IntelliPharmaCeutics International Inc. Announces Third Quarter 2009 Results of IntelliPharmaCeutics Ltd.

IntelliPharmaCeutics International Inc. Announces Third Quarter 2009 Results
of IntelliPharmaCeutics Ltd.

TORONTO, Nov. 12 /PRNewswire-FirstCall/ - IntelliPharmaCeutics International
Inc. (NASDAQ:IPCI; TSX:I) today reported the results of operations for the
three and nine months ended September 30, 2009 of IntelliPharmaCeutics Ltd.,
(the "Predecessor Company") . The company is filing the September 30, 2009
financial statements of IntelliPharmaCeutics Ltd., in accordance with Section
4.10(2)(a) of 51-102 which provides that all financial statements be filed for
all annual and interim periods ending before the date of the reverse takeover
and after the date of the financial statements included in the information
circular or similar document prepared in connection with the transaction. All
dollar amounts referenced herein are in United States dollars unless otherwise
noted.
The net loss for the third quarter of 2009 was $165,739, or $0.01 per common
share, compared with a net loss of $915,596, or $0.05 per common share for the
same period in 2008. We incurred a net loss for the nine months ended
September 30, 2009 of $963,411, or $0.06 per common share, compared with a net
loss of $1,683,184, or $0.10 per common share for the same period in 2008. The
decreased loss for the three and nine months ended September 30, 2009 is due
to initiatives taken by us to lower operating expenses. Cost reduction
initiatives included a decrease in wages and benefits for both administrative
and research and development staff as well as a reduction in overall staffing
levels.
At September 30, 2009, our cash totaled $10,883, compared with $902,213 at
December 31, 2008 and $25,518 at June 30, 2009. Our net cash used in operating
activities for the three and nine months ended September 30, 2009 has been
offset by advances from Dr. Isa Odidi and Dr. Amina Odidi, principal
stockholders, directors and executive officers.

Corporate Update

- On October 22, 2009 we announced the completion of our previously
announced plan of arrangement with Vasogen Inc.. The shareholders of
IntelliPharmaCeutics Ltd. and Vasogen Inc. approved this transaction
at their respective shareholder meetings on October 19, 2009. All
court and regulatory approvals required to effect the arrangement
have been received. The arrangement resulted in IntelliPharmaCeutics
Ltd. and IntelliPharmaCeutics Corp. combining with 7231971 Canada
Inc., a new Vasogen company that acquired substantially all of the
assets of Vasogen Inc., including the $7.5 million in gross proceeds
from its non-dilutive financing transaction with Cervus LP. As a
result of this transaction, former shareholders of
IntelliPharmaCeutics Ltd. own approximately 86% of the outstanding
common shares of IPC and former shareholders of Vasogen Inc. own
approximately 14% of the outstanding common shares of IPC.

- In connection with the transaction that was completed on October 22,
2009 IntelliPharmaCeutics International Inc. received approximately
$10.0 million in Net Cash as defined in the arrangement agreement
with Vasogen Inc. that will be used to fund our operations and
portfolio of NDA and ANDA products.

IPC Overview

Using our proprietary technologies, our strategy involves the development of
products for partners and the development and manufacture of our own
proprietary products. Currently, we have 15 products in our pipeline at
varying stages of development and regulatory review. Several of these product
candidates have been partnered under drug development arrangements which have
or provide for milestone and success fees, support for internal development
costs, coverage of clinical trial costs, coverage of patent litigation costs,
and royalties or profit sharing on product sales. We apply our proprietary
delivery platform technology and expertise in pharmaceutics, drug delivery,
and drug manufacture with the goal of minimizing the risk, time, and
manufacturing cost of bringing the finished product to market.
Our lead products in the generic, controlled-release pharmaceutical category
are Dexmethylphenidate XR (dexmethylphenidate hydrochloride), a generic
version of Focalin XR(R), which is an extended-release capsule for the
treatment of Attention Deficit Hyperactivity Disorder, and Carvedilol CR
(carvedilol phosphate), a generic version of Coreg CR(R), which is an extended
release capsule for the treatment of high blood pressure. In 2008, Focalin(R),
including Focalin XR(R), had U.S. sales of approximately U.S. $350 million,
and Coreg(R), including Coreg CR(R), had U.S. sales of approximately U.S.
$300M million.
One of our key non-generic products is an abuse- and alcohol-resistant,
controlled-release oral oxycodone formulation. This product is covered by
pending patent applications for its novel ReXista(TM) abuse- and
alcohol-resistant drug delivery technology. The product is a unique dosage
form, designed to be resistant to abuse by oral ingestion when crushed or
chewed, by injection when combined with solvents, and by nasal inhalation when
crushed or powdered. The abuse of this important pain relief drug has been
well documented over many years. In 2008, Oxycodone had U.S. sales of
approximately U.S. $2 billion. The product is also designed to resist release
of the entire dose when consumed with alcohol, a significant problem with some
opioid drugs, such as hydromorphone.

Certain statements in this document constitute "forward-looking statements"
within the meaning of the United States Private Securities Litigation Reform
Act of 1995 and/or "forward-looking information" under the Securities Act
(Ontario). These statements include, without limitation, statements regarding
the status of development, or expenditures relating to our business, plans to
fund our current activities, statements concerning our partnering activities,
health regulatory submissions, strategy, future operations, future financial
position, future revenues and projected costs. 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. We made a number of assumptions in the
preparation of these forward-looking statements. You should not place undue
reliance on our forward-looking statements, which are subject to a multitude
of risks and uncertainties that could cause actual results, future
circumstances or events to differ materially from those projected in the
forward-looking statements. These risks include, but are not limited to,
securing and maintaining corporate alliances, the need for additional capital
and the effect of capital market conditions and other factors, including the
current status of our programs, on capital availability, the potential
dilutive effects of any financing and other risks detailed from time to time
in our public disclosure documents or other filings with the securities
commissions or other securities regulatory bodies in Canada and the U.S.
Additional risks and uncertainties relating to IPC and our business can be
found in the "Risk Factors" section of our joint management information
circular dated September 16, 2009, as well as in our other public filings. The
forward-looking statements are made as of the date hereof, and we disclaim any
intention and have no obligation or responsibility, except as required by law,
to update or revise any forward-looking statements, whether as a result of new
information, future events or otherwise.

The unaudited interim consolidated financial statements, accompanying notes to
the unaudited interim consolidated financial statements, and Management's
Discussion and Analysis for the three and nine months ended September 30,
2009, will be accessible on IntelliPharmaCeutics Website at
www.intellipharmaceutics.com and will be available on SEDAR and EDGAR.

Summary financial tables are provided below.

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INTELLIPHARMACEUTICS LTD.

Interim Consolidated Balance Sheets
(Stated in U.S. dollars; Unaudited)

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As at September 30, December 31,
2009 2008
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Assets

Current assets:
Cash $ 10,883 $ 902,213
Accounts receivable 20,526 40,182
Investment tax credits 1,612,094 871,784
Deferred costs 614,605 -
Prepaid expenses and sundry assets 60,736 77,197
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2,318,844 1,891,376

Property and equipment, net 970,734 1,134,648
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$ 3,289,578 $ 3,026,024
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Liabilities and Shareholders' (Deficiency)
Equity

Current liabilities:
Accounts payable $ 829,618 $ 328,477
Accrued liabilities 530,966 315,864
Current portion of capital lease obligations 36,140 32,285
Deferred revenue 458,656 497,149
Due to related parties 2,303,258 925,830
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4,158,638 2,099,605

Capital lease obligations 18,280 39,305

Deferred revenue 1,152,016 1,470,189
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5,328,934 3,609,099
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Shareholders' deficiency:
Capital stock
Authorized:
20,000,000 Special Voting Shares,
$0.001 par value
40,000,000 common shares, $0.001 par
value
Issued and outstanding:
10,850,000 Special Voting Shares
(2008-10,850,000) 10,850 10,850
6,023,944 common shares (2008 -
6,023,944) 6,024 6,024
Additional paid-in capital 10,482,120 10,482,120
Accumulated other comprehensive income (107,223) 385,647
Deficit (12,431,127) (11,467,716)
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(2,039,356) (583,075)
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$ 3,289,578 $ 3,026,024
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INTELLIPHARMACEUTICS LTD.

Interim Consolidated Statements of Operations and Comprehensive Loss
(Stated in U.S. dollars; Unaudited)

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Three months ended Nine months ended
September 30 September 30
2009 2008 2009 2008
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Revenue:
Research and
development $ 125,590 $ 180,388 $ 468,422 $ 1,159,964
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$ 125,590 $ 180,388 $ 468,422 $ 1,159,964
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Expenses:
Cost of Revenue 86,773 374,712 200,970 1,106,934
Research and
development 156,583 82,254 816,599 242,985
Selling, general
and
administrative
costs 238,012 363,554 560,159 740,965
Depreciation 98,480 132,965 300,129 465,265
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579,848 953,485 1,877,857 2,556,149
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Loss before the
undernoted (454,258) (773,097) (1,409,435) (1,396,185)

Foreign exchange
gain (loss) 321,750 (136,681) 508,380 (296,982)

Interest income 49 12,153 1,566 70,454

Interest expense (33,280) (17,971) (63,922) (60,471)
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Net Loss for the
period (165,739) (915,596) (963,411) (1,683,184)

Comprehensive Items:
Foreign exchange
translation
adjustment (324,720) 63,499 (492,870) 74,232
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Comprehensive
loss $ (490,459) $ (852,097) $ (1,456,281) $ (1,608,952)
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Loss per share,
basic and
diluted $ (0.01) $ (0.05) $ (0.06) $ (0.10)
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Weighted average
number of common
shares and
Special Voting
Shares
outstanding,
basic and diluted 16,873,944 16,873,944 16,873,944 16,873,944
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SOURCE INTELLIPHARMACEUTICS INTERNATIONAL INC.

Graham Neil, Investor Relations, 30 Worcester Road, Toronto, M9W 5X2, tel:
(416) 798-3001, fax: (416) 798-3007, www. intellipharmaceutics.com,
investors@intellipharmaceutics.com