EXHIBIT 1
                                                                       ---------



                                  VASOGEN INC.



                           2155 DUNWIN DRIVE, SUITE 10
                              MISSISSAUGA, ONTARIO
                                     L5L 4M1
                                     CANADA





                                      2003
                             ANNUAL INFORMATION FORM


                                 APRIL 12, 2004


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                                        i

                             ANNUAL INFORMATION FORM



                                TABLE OF CONTENTS


ITEM 1   COVER PAGE...........................................................1

         FORWARD-LOOKING INFORMATION..........................................2

ITEM 2   INCORPORATION........................................................3

ITEM 3   GENERAL DEVELOPMENT OF THE BUSINESS..................................3

ITEM 4   NARRATIVE DESCRIPTION OF THE BUSINESS................................4

         1.  INTRODUCTION.....................................................4

         2.  PRODUCTS AND MARKETS.............................................4

                  Celacade(TM) Peripheral Arterial Disease Program............5
                  Celacade(TM) Chronic Heart Failure Program..................5
                  VP025 Drug Development Program..............................6

         3.    QUEST DIAGNOSTICS STRATEGIC ALLIANCE...........................7

         4.    SCIENTIFIC ADVISORY BOARD......................................7

         5.    COMPETITIVE ENVIRONMENT........................................9

         6.    MANUFACTURING .................................................9

         7.    INTELLECTUAL PROPERTY..........................................10

         8.   ROYALTIES.......................................................10

         9.   GOVERNMENT REGULATION...........................................10

                  Europe......................................................10
                  United States...............................................11
                  Canada......................................................11

         10.  HUMAN RESOURCES.................................................12

         11.  FACILITIES......................................................12

         12.  ENVIRONMENTAL MATTERS...........................................12

         13.  RISK FACTORS....................................................12

ITEM 5   SELECTED CONSOLIDATED FINANCIAL DATA.................................19

ITEM 6   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
           AND RESULTS OF OPERATIONS..........................................20

ITEM 7   MARKET FOR SECURITIES................................................20

ITEM 8   DIRECTORS AND OFFICERS...............................................21

ITEM 9   ADDITIONAL INFORMATION...............................................22

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                                        2


FORWARD-LOOKING INFORMATION

Certain statements contained in this annual information form constitute
"forward-looking statements" within the meaning of the United States Private
Securities Litigation Reform Act of 1995. These statements include, without
limitation, statements concerning our strategy, future operations, future
financial position, future revenues, projected costs, prospects, plans and
objectives of management. In some cases, you can identify forward-looking
statements by terminology such as "may", "will", "should", "expects", "plans",
"anticipates", "believes", "estimated", "predicts", "potential", "continue",
"intends", "could", or the negative of such terms or other comparable
terminology. You should not place undue reliance on our forward-looking
statements. Forward-looking statements, particularly those concerning
anticipated events relating to the development, the clinical trials, regulatory
approval and marketing of our products and the timing or magnitude of those
events, are inherently risky and uncertain. The factors discussed below and
other considerations discussed in the "Risk Factors" section of this annual
information form could cause our actual results to differ significantly from
those contained in any forward-looking statements.

Specifically, this annual information form and the documents incorporated by
reference in this annual information form contain forward-looking statements
regarding:

o    our plan to continue development of Celacade(TM) for the treatment of
     chronic heart failure and peripheral arterial disease;

o    our plan to further investigate the impact of VP025 on several models of
     neuro-inflammatory disease;

o    our intentions to complete site enrollment and advance patient recruitment
     in our phase III chronic heart failure clinical trial and phase III
     peripheral arterial disease clinical trial;

o    our intention to seek regulatory approvals in the United States and Canada
     for our products; and

o    our intention to seek corporate alliances to jointly develop and
     commercialize our immune modulation therapies.

Such forward-looking statements involve known and unknown risks, uncertainties
and other factors that may cause our actual results, performance or achievements
to differ materially from any future results, performance or achievements
expressed or implied by such forward-looking statements. Important factors that
could cause such differences include, among other things, the following:

o    difficulties or delays we may experience in the conduct of clinical trials
     for chronic heart failure and peripheral arterial disease;

o    difficulties or delays we may experience in our further investigation of
     the impact of VP025 on several models of neuro-inflammatory disease;

o    the inability to obtain regulatory approvals for our products;

o    difficulties we may experience in completing the development of, and
     commercializing, Celacade(TM) to address the treatment of chronic heart
     failure and peripheral arterial disease;

o    acceptance and demand for our products;

o    difficulties we may experience in identifying and successfully
     collaborating with appropriate corporate alliances; and

o    the need for additional capital and the effect of capital market conditions
     and other factors on capital availability.

Although we believe that the expectations reflected in the forward-looking
statements are reasonable, we cannot guarantee future results, levels of
activity, performance or achievements. We are under no duty to update any of the
forward-looking statements after the date of this annual information form to
conform forward-looking statements to actual results.

IN THIS REPORT, "WE," "US," AND "OUR" REFER TO VASOGEN INC. ("VASOGEN" OR "THE
COMPANY").

Unless otherwise stated, the information contained herein is at November 30,
2003.

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                                        3


                             ITEM 2 - INCORPORATION

Vasogen Inc. was incorporated under the BUSINESS CORPORATIONS ACT (Ontario) and
was continued under the CANADA BUSINESS CORPORATIONS ACT by certificate and
articles of continuance dated August 9, 1999. We have one subsidiary, Vasogen
Ireland Limited, a corporation wholly owned by Vasogen and incorporated under
the laws of Ireland. Vasogen Ireland Limited owns our intellectual property
related to our immune modulation therapies and pharmaceuticals.

Our registered office is located at BCE Place, Suite 2500, 181 Bay Street,
Toronto, Ontario M5J 2T7 and our principal office is located at 2155 Dunwin
Drive, Suite 10, Mississauga, Ontario L5L 4M1. We are currently a "reporting
issuer" in all of the provinces and territories of Canada. Our telephone number
is (905) 569-2265 and our facsimile number is (905) 569-9231. Our Web site is
www.vasogen.com. Any information contained on our Web site is not, and will be
deemed not to be, incorporated herein by reference. All currency figures herein
are in Canadian dollars, unless otherwise noted.

                  ITEM 3 - GENERAL DEVELOPMENT OF THE BUSINESS

We are focused on the research and commercial development of immune modulation
therapies for the treatment of cardiovascular, neurological, and other chronic
inflammatory diseases. Our lead product, Celacade(TM) (immune modulation
therapy) is currently in phase III clinical trials for the treatment of chronic
heart failure and peripheral arterial disease. Celacade(TM) is designed to
target chronic inflammation by activating the immune system's physiological
anti-inflammatory response to apoptotic cells. Celacade(TM) up-regulates the
expression of cell surface molecules that interact with specific receptors on
antigen presenting cells (APCs) to modulate the production of cytokines - potent
chemical messengers that initiate and control inflammation. We are also
developing a new class of phospholipid-based drugs designed to interact with
APCs to regulate cytokine levels and control inflammation. VP025, the first
product candidate from this new class of drugs, is in preclinical development
for the treatment of neuro-inflammatory disorders.

We manage the development and manufacture of our products for use in preclinical
and clinical research and we continue to advance our product development program
to support future commercial scale production. Patent applications are filed to
protect our products and processes. Our policy is to file patent applications to
protect inventions, technology, and improvements that are important to the
development of our business and with respect to the application of our immune
modulation therapies to the treatment of a number of disease indications. We
have 14 U.S. patents, 122 patents granted in other jurisdictions, and 172 patent
applications pending worldwide.

We intend to commercialize our technology through licensing agreements with
established healthcare companies. On November 6, 2001, we entered into a
strategic alliance with Quest Diagnostics Incorporated ("Quest Diagnostics") of
New Jersey regarding the establishment of an outpatient services delivery model
to support the commercialization of Celacade(TM) in the United States on an
exclusive basis. See "Quest Diagnostics Strategic Alliance."

Over the past three fiscal years, we have raised approximately $84.4 million in
net proceeds from the issuance of equity securities to investors including Quest
Diagnostics, and through the exercise of options and warrants. Our common shares
(the "Common Shares") are listed on the Toronto Stock Exchange under the symbol
"VAS" and on the NASDAQ National Market under the symbol "VSGN".


                          VASOGEN DEVELOPMENT PIPELINE

<TABLE>
<CAPTION>
PRODUCT CANDIDATE          INDICATION                         DEVELOPMENTAL STAGE
<S>                        <C>                                <C>
Celacade(TM)               Peripheral Arterial Disease        Pivotal phase III clinical trial*
Celacade(TM)               Chronic Heart Failure              Pivotal phase III clinical trial*
VP025                      Neuro-inflammatory Diseases        Preclinical
</TABLE>

*Pivotal phase III clinical trials are multi-center studies undertaken to
confirm the efficacy of a therapeutic intervention in large patient groups.

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                 ITEM 4 - NARRATIVE DESCRIPTION OF THE BUSINESS


1.       INTRODUCTION

We are focused on the research and commercial development of immune modulation
therapies for the treatment of cardiovascular, neurological, and other chronic
inflammatory diseases. Our lead product, Celacade(TM), is currently in phase III
clinical trials for the treatment of chronic heart failure and peripheral
arterial disease. Celacade(TM) is designed to target chronic inflammation by
activating the immune system's physiological anti-inflammatory response to
apoptotic cells. Celacade(TM) up-regulates the expression of cell surface
molecules that interact with specific receptors on antigen presenting cells
(APCs) to modulate the production of cytokines - potent chemical messengers that
initiate and control inflammation. We are also developing a new class of
phospholipid-based drugs designed to interact with APCs to regulate cytokine
levels and control inflammation. VP025, the first product candidate from this
new class of drugs, is in preclinical development for the treatment of
neuro-inflammatory disorders.

2.       PRODUCTS AND MARKETS

Celacade(TM) is in phase III clinical development for the treatment of chronic
heart failure and peripheral arterial disease. Celacade(TM) is designed to
target the chronic inflammation underlying cardiovascular disease by activating
the immune system's physiological anti-inflammatory response to cells undergoing
apoptosis. Celacade(TM) is administered to the patient once per month as a brief
outpatient procedure. During the treatment, a small sample of a patient's blood
cells is drawn into our single-use disposable cartridge, exposed to controlled
oxidative stress utilizing our proprietary medical device technology, and then
administered to the patient intramuscularly. Oxidative stress is known to induce
cell apoptosis.

During apoptosis, certain molecules normally expressed only on the inner bilayer
of cell membranes, including phosphatidylserine (PS) molecules, move to the cell
surface. The exposed PS molecules then interact with specific PS receptors on
the surface of antigen presenting cells (APCs) of the immune system, including
macrophages and dendritic cells. The interaction with macrophages leads to an
up-regulation in the production of the anti-inflammatory cytokines IL-10 and
TGF-a. Dendritic cells that interact with apoptotic cells remain immature and,
in the presence of anti-inflammatory cytokines such as IL-10 and TGF-a, cause
the differentiation of some naive T cells to regulatory T cells. These traffic
through the tissues and inhibit inflammatory cells such as T1 cells by a process
that includes cell-cell interaction and the production of anti-inflammatory
cytokines by the regulatory T cells. The end result is a reduction in tissue
levels of inflammatory cytokines such as TNF-a, IL-6, IFN-A, and IL-1a, and a
down-regulation of chronic inflammation.

Celacade(TM) is currently in pivotal phase III clinical trials for chronic heart
failure (HF) and peripheral arterial disease (PAD). We believe that Celacade(TM)
has the potential to become a first-in-class therapy targeting chronic
inflammation in cardiovascular disease, addressing unmet medical needs by
providing a safe and effective addition to the standard of care. We are
collaborating with opinion leaders in cardiovascular medicine to conduct our
phase III clinical trials and we believe that successful completion of these
clinical trials will enhance the potential for Celacade(TM) to be adopted as
part of the standard of care in these conditions. Our phase III clinical trials
are designed to support regulatory approvals and market introduction in North
America and Europe. Through alliances with established healthcare companies, we
plan to establish the sales and marketing capability needed to promote the
adoption of Celacade(TM) by cardiologists and other physicians.

We are also developing a new class of phospholipid-based drugs designed to
interact with APCs to regulate cytokine levels and control inflammation. This
new class of drugs was discovered as a result of basic research concerning the
mechanism of Celacade(TM). While Celacade(TM) is designed to exploit the
anti-inflammatory immune response resulting from the interaction of apoptotic
cells with APCs, our new class of drugs is based on synthetic three-dimensional
phospholipid-based structures with specific groups of surface molecules that
interact with APCs to modulate cytokine levels. VP025, the lead product
candidate from this new class of drugs, has been optimized for the treatment of
neurological disorders.

NOTE: THE USE OF THE TERM "SIGNIFICANT" OR "SIGNIFICANTLY" WHEN DESCRIBING
CLINICAL AND PRECLINICAL RESULTS IN THE FOLLOWING SECTIONS REFERS TO
"STATISTICAL SIGNIFICANCE," IN WHICH THERE IS A 5% OR LOWER PROBABILITY THAT THE
OBSERVED DIFFERENCE BETWEEN GROUPS ON A CERTAIN OUTCOME MEASURE OCCURED BY
RANDOM CHANCE.

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CELACADE(TM) PERIPHERAL ARTERIAL DISEASE PROGRAM

Peripheral arterial disease (PAD) is a serious condition of impaired blood flow
to the extremities resulting from atherosclerosis. It is now well established
that inflammatory pathways are implicated in the development and progression of
atherosclerosis. Known risk factors such as aging, obesity, smoking, lack of
exercise, and diabetes contribute to the increasing incidence of PAD. The
disease often leads to reduced mobility and a marked impairment in the ability
to undertake the basic activities of daily independent living.

It is estimated that in the United States alone, PAD affects approximately seven
million people, with related healthcare costs exceeding $10 billion annually.
The condition is associated with a high level of morbidity, and an estimated 30%
of patients diagnosed with PAD will die within five years. Patients with PAD
often experience intermittent claudication (pain on walking), a symptom
associated with a threefold increase in the incidence of heart attack and
stroke. In approximately 80,000 patients each year, the progression of PAD
results in the need for amputation. Currently, there are limited effective
pharmacological therapies available for the treatment of intermittent
claudication, and there is a need for a more effective treatment option.

We are advancing a pivotal phase III, double-blind, placebo-controlled clinical
trial of Celacade(TM) in patients with peripheral arterial disease. Vasogen's
SIMPADICO (Study of Immune Modulation Therapy in Peripheral Arterial Disease and
Intermittent Claudication Outcomes) trial is investigating the impact of
Celacade(TM) on improving the symptom of intermittent claudication. The trial is
being conducted at cardiac and vascular centers throughout the United States and
Canada, and is designed to support regulatory approval and marketing in North
America and Europe.

The SIMPADICO trial is designed to enroll up to 500 patients with Fontaine stage
II disease (symptomatic PAD) who have intermittent claudication. The primary
endpoint of SIMPADICO is the change in maximal treadmill walking distance over
six months. Maximal treadmill walking distance is the primary efficacy endpoint
recognized by the FDA and other regulatory authorities for approving new
treatments for symptomatic PAD. The trial is also investigating the impact of
Celacade(TM) on quality of life and PAD-related clinical outcomes.

The Principal Investigator and Chairman of the Steering Committee for Vasogen's
SIMPADICO trial is Dr. Jeffrey W. Olin, Director of the Vascular Medicine
Program at The Zena and Michael A. Wiener Cardiovascular Institute, Mount Sinai
School of Medicine in New York.

The initiation of SIMPADICO was based on results from a double-blind,
placebo-controlled phase II clinical trial of Celacade(TM) in patients with
moderate to severe PAD. The primary endpoint of this trial, the difference in
the proportion of patients having a greater than 50% increase in their initial
claudication distance (ICD) at 24 weeks, was met in the per-protocol population
(n=81), with significantly more patients who received Celacade(TM) responding
compared to placebo (p=0.047). Sub-group analysis of the 69 severe claudication
patients in the per-protocol population at nine weeks post treatment showed that
56.3% of the Celacade(TM) patients responded compared to 29.7% of the placebo
group (p=0.031).

Celacade(TM) was also shown to be safe and well tolerated, with no
treatment-related serious adverse events. Results from this trial were presented
at the XV Annual Meeting of the European Society for Vascular Surgery and were
published in the EUROPEAN JOURNAL OF VASCULAR AND ENDOVASCULAR SURGERY in 2002.


CELACADE(TM) CHRONIC HEART FAILURE PROGRAM

Chronic heart failure, most frequently resulting from coronary artery disease or
hypertension, is a debilitating condition in which the heart's ability to
function as a pump is impaired. Patients with heart failure experience a
continuing decline in their health, resulting in an increased frequency of
hospitalization and premature death.

In North America alone, heart failure affects more than five million people and
is associated with more than 300,000 deaths each year. The cost of medical care,
primarily resulting from hospitalization, is estimated to exceed $19 billion
annually. These statistics suggest that important pathological mechanisms remain
active and unmodified by available therapies, particularly when the disease has
reached advanced stages. Chronic inflammation is recognized as an underlying
pathology contributing to the development and progression of chronic heart
failure.

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                                       6


We are currently advancing the pivotal phase III double-blind,
placebo-controlled ACCLAIM (Advanced Chronic Heart Failure CLinical Assessment
of Immune Modulation Therapy) trial to further investigate the impact of
Celacade(TM) on reducing the risk of death and cardiovascular hospitalization in
patients with advanced chronic heart failure. The ACCLAIM trial is being
conducted at cardiac centers throughout the United States and Canada, and is
designed to support regulatory approval and marketing in North America and
Europe.

The primary outcome measure of ACCLAIM is the composite endpoint of all-cause
mortality or hospitalization for cardiovascular causes (time to first event).
The trial, which has been approved to enroll up to 2,016 patients, will conclude
when a minimum of 701 outcome events have occurred and all patients have been
followed for at least six months.

The Global Principal Investigator and Chairman of the Steering Committee for
ACCLAIM is Dr. James B. Young, Chairman, Division of Medicine at The Cleveland
Clinic Foundation and Medical Director, Kaufman Center for Heart Failure in
Cleveland. Dr. Guillermo Torre-Amione, Medical Director of the Heart Transplant
Service at Baylor College of Medicine and the DeBakey Heart Center of The
Methodist Hospital in Houston, is Principal Investigator for the U.S. arm of the
study. Dr. Jean-Lucien Rouleau, Dean of Medicine, University of Montreal, is
Principal Investigator for the Canadian arm of the trial.


The initiation of the ACCLAIM trial was based on the success of our 73-patient
double-blind, placebo-controlled phase II trial in advanced chronic heart
failure patients conducted at The Cleveland Clinic, Baylor College of Medicine,
the Texas Heart Institute, and the University of Montreal. The patients enrolled
into this study were receiving stable doses of pharmaceuticals that reflect the
standard of care.

The key finding from this clinical trial was a significant reduction in the risk
of death (p=0.022; 1 vs. 7 deaths) and all-cause hospitalization (p=0.008; 12
vs. 21 hospitalizations) for patients receiving Celacade(TM) compared to those
receiving placebo. In addition to the observed reduction in the risk of major
events, there was also an observation that patients receiving Celacade(TM) had
significant improvements in key electrocardiogram (ECG) measures. Approximately
50% of patients diagnosed with chronic heart failure experience sudden death due
to serious ventricular arrhythmia (irregular heartbeat originating in the
ventricles of the heart), which has been linked to specific ECG abnormalities,
including an increased QTc interval. The study showed a significant reduction in
mean QTc interval of 18 milliseconds (msec) among assessable patients in the
active treatment group, compared to an increase of 12 msec in the placebo group,
resulting in a significant between-group difference at the end of the study
(429+/-45 vs. 463+/-45 msec, n=35, p=0.035). Celacade(TM) was also shown to be
safe and well tolerated, with no reports of treatment-related serious adverse
events or withdrawals from the trial. The results of the study were presented at
the 2002 Scientific Sessions of the Heart Failure Society of America and the
American Heart Association.


VP025 DRUG DEVELOPMENT PROGRAM

There are several neurological conditions associated with inflammation in the
brain and nervous system, including Alzheimer's disease, Parkinson's disease,
and amyotrophic lateral sclerosis (ALS), also known as Lou Gehrig's disease. In
each of these conditions there is evidence of increased inflammatory mediators,
including cytokines, leading to the death of nerve cells and the eventual loss
of functional activity. Due to the prevalence of neuro-inflammatory diseases and
the morbidity and mortality associated with them, they represent a significant
medical, social, and financial burden. It is estimated that these neurological
conditions affect more than five million people in North America and generate
costs of care that exceed US$75 billion annually.

We are developing a new class of phospholipid-based drugs designed to interact
with antigen presenting cells (APCs) to regulate cytokine levels and control
inflammation. This new class of drugs was discovered as a result of basic
research concerning the mechanism of action of Celacade(TM). While Celacade(TM)
is designed to exploit the anti-inflammatory immune response resulting from the
interaction of apoptotic cells with APCs, our new class of drugs is based on
synthetic three-dimensional phospholipid-based structures with specific groups
of surface molecules that interact with APCs to modulate cytokine levels.

VP025, the lead product candidate from this new class of drugs, has been
optimized for the treatment of neurological disorders. Our preclinical research
has shown that the effects of VP025 cross the blood-brain barrier, produce
potent

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anti-inflammatory activity, including cytokine modulation, and result in the
preservation of the function of specific neural pathways involved in memory and
learning.

Preclinical findings, demonstrating the ability of VP025 to significantly reduce
key measures of inflammation and cell death in the brain and to improve
physiological measurements that correlate with memory and learning activity,
were presented at the 33rd Annual Meeting of the Society for Neuroscience in New
Orleans in November 2003, by Professor Marina Lynch, PhD, and her team from the
Department of Physiology of Trinity College, in Dublin, Ireland. This research
demonstrated that the inflammation-induced loss of memory function, measured by
the ability to sustain long-term potentiation, was significantly (p<0.001)
reduced by VP025. This improvement was associated with significant (p<0.05)
reductions in inflammatory markers in the hippocampus, the site of memory and
learning in the brain, including the stress-activated kinase c-Jun N-terminal
kinase (JNK) and the pro-inflammatory cytokine IL-1a. Furthermore, VP025
administration resulted in an increase in the hippocampal levels of the
anti-inflammatory cytokine interleukin-4 (p<0.05) in this model. We are also
advancing an extensive preclinical research program at leading centers of
excellence for neuroscience research, designed to investigate the impact of
VP025 on several models of neuro-inflammatory disease, including Parkinson's
disease, Alzheimer's disease, and ALS. We expect this research program to
provide the basis for advancing VP025 into clinical development.

3.       QUEST DIAGNOSTICS STRATEGIC ALLIANCE

During the year ended November 30, 2001, we entered into a strategic alliance
with Quest Diagnostics, a third party, regarding the establishment of an
outpatient services delivery model to support the commercial development of
Celacade(TM) in the United States on an exclusive basis. The terms of the
strategic alliance with Quest Diagnostics are to be finalized prior to the
Company filing for FDA approval for Celacade(TM). The Company remains free to
pursue marketing arrangements with other parties to augment our relationship
with Quest Diagnostics. As part of the agreement, Quest Diagnostics made a US
$7.5 million (Cdn $11.9 million) investment in the Company and received
1,406,783 shares. Quest Diagnostics also received 625,237 warrants at an
exercise price of $12.73, expiring in November 2006. The fair value of the
warrants on the day of grant was negligible.

4.       SCIENTIFIC ADVISORY BOARD

We have an independent Scientific Advisory Board ("SAB") to advise Management
and the Board of Directors on our scientific, technical, research, development,
and commercialization endeavors. Members of the SAB are entitled to an annual
honorarium and reimbursement for their reasonable out-of-pocket expenses
incurred on Company business, and are eligible to receive stock options. Members
of the SAB through their affiliation with universities, hospitals, and other
centers of biomedical research may, from time to time, collaborate on or direct
independent basic research, preclinical studies, and/or feasibility clinical
trials involving our technologies and receive, in connection therewith,
professional fees at market rates. The members of our SAB are:

ROBERT ROBERTS, MD, FRCP(C), FACC, Chairman

Dr. Roberts is the new president and CEO of the University of Ottawa Heart
Institute, one of Canada's leading institutes in cardiovascular medicine. Dr.
Roberts was formerly Chief of Cardiology, Don W. Chapman Professor of Medicine,
and Professor of Molecular Physiology and Biophysics at Baylor College of
Medicine in Houston, Texas, one of the world's leading centers for
cardiovascular care, research, and education. Dr. Roberts is an active clinician
and researcher recognized for his groundbreaking research on cardiac creatine
kinase (CK-MB), a key diagnostic marker for cardiac injury, as well as for his
original contributions to the molecular biology and genetics of heart disease.
He and his research team are credited with uncovering the genetic basis for
several inherited cardiac disorders. He is the author of more than 600
scientific publications and sits on several key editorial boards. Dr. Roberts
has received many honors and awards, including the prestigious American College
of Cardiology's 1998 Distinguished Scientist Award. In addition to his
contributions to basic research, Dr. Roberts is also well recognized for his
role as a principal investigator in several pivotal clinical trials related to
the introduction of new therapies for heart disease.

STANLEY H. APPEL, MD

Dr. Appel is Professor and Chairman of the Department of Neurology, Director of
the Vicki Appel MDA/ALS Clinic, and past-Director of the Alzheimer's Disease
Research Center at Baylor College of Medicine in Houston,

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                                        8


Texas. He also serves as the Director of the Jerry Lewis Neuromuscular Research
Center. Dr. Appel is a leading expert on degenerative neurological diseases,
such as Parkinson's, Alzheimer's, and amyotrophic lateral sclerosis (ALS), also
known as Lou Gehrig's disease. Specifically, Dr. Appel focuses on the importance
of neurotrophic factors and immune mechanisms, including the role of
inflammatory cytokines in these diseases. He has served as an Advisory Board
member of the Alzheimer's Disease and Related Disorders Association and as a
Council member of the American Society of Neurochemistry. For ten years, he
acted as Editor-in-Chief for the journal Current Neurology. Dr. Appel received
his medical degree from Columbia College of Physicians and Surgeons and has over
300 scientific publications to his credit.

VALENTIN FUSTER, MD, PhD

Dr. Fuster is the Director of The Zena and Michael A. Wiener Cardiovascular
Institute and The Marie-Josee and Henry R. Kravis Center for Cardiovascular
Health at the Mount Sinai School of Medicine in New York, where he is also the
Richard Gorlin, MD/Heart Research Foundation Professor. Dr. Fuster is recognized
as a leading expert in coronary disease, atherosclerosis, and thrombosis
research and has published over 400 articles on these subjects. He is also the
Lead Editor of "The Heart," a major textbook on cardiology. Dr. Fuster is
past-President of the American Heart Association, a member of the National
Heart, Lung, and Blood Institute Advisory Council, and Chairman of the
Fellowship Training Directors Program of the American College of Cardiology. Dr.
Fuster has received the Andreas Gruntzig Scientific Award of the European
Society of Cardiology, as well as many awards from both the American College of
Cardiology and the American Heart Association. He is the recipient of nine
honorary degrees from distinguished universities throughout the world, and
received the Principe de Asturias Award of Science and Technology, the highest
award to Spanish-speaking scientists from the son of the King and Queen of
Spain. Recently, Dr. Fuster was elected as a member of the Institute of Medicine
of the National Academy of Sciences, and was appointed President-Elect of the
World Heart Federation. In 2003, Dr. Fuster received the "Gold Heart Award," the
American Heart Association's highest award.

RICHARD G. MARGOLESE, MD, FRCS(C)

Dr. Margolese is the Herbert Black Professor of Surgical Oncology at McGill
University and the Director of the Department of Oncology at Sir Mortimer B.
Davis-Jewish General Hospital in Montreal. Internationally recognized for his
leadership in both cancer research and treatment, he is the author of numerous
important scientific publications and has served on the review and editorial
boards of most major oncology journals. Dr. Margolese has served as Chairman of
the Treatment Committee of the Breast Cancer Task Force at the National Cancer
Institute (U.S.A.), and he is the Chairman of the Surgical Committee at the
National Surgical Adjuvant Breast Project, a position he has held for the past
20 years. He has served as President of the National Cancer Institute of Canada,
as Chairman of Cancer 2000, a Federal and Provincial Task Force on Cancer
Control, and as Chairman of the Management Committee of the Canadian Breast
Cancer Research Initiative. Dr. Margolese is the recipient of numerous awards,
including the Order of Canada and the R.M. Taylor medal of the Canadian Cancer
Society.

RICHARD G. MILLER, PhD, FRSC

Dr. Miller is Professor and past-Chairman of the Department of Medical
Biophysics and Professor and founding Chairman (1984 to 1990) of the Department
of Immunology at the University of Toronto. He is a past-President of the
Canadian Society of Immunology and a Fellow of the Royal Society of Canada. As
an internationally recognized scientist and leader in the field of immunology,
he has received many honors, including being invited as a visiting scientist to
many of the world's leading immunology centers. He is the author of over 150
publications and numerous book chapters and has been a member of the editorial
board of several key scientific journals in the areas of immunology and cancer.
Dr. Miller is a gold medal graduate in Physics from the University of Alberta
and was awarded his PhD at the California Institute of Technology.

MILTON PACKER, MD

Dr. Packer is Dickinson W. Richards Jr. Professor of Medicine, Professor of
Pharmacology, and Chief of the Division of Circulatory Physiology at the
Columbia University College of Physicians and Surgeons, and Director of the
Heart Failure Center at the Columbia-Presbyterian Medical Center in New York
City. One of the leading experts in the pathophysiology and treatment of heart
failure, Dr. Packer has made significant contributions to heart failure research
and has been instrumental in the introduction of a number of new treatments. The
author of more than 200 papers, he has won numerous honors for teaching and has
lectured around the world, including a number of prestigious named lectureships,
on the treatment of heart failure. He has served, or currently serves, on the
editorial

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boards of many major medical journals, including Circulation and Journal of the
American College of Cardiology. He has also been elected to a number of
societies, including the American Society for Clinical Investigation. He is
currently on the executive committees of both the American Heart Association and
the American College of Cardiology and is past-President of the Heart Failure
Society of America. Dr. Packer is a primary consultant to the National
Institutes of Health and the Food and Drug Administration on the management of
heart failure and on matters related to cardiovascular research and drug
development and health care policy.

FRED S. ROSEN, MD

Dr. Rosen is President of the CBR Institute for Biomedical Research in Boston,
Massachusetts, and James L. Gamble Professor of Pediatrics at Harvard Medical
School. He is internationally recognized for his groundbreaking research into
the functioning of the immune system and the causes of immune deficiency
diseases. Dr. Rosen's extensive scientific leadership in immunology has led to
fundamental insights into the mechanisms by which immune responses are
initiated. His work has been widely published in premier scientific journals,
such as Science, Nature, and The New England Journal of Medicine, where his
immunology review articles are considered classics. Dr. Rosen has been elected
as an honorary member to scientific societies in many countries. He is a Membre
d'Honneur for Life of the French Society of Immunology and is the recipient of
numerous honorary designations, including Distinguished Visiting Scholar at
Christ's College, Cambridge University, England. He is also active in several
scientific societies and is past-Chairman of the Scientific Advisory Committee
of the Clinical Research Center, Children's Hospital, Boston, and the World
Health Organization's Expert Scientific Committee on Primary Immunodeficiency.

DAVID WOFSY, MD

Dr. Wofsy is Professor of Medicine and Microbiology/Immunology, Director of the
Clinical Trials Center, and George A. Zimmerman Distinguished Professor at the
University of California, San Francisco. He also serves as Chief of Rheumatology
at the San Francisco Veterans Affairs Medical Center. Dr. Wofsy is a leading
authority on the cellular and molecular mechanisms underlying autoimmune
diseases. Based on extensive research, he has developed novel approaches to the
use of immune modulation therapies in the treatment of this very common group of
diseases. Much of Dr. Wofsy's research has been on systemic lupus erythematosus
(SLE), an autoimmune disease, where he was the first to demonstrate the key
pathological role of CD4+T cells in a standard animal model of this disease. His
most recent research has extended to additional novel methods for blocking T
cell activation. These approaches are currently in clinical trials. He is the
author of numerous key publications and book chapters and serves on the
editorial and advisory boards of several major immunology journals. He has
received many distinguished awards and his visiting professorships include
Harvard University and the National Institutes of Health.

5.       COMPETITIVE ENVIRONMENT

The pharmaceutical, medical device, and biotechnology industries are
characterized by rapidly evolving technology and intense competition. Many
companies, including major pharmaceutical as well as specialized biotechnology
companies, are engaged in activities focused on similar medical conditions to
those targeted by us. Many of these companies have substantially greater
financial and other resources, larger research and development staff, and more
extensive marketing and manufacturing organizations than we do. Many of these
companies have significant experience in preclinical testing, human clinical
trials, product manufacturing, marketing and distribution, and other regulatory
approval procedures. In addition, colleges, universities, government agencies,
and other public and private research organizations conduct research and may
market commercial products on their own or through joint ventures. These
institutions are becoming more active in seeking patent protection and licensing
arrangements to collect royalties for use of technology that they have
developed. These institutions also compete with us in recruiting and retaining
highly qualified scientific personnel.

6.       MANUFACTURING

We maintain a quality system that is registered to EN46001 and ISO13485. These
quality system registrations are necessary to support regulatory approvals (see
"Government Regulation"). For entry into the U.S. market, the Company is also
ensuring the necessary compliance of its own quality system to the FDA Quality
System Regulation

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                                       10


("QSR"). In addition, Vasogen's medical devices meet the requirements of the
European Union Medical Devices Directive 93/42/EEC for CE Marking.

We currently rely upon subcontractors for the manufacture of our device
technology. The subcontractors operate quality systems in accordance with
ISO9001, EN 46001, ISO13485 and/or the FDA QSR, as necessary. Manufacturing,
testing, and maintenance of Vasogen's medical devices are verified and validated
as appropriate to ensure conformance to defined specifications.

7.       INTELLECTUAL PROPERTY

Because of the substantial length of time and expense associated with developing
new products, the pharmaceutical, medical device, and biotechnology industries
place considerable importance on obtaining patent protection for new
technologies, products, and processes. Our policy is to file patent applications
to protect inventions, technology, and improvements that are important to the
development of our business and with respect to the application of our immune
modulation therapies to the treatment of a number of disease indications. We
seek patent protection in various commercial jurisdictions of the world. We have
14 U.S. patents, 122 patents granted in other jurisdictions, and 172 patent
applications pending worldwide. We will continue to seek intellectual property
protection as appropriate.

We require our employees, consultants, members of the SAB, outside scientific
collaborators, and sponsored researchers to enter into confidentiality
agreements with us that contain assignment of invention clauses outlining
ownership of any intellectual property developed during the course of the
individual's relationship with us.

8.       ROYALTIES

We have granted royalties to unrelated third parties on gross amounts receivable
by us on future commercial sales of our products, comprising 1.5% on all sales
to a maximum of $1.3 million per annum and an additional 2% with respect to
revenue derived from certain applications of Celacade(TM) to a maximum royalty
of $5.0 million per annum. To date, no royalties are or have been due or
payable.

9.       GOVERNMENT REGULATION

Before medical products can be distributed commercially, a submission providing
detailed information must be reviewed and approved by the applicable government
or agency in the jurisdiction in which the product is to be marketed. The
regulatory review and approval process varies from country to country.
Similarly, we are also subject to separate regulations where we conduct clinical
trials. We are pursuing pre-market approvals and comply with clinical study
requirements in a number of jurisdictions; namely, Europe, the United States,
and Canada, where activities are being planned or are being conducted by us or
on our behalf. We cannot predict or give any assurances as to whether further
regulatory approvals will be received or how long the process of seeking
regulatory approvals will take.

EUROPE

Medical products that are placed on the market in the European Union ("EU") are
subject to one of two mutually exclusive regulatory regimes: either the Medical
Devices Directive ("MDD"), Council Directive 93/42/EEC, for medical devices, or
the Medicinal Products Directive ("MPD"), Council Directive 65/65/EEC for
pharmaceutical products. Our technology for the delivery of Celacade(TM) has
been classified as medical devices in the EU.

We are required to demonstrate compliance with the requirements of the MDD
93/42/EEC and affix a CE mark to our medical devices in order to place our
medical device products on the market within the member states of the EU,
Norway, and Switzerland. On February 2, 2004 we announced that we received CE
Mark approval for Celacade(TM) in chronic heart failure; we have previously
obtained the CE Mark for Celacade(TM) in peripheral arterial disease. The CE
mark attests that our medical device products meet the "essential requirements"
of the MDD relating to safety and efficacy. We must also demonstrate our
regulatory compliance ("conformity assessment") annually through a qualified
third party (a "Notified Body") selected by us. We have demonstrated our
regulatory compliance with

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                                       11


these requirements for devices placed in Europe for clinical trials, and our
quality system was registered to ISO9001 and EN46001 in February 1998. In
addition, our quality system was registered to ISO13485 in August 2001.

We are subject to annual surveillance audits by our Notified Body and are
required to report any device-related serious adverse incidents or
near-incidents to the appropriate authorities.

To conduct clinical trials of our CE-Marked medical devices, we are required to
provide notification to national authorities in most European jurisdictions and
may require additional approvals depending on the specific content of the
clinical protocol. In addition, before a study can commence at each
participating clinical center, the center's ethics review board must approve the
clinical protocol and other related documents.

UNITED STATES

In the United States, clinical trials and commercialization of medical devices
require the approval of the Food and Drug Administration ("FDA"). We are subject
to the regulation of the FDA, as well as state and local authorities. Our
medical devices are currently subject to the FDA's Pre-Market Approval ("PMA")
process prior to marketing in the United States. The PMA approval process is a
multi-step process that requires us to submit to the FDA preclinical, clinical,
and design and manufacturing data which we have compiled to demonstrate the
safety and effectiveness of our devices for the stated medical indications or
uses.

The clinical studies that generate the clinical data for the PMA are subject to
regulation under the investigational device exemption ("IDE") regulations.
Before clinical studies of our device can begin, an IDE application must be
submitted to, and approved by, the FDA. In addition, before a study can commence
at each participating clinical center, the center's institutional review board
must approve the clinical protocol and other related documents.

During the PMA review process, the FDA will conduct an inspection of the
manufacturer's facilities to ensure that the device design and manufacture are
in compliance with applicable QSR requirements. The QSR requirements mandate
that we manufacture our devices and maintain our documents in a prescribed
manner with respect to design, manufacturing, testing, and control activities.
If the FDA evaluations of both the PMA application and the manufacturing
facilities are favorable, the FDA may issue an approvable letter, which usually
contains a number of conditions that must be met in order to secure final
approval of the PMA. Only when those conditions have been fulfilled to the
satisfaction of the FDA will the agency issue a PMA approval order, authorizing
commercial marketing of the device for stated indications. The FDA also has the
authority to impose certain post-approval requirements in the PMA approval
order. FDA approval can be withdrawn for failure to comply with any
post-approval requirements or for other reasons, such as the discovery of
significant adverse effects.

CANADA

In Canada, clinical trials and the commercialization of medical products require
the approval of Health Canada. The Therapeutic Products Directorate ("TPD")
regulates the manufacture and sale of medical devices in Canada. The Canadian
Medical Device Regulations are similar to those of the United States and require
that clinical studies be conducted to demonstrate the safety and effectiveness
of devices prior to marketing. There must also be documented evidence that the
devices are developed, manufactured, and produced under current quality system
regulations and guidelines in order to ensure the quality of the product made
available for sale. Approval of such therapy and technology is a multi-step
process, and we are prohibited from promoting or commercializing our products
prior to regulatory approval. For any clinical investigation and testing of our
products in Canada, authorization by the TPD is required. In addition, before a
study can commence at each participating clinical center, the center's
institutional review board must approve the clinical protocol and other related
documents.

We must manufacture the device under approved quality system conditions and must
validate the performance characteristics of the device to ensure that the device
performs safely, consistently, and reliably. The TPD has adopted ISO13485 and
relies upon accredited registrars to certify manufacturers of medical devices.
Vasogen's quality system was registered to ISO13485 in August 2001. Also,
manufacturers of marketed devices must be licensed by Health Canada. Licensing
is contingent upon successful certification by an accredited registrar.

In addition to the regulatory product approval framework, we are also subject to
municipal, provincial, and federal laws governing occupational safety,
laboratory practices, the use, handling, and disposition of biological waste,
environmental protection, and hazardous substance control. We may be subject to
other current and future

<PAGE>

                                       12


regulations, including future regulation of the biotechnology industry. We
believe we are in material compliance with all such existing regulations.

10.      HUMAN RESOURCES

We have 82 full-time employees. Our employees are not governed by a collective
agreement. We have not experienced a work stoppage and believe our employee
relations are satisfactory.

11.      FACILITIES

We lease facilities at 2155, 2150, and 2160 Dunwin Drive, all of which are
located in Mississauga, Ontario, Canada L5L 4M1. These leases cover a total of
21,692 square feet. In addition, Vasogen Ireland Ltd. leases premises in
Ireland. We continually monitor our facility requirements in the context of our
growth and the results of our research and development activities, and we expect
these requirements to grow commensurately with our activities.

12.      ENVIRONMENTAL MATTERS

We believe we are in material compliance with applicable environmental
protection laws, and we believe that ongoing compliance with applicable
environmental protection laws will have no material effect on us. Expenditures
for environmental compliance have not been, and are not anticipated to be,
material. We are unable to predict what changes may be made to environmental
laws in the jurisdictions in which Vasogen may operate in the future, although
we anticipates that such laws will likely become more stringent.

13.      RISK FACTORS

Our business entails significant risks. In addition to the usual risks
associated with a business, the following is a general description of certain
significant risk factors which are applicable to us.

WE WILL REQUIRE ADDITIONAL FUNDS IN OUR BUSINESS.

We will need to raise additional funds to conduct research and development,
preclinical studies, and clinical trials necessary to bring our potential
products to market and establish marketing, sales and distribution capabilities.
Our future capital requirements will depend on many factors, including continued
scientific progress in our research and development programs, the scope and
results of preclinical studies and clinical trials, the time and costs involved
in obtaining regulatory approvals, the costs involved in filing, prosecuting,
and enforcing patent claims, competing technological and market developments,
the cost of manufacturing scale-up, effective commercialization activities and
arrangements, and other factors not within our control. We do not anticipate
generating revenues from operations in the foreseeable future, and we have no
committed sources of capital.

Adequate funds may not be available when needed or on terms acceptable to us.
Insufficient funds may require us to scale back or eliminate some, or all, of
our research and development programs or license to third parties products or
technologies that we would otherwise seek to develop.

In order to obtain financing, if it is even available, it is likely that we will
sell additional common shares or financial instruments that are exchangeable or
convertible into common shares. Also, in order to provide incentives to current
employees and induce prospective employees and consultants to work for us, we
have granted options and intend to offer and issue options to purchase common
shares and/or rights exchangeable or convertible into common shares. These
activities could result in substantial dilution to all our shareholders.

WE ARE A DEVELOPMENT STAGE COMPANY WITH A HISTORY OF LOSSES, WE HAVE NOT
RECOGNIZED ANY PRODUCT REVENUES, AND WE MAY NEVER ACHIEVE PROFITABILITY.

Our products are in the development stage and, accordingly, our business
operations are subject to all of the risks inherent in the establishment and
maintenance of a developing business enterprise, such as those related to
competition and viable operations management. We have incurred a loss in each
year since our inception and have received no cash flow from

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                                       13


operations to date, and there is no assurance that we will have earnings or cash
flow from operations in the future. These losses have resulted in, and are
expected to continue to cause decreases in, our cash balances, working capital,
and shareholders' equity. The future earnings and cash flow from operations of
our business are dependent, in part, on our ability to further develop our
products. There can be no assurance that we will grow and be profitable.

At November 30, 2003, we had an accumulated deficit of approximately Cdn $113
million. We have not generated revenues from the commercialization of any
products. Our net operating losses over the near term and the next several years
are expected to continue and increase as a result of the expanded clinical trial
activity necessary to support regulatory approval of our products. Costs
associated with phase III clinical trials are generally substantially greater
than for phase II clinical trials, as the number of clinical sites and patients
required is much larger. There can be no assurance that we will be able to
generate sufficient product revenue to become profitable at all or on a
sustained basis. We expect to have quarter-to-quarter fluctuations in expenses,
some of which could be significant, due to expanded research, development, and
clinical trial activities.

WE ARE SUBJECT TO STRINGENT ONGOING GOVERNMENT REGULATION.

Biotechnology, medical device, and pharmaceutical companies operate in a
high-risk regulatory environment. The FDA, Health Canada, and other health
agencies can be very slow to approve a product and can also withhold product
approvals. In addition, these health agencies also oversee many other medical
product operations, such as research and development, manufacturing, and testing
and safety regulation of medical products. As a result, regulatory risk is
normally higher than in other industry sectors.

We have incurred, and expect to continue to incur, substantial clinical research
and other costs in connection with obtaining regulatory approvals for our
medical products in Canada, the United States, and other jurisdictions. While we
are not aware of any pending or threatened governmental action against us in any
country, any enforcement action by regulatory authorities with respect to past,
or any future, regulatory non-compliance could have a material adverse effect on
our business, financial condition, and results of operations.

To date, Celacade(TM) has been regulated by the FDA and Health Canada as a
medical device. There can be no assurance that this regulatory status will not
change in the future or that additional regulatory bodies beyond the medical
device authorities will not have input into the approval of our medical
products. If the FDA or Health Canada decides to regulate Celacade(TM) as a
drug, biologic, or combination product we could be obligated to conduct
additional clinical trials and, in any event, the cost and time required to
achieve regulatory approval, if Celacade(TM) is approved at all, could be
substantially increased.

There can be no assurance that we will be able to achieve or maintain regulatory
compliance with respect to all or any part of our current or future products or
that we will be able to timely and profitably produce our products while
complying with applicable regulatory requirements. If we fail to maintain
compliance, regulatory authorities can institute proceedings to detain or seize
products, issue a recall, enjoin future violations, assess civil and criminal
penalties against us and our directors, officers, and employees, or require us
to make substantial changes to our manufacturing operations. Any such actions
could have a material adverse effect on our business, financial condition, and
results of operations.

WE DO NOT YET HAVE ALL THE REQUIRED APPROVALS TO MARKET OUR PRODUCT CANDIDATES,
AND OUR CLINICAL TRIALS MAY NOT YIELD RESULTS WHICH WILL ENABLE US TO OBTAIN
REGULATORY APPROVAL.

We have not completed the development of any products and there can be no
assurance that any products will be successfully developed. None of our products
has received regulatory approval for commercial use and sale in North America.
We cannot market a pharmaceutical or medical device product in any jurisdiction
until it has completed thorough preclinical testing and clinical trials in
addition to that jurisdiction's extensive regulatory approval process. In
general, significant research and development and clinical studies are required
to demonstrate the safety and effectiveness of our products before we can submit
any regulatory applications. We may never obtain the required regulatory
approvals for any of our products. Our immune modulation therapies will require
significant additional research and development efforts, including clinical
trials, prior to regulatory approval and potential commercialization in the
United States and elsewhere. However, there can be no assurance that the results
of all required clinical trials will demonstrate that these immune modulation
therapies are safe and effective or, even if the results of the clinical trials
are considered successful by us, that the FDA will not require us to conduct
additional large-scale clinical trials before it will consider approving such
therapies for commercial use. Approval or consent by the FDA or other regulatory
authorities to commence a clinical trial does not indicate that the device,
drug, or treatment being studied can or will be approved. Preparing, submitting,
and advancing applications for regulatory

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                                       14


approval is complex, expensive, and time intensive and entails significant
uncertainty. We have not completed this process for any of our products.

The results of our completed preclinical studies and clinical trials may not be
indicative of future clinical trial results. A commitment of substantial
resources to conduct time-consuming research, preclinical studies, and clinical
trials will be required if we are to complete development of our products.
Clinical trials of our products require that we identify and enroll a large
number of patients with the illness under investigation. We may not be able to
enroll a sufficient number of patients to complete our clinical trials in a
timely manner. If we experience difficulty in enrolling a sufficient number of
patients to conduct our clinical trials, we may need to delay or terminate
ongoing clinical trials and will not accomplish objectives material to our
success that could affect the price of our common shares. Delays in planned
patient enrollment, or lower than anticipated event rates in our current
clinical trials or future clinical trials may result in increased costs, program
delays, or both.

There can be no assurance that unacceptable toxicities or adverse side effects
will not occur at any time in the course of human clinical trials or, if any
products are successfully developed and approved for marketing, during
commercial use of our products. The appearance of any such unacceptable
toxicities or adverse side effects could interrupt, limit, delay, or abort the
development of any of our products or, if previously approved, necessitate their
withdrawal from the market. Furthermore, there can be no assurance that disease
resistance or other factors will not limit the effectiveness of our potential
products. Any products resulting from our programs are not expected to be
successfully developed or made commercially available in the near term and may
not be successfully developed or made commercially available at all.

THE SCIENCE AND TECHNOLOGY UNDERLYING CELACADE(TM) IS RELATIVELY NEW AND
UNPROVEN.

Definitive proof of the precise mechanism of action of a biological response
modifier such as immune modulation therapy will require considerably more basic
scientific research than we or others have accomplished to date. We have not,
nor has any other company, received regulatory approval for, or successfully
commercialized, an immune modulation therapy similar to Celacade(TM) . There can
be no assurance that the products we are currently developing will be approved
by regulatory agencies or that further testing will yield positive results.
Should one of our immune modulation therapies prove to have insufficient benefit
and/or have an unsafe profile, its development will likely be discontinued.

A SETBACK IN EITHER OF OUR CLINICAL TRIALS IN CELACADE(TM) WOULD LIKELY CAUSE A
DROP IN THE PRICE OF OUR COMMON SHARES.

We intend to rely substantially on the exploitation of Celacade(TM) for our
future earnings. If Celacade(TM) does not become commercially viable for any
reason, we may not achieve profitability and our common share price would likely
decline.

WE ARE RELIANT ON OUR KEY PERSONNEL.

The operations of our business are highly dependent upon the participation of
our key personnel. The loss of the service of any one of our key personnel may
materially affect the ability of our company to successfully introduce our
products and to grow and expand. There is intense competition for qualified
management and skilled employees, and our failure to recruit, train, and retain
such employees could have a material adverse effect on our business, financial
condition, or results of operations.

OUR INTELLECTUAL PROPERTY MAY NOT PROVIDE MEANINGFUL PROTECTION FOR OUR PRODUCT
CANDIDATES. WE MAY INFRINGE OTHERS' PATENTS. PATENT LITIGATION IS TIME CONSUMING
AND EXPENSIVE.

We have filed a number of patent applications in the United States and many
other countries relating to our products and processes and we have been issued
patents covering certain aspects of our immune modulation therapies. Our success
may depend, in part, on our ability to obtain patent protection for our products
and processes. There can be no assurance that our patent applications will be
issued as patents or that any of our issued patents, or any patent that may be
issued in the future, will provide us with adequate protection for our products,
processes, or technology. The patent positions of biotechnology and
pharmaceutical companies can be highly uncertain and involve complex legal and
factual questions. Therefore, the breadth of claims allowed in biotechnology and
pharmaceutical patents cannot be predicted. We also rely upon unpatented trade
secrets and know-how, and no assurance can be given that others will not
independently develop substantially equivalent trade secrets or know-how. In
addition, whether or not our patents are issued, or issued with limited
coverage, others may receive patents that contain claims applicable to our
products. Our competitors may attempt to circumvent our patents by means of
alternative designs and processes. There can be no assurance that any of our
patents, or any patents issued to us in the future, will afford meaningful
protection against competitors. There can be no assurance that our patents will
be held valid or enforceable by a

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                                       15


court of competent jurisdiction. The patents of our competitors may impair our
ability to do business in a particular area. We also rely in part on
confidentiality agreements with our corporate collaborators, employees,
consultants, and certain contractors to protect our proprietary technology.
There can be no assurance that these agreements will not be breached, that we
will have adequate remedies for any breach, or that our trade secrets will not
otherwise become known or independently discovered by our competitors.

It is possible that our products or processes will infringe, or will be found to
infringe, patents not owned or controlled by us. In addition, because patent
applications are often maintained in secrecy and may take many years to issue,
there may be currently pending patent applications that may later result in
issued patents that our products infringe. If any relevant claims of third-party
patents that relate to our products are upheld as valid and enforceable, we
could be prevented from practicing the subject matter claimed in such patents,
or would be required to obtain licenses or redesign our products or processes to
avoid infringement. There can be no assurance that such licenses would be
available at all or on terms commercially reasonable to us or that we could
redesign our products or processes to avoid infringement. Litigation may be
necessary to defend against claims of infringement, to enforce patents issued to
us, or to protect trade secrets. Such litigation could result in substantial
costs and diversion of management efforts regardless of the results of such
litigation, and an adverse result could subject us to significant liabilities to
third parties, require disputed rights to be licensed, or require us to cease
using such technology.

IF WE FAIL TO OBTAIN ACCEPTABLE PRICES OR ADEQUATE REIMBURSEMENT FOR OUR
PRODUCTS, OUR ABILITY TO SUCCESSFULLY COMMERCIALIZE OUR PRODUCTS WILL BE
IMPAIRED.

Government and insurance reimbursements for healthcare expenditures play an
important role for all healthcare providers, including physicians, medical
device companies, drug companies, medical supply companies, and companies, such
as ours, that plan to offer various products and treatments in the United States
and other countries in the future. Our ability to earn sufficient returns on our
products will depend in part on the extent to which reimbursement for the costs
of such products and related treatments will be available from government health
administration authorities, private health coverage insurers, managed care
organizations, and other organizations. In the United States, our ability to
have our products and treatments eligible for Medicare or private insurance
reimbursement will be an important factor in determining the ultimate success of
our products. If, for any reason, Medicare or the insurance companies decline to
provide reimbursement for our products and treatments, our ability to
commercialize our products would be adversely affected. There can be no
assurance that our products and treatments will be eligible for reimbursement.

There has been a trend toward declining government and private insurance
expenditures for many healthcare items. Third-party payors are increasingly
challenging the price of medical products and services.

If purchasers or users of our products are not able to obtain adequate
reimbursement for the cost of using such products, they may forgo or reduce such
use. Even if our products and treatments are approved for reimbursement by
Medicare and private insurers, of which there can be no assurance, the amount of
reimbursement may be reduced at times, or even eliminated. This would have a
material adverse effect on our business, financial condition, and results of
operations.

Significant uncertainty exists as to the reimbursement status of newly approved
healthcare products, and there can be no assurance that adequate third-party
coverage will be available.

COMPETITION IN OUR TARGET MARKETS IS INTENSE, AND DEVELOPMENTS BY OTHER
COMPANIES COULD RENDER OUR PRODUCT CANDIDATES OBSOLETE.

The industry that we compete in is not a static environment, and market share
can change rapidly if competing products are introduced. There can be no
assurance that we can avoid intense competition from other medical technology
companies, universities, government agencies, or research organizations, and
from other technological advances that could render our technology uneconomical
or obsolete. Many of these competitors have substantially greater financial
and/or other resources. Our competitors may succeed in developing technologies
and products that are more effective or cheaper to use than any that we may
develop. These developments could render our products obsolete and
uncompetitive, which would have a material adverse effect on our business,
financial condition and results of operations. In addition, there are numerous
existing therapies for PAD and chronic heart failure, and others are being
developed.

WE RELY ON THIRD PARTIES FOR A VARIETY OF FUNCTIONS AND WE MAY ENTER INTO FUTURE
COLLABORATIONS. WE MAY NOT RECEIVE THE BENEFITS THAT WE EXPECT FROM THESE
ARRANGEMENTS.

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                                       16


Our strategy for the research, development, and commercialization of our
products requires entering into various arrangements with corporate
collaborators, licensors, licensees, and others, and our commercial success is
dependent upon these outside parties performing their respective contractual
responsibilities. The amount and timing of resources such third parties will
devote to these activities may not be within our control. There can be no
assurance that such parties will perform their obligations as expected. There
can be no assurance that our collaborators will devote adequate resources to our
programs. In addition, we could become involved in disputes with our
collaborators, which could result in a delay or termination of the related
development programs or result in litigation. We intend to seek additional
collaborative arrangements to develop and commercialize some of our products.
There can be no assurance that we will be able to negotiate collaborative
arrangements on favorable terms, or at all, in the future, or that our current
or future collaborative arrangements will be successful.

WE ARE SUBJECT TO EXPOSURE TO PRODUCT LIABILITY CLAIMS.

We face an inherent business risk of exposure to product liability and other
claims in the event that the development or use of our technology or prospective
products results, or is alleged to have resulted, in adverse effects. While we
have taken, and will continue to take, what we believe are appropriate
precautions, there can be no assurance that we will avoid significant liability
exposure. Although we currently carry product liability insurance for clinical
trials, there can be no assurance that we have sufficient coverage, or can in
the future obtain sufficient coverage at a reasonable cost. An inability to
obtain product liability insurance at an acceptable cost or to otherwise protect
against potential product liability claims could prevent or inhibit the
commercialization of products we develop. A product liability claim could have a
material adverse effect on our business, financial condition, and results of
operations.

WE DO NOT HAVE COMMERCIAL-SCALE MANUFACTURING CAPABILITY, AND WE LACK COMMERCIAL
MANUFACTURING EXPERIENCE.

We currently rely upon a single subcontractor for the disposable cartridges and
a single subcontractor for the treatment units on which the Celacade(TM)
delivery system is based. The establishment of additional or replacement
suppliers for certain materials, components, subassemblies, assemblies, or
finished products cannot be accomplished quickly, largely due to the regulatory
approval systems and the complex nature of the manufacturing processes employed
by many suppliers. The failure to obtain sufficient quantities of component
materials on commercially reasonable terms could have a material adverse effect
on our clinical studies, business, financial condition, and results of
operations.

If we are successful in developing the markets for our immune modulation
therapies, we would have to arrange for the scaled-up manufacturing of our
devices. At the present time, we have not arranged for the large-scale
manufacture of these medical devices. There can no assurance that we will, on a
timely basis, be able to make the transition from manufacturing clinical trial
quantities to commercial production quantities successfully or be able to
arrange for contract manufacturing. We believe our contractors will be able to
manufacture our medical devices for initial commercialization if the products
obtain FDA and other regulatory approval, but we have not yet demonstrated the
capability to manufacture the medical devices in commercial quantities.
Potential difficulties experienced by us in manufacturing scale-up, including
recalls or safety alerts, could have a material adverse effect on our business,
financial condition, and results of operations.

The manufacture of our products involves a number of steps and requires
compliance with stringent quality control specifications imposed by the FDA and
other regulatory agencies. Moreover, our products can only be manufactured in a
facility that has undergone a satisfactory inspection by the FDA and other
relevant regulatory authorities. For these reasons, we would not be able to
replace our manufacturing capacity quickly if we were unable to use our
manufacturing facilities as a result of a fire, natural disaster (including an
earthquake), equipment failure, or other difficulty, or if such facilities are
deemed not in compliance with the regulatory requirements and the non-compliance
could not be rapidly rectified. Our inability or reduced capacity to manufacture
our products would have a material adverse effect on our business, financial
condition, and results of operations.

We expect to enter into additional arrangements with contract manufacturing
companies in order to meet requirements for our products, or to attempt to
improve manufacturing efficiency. If we choose to contract for manufacturing
services and encounter delays or difficulties in establishing relationships with
manufacturers to produce, package, and distribute our finished products, then
clinical trials, market introduction, and subsequent sales of such products
would be adversely affected. Further, contract manufacturers must also operate
in compliance with the FDA and other regulatory requirements. Failure to do so
could result in, among other things, the disruption of product supplies. Our
potential dependence upon third parties for the design and/or manufacture of our
products may adversely affect our profit margins and our ability to develop and
deliver such products on a timely and competitive basis.

<PAGE>

                                       17


WE HAVE LIMITED SALES, MARKETING, AND DISTRIBUTION EXPERIENCE.

We have limited experience in the sales, marketing, and distribution of
pharmaceutical or medical device products. There can be no assurance that we
will be able to establish sales, marketing, and distribution capabilities or
make arrangements with our collaborators, licensees, or others to perform such
activities or that such efforts will be successful. If we decide to market any
of our products directly, we must either acquire or internally develop a
marketing and sales force with technical expertise and with supporting
distribution capabilities. The acquisition or development of a sales and
distribution infrastructure would require substantial resources, which may
divert the attention of our management and key personnel, and have a negative
impact on our product development efforts. If we contract with third parties for
the sales and marketing of our products, our revenues will be dependent on the
efforts of these third parties, whose efforts may not be successful. If we fail
to establish successful marketing and sales capabilities or to make arrangements
with third parties, our business, financial condition and results of operations
will be materially adversely affected.

OUR STRATEGIC ALLIANCE WITH QUEST DIAGNOSTICS MAY NOT BE SUCCESSFUL.

On November 6, 2001, we entered into a strategic alliance with Quest Diagnostics
regarding the establishment of an outpatient services delivery model to support
the commercialization of Celacade(TM) in the United States on an exclusive
basis. The terms of this strategic alliance have not yet been finalized. The
success of the strategic alliance will depend in part on the resources Quest
Diagnostics invests in it. While we believe that Quest Diagnostics will have
sufficient economic motivation to commit the resources necessary to make the
strategic alliance successful, there can be no assurance that our strategic
alliance will be successful. Should we not finalize the terms of this strategic
alliance, or should the strategic alliance not ultimately be successful, our
business may be adversely affected.

TWO OF OUR DIRECTORS' RELATIONSHIPS WITH QUEST DIAGNOSTICS COULD CREATE A
CONFLICT OF INTEREST.

Certain of the directors and officers of our Company are also directors and
officers of other companies. One of our directors is also President, Chief
Operating Officer, and a director of Quest Diagnostics. Quest Diagnostics has
announced that this individual will become Chief Executive Officer of Quest
Diagnostics before its next annual meeting of shareholders in May 2004. In
addition, our Chairman is also a director of Quest Diagnostics. Consequently,
there exists the possibility for such directors and officers to be in a conflict
of interest position. Any decision made by any of such directors and officers
involving our Company is subject to their duties and obligations to deal fairly
and in good faith with our Company and such other companies.

In addition, each of our directors is required to declare a conflict in, and
refrain from voting on, any matter in which such director may have a conflict of
interest.

IF OUR PRODUCTS DO NOT GAIN MARKET ACCEPTANCE, WE MAY BE UNABLE TO GENERATE
SIGNIFICANT REVENUES.

We do not believe that we have the required clinical data and results to
successfully market our product candidates in any jurisdiction; future clinical
or preclinical results may be negative or insufficient to allow us to
successfully market any of our product candidates; and obtaining needed data and
results may take longer than planned, and may not be obtained at all.

Even if our products are approved for sale, they may not be successful in the
marketplace. Market acceptance of any of our products will depend on a number of
factors, including demonstration of clinical effectiveness and safety; the
potential advantages of our products over alternative treatments; the
availability of acceptable pricing and adequate third-party reimbursement; and
the effectiveness of marketing and distribution methods for the products. If our
products do not gain market acceptance among physicians, patients, and others in
the medical community, our ability to generate significant revenues from our
products would be limited.

WE MAY NOT ACHIEVE OUR PROJECTED DEVELOPMENT GOALS IN THE TIME FRAMES WE
ANNOUNCE AND EXPECT.

We set goals for and make public statements regarding timing of the
accomplishment of objectives material to our success, such as the commencement
and completion of clinical trials, anticipated regulatory approval dates, and
time of product launch. The actual timing of these events can vary dramatically
due to factors such as delays or failures in our clinical trials, the
uncertainties inherent in the regulatory approval process, and delays in
achieving product development, manufacturing or marketing milestones necessary
to commercialize our products. There can be no assurance that our clinical
trials will be completed, that we will make regulatory submissions or receive
regulatory approvals as planned, or that we will be able to adhere to our
current schedule for the scale-up of manufacturing and launch of any of our
products. If we fail to achieve one or more of these milestones as planned, the
price of our common shares could decline.

<PAGE>

                                       18


OUR BUSINESS INVOLVES THE USE OF HAZARDOUS MATERIAL, WHICH REQUIRES US TO COMPLY
WITH ENVIRONMENTAL REGULATIONS.

Although we do not currently manufacture commercial quantities of our products,
we produce limited quantities of such products for our clinical trials. Our
research and development processes involve the controlled storage, use, and
disposal of hazardous materials and hazardous biological materials. We are
subject to laws and regulations governing the use, manufacture, storage,
handling, and disposal of such materials and certain waste products. Although we
believe that our safety procedures for handling and disposing of such materials
comply with the standards prescribed by such laws and regulations, the risk of
accidental contamination or injury from these materials cannot be completely
eliminated. In the event of such an accident, we could be held liable for any
damages that result, and any such liability could exceed our resources. There
can be no assurance that we will not be required to incur significant costs to
comply with current or future environmental laws and regulations, or that our
business, financial condition, and results of operations will not be materially
or adversely affected by current or future environmental laws or regulations.

Our insurance may not provide adequate coverage with respect to environmental
matters.

ENVIRONMENTAL REGULATION COULD HAVE A MATERIAL ADVERSE EFFECT ON THE RESULTS OF
OUR OPERATIONS AND OUR FINANCIAL POSITION.

We are subject to a broad range of environmental regulations imposed by federal,
state, provincial, and local governmental authorities. Such environmental
regulation relates to, among other things, the handling and storage of hazardous
materials, the disposal of waste, and the discharge of contaminants into the
environment. Although we believe that we are in material compliance with
applicable environmental regulation, as a result of the potential existence of
unknown environmental issues and frequent changes to environmental regulation
and the interpretation and enforcement thereof, there can be no assurance that
compliance with environmental regulation or obligations imposed thereunder will
not have a material adverse effect on us in the future.


<PAGE>

                                       19


                  ITEM 5 - SELECTED CONSOLIDATED FINANCIAL DATA


The following selected consolidated financial data, for the last three completed
financial years ended November 30, 2001, 2002, and 2003, is derived from our
audited consolidated financial statements. All amounts are in thousands of
Canadian dollars except for per share data.

                                                  YEARS ENDED NOVEMBER 30,

                                               2003         2002         2001

                                             (audited)    (audited)    (audited)

EXPENSES:
---------

Research and development                   $  21,730    $  12,675    $   9,208
General and administration                    10,250        7,542        7,304
Foreign exchange loss (gain)                   1,111          267          (58)

Loss before the undernoted                   (33,091)     (20,484)     (16,454)

Investment income                              1,143          977        2,065

Loss for the period                          (31,948)     (19,507)     (14,389)
Deficit, beginning of period                 (81,167)     (61,660)     (47,271)
Deficit, end of period                      (113,115)     (81,167)     (61,660)
Basic and fully diluted loss per share         (0.57)       (0.40)       (0.32)


                                                  YEARS ENDED NOVEMBER 30,

                                               2003         2002         2001

                                             (audited)    (audited)    (audited)

BALANCE SHEET
-------------

Total assets                                  68,783       48,836       44,769
Cash and marketable securities                60,085       42,715       39,528
Shareholders' equity                          62,465       45,506       41,374



<PAGE>

                                       20


                                                  QUARTERLY RESULTS
                                                  -----------------

                                                               BASIC AND FULLY
                                             LOSS FOR          DILUTED LOSS PER
                                            THE PERIOD         SHARE
                                            ----------         -----

FEBRUARY 28, 2003                            $ (5,428)         (0.10)
MAY 31, 2002                                   (7,335)         (0.14)
AUGUST 31, 2003                                (5,870)         (0.10)
NOVEMBER 30, 2003                             (13,315)         (0.22)

February 28, 2002                            $ (5,028)         (0.11)
May 31, 2002                                   (4,478)         (0.09)
August 31, 2002                                (4,241)         (0.08)
November 30, 2002                              (5,760)         (0.12)

(1)  We are in the development stage and, accordingly, have no revenue.
(2)  In March, 2004, we completed a public share offering for gross proceeds of
     $76.9 million resulting from the issuance of 9,775,000 common shares at a
     price of $7.92 (US$5.90) per share.

DIVIDEND RECORD AND POLICY

No dividends have been paid to date and it is not contemplated that any
dividends will be paid in the immediate or foreseeable future.


    ITEM 6 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
                              RESULTS OF OPERATIONS

Please refer to pages 16 to 23 of our 2003 Annual Report, which are incorporated
herein by reference.


                         ITEM 7 - MARKET FOR SECURITIES


Our Common Shares are listed on the Toronto Stock Exchange and the NASDAQ
National Market.

<PAGE>

                                       21


                         ITEM 8 - DIRECTORS AND OFFICERS


The names and municipalities of residence of all our directors and officers as
at the date hereof, the offices presently held, principal occupations, and the
year each director first became a director are set out below. Each director was
elected to serve until the next annual meeting or until his successor is elected
or appointed. Officers are appointed annually and serve at the discretion of the
Board of Directors.

<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------------------------
NAME AND                 POSITION WITH THE COMPANY AND PRINCIPAL         OTHER PUBLIC                    DIRECTOR/OFFICER
RESIDENT (3)             OCCUPATION (4)                                  COMPANY BOARDS                  SINCE
-------------------------------------------------------------------------------------------------------------------------------
<S>                      <C>                                             <C>                             <C>
WILLIAM R. GRANT (1)     Chairman of the Board and Director of the       Advanced Medical Optics, Inc.   November 1998;
New York, New York       Company and Chairman of Galen Associates        Massey Energy Company           Chairman since March
                                                                         Ocular Sciences, Inc.           2001
                                                                         Quest Diagnostics Incorporated
-------------------------------------------------------------------------------------------------------------------------------
ANDRE BERARD (1)         Director of the Company and Former Chairman     Banque Saradar France           November 2000
Verdun, Quebec           and CEO of National Bank of Canada              BCE Inc.
                                                                         Groupe BMTC Inc.
                                                                         Groupe Saputo Inc.
                                                                         Kruger Inc.
                                                                         Le Groupe Canam Manac Inc.
                                                                         National Bank of Canada
                                                                         Noranda Inc.
                                                                         Societe financiere Bourgie
                                                                         Inc.
                                                                         TransForce Income Fund
-------------------------------------------------------------------------------------------------------------------------------
DAVID G. ELSLEY          President, CEO, and a Director of the Company   Nil                             January 1991
Oakville, Ontario
-------------------------------------------------------------------------------------------------------------------------------
TERRANCE H. GREGG (2)    Director of the Company and Former President    Amylin Pharmaceuticals, Inc.    September 1999
Los Angeles, California  of Medtronic MiniMed                            Ocular Sciences, Inc.
-------------------------------------------------------------------------------------------------------------------------------
BENOIT LA SALLE (1)      Director of the Company and the President and   AFCAN Mining Corporation        January 1997
Montreal, Quebec         Chief Executive Officer of SEMAFO Inc.          ART Research Technologies
                                                                         BioCapital Inc.
                                                                         LMS Medical Systems Inc
                                                                         Pebercan Inc.
                                                                         Pheromone Sciences Corp.
                                                                         SEMAFO Inc.
-------------------------------------------------------------------------------------------------------------------------------
SURYA N. MOHAPATRA (2)   Director of the Company and President and       Quest Diagnostics Incorporated  March 2002
Saddle River, New        Chief Operating Officer of Quest Diagnostics
Jersey                   Incorporated
-------------------------------------------------------------------------------------------------------------------------------
</TABLE>

<PAGE>

                                       22


<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------------------------
NAME AND                 POSITION WITH THE COMPANY AND PRINCIPAL         OTHER PUBLIC                    DIRECTOR/OFFICER
RESIDENT (3)             OCCUPATION (4)                                  COMPANY BOARDS                  SINCE
-------------------------------------------------------------------------------------------------------------------------------
<S>                      <C>                                             <C>                             <C>
ELDON R. SMITH           Vice President, Scientific Affairs, and a       BioMax Technologies Inc.        July 1998
Calgary, Alberta         Director of the Company                         Canadian Natural Resources
                                                                         Limited
                                                                         Pheromone Sciences Corp.
-------------------------------------------------------------------------------------------------------------------------------
JOHN C. VILLFORTH (2)    Director of the Company and Former President    EduNeering Inc.                 March 2001
Derwood, Maryland        and Executive Director, Food and Drug Law
                         Institute
-------------------------------------------------------------------------------------------------------------------------------
GEOFREY MYERS            Assistant Secretary of the Company and Senior   N/A                             February 2000
Toronto, Ontario         Partner with Lang Michener LLP
-------------------------------------------------------------------------------------------------------------------------------
MICHAEL MARTIN           Vice President, Marketing and Business          N/A                             June 2001
Montclair, New Jersey    Development of the Company
-------------------------------------------------------------------------------------------------------------------------------
SUSAN LANGLOIS           Vice President, Regulatory and Clinical         N/A                             May 2003
Bolton, Ontario          Affairs, of the Company
-------------------------------------------------------------------------------------------------------------------------------
BERNARD LIM              Vice President, Technology of the Company       N/A                             March 2001
Oakville, Ontario
-------------------------------------------------------------------------------------------------------------------------------
CHRISTOPHER J. WADDICK   Executive Vice President and Chief Financial    N/A                             March 1997
Chatham, Ontario         Officer, Corporate Secretary and Treasurer of
                         the Company
-------------------------------------------------------------------------------------------------------------------------------
</TABLE>

Notes:

1.   Member of the Audit Committee of the Board of Directors.
2.   Member of the Compensation and Corporate Governance Committee of the Board
     of Directors.
3.   The Company does not have an executive committee of the Board of Directors.
4.   Additional biographical information on the Board of Directors can be found
     in the Company's 2003 Management Proxy Circular.

The directors and officers of Vasogen as a group beneficially own, directly or
indirectly, or exercise control or direction over, approximately 1.6% of the
issued common shares of the Company.

On December 9, 2002, BridgePoint International Inc., a company of which Mr.
Benoit La Salle was a director and chairman, announced in a press release that
cease trade orders had been issued with respect to its shares by the securities
regulatory authorities in each of Quebec, Ontario, Manitoba, Alberta, and
British Columbia as a consequence of its default in filing its audited financial
statements for the year ended June 30, 2002 within the prescribed time period.
On or before April 1, 2003, all cease trade orders were revoked by the
above-mentioned regulatory authorities.


                         ITEM 9 - ADDITIONAL INFORMATION


Additional information concerning Vasogen, including directors' and officers'
remuneration and indebtedness, principal holders of securities, options to
purchase securities, and interests of insiders in material transactions, where
applicable, is contained in the Management Proxy Circular dated March 22, 2004.
Additional financial information is provided in the consolidated financial
statements for the fiscal period ended November 30, 2003. Copies of our
Management Proxy Circular and 2003 Annual Report, including the consolidated
financial statements, may be obtained upon request from our Corporate Secretary
at 2155 Dunwin Drive, Unit 10, Mississauga, Ontario L5L 4M1 and are available on
Sedar at www.sedar.com.

We shall provide to any person, upon request to the Secretary of the Company:

(1)      when our securities are in the course of a distribution pursuant to a
         short form prospectus or a preliminary short form prospectus has been
         filed in respect of a distribution of our securities,

         (a)      one copy of our Annual Information Form, together with one
                  copy of any document, or the pertinent pages of any document,
                  incorporated by reference in the Annual Information Form,

<PAGE>

                                       23


         (b)      one copy of our comparative financial statements for our most
                  recently completed fiscal year for which financial statements
                  have been filed, together with the accompanying report of the
                  auditor and one copy of our most recent interim financial
                  statements that have been filed, if any, subsequent to the
                  financial statements for our most recently completed financial
                  year,

         (c)      one copy of our information circular in respect of our most
                  recent annual meeting of shareholders that involved the
                  election of directors or one copy of any annual filing
                  prepared in lieu of that information circular, as appropriate,
                  and

         (d)      one copy of any other document that is incorporated by
                  reference into the preliminary short form prospectus and is
                  not required to be provided under (a) to (c) above; or

(2)      at any other time, one copy of any other document referred to in
         (1)(a), (b),(c), and (d) above, provided we may require the payment of
         a reasonable charge if the request is made by a person who is not one
         of our security holders.