RELEASE AND SETTLEMENT AGREEMENT

Exhibit 10.32

RELEASE AND SETTLEMENT AGREEMENT

        This Agreement is made the day and year hereunder written between:

BIOMIRA INC.
("Biomira")
—and—
DR. ALEX McPHERSON
("McPherson")

        WHEREAS McPherson was employed by Biomira as the President and Chief Executive Officer;

        AND WHEREAS both of the parties hereto have reached a settlement in regard to the retirement of McPherson from employment in accordance with the terms and conditions hereinafter set forth;

        NOW THEREFORE, in consideration of the premises and mutual covenants and agreement herein contained, the parties hereto agree as follows:

1.     RETIREMENT FROM EMPLOYMENT

1.1

McPherson hereby resigns from his employment with Biomira effective the 17 ^th day of May, 2006 (hereinafter referred to as the "Retirement Date").

1.2

All agreements pertaining to or in any way related to the said employment and made between the parties hereto, prior to the date of this Agreement, shall be null and void and of no further force and effect as of the Retirement Date.

1.3

Immediately following the date of this Agreement, Biomira shall pay to McPherson the sum of Fifty Thousand Nine Hundred and Eighty Five ($50,985.00) Dollars as a retiring allowance.

2.     WITHDRAWAL OF LEGAL PROCEEDINGS

• McPherson agrees to discontinue any pending or commenced applications, grievances, actions and complaints filed with any board or tribunal, including the Labour Relations Board, the Workers' Compensation Board, the Alberta Human Rights and Citizenship Commission or any Court, relating to employment with Biomira, including but not limited to any salary, disability or benefit matters. McPherson further agrees that such discontinuance and withdrawal will be done at McPherson's expense and, provided that Biomira is not in default of any of its obligations contained in this Agreement, McPherson agrees not to commence any further applications, grievances, actions or complaints relating to employment with Biomira. McPherson further agrees that by executing this Release and upon Biomira fulfilling its obligations herein, all applications, grievances, actions and complaints filed with any board or tribunal, including the Labour Relations Board, the Alberta Human Rights and Citizenship Commission or any Court, shall be deemed settled.

3.     RELEASES, INDEMNITIES AND ACKNOWLEDGMENTS

3.1

Provided that Biomira is not in default of any of its obligations contained in this Agreement, McPherson hereby remises, releases and discharges Biomira, its subsidiaries and affiliates, or their respective servants, owners, members, shareholders, employees, agents, directors, officers, successors and assigns and their respective insurers, jointly and severally of and from any and all action, cause and causes of actions, contracts, whether expressly or implied, suits, debts, dues, sums or money, expenses, indemnity expenses, claims and demands for damages, loss or injury, c