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Vasogen Announces Second Quarter 2008 Results

Mississauga, Ontario - July 09, 2008

Vasogen Inc. (NASDAQ:VSGN; TSX:VAS) today reported the results of operations for the three and six months ended May 31, 2008. All dollar amounts referenced herein are in Canadian dollars unless otherwise noted.

At May 31, 2008, our cash and cash equivalents totaled $12.4 million, compared with $19.9 million at February 29, 2008.

The net loss for the second quarter of 2008 was $7.4 million, or $0.33 per common share, compared with a net loss of $9.7 million, or $0.54 per common share for the same period in 2007. We incurred a net loss for the six months ended May 31, 2008 of $12.7 million, or $0.57 per common share, compared with a net loss of $17.4 million, or $1.02 per common share for the same period in 2007. A key driver of this decrease was a reduction in expenses resulting from the repayment of the senior convertible notes in April 2007, lower restructuring costs, reduced stock compensation expense, lower infrastructure and other support costs driven by lower employee numbers in 2008, and a decrease in the foreign exchange loss that was incurred in the prior periods.

Corporate Update

• On April 14, 2008, we announced the implementation of a strategic restructuring plan to significantly reduce our cash burn rate and focus our efforts on opportunities that the Board and Management believe are most likely to provide shareholder value. As a result of this restructuring, our work force was reduced by approximately 85% during the quarter. As a result, we are no longer maintaining the necessary quality processes or personnel to support European commercialization or clinical development of Celacade. We also retained JMP Securities to assist in exploring potential strategic alternatives with the goal of enhancing shareholder value.
  
  
• Subsequent to the end of our second quarter and following an extensive review of our VP series of drugs program, we announced a halt to the expenses associated with the VP program, including an additional reduction in our work force, to further reduce our cash burn rate as we continue to explore strategic alternatives.
• As part of our restructuring, a new tenant has been secured for our 37,111 sq. ft. leased facility located at 2505 Meadowvale Boulevard in Mississauga, Ontario, and we have negotiated a lease surrender agreement with our landlord. As a result, our lease for this facility will terminate on September 30, 2008.
• On April 24, 2008, we received a letter from the Listing Qualifications Department of The NASDAQ Stock Market indicating that the minimum closing bid price of our common stock had fallen below $1.00 for 30 consecutive trading days, and therefore, we were not in compliance with Marketplace Rule 4310(c)(4) (the “Rule”). In accordance with the NASDAQ Marketplace Rule 4310(c)(8)(D), we are provided a compliance period of 180 calendar days, or until October 21, 2008, to regain compliance with this requirement.

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 may include, without limitation, plans to resume operations, to advance the development of the Celacade™ System or our VP series of drugs including VP015 and VP025, 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. These risks include, but are not limited to, the outcome of our strategic review, securing and maintaining corporate alliances, the need for additional capital and the effect of capital market conditions and other factors, including halting development of the Celacade System and VP series of drugs, 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 Canadian and U.S. securities commissions or other securities regulatory bodies. Additional risks and uncertainties relating to our Company and our business can be found in the “Risk Factors” section of our Annual Information Form and Form 20-F for the year ended November 30, 2007, as well as in our later public filings, including our Management’s Discussion and Analysis for the quarter ended May 31, 2008. 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 six months ended May 31, 2008, will be accessible on Vasogen’s Website at www.vasogen.com and will be available on SEDAR and EDGAR.

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