52Option cancellations
    
    
    (8,154
    )
    
    
    7.04Option exercises
    
    
    (37,388
    )
    
    
    3.79Option forfeited
    
    
    (5,130
    )
    
    
    6.42Balance, December 31, 2009
    
    
    802,871
    
    
    
    6.95
  92




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##### Table of Contents



Weighted-
    
    
    
    
    
    
    
    
    
    
    Weighted-Options
    
    
    Average
    
    
    Options
    
    
    
    
    
    
    AverageOutstanding
    
    
    Remaining
    
    
    Exercisable
    
    
    Weighted-
    
    
    RemainingNumber of
    
    
    Contractual
    
    
    Number of
    
    
    Average
    
    
    ContractualShares
    
    
    Life
    
    
    Shares
    
    
    Exercise
    
    
    LifeExercise Prices
    
    
    Outstanding
    
    
    (in years)
    
    
    Outstanding
    
    
    Price
    
    
    (in years)2.69
    
    
    
    68,000
    
    
    
    5.8
    
    
    
    68,000
    
    
    
    2.69
    
    
    
    5.83.00
    
    
    
    311,150
    
    
    
    6.0
    
    
    
    77,787
    
    
    
    3.00
    
    
    
    6.03.89
    
    
    
    99,891
    
    
    
    0.9
    
    
    
    99,891
    
    
    
    3.89
    
    
    
    0.94.11
    
    
    
    153,264
    
    
    
    2.8
    
    
    
    153,264
    
    
    
    4.11
    
    
    
    2.86.66
    
    
    
    28,608
    
    
    
    8.2
    
    
    
    28,608
    
    
    
    6.66
    
    
    
    8.27.25
    
    
    
    33,040
    
    
    
    6.4
    
    
    
    16,520
    
    
    
    7.25
    
    
    
    6.418.94
    
    
    
    12,169
    
    
    
    4.5
    
    
    
    11,080
    
    
    
    18.94
    
    
    
    4.522.28
    
    
    
    89,100
    
    
    
    10
    
    
    
    
    
    
    
    
    
    
    
    68.25
    
    
    
    555
    
    
    
    1.8
    
    
    
    555
    
    
    
    68.25
    
    
    
    1.8108.00
    
    
    
    7,094
    
    
    
    0.1
    
    
    
    7,094
    
    
    
    108.00
    
    
    
    0.1802,871
    
    
    
    5.19
    
    
    
    462,799
    
    
    
    3.44
    
    
    
    3.82
    [d] Stock Warrants
  [e] Sonus Employee Stock Purchase Plan
  [f] Shareholder Rights Plan
   93




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[g] 401(k) Plan
  [h] Loss per common share
  Years ended December 31,(in thousands except shares and per share amounts)
    
    2009
    
    
    2008
    
    
    2007NumeratorIncome (loss) attributable to common shareholders as reported
    
    $
    (5,476
    )
    
    $
    (6,177
    )
    
    $
    (11,480
    )DenominatorWeighted average number of common shares outstanding
    
    
    5,766,850
    
    
    
    1,829,276
    
    
    
    118,801Basic and diluted income (loss) per common share
    
    $
    (.95
    )
    
    $
    (3.38
    )
    
    $
    (96.63
    )Earnings per share associated with $4,428 extraordinary gain
    
    $
    
    
    
    
    2.42Basic and diluted income (loss) per common share excluding
extraordinary gain
    
    $
    (.95
    )
    
    $
    (5.80
    )
    
    $
    (96.63
    )
  12. RELATED PARTY TRANSACTIONS
   13. COMMITMENTS AND CONTINGENCIES
 Teva Pharmaceutical Industries Ltd.
   94




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##### Table of Contents



Isis Pharmaceuticals Inc. and University of British Columbia
        95




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##### Table of Contents



Bayer HealthCare LLC
   Lease Arrangements
   2010
    
    $
    1812011
    
    
    45Total
    
    $
    226
   96




---



##### Table of Contents



2010
    
    $
    1,9952011
    
    
    2,0552012
    
    
    2,1172013
    
    
    2,1802014
    
    
    2,245remainder
    
    
    7,150Total
    
    $
    17,742
  Guarantees and Indemnifications
    14. COMPREHENSIVE INCOME (LOSS)
 Year ended December 31,(in thousands)
    
    2009
    
    
    2008
    
    
    2007$
    
    
    $
    
    
    $Loss for the period
    
    
    5,476
    
    
    
    4,204
    
    
    
    8,536Unrealized gain (loss) on cash
equivalents and marketable securities
    
    
    
    
    
    
    
    
    
    
    3Unrealized gain (loss) on foreign exchange
    
    
    
    
    
    
    (3
    )
    
    
    5575,476
    
    
    
    4,207
    
    
    
    7,976
  97




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##### Table of Contents



15. QUARTERLY FINANCIAL INFORMATION (UNAUDITED)
 Quarter EndedDec. 31
    
    
    Sept. 30
    
    
    Jun. 30
    
    
    Mar. 31(in thousands, except per share amounts)2009Collaboration revenue
    
    $
    25,539
    
    
    $
    
    
    
    $
    
    
    
    $
    Research and development
    
    $
    17,365
    
    
    $
    1,513
    
    
    $
    3,588
    
    
    $
    1,694General and administrative
    
    $
    1,291
    
    
    $
    885
    
    
    $
    1,003
    
    
    $
    782Total expenses
    
    $
    18,656
    
    
    $
    2,398
    
    
    $
    4,591
    
    
    $
    2,476Other income (expense)
    
    $
    (3
    )
    
    $
    29
    
    
    $
    34
    
    
    $
    57Tax expense (recovery)
    
    $
    2,999
    
    
    $
    16
    
    
    $
    6
    
    
    $
    (10
    )Net loss (income) attributable to common
shareholders
    
    $
    (3,881
    )
    
    $
    2,385
    
    
    $
    4,563
    
    
    $
    2,409Net loss (income) per share*:Basic and diluted
    
    $
    (0.64
    )
    
    $
    0.40
    
    
    $
    0.82
    
    
    $
    0.432008Research and development
    
    $
    4,198
    
    
    $
    1,639
    
    
    $
    1,108
    
    
    $
    874General and administrative
    
    $
    1,050
    
    
    $
    1,024
    
    
    $
    646
    
    
    $
    573Total expenses
    
    $
    5,248
    
    
    $
    2,663
    
    
    $
    1,754
    
    
    $
    1,447Other income (expense)
    
    $
    334
    
    
    $
    297
    
    
    $
    (213
    )
    
    $
    4Tax expense (recovery)
    
    $
    41
    
    
    $
    (2,515
    )
    
    $
    201
    
    
    $
    214Redeemable preferred share accretion
    
    $
    
    
    
    $
    417
    
    
    $
    780
    
    
    $
    776Extraordinary gain
    
    $
    
    
    
    $
    4,428
    
    
    $
    
    
    
    $
    Net loss (income) attributable to common
shareholders
    
    $
    4,955
    
    
    $
    (4,160
    )
    
    $
    2,949
    
    
    $
    2,433Net income (loss) per share*:Basic and diluted
    
    $
    (0.99
    )
    
    $
    2.02
    
    
    $
    (24.81
    )
    
    $
    (20.48
    )
 *
    
    Quarterly EPS may not add to annual figure due to rounding. 16. SUBSEQUENT EVENTS
   98




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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
  
 ITEM 9A. CONTROLS AND PROCEDURES
      Managements Report on Internal Control over Financial Reporting
     
 ITEM 9B. OTHER INFORMATION
   99




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##### Table of Contents



PART III
 
 ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
  
 ITEM 11. EXECUTIVE COMPENSATION
  
 ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER
MATTERS
  (a)
    
    
    (b)
    
    
    (c)Number of securitiesremainingavailable for future issuanceNumber of securities to be
    
    
    Weighted-average
    
    
    under equity compensationissued upon exercise of
    
    
    exercise price of
    
    
    plansoutstanding
    
    
    outstanding
    
    
    (excluding securitiesoptions, warrants
    
    
    options, warrants
    
    
    reflected inPlan category
    
    and rights
    
    
    and rights
    
    
    column (a)Equity compensation plans approved by security holders
    
    
    781,452
    (1)
    
    $
    7.98
    (1)
    
    
    53,684
    (1)Equity compensation plans not approved by security
holders(2)
    
    
    21,419
    
    
    
    2.69
    
    
    
    0Total
    
    
    802,871
    
    
    $
    6.95
    
    
    
    53,684
 (1)
    
    As at December 31, 2009, the Company maintained the following equity compensation
plans, which were adopted by Sonus prior to the Arrangement: (a) the Incentive Stock
Option, Nonqualified Stock Option and Restricted Stock Purchase Plan  1991, (b) the 1999
Nonqualified Stock Incentive Plan (the 1999 Plan), (c) the 2000 Stock Incentive Plan, (d)
the 2007 Performance Incentive Plan, and (e) the OncoGenex Technologies Amended and
Restated Stock Option Plan.(2)
    
    The 1999 Plan is a broad-based plan for which shareholder approval was not required or
obtained. On February 11, 2009, the 1999 Plan terminated in accordance with its terms. All
stock options outstanding as of such time will continue in effect in accordance with their
respective terms. Stock options granted under the 1999 Plan were generally granted with an
exercise price equal to fair market value on the date of grant.   100




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##### Table of Contents



ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
  
 ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
  
 PART IV
 
 ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
   Report of Independent Registered Public Accounting Firm
    
    
    66Consolidated Balance Sheets as of December 31, 2009 and 2008
    
    
    68Consolidated Statements of Loss for the years ended December 31, 2009,
2008, and 2007
    
    
    69Consolidated Statements of Shareholders Equity for the years ended
December 31, 2009, 2008, and 2007
    
    
    70Consolidated Statements of Cash Flows for the years ended December 31,
2009, 2008, and 2007
    
    
    71Consolidated Notes to the Financial Statements
    
    
    72
    101




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##### Table of Contents



ExhibitNumber
    
    Description2.1
    (1)
    
    Arrangement Agreement between the Company and OncoGenex Technologies Inc. dated May 27, 20082.2
    (2)
    
    First Amendment to Arrangement Agreement between the Company and OncoGenex Technologies Inc. dated August 11, 20082.3
    (2)
    
    Second Amendment to Arrangement Agreement between the Company and OncoGenex Technologies Inc. dated August 15, 20083.1
    (3)
    
    Amended and Restated Certificate of Incorporation (As Amended Through October 17, 1995)3.2
    (4)
    
    Certificate of Amendment to Certificate of Incorporation filed on May 6, 19993.3
    (5)
    
    Certificate of Correction filed on March 9, 2009 to Certificate of Amendment filed on May 6, 19993.4
    (6)
    
    Certificate of Amendment to Certificate of Incorporation filed on May 7, 20043.5
    (5)
    
    Certificate of Correction filed on March 9, 2009 to Certificate of Amendment filed on May 7, 20043.6
    (2)
    
    Certificate of Amendment to Certificate of Incorporation of Sonus Pharmaceuticals Inc., effective August 20, 20083.7
    (7)
    
    Third Amended and Restated Bylaws of Oncogenex Pharmaceuticals, Inc.4.1
    (2)
    
    Specimen Certificate of Common Stock4.2
    (8)
    
    Amended and Restated Rights Agreement dated as of July 24, 2002 between Sonus Pharmaceuticals Inc. and U.S. Stock
Transfer Corporation4.3
    (9)
    
    First Amendment to Amended and Restated Rights Agreement dated as of October 17, 2005 between Sonus
Pharmaceuticals Inc. and U.S. Stock Transfer Corporation4.4
    (10)
    
    Second Amendment to Amended and Restated Rights Agreement dated as of August 10, 2006 between Sonus
Pharmaceuticals Inc. and U.S. Stock Transfer Corporation4.5
    (11)
    
    Third Amendment to Amended and Restated Rights Agreement dated May 27, 2008 between Sonus Pharmaceuticals Inc. and
Computershare Trust Company, N.A.4.6
    (1)
    
    Form of Escrow Agreement between the Company, Computershare Trust Company of Canada and former shareholders and
debentureholders of OncoGenex Technologies Inc.4.7
    (1)
    
    Form of OncoGenex Voting Agreement4.8
    (1)
    
    Form of Sonus Voting Agreement10.1
    (3)
    
    Sonus Pharmaceuticals, Inc. Incentive Stock Option, Nonqualified Stock Option and Restricted Stock Purchase Plan 
1991 (the 1991 Plan), as amended
  102




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##### Table of Contents



ExhibitNumber
    
    Description10.2
    (3)
    
    Form of Incentive Option Agreement (pertaining to the 1991 Plan)10.3
    (3)
    
    Form of Sonus Pharmaceuticals, Inc. Nonqualified Stock Option Agreement under the 1991 Plan10.4
    (4)
    
    Sonus Pharmaceuticals, Inc. 1999 Nonqualified Stock Incentive Plan (the 1999 Plan)10.5
    (4)
    
    Form of Sonus Pharmaceuticals, Inc. Nonqualified Stock Option Agreement under the 1999 Plan10.6
    (4)
    
    Form of Sonus Pharmaceuticals, Inc. Restricted Stock Purchase Agreement under the 1999 Plan10.7
    (12)
    
    Sonus Pharmaceuticals, Inc. 2000 Stock Incentive Plan (the 2000 Plan)10.8
    (13)
    
    First Amendment to Sonus Pharmaceuticals, Inc. 2000 Plan10.9
    (12)
    
    Form of Sonus Pharmaceuticals, Inc. Stock Option Agreement (pertaining to the 2000 Plan)10.10
    (14)
    
    Sonus Pharmaceuticals, Inc. 2007 Performance Incentive Plan (the 2007 Plan)10.11
    (15)
    
    Form of Sonus Pharmaceuticals, Inc. Stock Option Agreement (pertaining to the 2007 Plan)10.12
    (15)
    
    Form of Sonus Pharmaceuticals, Inc. Restricted Stock Purchase Agreement under the 2007 Plan10.13
    (16)
    
    OncoGenex Technologies Inc. Amended and Restated Stock Option Plan10.14
    (17)
    
    Stock Option Assumption, Amending and Confirmation Agreement dated as of August 21, 2008 between the Company and
OncoGenex Technologies Inc.10.15
    (18)
    
    OncoGenex Pharmaceuticals, Inc. Short Term Incentive Awards Program10.16
    (18)
    
    Agreement and Consent Form (related to the Short Term Incentive Awards Program)10.17
    (3)
    
    Form of Indemnification Agreement for Officers and Directors of the Company10.18
    (16)
    
    Form of Indemnification Agreement between OncoGenex Technologies Inc. and each of Scott Cormack, Stephen Anderson
and Cindy Jacobs10.19
    (16)
    
    Form of Indemnification Agreement between OncoGenex Technologies Inc. and Neil Clendeninn10.20
    (2)
    
    Executive Termination Agreement and General Release dated August 21, 2008 between the Company and Michael Martino10.21
    (2)
    
    Executive Termination Agreement and General Release dated August 21, 2008 between the Company and Alan Fuhrman
  103




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##### Table of Contents



ExhibitNumber
    
    Description10.22
    (19)
    
    Employment Agreement between OncoGenex Technologies Inc. and the Company and Scott Cormack dated as of November
4, 200910.23
    (19)
    
    Employment Agreement between OncoGenex Technologies Inc. and the Company and Stephen Anderson dated as of
November 4, 200910.24
    (20)
    
    Amendment dated February 24, 2010 to the Employment Agreement between OncoGenex Technologies Inc. and Stephen
Anderson10.25
    (19)
    
    Employment Agreement between the Company and Cindy Jacobs dated as of November 3, 200910.26
    (21)
    
    Employment Agreement dated October 14, 2008 between OncoGenex Technologies Inc. and Cameron Lawrence10.27
    (21)
    
    Employment Amending Agreement dated January 1, 2009 between OncoGenex Technologies Inc. and Cameron Lawrence10.28
    (22)
    
    Securities Purchase Agreement dated as of August 15, 2005 by and among Sonus Pharmaceuticals Inc. and the
investors named therein10.29
    (22)
    
    Form of Purchase Warrant related to the Securities Purchase Agreement10.30
    (23)
    
    Form of Purchase Warrant issued to Schering AG10.31
    (22)
    
    Registration Rights Agreement dated as of August 15, 2005 by and among Sonus Pharmaceuticals Inc. and the
investors named therein10.32
    (24)
    
    Lease by and between BMR-217th Place LLC and the Company dated as of November 21, 200610.33
    (25)
    
    First Amendment to Lease by and between BMR-217th Place LLC and the Company dated as of August 17, 200710.34
    (26)
    
    Second Amendment to Lease by and between BMR-217th Place LLC and the Company dated as
of January 28, 200810.35
    (6)
    
    Amended and Restated License Agreement effective as of July 2, 2008 by and between
OncoGenex Technologies Inc. and Isis Pharmaceuticals, Inc. (OGX-011)*10.36
    
    
    Letter Agreement Regarding Certain Sublicense Consideration for OGX-011 between OncoGenex Technologies Inc. and
Isis Pharmaceuticals, Inc. dated December 18, 200910.37
    
    
    Amendment No. 1 to Amended and Restated License Agreement between OncoGenex Technologies Inc. and Isis
Pharmaceuticals, Inc. dated December 19, 2009 (OGX-011)*10.38
    (27)
    
    License Agreement between OncoGenex Technologies Inc. and the University of British
Columbia effective as of November 1, 2001, and Amending Agreement dated as of August 30, 2006 (OGX-011)*10.39
    (2)
    
    Second Amending Agreement and Consent as of August 7, 2008 between the University of British Columbia and
OncoGenex Technologies Inc. (OGX-011)10.40
    
    
    Third Amending Agreement to the License Agreement between OncoGenex Technologies Inc and the University of
British Columbia dated as of December 20, 2009 (OGX-011)*
  104




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##### Table of Contents



ExhibitNumber
    
    Description10.41
    (27)
    
    Collaboration and License Agreement between OncoGenex Technologies Inc. and Isis
Pharmaceuticals, Inc. effective as of January 5, 2005 (OGX-427)*10.42
    (27)
    
    License Agreement between OncoGenex Technologies Inc. and the University of British
Columbia effective as of April 5, 2005, and Amending Agreement dated as of August 30, 2006 (OGX-427)*10.43
    (2)
    
    Second Amending Agreement as of August 7, 2008 between the University of British Columbia and OncoGenex
Technologies Inc. (OGX-427)10.44
    
    
    Collaboration and License Agreement between OncoGenex Technologies Inc. and Teva Pharmaceutical Industries Ltd.
dated as of December 20, 2009 (OGX-011)*21.1
    
    
    Subsidiaries of the Registrant23.1
    
    
    Consent of Ernst & Young LLP31.1
    
    
    Certification of President and Chief Executive Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities
Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 200231.2
    
    
    Certification of Chief Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act
of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 200232.1
    
    
    Certification of President and Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 200232.2
    
    
    Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906
of the Sarbanes-Oxley Act of 2002
 
    
    Schedules and similar attachments to the Arrangement Agreement have been omitted pursuant to
Item 601(b)(2) of Regulation S-K. Registrant will furnish supplementally a copy of any omitted schedule or similar attachment to the SEC upon request.*
    
    Confidential portions of this exhibit have been omitted and filed separately with the Commission pursuant to an application for Confidential Treatment under Rule 24b-2 promulgated under the Securities
Exchange Act of 1934, as amended.(1)
    
    Incorporated by reference to the Companys proxy statement on Schedule 14A filed on July 3, 2008.(2)
    
    Incorporated by reference to the Companys quarterly report on Form 10-Q for the quarter ended
September 30, 2008.(3)
    
    Incorporated by reference to the Companys Registration Statement on Form S-1, Reg. No. 33-96112.(4)
    
    Incorporated by reference to Companys quarterly report on Form 10-Q for the quarter ended March 31, 1999.(5)
    
    Incorporated by reference to the Companys current report on Form 8-K filed on March 11, 2009.(6)
    
    Incorporated by reference to the Companys annual report on Form 10-K for the year ended December 31, 2008.  105




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##### Table of Contents



(7)
    
    Incorporated by reference to the Companys current report on Form 8-K filed on October 30, 2008.(8)
    
    Incorporated by reference to the Companys amended Form 8-A filed on July 25, 2002.(9)
    
    Incorporated by reference to the Companys amended Form 8-A filed on October 18, 2005.(10)
    
    Incorporated by reference to the Companys amended Form 8-A filed on August 14, 2006.(11)
    
    Incorporated by reference to the Companys current report on Form 8-K filed on May 30, 2008.(12)
    
    Incorporated by reference to the Companys quarterly report on Form 10-Q for the quarter ended
June 30, 2000.(13)
    
    Incorporated by reference to the Companys quarterly report on Form 10-Q for the quarter ended
September 30, 2006.(14)
    
    Incorporated by reference to the Companys proxy statement on Schedule 14A filed on April 3, 2007.(15)
    
    Incorporated by reference to the Companys quarterly report on Form 10-Q for the quarter ended
September 30, 2007.(16)
    
    Incorporated by reference to the OncoGenex Technologies Inc. registration statement on Form F-1 filed on December 13, 2006.(17)
    
    Incorporated by reference to the Companys registration statement on Form S-8 filed on August 26, 2008.(18)
    
    Incorporated by reference to the Companys current report on Form 8-K filed on April 2, 2009.(19)
    
    Incorporated by reference to the Companys quarterly report on Form 10-Q for the quarter ended September 30, 2009.(20)
    
    Incorporated by reference to the Companys current report on Form 8-K filed February 25, 2010.(21)
    
    Incorporated by reference to the Companys current report on Form 8-K filed March 1, 2010.(22)
    
    Incorporated by reference to the Companys current report on Form 8-K filed on August 18, 2005.(23)
    
    Incorporated by reference to the Schedule 13D filed by Schering Berlin Venture Corporation on October 31, 2005.(24)
    
    Incorporated by reference to the Companys annual report on Form 10-K for the year ended December 31, 2006.(25)
    
    Incorporated by reference to the Companys annual report on Form 10-K for the year ended December 31, 2007.(26)
    
    Incorporated by reference to the Companys quarterly report on Form 10-Q for the quarter ended March 31, 2008.(27)
    
    Incorporated by reference to the OncoGenex Technologies Inc. registration statement on Form F-1,
Amendment No. 1, filed on January 29, 2007.  106




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##### Table of Contents



SIGNATURES
  ONCOGENEX PHARMACEUTICALS, INC.
(Registrant)Date: March 8, 2010
    By:
    /s/ SCOTT CORMACKScott CormackChief Executive Officer and President
(principal executive officer)  By:
    
    /s/ SCOTT CORMACK
    
    
    
    Chief Executive Officer, President and
    
    Date: March 8, 2010Scott Cormack
    
    
    
    Director (principal executive officer)By:
    
    /s/ CAMERON LAWRENCE
    
    
    
    Principal financial officer and
    
    Date: March 8, 2010Cameron Lawrence
    
    
    
    principal accounting officerBy:
    
    /s/ MICHAEL MARTINO
    
    
    
    Director
    
    Date: March 8, 2010Michael MartinoBy:
    
    /s/ MICHELLE BURRIS
    
    
    
    Director
    
    Date: March 8, 2010Michelle BurrisBy:
    
    /s/ DWIGHT WINSTEAD
    
    
    
    Director
    
    Date: March 8, 2010Dwight WinsteadBy:
    
    /s/ NEIL CLENDENINN
    
    
    
    Director
    
    Date: March 8, 2010Neil Clendeninn
  107




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##### Table of Contents



ExhibitNumber
    
    Description2.1
    (1)
    
    Arrangement Agreement between the Company and OncoGenex Technologies Inc. dated
May 27, 20082.2
    (2)
    
    First Amendment to Arrangement Agreement between the Company and OncoGenex
Technologies Inc. dated August 11, 20082.3
    (2)
    
    Second Amendment to Arrangement Agreement between the Company and OncoGenex
Technologies Inc. dated August 15, 20083.1
    (3)
    
    Amended and Restated Certificate of Incorporation (As Amended Through October 17, 1995)3.2
    (4)
    
    Certificate of Amendment to Certificate of Incorporation filed on May 6, 19993.3
    (5)
    
    Certificate of Correction filed on March 9, 2009 to Certificate of Amendment filed on
May 6, 19993.4
    (6)
    
    Certificate of Amendment to Certificate of Incorporation filed on May 7, 20043.5
    (5)
    
    Certificate of Correction filed on March 9, 2009 to Certificate of Amendment filed on
May 7, 20043.6
    (2)
    
    Certificate of Amendment to Certificate of Incorporation of Sonus Pharmaceuticals
Inc., effective August 20, 20083.7
    (7)
    
    Third Amended and Restated Bylaws of Oncogenex Pharmaceuticals, Inc.4.1
    (2)
    
    Specimen Certificate of Common Stock4.2
    (8)
    
    Amended and Restated Rights Agreement dated as of July 24, 2002 between Sonus
Pharmaceuticals Inc. and U.S. Stock Transfer Corporation4.3
    (9)
    
    First Amendment to Amended and Restated Rights Agreement dated as of October 17, 2005
between Sonus Pharmaceuticals Inc. and U.S. Stock Transfer Corporation4.4
    (10)
    
    Second Amendment to Amended and Restated Rights Agreement dated as of August 10, 2006
between Sonus Pharmaceuticals Inc. and U.S. Stock Transfer Corporation4.5
    (11)
    
    Third Amendment to Amended and Restated Rights Agreement dated May 27, 2008 between
Sonus Pharmaceuticals Inc. and Computershare Trust Company, N.A.4.6
    (1)
    
    Form of Escrow Agreement between the Company, Computershare Trust Company of Canada
and former shareholders and debentureholders of OncoGenex Technologies Inc.4.7
    (1)
    
    Form of OncoGenex Voting Agreement4.8
    (1)
    
    Form of Sonus Voting Agreement10.1
    (3)
    
    Sonus Pharmaceuticals, Inc. Incentive Stock Option, Nonqualified Stock Option and
Restricted Stock Purchase Plan  1991 (the 1991 Plan), as amended




---



##### Table of Contents



ExhibitNumber
    
    Description10.2
    (3)
    
    Form of Incentive Option Agreement (pertaining to the 1991 Plan)10.3
    (3)
    
    Form of Sonus Pharmaceuticals, Inc. Nonqualified Stock Option Agreement under the
1991 Plan10.4
    (4)
    
    Sonus Pharmaceuticals, Inc. 1999 Nonqualified Stock Incentive Plan (the 1999 Plan)10.5
    (4)
    
    Form of Sonus Pharmaceuticals, Inc. Nonqualified Stock Option Agreement under the
1999 Plan10.6
    (4)
    
    Form of Sonus Pharmaceuticals, Inc. Restricted Stock Purchase Agreement under the
1999 Plan10.7
    (12)
    
    Sonus Pharmaceuticals, Inc. 2000 Stock Incentive Plan (the 2000 Plan)10.8
    (13)
    
    First Amendment to Sonus Pharmaceuticals, Inc. 2000 Plan10.9
    (12)
    
    Form of Sonus Pharmaceuticals, Inc. Stock Option Agreement (pertaining to the 2000
Plan)10.10
    (14)
    
    Sonus Pharmaceuticals, Inc. 2007 Performance Incentive Plan (the 2007 Plan)10.11
    (15)
    
    Form of Sonus Pharmaceuticals, Inc. Stock Option Agreement (pertaining to the 2007
Plan)10.12
    (15)
    
    Form of Sonus Pharmaceuticals, Inc. Restricted Stock Purchase Agreement under the
2007 Plan10.13
    (16)
    
    OncoGenex Technologies Inc. Amended and Restated Stock Option Plan10.14
    (17)
    
    Stock Option Assumption, Amending and Confirmation Agreement dated as of August 21,
2008 between the Company and OncoGenex Technologies Inc.10.15
    (18)
    
    OncoGenex Pharmaceuticals, Inc. Short Term Incentive Awards Program10.16
    (18)
    
    Agreement and Consent Form (related to the Short Term Incentive Awards Program)10.17
    (3)
    
    Form of Indemnification Agreement for Officers and Directors of the Company10.18
    (16)
    
    Form of Indemnification Agreement between OncoGenex Technologies Inc. and each of
Scott Cormack, Stephen Anderson and Cindy Jacobs10.19
    (16)
    
    Form of Indemnification Agreement between OncoGenex Technologies Inc. and Neil
Clendeninn10.20
    (2)
    
    Executive Termination Agreement and General Release dated August 21, 2008 between
the Company and Michael Martino10.21
    (2)
    
    Executive Termination Agreement and General Release dated August 21, 2008 between
the Company and Alan Fuhrman




---



##### Table of Contents



ExhibitNumber
    
    Description10.22
    (19)
    
    Employment Agreement between OncoGenex Technologies Inc. and the Company and Scott
Cormack dated as of November 4, 200910.23
    (19)
    
    Employment Agreement between OncoGenex Technologies Inc. and the Company and
Stephen Anderson dated as of November 4, 200910.24
    (20)
    
    Amendment dated February 24, 2010 to the Employment Agreement between OncoGenex
Technologies Inc. and Stephen Anderson10.25
    (19)
    
    Employment Agreement between the Company and Cindy Jacobs dated as of November 3,
200910.26
    (21)
    
    Employment Agreement dated October 14, 2008 between OncoGenex Technologies Inc. and
Cameron Lawrence10.27
    (21)
    
    Employment Amending Agreement dated January 1, 2009 between OncoGenex Technologies
Inc. and Cameron Lawrence10.28
    (22)
    
    Securities Purchase Agreement dated as of August 15, 2005 by and among Sonus
Pharmaceuticals Inc. and the investors named therein10.29
    (22)
    
    Form of Purchase Warrant related to the Securities Purchase Agreement10.30
    (23)
    
    Form of Purchase Warrant issued to Schering AG10.31
    (22)
    
    Registration Rights Agreement dated as of August 15, 2005 by and among Sonus
Pharmaceuticals Inc. and the investors named therein10.32
    (24)
    
    Lease by and between BMR-217th Place LLC and the Company dated as of
November 21, 200610.33
    (25)
    
    First Amendment to Lease by and between BMR-217th Place LLC and the
Company dated as of August 17, 200710.34
    (26)
    
    Second Amendment to Lease by and between BMR-217th Place LLC and the
Company dated as
of January 28, 200810.35
    (6)
    
    Amended and Restated License Agreement effective as of July 2, 2008 by and between
OncoGenex Technologies Inc. and Isis Pharmaceuticals, Inc. (OGX-011)*10.36
    
    
    Letter Agreement Regarding Certain Sublicense Consideration for OGX-011 between
OncoGenex Technologies Inc. and Isis Pharmaceuticals, Inc. dated December 18, 200910.37
    
    
    Amendment No. 1 to Amended and Restated License Agreement between OncoGenex
Technologies Inc. and Isis Pharmaceuticals, Inc. dated December 19, 2009 (OGX-011)*10.38
    (27)
    
    License Agreement between OncoGenex Technologies Inc. and the University of British
Columbia effective as of November 1, 2001, and Amending Agreement dated as of
August 30, 2006 (OGX-011)*10.39
    (2)
    
    Second Amending Agreement and Consent as of August 7, 2008 between the University
of British Columbia and OncoGenex Technologies Inc. (OGX-011)10.40
    
    
    Third Amending Agreement to the License Agreement between OncoGenex Technologies
Inc and the University of British Columbia dated as of December 20, 2009 (OGX-011)*




---



##### Table of Contents



ExhibitNumber
    
    Description10.41
    (27)
    
    Collaboration and License Agreement between OncoGenex Technologies Inc. and Isis
Pharmaceuticals, Inc. effective as of January 5, 2005 (OGX-427)*10.42
    (27)
    
    License Agreement between OncoGenex Technologies Inc. and the University of British
Columbia effective as of April 5, 2005, and Amending Agreement dated as of
August 30, 2006 (OGX-427)*10.43
    (2)
    
    Second Amending Agreement as of August 7, 2008 between the University of British
Columbia and OncoGenex Technologies Inc. (OGX-427)10.44
    
    
    Collaboration and License Agreement between OncoGenex Technologies Inc. and Teva
Pharmaceutical Industries Ltd. dated as of December 20, 2009 (OGX-011)*21.1
    
    
    Subsidiaries of the Registrant23.1
    
    
    Consent of Ernst & Young LLP31.1
    
    
    Certification of President and Chief Executive Officer pursuant to Rule 13a-14(a)
or 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to
Section 302 of the Sarbanes-Oxley Act of 200231.2
    
    
    Certification of Chief Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a) of
the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the
Sarbanes-Oxley Act of 200232.1
    
    
    Certification of President and Chief Executive Officer pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 200232.2
    
    
    Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
 
    
    Schedules and similar attachments to the Arrangement Agreement have been omitted pursuant to
Item 601(b)(2) of Regulation S-K. Registrant will furnish supplementally a copy of any omitted schedule or similar attachment to the SEC upon request.*
    
    Confidential portions of this exhibit have been omitted and filed separately with the Commission pursuant to an application for Confidential Treatment under
Rule 24b-2 promulgated under the Securities Exchange Act of 1934, as amended.(1)
    
    Incorporated by reference to the Companys proxy statement on Schedule 14A filed on July 3, 2008.(2)
    
    Incorporated by reference to the Companys quarterly report on Form 10-Q for the quarter ended
September 30, 2008.(3)
    
    Incorporated by reference to the Companys Registration Statement on Form S-1, Reg. No. 33-96112.(4)
    
    Incorporated by reference to Companys quarterly report on Form 10-Q for the quarter ended March 31, 1999.(5)
    
    Incorporated by reference to the Companys current report on Form 8-K filed on March 11, 2009.(6)
    
    Incorporated by reference to the Companys annual report on Form 10-K for the year ended December 31, 2008.




---



##### Table of Contents



(7)
    
    Incorporated by reference to the Companys current report on Form 8-K filed on October 30, 2008.(8)
    
    Incorporated by reference to the Companys amended Form 8-A filed on July 25, 2002.(9)
    
    Incorporated by reference to the Companys amended Form 8-A filed on October 18, 2005.(10)
    
    Incorporated by reference to the Companys amended Form 8-A filed on August 14, 2006.(11)
    
    Incorporated by reference to the Companys current report on Form 8-K filed on May 30, 2008.(12)
    
    Incorporated by reference to the Companys quarterly report on Form 10-Q for the quarter ended
June 30, 2000.(13)
    
    Incorporated by reference to the Companys quarterly report on Form 10-Q for the quarter ended
September 30, 2006.(14)
    
    Incorporated by reference to the Companys proxy statement on Schedule 14A filed on April 3, 2007.(15)
    
    Incorporated by reference to the Companys quarterly report on Form 10-Q for the quarter ended
September 30, 2007.(16)
    
    Incorporated by reference to the OncoGenex Technologies Inc. registration statement on Form F-1 filed on December 13, 2006.(17)
    
    Incorporated by reference to the Companys registration statement on Form S-8 filed on August 26, 2008.(18)
    
    Incorporated by reference to the Companys current report on Form 8-K filed on April 2, 2009.(19)
    
    Incorporated by reference to the Companys quarterly report on Form 10-Q for the quarter ended September 30, 2009.(20)
    
    Incorporated by reference to the Companys current report on Form 8-K filed February 25, 2010.(21)
    
    Incorporated by reference to the Companys current report on Form 8-K filed March 1, 2010.(22)
    
    Incorporated by reference to the Companys current report on Form 8-K filed on August 18, 2005.(23)
    
    Incorporated by reference to the Schedule 13D filed by Schering Berlin Venture Corporation on October 31, 2005.(24)
    
    Incorporated by reference to the Companys annual report on Form 10-K for the year ended December 31, 2006.(25)
    
    Incorporated by reference to the Companys annual report on Form 10-K for the year ended December 31, 2007.(26)
    
    Incorporated by reference to the Companys quarterly report on Form 10-Q for the quarter ended March 31, 2008.(27)
    
    Incorporated by reference to the OncoGenex Technologies Inc. registration statement on Form F-1,
Amendment No. 1, filed on January 29, 2007.