UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No.     )

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o		Soliciting Material Pursuant to §240.14a-12

QLT Inc.

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April 15, 2011

To the Shareholders of QLT Inc.

I am pleased to invite you to attend the Annual Meeting of shareholders of QLT Inc. to be held on Thursday, May 26, 2011 at 10:00 a.m. (Pacific Time) at QLT’s offices at 887 Great Northern Way, Vancouver, British Columbia. A reception will follow the Annual Meeting to allow you to meet the Directors and Management of QLT.

The attached Notice of Annual Meeting and Proxy Statement provide details of the business to be conducted at the Annual Meeting. The Notice of Annual Meeting and Proxy Statement, the Instrument of Proxy, and the Annual Report on Form 10-K are first being mailed to shareholders on or about April 25, 2011. A copy of QLT’s Annual Report on Form 10-K is enclosed.

Your vote on the enclosed Instrument of Proxy is very important to us. Whether or not you plan to attend our Annual Meeting, please communicate your vote in accordance with the instructions in the Proxy Statement and the enclosed Instrument of Proxy.

Thank you for your continued support of QLT and I look forward to seeing you at the Annual Meeting on May 26, 2011.

Sincerely,

QLT Inc.

ROBERT L. BUTCHOFSKY
President and Chief Executive Officer

QLT Inc.
887 Great Northern Way, Suite 101
Vancouver, British Columbia V5T 4T5
Notice of Annual Meeting of Shareholders
to be held May 26, 2011

NOTICE IS HEREBY GIVEN that the Annual Meeting (the “Annual Meeting”) of shareholders of QLT Inc. (“QLT”) will be held at QLT’s head office at 887 Great Northern Way, Vancouver, British Columbia, on Thursday, May 26, 2011 at 10:00 a.m. (Pacific Time) for the following purposes, each of which is described in more detail in the accompanying Proxy Statement (the “Proxy Statement”):

1.		To receive the Annual Report on Form 10-K, including the report of the Directors of QLT (the “Directors”), and the Audited Consolidated Financial Statements of QLT for the year ended December 31, 2010, together with the Report of the Independent Registered Chartered Accountants on those Financial Statements;
2.		To elect eight Directors to serve for the ensuing year;
3.		To approve the appointment of Deloitte & Touche LLP as independent auditors of QLT for the ensuing year and to authorize the Directors to fix the remuneration to be paid to the auditors;
4.		To conduct an advisory vote on the compensation of our named executive officers;
5.		To conduct an advisory vote on the frequency of the advisory vote on the compensation of our named executive officers; and
6.		To transact such other business as may properly come before the Annual Meeting, or at any adjournments or postponements thereof.

You are entitled to receive notice of and attend the Annual Meeting, and may vote at the Annual Meeting, if you were a shareholder of QLT at the close of business on April 7, 2011, which we refer to as the “record date.” If you are unable to attend the Annual Meeting in person, you may vote by proxy on the matters to be considered at the Annual Meeting. Please read the notes accompanying the Instrument of Proxy enclosed with these materials and then follow the instructions for voting by proxy contained in this Proxy Statement. If on April 7, 2011, your shares in QLT were held of record in your brokerage firm, securities dealer, trust company, bank or another similar organization, you may vote at the Annual Meeting if you obtain a proxy card from that organization issued in your name and carefully follow any instructions that are provided to you in connection with that proxy card.

In order for it to be voted at the Annual Meeting, a proxy must be received (whether delivered by mail, facsimile, telephone or Internet) by no later than 10:00 a.m. (Pacific Time)/1:00 p.m. (Eastern Time) on Tuesday, May 24, 2011 by our registrar and transfer agent, Computershare Investor Services Inc., Attn: Proxy Department, 100 University Avenue, 9th Floor, Toronto, Ontario, M5J 2Y1, facsimile number: from within North America at (866) 249-7775 or from outside North America at (416) 263-9524; telephone number: 1-866-732-VOTE (8683), website: www.investorvote.com. The Chairman of the Annual Meeting may determine, in his sole discretion, to accept or reject an Instrument of Proxy that is delivered in person to the Chairman at the Annual Meeting as to any matter in respect of which a vote has not already been cast.

DATED at Vancouver, British Columbia, this 15th day of April, 2011.

BY ORDER OF THE BOARD OF DIRECTORS
Robert L. Butchofsky
President and Chief Executive Officer

Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting of Shareholders to be held on May 26, 2011:

This Proxy Statement and our Annual Report for the fiscal year ended December 31, 2010 are available at www.qltinc.com by clicking on “2011 Proxy Materials and Annual Report” or directly at: http://phx.corporate-ir.net/phoenix.zhtml?c=67181&p=irol-proxy.

TABLE OF CONTENTS

		Page
QUESTIONS AND ANSWERS ABOUT THIS PROXY STATEMENT AND OUR ANNUAL MEETING			1
CORPORATE GOVERNANCE			6
COMPENSATION OF DIRECTORS			16
PROPOSAL NO. 1 ELECTION OF DIRECTORS			20
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT			27
EXECUTIVE COMPENSATION			28
COMPENSATION COMMITTEE REPORT			54
SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS			56
INDEBTEDNESS OF DIRECTORS AND EXECUTIVE OFFICERS			57
REPORT OF THE AUDIT AND RISK COMMITTEE			57
PROPOSAL NO. 2 APPROVAL OF APPOINTMENT OF INDEPENDENT AUDITORS			59
PROPOSAL NO. 3 ADVISORY VOTE ON THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS (“SAY-ON-PAY VOTE”)			59
PROPOSAL NO. 4 ADVISORY VOTE ON THE FREQUENCY OF AN ADVISORY VOTE ON THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS (“FREQUENCY VOTE”)			61
AUDITED CONSOLIDATED FINANCIAL STATEMENTS AND ADDITIONAL INFORMATION			62
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE			63
OTHER BUSINESS			63

QLT INC.
887 Great Northern Way, Suite 101
Vancouver, British Columbia V5T 4T5

PROXY STATEMENT FOR
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON MAY 26, 2011

We have sent this Notice of Annual Meeting and Proxy Statement, together with the enclosed Instrument of Proxy, because our Board of Directors and management are soliciting your proxy to vote at our Annual Meeting of shareholders to be held on Thursday, May 26, 2011. This Proxy Statement contains information about the matters being voted on at the Annual Meeting and important information about QLT. Unless otherwise stated, information in this Proxy Statement is given as of April 14, 2011. As many of our shareholders are expected to be unable to attend the Annual Meeting in person, proxies are solicited by mail to give each shareholder an opportunity to vote on all matters that will properly come before the Annual Meeting. QLT intends to mail this Proxy Statement and accompanying Instrument of Proxy on or about April 25, 2011 to all shareholders of record as at the close of business on April 7, 2011, which we refer to as the “record date.”

We use a number of abbreviations in this Proxy Statement. We refer to the company as “the Company,” “we,” “us” or “our” and to our board of directors as the “Board” or the “Board of Directors.” The term “proxy solicitation materials” includes this Proxy Statement and the enclosed Instrument of Proxy. References to “fiscal 2010” and “fiscal 2011” mean our 2010 fiscal year which began on January 1, 2010 and ended on December 31, 2010 and our 2011 fiscal year which began on January 1, 2011 and will end on December 31, 2011, respectively. Our Annual Meeting of Shareholders to be held on Thursday, May 26, 2011 is referred to as the “Annual Meeting” or the “Meeting.” References in this Proxy Statement to the Annual Meeting include any adjournment or postponement of the Meeting.

QUESTIONS AND ANSWERS ABOUT THIS PROXY STATEMENT
AND OUR ANNUAL MEETING

Why did I receive this Proxy Statement?

You are receiving these proxy materials from us because you owned common shares of QLT at the close of business on the record date. When you vote using the Instrument of Proxy, you appoint Messrs. Robert L. Butchofsky and C. Boyd Clarke as your representatives at the Annual Meeting. Messrs. Butchofsky and Clarke will vote your shares at the Annual Meeting as you have instructed them on the Instrument of Proxy. This way, your shares will be voted whether or not you attend the Annual Meeting. Even if you plan to attend the Meeting, it is a good idea to vote by proxy in advance of the Annual Meeting just in case your plans change.

Can I access the proxy materials on the Internet?

Yes. This Proxy Statement and our Annual Report for the fiscal year ended December 31, 2010 are available on our website at www.qltinc.com by clicking “2011 Proxy Materials and Annual Report” or directly at: http://phx.corporate-ir.net/phoenix.zhtml?c=67181&p=irol-proxy.

What is the date, time, and place of the Annual Meeting?

The Annual Meeting will be held at our head office at 887 Great Northern Way, Vancouver, British Columbia, on Thursday, May 26, 2011 at 10:00 a.m. (Pacific Time). Directions to our head office location are available at www.qltinc.com.

Who is entitled to vote at the Annual Meeting?

Only shareholders of record at the close of business on the record date may vote at the Annual Meeting. On a show of hands every shareholder present in person has one vote, and on a poll every shareholder present in person or by proxy has one vote for each QLT common share registered in the shareholder’s name. There are no other classes of voting securities other than the common shares. Cumulative voting is not permitted.

What am I voting on at the Annual Meeting?

At the Annual Meeting, shareholders will be asked to vote on the following items of business:

1.		the election of eight Directors for the ensuing year;
2.		the appointment of Deloitte & Touche LLP as independent auditors of QLT for the ensuing year and to authorize the Directors to fix the remuneration to be paid to the auditors;
3.		an advisory vote on the compensation of our named executive officers; and
4.		an advisory vote on the frequency of the advisory vote on the compensation of our named executive officers.

QLT does not know of any business or proposals to be considered at the Annual Meeting other than those set out in this Proxy Statement. If any other business is proposed and properly presented at the Annual Meeting, the proxies received from our shareholders give the proxy holders the authority to vote on the matter at their discretion. The proxy holders intend to vote the shares they represent as directed by our Board.

How does the Board recommend that I vote?

Our Board believes the election of our eight nominees to the Board and the appointment of Deloitte & Touche LLP as our independent auditors are in the best interests of QLT and our shareholders and, accordingly, recommends that each shareholder vote his or her shares “FOR” each of the director nominees and “FOR” the approval of Deloitte & Touche LLP as our independent auditors for fiscal 2011. Our Board also recommends that each shareholder vote his or her shares “FOR” the approval of the compensation of our named executive officers, as disclosed in this Proxy Statement pursuant to the compensation disclosure rules of the U.S. Securities and Exchange Commission (the “SEC”), and in favour of a frequency of every “THREE YEARS” to hold the advisory vote on the compensation of our named executive officers.

What vote is required to approve each proposal?

Broker Non-Votes and Abstentions. Common shares that are represented by “broker non-votes” (i.e. common shares held by a bank, broker or other holder of record holding shares for a beneficial owner that are represented at the Annual Meeting but with respect to which the bank, broker or other holder of record is not empowered to vote on a particular proposal) and common shares held by holders who abstain from

voting (or voted “withhold”) on any matter will have no effect on the outcome of the matter but are included for quorum purposes. We encourage all shareholders that hold shares through a bank, broker or other holder of record to provide voting instructions to such parties to ensure that their shares are voted at the Annual Meeting.

Election of Directors. For Proposal 1, the election of eight Directors, the nominees will be elected by a plurality of the votes cast at the Annual Meeting. This means that the eight nominees with the most votes for election will be elected. You may choose to vote, or withhold your vote, separately for each nominee.

Appointment of Auditors. For Proposal 2, the appointment of Deloitte & Touche LLP as auditors and authorization of the Board to fix the remuneration to be paid to the auditors, the affirmative vote of a simple majority of the common shares voted at the Annual Meeting will be required for approval.

Advisory Vote on the Compensation of Named Executive Officers. For Proposal 3, the compensation of our named executive officers, as disclosed in this Proxy Statement pursuant to the compensation disclosure rules of the SEC, the affirmative vote of a simple majority of the common shares voted at the Annual Meeting will be required for approval, on an advisory basis. Because your vote is advisory, it will not be binding on the Board of Directors, the Executive Compensation Committee or the Company. However, the Board of Directors will review the voting results and take them into consideration when making future decisions about executive compensation.

Advisory Vote on the Frequency of Future Advisory Votes on the Compensation of Named Executive Officers. For Proposal 4, the frequency of an advisory vote on the compensation of our named executive officers, the affirmative vote of a simple majority of the common shares voted at the Annual Meeting will be required for approval, on an advisory basis. If none of the frequency alternatives (one year, two years or three years) receive a majority vote, we will consider the frequency that receives the highest number of votes by stockholders to be the frequency that has been selected by the shareholders. However, because your vote is advisory and not binding on the Board of Directors, the Executive Compensation Committee or the Company, the Board of Directors may decide that it is in our and our shareholders’ best interests to hold an advisory vote on executive compensation more or less frequently than the alternative approved by our shareholders.

Who may attend the Annual Meeting?

All QLT shareholders are invited to attend the Annual Meeting, including shareholders whose shares are held by their brokerage firm or another similar organization.

What is the quorum for the Annual Meeting?

At least (i) two shareholders, (ii) two proxy holders representing two shareholders, or (iii) one shareholder and a proxy holder representing another shareholder entitled to vote at the Annual Meeting, present in person at the beginning of the Meeting and collectively holding or representing by proxy in the aggregate not less than 33 1/3% of the issued and outstanding QLT common shares as of the record date, will constitute a quorum for the Annual Meeting. There were 50,779,775 common shares of QLT issued and outstanding on the record date. To the knowledge of QLT’s executive officers and the Directors, the only persons or companies that beneficially own, control or direct, directly or indirectly, 10% or more of QLT’s common shares are NB Public Equity K/S which, as evidenced by public filings, own 7,727,613 common shares, representing approximately 15.2% of the issued and outstanding common shares and Axial Capital Management, LLC which, as evidenced by public filings, own 6,865,036 common shares, representing approximately 13.5% of the issued and outstanding common shares.

How do I vote?

Carefully read and consider the information contained or incorporated by reference in this Proxy Statement. You should also determine whether you hold your shares directly in your name as a registered shareholder or through a broker or other nominee, because this will determine the procedure that you must follow in order to vote. If you are a registered shareholder of QLT (that is, if your shares are registered in your name, as opposed to being held through a broker or other intermediary), you may vote in any of the following ways:

	•		in person at the Annual Meeting;
	•		by mail or facsimile — complete, sign and date the enclosed Instrument of Proxy and return it in the enclosed postage paid return envelope or by facsimile as soon as possible to our registrar and transfer agent, Computershare Investor Services Inc., Attn: Proxy Department, 100 University Avenue, 9th Floor, Toronto, Ontario, M5J 2Y1, facsimile number: from within North America at 1-866-249-7775 or from outside North America at 1-416-263-9524;
	•		by telephone — call 1-866-732-VOTE (8683) toll free from your touch-tone phone and follow the instructions (you will need the control number located on the enclosed Instrument of Proxy). You do not need to return your proxy form if you vote by telephone; or
	•		using the Internet — go to www.investorvote.com and follow the instructions on the screen (you will need the control number located on the enclosed Instrument of Proxy). You do not need to return your proxy form if you vote using the Internet.

All votes made by proxy must be received (whether delivered by mail, facsimile, telephone or Internet) no later than Tuesday, May 24, 2011 at 10:00 a.m. (Pacific Time)/1:00 p.m. (Eastern Time).

If your shares are not registered in your name but instead are held through your broker or another intermediary, then you will have received this material from your broker or the intermediary seeking your instructions as to how you wish your shares to be voted. In that case, follow the instructions given to you by your broker or the other intermediary. The Chairman may determine, in his sole discretion, to accept or reject an Instrument of Proxy that is delivered in person to the Chairman at the Annual Meeting as to any matter in respect of which a vote has not already been cast. You have the right to appoint another person to attend and act on your behalf at the Annual Meeting other than the persons named in the enclosed Instrument of Proxy. To exercise this right, you should strike out the names of the persons named in the Instrument of Proxy and insert the name of your nominee in the blank space provided. A person appointed as a proxy holder need not be a shareholder of QLT.

How will proxies be exercised?

The proxy holder will vote or withhold from voting according to instructions in the Instrument of Proxy on any ballot that may be called for and for which a choice has been specified. Unless otherwise indicated by you on the Instrument of Proxy, your shares will be voted “FOR” the election of the eight nominees for election to the Board as set out in this Proxy Statement, “FOR” the approval of the appointment of Deloitte & Touche LLP as our independent auditors until the close of the next annual meeting of shareholders, “FOR” the approval of the compensation of our named executive officers, as disclosed in this Proxy Statement pursuant to the compensation disclosure rules of the SEC, and in favour of a frequency of every “THREE YEARS” to hold the advisory vote on the compensation of our named executive officers. If you properly return your Instrument of Proxy, but do not include instructions on how to vote, your shares will be voted as recommended by the Board.

The Instrument of Proxy also confers upon the proxy holder discretionary authority to vote all shares represented by the proxy with respect to amendments or variations to matters identified in the Notice of Meeting and any other matter that properly comes before the Annual Meeting. We know of no such amendment, variation or other matter that is to be presented for action at the Annual Meeting. However, if any other matters which are not now known to us should properly come before the Annual Meeting, the proxies will be voted, or not voted, by the proxy holder in his or her discretion.

What does it mean if I receive more than one set of proxy materials?

You may receive more than one set of proxy materials because you own QLT common shares that are registered under different names. For example, you may own some shares directly as a shareholder of record and other shares through a broker, or you may own shares through more than one broker. In these situations, you will receive multiple sets of proxy materials. It is necessary for you to vote all of the Instruments of Proxy according to the instructions contained in this Proxy Statement and to follow the instructions for any alternative voting procedures you receive in order to vote all of the shares you own. Each Instrument of Proxy you receive will come with its own prepaid return envelope. If you vote by mail, please make sure you return each Instrument of Proxy in the return envelope that accompanies that Instrument of Proxy.

Can I change my vote after I have voted?

You may revoke your proxy at any time before it is exercised at the Annual Meeting. A proxy may be revoked by voting in person at the Annual Meeting, by an instrument in writing stating that the proxy is revoked and signed and delivered as follows, or in any other manner provided by law:

	•		the instrument revoking the proxy must be signed by you or by the person to whom you have granted a power of attorney in writing. If the shareholder is a corporation, the instrument of revocation must be signed under that corporate shareholder’s corporate seal or by a duly authorized officer or attorney of the corporation; and
	•		the instrument revoking the proxy must be (i) delivered to our registered office at 26th Floor, Toronto Dominion Bank Tower, 700 West Georgia Street, Vancouver, British Columbia, V7Y 1B3 on or before Wednesday, May 25, 2011 at 5:00 p.m. (Pacific Time) or the last business day preceding the date of any adjournment of the Annual Meeting at which the proxy is to be voted, or (ii) deposited with the Chairman on the date of the Annual Meeting or any adjournment of it before the taking of any vote in respect of which the proxy is to be used.

If your shares are held in the name of an intermediary such as a brokerage firm, securities dealer, trust company, bank or other nominee institution, you may change your vote by submitting new voting instructions to your intermediary, as applicable. You will need to contact your brokerage firm, securities dealer, trust company, bank or other nominee institution to learn how to make that change.

Who will tabulate the votes?

Our transfer agent, Computershare Investor Services Inc., will tabulate votes cast by proxy by an automated system. Votes cast by proxy or in person at the Meeting will be counted by the persons appointed by us to act as scrutineer for the Annual Meeting.

Who pays the cost of the proxy solicitation?

We will pay the cost of soliciting these proxies, including the printing, handling and mailing of the proxy materials. Copies of these materials will be given to brokerage firms, securities dealers, trust companies, banks and other institutions that hold our shares that are beneficially owned by others. We will reimburse these brokerage firms, securities dealers, trust companies, banks and other institutions for their reasonable out of pocket expenses in forwarding proxy materials to beneficial owners of our shares. Proxies may be solicited by certain Directors, officers and employees of QLT personally or by telephone, mail, facsimile or e-mail. No additional compensation will be paid to Directors, officers or other QLT employees for soliciting proxies. In addition, we may engage external proxy solicitation services to solicit proxies from brokers, banks and other institutional holders and from beneficial owners and individual holders of record of common shares. In the event we engage such proxy solicitation services, we anticipate that the services would be provided at a standard fee and on other typical commercial terms.

How can shareholders submit proposals for QLT’s 2012 Annual Meeting?

If you want to propose a matter for consideration at the 2012 Annual Meeting, then notice of that proposal must be received at our registered office at 26th Floor, Toronto Dominion Bank Tower, 700 West Georgia Street, Vancouver, British Columbia, V7Y 1B3 before February 27, 2012. For a proposal to be valid, it must, according to the Business Corporations Act (British Columbia) (the “BCA”), be in writing, accompanied by the requisite declarations and signed by the submitter and qualified shareholders who at the time of signing are the registered or beneficial owners of shares that, in the aggregate, (i) constitute at least 1% of the issued shares of QLT that have the right to vote at general meetings, or (ii) have a fair market value in excess of $2,000. For the submitter or a qualified shareholder to be eligible to sign the proposal, that shareholder must have been the registered or beneficial owner of QLT shares that carry the right to vote at general meetings for an uninterrupted period of at least two years before the date the proposal is signed.

CORPORATE GOVERNANCE

Overview of Our Corporate Governance Principles

We believe that effective and transparent corporate governance is critical to our long-term success and our ability to create value for our shareholders. We frequently review our corporate governance policies, monitor emerging developments in corporate governance and update our policies and procedures when our Board determines that it would benefit the Company and our shareholders to do so.

We maintain a corporate governance page on our website that includes key information about our corporate governance, including our Code of Ethics and Code of Exemplary Conduct and the charters for the Audit and Risk, Corporate Governance and Nominating, Executive Compensation and Scientific Review Committees of our Board, all of which can be found at www.qltinc.com by clicking on “Corporate Governance” under “Investors.” The charter of the Audit and Risk Committee is also available on EDGAR at www.sec.gov and on SEDAR at www.sedar.com. The documents noted above will also be provided without charge to any shareholder who requests them. Any changes to these documents, and any waivers granted by us with respect to our Code of Ethics, will be posted on our website.

We also monitor our corporate governance policies and practices to maintain compliance with the provisions of the Sarbanes-Oxley Act of 2002, rules of the SEC, National Instrument 58-101 - Disclosure of Corporate Governance Guidelines, National Policy 58-201 — Corporate Governance Guidelines, Multilateral Instrument 52-110 — Audit Committees, the Marketplace Rules of The NASDAQ Stock

Market (“NASDAQ”), and the policies of the Toronto Stock Exchange (the “TSX”) (collectively, the “Governance Guidelines”). Our policies and practices meet or exceed the Governance Guidelines.

Disclosure Practices

QLT has in place disclosure controls and procedures to ensure QLT meets its information disclosure obligations on a timely basis. These disclosure controls and procedures are evaluated on an ongoing basis, not less than quarterly, to ensure the controls and procedures allow QLT to accomplish this objective. To implement and review our disclosure controls and procedures, our President and Chief Executive Officer and our Chief Financial Officer have established a Disclosure Practices Committee. The role of this Disclosure Practices Committee is to identify and consider the information gathered for disclosure purposes and also to make recommendations to the President and Chief Executive Officer and the Chief Financial Officer with respect to the disclosures to be made by QLT.

The disclosure controls and procedures include procedures for ensuring prompt and effective communication of any material or reportable event to the appropriate executives, the President and Chief Executive Officer and the Chief Financial Officer, and also for designating those individuals within QLT responsible for preparing, reviewing and approving the content of any disclosure.

Corporate Code of Ethics and Code of Exemplary Conduct

QLT has adopted a Code of Ethics which is applicable to all Directors, officers and employees of QLT, as well as a Code of Exemplary Conduct which applies to the Chief Executive Officer, all other executive officers and all senior financial managers, internal legal counsel and human resources managers of QLT. As further described in the charter of the Audit and Risk Committee (available on our website at www.qltinc.com), the Audit and Risk Committee is responsible for monitoring compliance with the Code of Ethics and Code of Exemplary Conduct, and reviewing and, if determined appropriate, updating them annually.

Our Audit and Risk Committee and our management review and discuss with the Board from time to time the effectiveness of our Code of Ethics and our Code of Exemplary Conduct and any areas or systems that may be further improved. QLT has not been required to, and has not, filed a material change report that pertains to any conduct of any of our Directors or executive officers that constitutes a departure from these codes.

QLT complies with the provisions of the BCA that deal with conflict of interest situations. QLT, through Directors’ and officers’ questionnaires and other systems, also gathers and monitors relevant information in relation to potential conflicts of interest that a Director or officer may have.

The Code of Ethics and Code of Exemplary Conduct are available on QLT’s website at www.qltinc.com. QLT will also post on its website any amendments to those codes or waivers of compliance by Directors or executive officers. In fiscal 2010, there were no such amendments made or waivers granted.

Mandate of the Board and the Chairman of the Board

Our Board is responsible for the supervision of the management of the business and affairs of QLT, the stewardship of QLT and the enhancement of shareholder value. The Board has adopted a written Mandate, which is applicable to all Directors, and which has formalized its position on corporate governance. The Board has also developed a written position description for the Chairman of the Board, which is detailed in the Mandate of the Chairman of the Board and described below. The Mandate of the Board of Directors and the Mandate of the Chairman of the Board are incorporated herein by reference and are available on our website at www.qltinc.com and on SEDAR at www.sedar.com, or copies will be

provided without charge to any shareholder who requests them. The Corporate Governance and Nominating Committee of the Board has the mandate to actively review and ensure that good corporate governance practices and the Mandate of the Board of Directors are followed. The Corporate Governance and Nominating Committee is also responsible for reviewing and, if determined appropriate, updating the Mandate of the Board of Directors.

Under its Mandate, our Board is responsible for developing a succession plan for the Chief Executive Officer, and for discussing with the Chief Executive Officer succession plans for other senior management personnel. The Chief Executive Officer is responsible for recommending and then implementing the corporate strategy approved by the Board and for managing QLT’s business with the objective of meeting the corporate goals. On an annual basis, the Board reviews, approves and documents in writing the annual corporate goals and objectives that the Chief Executive Officer is responsible for meeting each year, and the Board, together with the Executive Compensation Committee, assesses the Chief Executive Officer’s performance against those goals.

Our Directors are kept informed of QLT’s business through open discussions with the Chief Executive Officer and other key members of management. Our Board also reviews documents, such as detailed quarterly and periodic management reports and financial statements, by attending presentations made during Board meetings and through periodic reports to the full Board from each of QLT’s committees. Our Directors have access to all books, records and reports upon request, and members of management are available at all times to answer any questions.

Role of the Board in Risk Oversight

The Board is actively involved in overseeing risk management for QLT. In accordance with our Mandate of the Board of Directors, the Board, as a whole, oversees the development and application of policies regarding corporate governance, and is responsible for adopting the corporate strategies and plans for QLT’s business, identifying the principal risks of QLT’s business and ensuring the implementation of the appropriate systems to manage these risks, overseeing the integrity of QLT’s internal controls and management information systems and maintaining a continuing dialogue with senior management in order to ensure QLT’s ability to respond to changes, both internal and external, which may affect its business operations from time to time. This oversight is also conducted through committees of the Board. The Board receives full reports from each committee Chair regarding the committee’s consideration and actions. The oversight responsibility of the Board and its committees is enabled by management reporting processes that are designed to provide visibility to the Board about the identification, assessment and management of critical risks. These areas of focus include financial and reporting, compliance, compensation and operations, as summarized below.

The Audit and Risk Committee reviews and discusses with management significant financial risks in conjunction with enterprise risk exposures, QLT’s policies with respect to risk assessment and risk management and the actions management has taken to limit, monitor or control financial and enterprise risk exposure.

The Corporate Governance and Nominating Committee oversees risk management as it relates to, among other things, the development and assessment of our corporate governance framework, board and Chairman succession, including board and committee nominations, membership and standards, and potential conflicts of interest.

The Executive Compensation Committee oversees risk management as it relates to our compensation plans, policies and practices in connection with structuring our executive compensation programs and reviewing our incentive compensation programs for other employees. This includes a review of our

material compensation policies and practices under which, in early 2011, the Executive Compensation Committee concluded that these policies and practices are not reasonably likely to have a material adverse effect on the Company.

The Scientific Review Committee reviews management’s direction and investment in QLT’s research, development and technology initiatives to ensure that the scientific strategy and its implementation is consistent with and supports the strategic and business objectives of QLT. The Scientific Review Committee works with management to identify operational risks with respect to current and future research and development programs and products and technology in which QLT is investing its research and development efforts.

Board Leadership Structure

We operate under a corporate governance structure where the Chairman of the Board and the Chief Executive Officer are separate positions held by different individuals. Due to the demands of each position, we believe separating these roles enhances the ability of each to discharge his duties and fosters more accountability. The members of the Board annually elect a Chairman of the Board who will satisfy the independence standards established by the Board and applicable laws. Our Chairman’s extensive knowledge and experience regarding QLT, combined with a perspective that comes from a separation from day-to-day affairs, makes him well-suited to assist the Board in approving strategic direction of QLT, to evaluate management’s strategic plans and initiatives, and to provide leadership to the Board in its various responsibilities. The services that our Chairman provides, include, among others: (i) providing leadership to the Board, (ii) providing advice and counsel to management, including, in particular, the Chief Executive Officer, (iii) communicating with the Board and apprising the Board on major developments with respect to QLT, (iv) presiding at meetings of our shareholders and directors, (v) providing input to our Corporate Governance and Nominating Committee with respect to Board and committee candidates, (vi) leading QLT’s director development program in consultation with our Corporate Governance and Nominating Committee, (vii) assessing whether the Board and its committees have appropriate administrative support, access to senior management and access to outside advisors for the purposes of the Board fulfilling its mandate and (viii) overseeing and coordinating activities of the Board. We believe that having the Board operate under the leadership and direction of a Board member who is independent from management provides the Board with the most appropriate mechanism to fulfill its oversight responsibilities.

Board Attendance at Annual Meeting

It is a policy of the Board to encourage Directors to attend regular Board meetings, Board committee meetings on which they serve and each annual general meeting of the shareholders. In 2010, with the exception of Mr. Crossgrove, all members of the Board attended QLT’s annual general meeting. It is anticipated that all director nominees will attend our 2011 Annual Meeting.

Decisions Requiring Prior Approval of the Board

In addition to matters that must, by law or by the Articles of QLT, be approved by the Board, management is required to seek approval from the Board for major transactions, for any single expense which exceeds certain specified dollar values, and for certain transactions with related persons. Additional information relating to transactions with related persons is set forth below under the heading “Review, Approval or Ratification of Transactions with Related Persons.”

Orientation and Continuing Education Programs

It is the intention of the Board that as and when a new Board nominee is appointed, the Board will ensure that a full program of orientation and education is provided for the nominee, including (but not limited to) provision of a complete corporate history, copies of past minutes of meetings of the Board and the Mandate of the Board, and information regarding our business and operations. The Corporate Governance and Nominating Committee is responsible for reviewing the current orientation and education program and recommending and initiating improvements to this program as warranted. As part of the ongoing commitment of the Board to effective governance and director continuing education, our Directors are encouraged to periodically attend accredited courses on current trends in corporate governance and other relevant areas. As well, from time to time the Directors tour the facilities of QLT.

Outside Advice

In certain circumstances it may be appropriate for an individual Director to engage an outside professional advisor at the expense of QLT. The engagement of the outside professional advisor would be subject to approval of the Chairman of the Board. Each of the Audit and Risk Committee, the Executive Compensation Committee and the Corporate Governance and Nominating Committee also has the authority to engage external advisors as set forth in each of their respective charters. The Scientific Review Committee is also authorized to engage independent consultants with the approval of the Chairman of the Board.

Director and Officer Liability Insurance

We maintain Directors’ and officers’ liability insurance coverage through a policy covering QLT and its subsidiaries. This insurance provides coverage for indemnity payments made by QLT to our Directors and officers as required or permitted by law for losses, including legal costs, incurred by Directors and officers in their capacity as such. This policy also provides coverage directly to individual Directors and officers if they are not indemnified by QLT. The insurance coverage for our Directors and officers has customary exclusions, including those acts determined to be uninsurable under law, deliberately fraudulent or dishonest, or that have resulted in personal profit or advantage.

Minimum Share Ownership Guidelines for Directors

The Board believes it to be in the best interests of our shareholders to specify a minimum level of equity holdings in QLT by each independent Director to further align the interests of our Board and shareholders. As a result, following consultation with Radford, an Aon Consulting Company and independent compensation advisor, we adopted share ownership guidelines for our independent Directors. Under these guidelines, independent Directors are encouraged to acquire (if not already held) common shares of QLT as follows:

	•		Chairman: an amount equal to three times the Chairman’s annual retainer, satisfied within four years from the date he or she assumes the office of Chairman;
	•		Directors other than the Chairman: an amount equal to three times the Director’s annual Board retainer, satisfied within four years from the later of: (i) the implementation of the initial share ownership guidelines in March 2005 (i.e., March 2009) and (ii) the date the Director joined the Board.

Holdings of vested deferred share units (referred to as “DSUs”) are counted towards fulfilling the guidelines, while unexercised stock options, if any, are not. According to Radford, the implementation of share ownership guidelines instituted by the Board is consistent with ISS’ best practices.

The value of the shares owned for the purposes of fulfilling the share ownership guidelines is determined as the greater of the acquisition cost or the market value at the time of the determination. Compliance with the share ownership guidelines is evaluated on an annual basis by the Corporate Governance and Nominating Committee. Messrs. Carter, Clarke, Crossgrove, Massey and Wood are in compliance with the guidelines. Ms. Falberg and Mr. Turner joined the Board in 2009 and 2010, respectively, and intend to meet the share ownership guidelines within four years of their appointment.

Our share ownership guidelines for executive officers are described below in this Proxy Statement under the heading “Compensation Discussion and Analysis.”

Director Nomination Process

To assist with director nominations, the Board has designated a standing committee, the Corporate Governance and Nominating Committee, as being responsible for reviewing and recommending nominees to the Board. In evaluating prospective nominees, the Corporate Governance and Nominating Committee looks for the following minimum qualifications: strong business acumen, previous experience as an executive or director with successful companies, the highest standards of integrity and ethics, and a willingness and ability to make the necessary time commitment to diligently perform the duties of a director. Nominees are selected with a view to the best interests of QLT as a whole.

The Board prefers a mix of experience among its members to maintain a diversity of viewpoints and ensure that the Board can achieve its objectives. In searching for a new director, the Corporate Governance and Nominating Committee identifies particular areas of specialization which it considers beneficial, in addition to the general qualifications, having regard to the skill sets of the other members of the Board.

Although we do not have a formal diversity policy, to foster and maintain a diversity of viewpoints, backgrounds and experience on the Board, the Corporate Governance and Nominating Committee evaluates the mix of skills and experience of the directors and assesses nominees and potential candidates in the context of the current composition of the Board and the requirements of QLT. In accordance with its charter, the Corporate Governance and Nominating Committee considers, among other things, the following in recommending candidates for election to the Board: (i) personal and professional integrity, ethics and values, (ii) experience in corporate management, such as serving as an officer or former officer of a publicly-held company, and a general understanding of marketing, finance, product development and other elements relevant to the success of a publicly-traded company in today’s business environment, (iii) experience in QLT’s industry and in the principal jurisdictions in which QLT conducts its business, namely Canada and the United States, (iv) experience as a board member of another publicly-held company, (v) academic or therapeutic expertise in an area of QLT’s operations and (vi) practical and mature business judgment, including the ability to make independent and analytical inquiries.

The Corporate Governance and Nominating Committee may retain the assistance of a recruiting firm to assist it to identify and recruit candidates that possess the desired qualifications. The Corporate Governance and Nominating Committee may also involve other members of the Board or other Board committees to assist it with the recruitment of new directors. Potential nominees and their respective references are interviewed extensively in person before any nomination is endorsed by that Board committee. All nominations proposed by the Corporate Governance and Nominating Committee must receive the approval of the Board.

The Board will also consider any director nominees proposed by shareholders. Shareholders may submit nominations to the Board by addressing a communication to the Chair of the Corporate Governance and Nominating Committee and providing sufficient information to the Corporate Governance and Nominating Committee to permit it to conduct an assessment of the qualifications of the proposed

nominee, including biographical information about the candidate and his or her professional experience, confirmation of the candidate’s willingness to serve as a Director, and complete contact information for the candidate and the nominating shareholder. The methods by which a shareholder may communicate with the Corporate Governance and Nominating Committee are set out on QLT’s website at www.qltinc.com. As a matter of policy, the Corporate Governance and Nominating Committee is committed to giving due and fair consideration to proposed nominations submitted by shareholders using the same criteria and processes as other nominations that come before it.

Independence of Directors

To ensure good objective governance is maintained at QLT, the Board strives to maintain strong independence from management. In determining whether Directors are independent, each year the Board considers and discusses the nature and materiality of all direct or indirect relationships between each Director and QLT, including any family, supplier or service provider relationships. The Board considers a relationship material where that relationship could, in the view of the Board, reasonably interfere with the exercise of the Director’s independent judgment.

The Chairman of the Board, Mr. Boyd Clarke, is an independent member of the Board. Seven of the eight current Directors are considered “independent.” Mr. Butchofsky is not considered “independent” since he is also our President and Chief Executive Officer.

Executive Session of Independent Directors

The independent members of the Board meet without management and non-independent Directors present during a session of each quarterly Board meeting (unless the independent Directors determine such a session is not required) and during such other meetings where considered appropriate.

Independence of Committee Members

The members of each of the Audit and Risk Committee, the Executive Compensation Committee, the Corporate Governance and Nominating Committee and the Scientific Review Committee are all “independent” Directors within the meaning ascribed to it in Multilateral Instrument 52-110 — Audit Committees and the Marketplace Rules of the NASDAQ, respectively, and, in the case of the Audit and Risk Committee, the additional independence requirements set out by the SEC.

Audit Committee Financial Expert

Each member of the Audit and Risk Committee is financially sophisticated, as defined by the Marketplace Rules of NASDAQ, and is financially literate, as defined by Canadian securities regulations, and as required by such rules, able to read and understand fundamental financial statements, including QLT’s consolidated balance sheet, consolidated statement of income and consolidated statement of cash flows. The Board has determined that the Chair and each other member of our Audit and Risk Committee is an “audit committee financial expert” as defined in Item 407(d)(5) of Regulation S-K under the Exchange Act and is also “independent,” as independence for audit committee members is defined by the NASDAQ, TSX and applicable Canadian securities rules.

Compensation Committee Interlocks and Insider Participation

None of the members of the Executive Compensation Committee during fiscal 2010 or as of the date of this Proxy Statement is a current officer or employee of QLT or has any interlocking relationship as set forth in applicable SEC rules. In addition, none of QLT’s executive officers serves as a member of the

compensation committee or board of directors of any entity that has one or more executive officers serving as a member of our Executive Compensation Committee or Board.

The Directors are also directors of the following publicly-traded companies:

Name of Director		Reporting Issuer
Robert L. Butchofsky		N/A
Dr. Bruce L.A. Carter		Dr. Reddy Ltd.
C. Boyd Clarke		N/A
Peter A. Crossgrove		Barrick Gold Corporation
		Detour Gold Corporation
		Excellon Resources Inc.
		Lake Shore Gold Corp.
		Pelangio Exploration Inc.
Kathryn E. Falberg		Halozyme Therapeutics, Inc.
Dr. Ian J. Massey		N/A
Joseph L. Turner		Alexza Pharmaceuticals, Inc.
		Corcept Therapeutics Incorporated
L. Jack Wood		Clinuvel Pharmaceuticals Ltd.

Communicating with the Board of Directors

Any shareholder or interested party who wishes to communicate with the Board or any specific Director, including independent Directors, the Chairman of the Board, or committee members, may write to:

QLT Inc.
Attn: Board of Directors
887 Great Northern Way, Suite 101
Vancouver, British Columbia, V5T 4T5
Canada

Depending on the subject matter of the communication, the corporate secretary will:

	•		forward the communication to the Director or Directors to whom it is addressed (matters addressed to the Chairman of the Board will be forwarded unopened directly to the Chairman of the Board);
	•		attempt to handle the inquiry directly where the communication does not appear to require direct attention by the Board, or an individual member, e.g., the communication is a request for information about the company or is a stock-related matter; or
	•		not forward the communication if it is primarily commercial in nature or if it relates to an improper or irrelevant topic.

Shareholders and other interested persons may submit concerns regarding accounting matters by following the instructions for making a report published in the Corporate Governance subsection of the Investor Relations section of our website.

Board of Directors and Board Committees

The Board held six meetings (in person or by teleconference) during fiscal 2010, a number of which included sessions with only independent Directors. Each Director attended at least 75% of (1) the total number of meetings of the Board, and (2) the total number of meetings held by all committees of the Board on which he or she served during fiscal 2010. Set forth below is a summary of Board and Committee attendance during 2010:

Summary of Attendance of Directors in 2010:

					Committee Meetings
					Attended (where
					attending as a member
		Board Meetings			of the committee and
		Attended			paid for attendance) in
		in 2010			2010
Robert L. Butchofsky		6/6			N/A
Bruce L.A. Carter		6/6			8/8
C. Boyd Clarke(1)		6/6			4/4
Peter A. Crossgrove(2)		6/6			9/9
Kathryn E. Falberg		6/6			5/5
Ian J. Massey(3)		5/6			8/8
Joseph L. Turner(4)		6/6			5/5
L. Jack Wood(4)		6/6			12/12

The Board has a standing Audit and Risk Committee, Corporate Governance and Nominating Committee, Executive Compensation Committee and Scientific Review Committee. In addition, from time to time, the Board establishes special committees to assist the Board in respect of certain matters. The Board did not establish any special committees in 2010. Set forth below is a chart indicating, by committee, each committee’s members, key functions and the number of committee meetings held in 2010:

						Number of
		Members (as at				Meetings
Committee		12/31/10)		Key Functions		in 2010
Audit and Risk		Kathryn E. Falberg*(1)		monitors QLT’s internal accounting controls and business conduct			5
		Peter A. Crossgrove		oversees QLT’s accounting and financial reporting practices
		Joseph L. Turner		reviews the adequacy of the system of internal controls, reviewing any relevant accounting, financial and securities regulatory matters
				reviews the management of corporate financial and compliance risks
				recommends the appointment of independent auditors, engages the independent auditors, and receives the reports of the Chief Executive Officer and the Chief Financial Officer with respect to their assessment of internal controls
				provides a mechanism for communication between the Board and QLT’s independent auditors
				meets regularly with QLT’s auditors without management present
Corporate Governance and Nominating		C. Boyd Clarke* Kathryn E.Falberg(1) L. Jack Wood		develops and oversees Board governance principles assesses the effectiveness of corporate governance and makes recommendations to the full Board			4
				makes recommendations to the Board regarding the size and composition of the Board and Board committees
				develops and oversees Board continuing education program
				conducts an annual assessment process to assess the effectiveness of the Board and individual members of the Board
				reviews and considers nominations to the Board
				reviews annually the credentials of nominees for re-election and ensures qualifications are maintained
				reviews compliance with QLT share ownership guidelines by members of the Board and executive officers
Executive Compensation		L. Jack Wood* Ian J. Massey Bruce L.A. Carter		makes recommendations to the Board regarding the compensation of all executive officers reviews and makes recommendations with respect to compensation policy and programs generally and determines and recommends option grants under QLT’s incentive stock option plans			5
				reviews and recommends to the Board the manner in which executive compensation should be tied to both short-term and long-term corporate goals of QLT and completes the disclosure regarding executive compensation contained in QLT’s Proxy Statement
				assists the Board in ensuring that QLT has a plan for continuity of its officers and an executive compensation plan that is competitive to attract, retain and motivate high performance of its executive management and other key personnel
				establishes QLT share ownership guidelines for members of the Board and executive officers
Scientific Review		Ian J. Massey* Bruce L.A. Carter		reviews management’s direction and investment in QLT’s research, development and technology initiatives			3

COMPENSATION OF DIRECTORS

2010 Independent Director Compensation Program

Overview

The compensation program for our independent Directors is intended to fairly compensate them for the time and effort required of a director based upon the size and complexity of our business, as well as, through an equity component of the program, to further align the interests of our independent Directors with those of our shareholders. The amount and form of director compensation is reviewed periodically by the Executive Compensation Committee, with any resulting recommendations made to the Board, to ensure that such compensation realistically reflects the responsibilities and risks of being an effective director. To assist in its evaluation of director compensation, the Executive Compensation Committee has the authority to retain independent compensation consultants.

Our independent Directors receive cash and equity-based compensation for their service on the Board. As an employee, our President and Chief Executive Officer is not additionally compensated for his service on the Board.

Cash Compensation

The cash compensation component of our program includes annual Board and Committee member or chair position retainers, meeting attendance fees, and fees paid for attending to Board or Committee business other than for attendance at a meeting. Directors are also eligible for reimbursement of their expenses incurred in connection with attendance at Board meetings in accordance with our policies. Director fees are paid quarterly in arrears.

The cash compensation levels under our Director compensation program have remained constant since early 2008 through 2010. In 2010, the fees paid to our independent Directors were based on the following:

Nature of Board Duty		Fee (US$)
Annual Board Retainer Fee:
•    for all Directors		$	30,000
•    additional retainer for Chairman of the Board		$	45,000
Additional Annual Retainer fee for Chair of the Audit and Risk Committee		$	12,500
Additional Annual Retainer fee for Chair of all other committees (other than the Chair of the Corporate Governance and Nominating Committee, for which no additional retainer is paid)		$	10,000
Additional Annual Retainer fee for non-Chair committee members		$	5,000
Fee for each QLT Board meeting attended:
•    by telephone		$	1,500
•    in person		$	3,000
Fee for each committee meeting attended:
•    by telephone		$	1,500	(1)
•    in person (unless already attending in person for a meeting of the Board of Directors, in which case only a $1,000 meeting fee will be paid)		$	3,000	(1)
Fee to perform Board or committee business (other than attendance at a Board or committee meeting) at the specific request of the Board or relevant committee:
•    if out of town travel is required		$	3,000
•    if no out of town travel is required		$	1,500
Fee to QLT Board member for attending operating subsidiary Board meeting as a member of the Board of Directors of the operating subsidiary (whether in person or by telephone)		$	1,500

Equity-Based Compensation

In addition to cash compensation, our independent Directors also receive equity-based compensation to ensure that their interests are fully aligned with those of our shareholders.

We maintain a Directors’ Deferred Share Unit Plan, which we refer to as the “DDSU Plan.” Under the DDSU Plan, at the discretion of the Board, independent Directors receive all or a percentage of their equity-based compensation in the form of deferred share units, or “DSUs,” each of which has a value equal to the closing price of our common shares on the TSX on the trading day immediately prior to the date of grant. A DSU is convertible only into cash (no shares are issued), and can only be converted after the independent Director ceases to be a member of the Board. The DSUs vest monthly over 36 months from the date of grant.

The value of a DSU, when converted to cash, will be equivalent to the market value of a QLT common share at the time the conversion takes place. We do not have a history of paying dividends on our common shares; however, if dividends ever are paid on our common shares, an independent Director’s DSU account will be credited with dividends at the same rate.

The Executive Compensation Committee’s objective in granting DSUs to independent Directors is to provide a reasonable, market-based, incentive for Directors to deliver increased value to shareholders. Based in part on advice received from Towers Watson (previously Towers Perrin), an independent, internationally recognized human resources and compensation consulting firm, at the time the DDSU Plan was implemented in 2005, the Executive Compensation Committee and the Board concluded that DSUs

are an effective way to align the interests of the independent Directors with those of the shareholders, without resulting in additional share dilution to shareholders.

In May 2010, following his or her appointment at the Annual Meeting of shareholders, each independent Director received 7,500 DSUs, except the Chairman of the Board who received 15,000 DSUs.

Our Directors are also eligible to receive stock options under the QLT 2000 Incentive Stock Option Plan (the “QLT Plan”); however, no stock options were granted to our independent Directors in fiscal 2010.

The following table provides information regarding the compensation of our independent Directors for fiscal 2010.

2010 Director Compensation

		Fees Earned or				Stock
		Paid in Cash				Awards				Total
Name		(US$)(1)				(US$)(2)(3)(4)				(US$)
Bruce L.A. Carter		$	62,000			$	45,883			$	107,883
C. Boyd Clarke		$	101,500			$	91,765			$	193,265
Peter A. Crossgrove		$	70,651			$	45,883			$	116,534
Kathryn E. Falberg		$	58,849			$	45,883			$	104,732
Ian J. Massey		$	65,500			$	45,883			$	111,383
Joseph L. Turner		$	51,863			$	45,883			$	97,745
L. Jack Wood		$	70,437			$	45,883			$	116,320

		Outstanding Stock
Name		Awards (DSUs)
Bruce L.A. Carter			37,500
C. Boyd Clarke			82,500
Peter A. Crossgrove			45,000
Kathryn E. Falberg			15,000
Ian J. Massey			37,500
Joseph L. Turner			7,500
L. Jack Wood			45,000

None of our independent Directors held QLT stock options as of December 31, 2010.

Review of 2010 Independent Director Compensation Program

In 2010 the Executive Compensation Committee engaged Radford, an Aon Consulting Company that focuses on the compensation issues facing technology and life sciences companies, to conduct an independent assessment of our director compensation practices relative to a comparator group of peer companies. The Radford director compensation report was received in September 2010. The peer group comprised biotechnology and life sciences companies located in Canada and the United States comparable to QLT based on a number of factors, including number of employees, market capitalization, revenues and research and development expenditures. The peer group was selected by Radford and approved by the Executive Compensation Committee.

According to the Report, overall, our Director compensation program is competitive at the 50th percentile of our comparator group. Following a review of the results and recommendations of the Report and the Executive Compensation Committee, the Board determined that the compensation levels and structure of our director compensation program are competitive and provide the proper incentive and compensation mechanisms for the Board of Directors.

2011 Independent Director Compensation Program

There have been no changes to the compensation program for the independent Directors to date in 2011. It is anticipated that the Executive Compensation Committee will review and assess our compensation program for the independent Directors during the course of 2011.

PROPOSAL NO. 1
ELECTION OF DIRECTORS

Our Board of Directors currently has eight members. Upon the recommendation of the Corporate Governance and Nominating Committee, the Board has fixed the number of directors constituting the Board at eight and has nominated for election at the Annual Meeting a slate of eight nominees.

The Board of Directors of QLT has consistently sought Board membership that reflects a mix of experience among its members to maintain a diversity of perspectives and to ensure that QLT can meet its objectives. The Board believes the current Board nominees achieve this goal, reflecting as a whole diverse knowledge and experience, including in the areas of finance, science and biotechnology and healthcare executive management. The names and biographical information about each nominee are set out below.

Each Director elected will hold office until the next Annual Meeting or until his or her successor is duly elected, unless he or she resigns earlier. The Board is permitted to increase the number of Directors by up to one-third of the number of Directors elected at the Annual Meeting at any time prior to the next Annual Meeting.

In the unanticipated event that a nominee is unable to or declines to serve as a Director at the time of the Annual Meeting, the proxies will be voted at the discretion of the proxy holder to elect another nominee designated by the Board, if presented, or the Board will comprise a lesser number of Directors accordingly. As of the date of this Proxy Statement, the Board is not aware of any nominee who is unable or who intends to decline to serve as a Director, if elected.

Information Regarding Director Nominees

The names of the nominees and certain information about them are set forth below:

						Position(s) With the
Name of Nominee and Residence		Age				Company		Independent		Director Since
Robert L. Butchofsky British Columbia, Canada			49			President, Chief Executive Officer and Director		No		2006
Bruce L.A. Carter, Ph.D Washington, USA			67			Director		Yes		2006
C. Boyd Clarke Pennsylvania, USA			62			Chairman of the Board and Director		Yes		2003
Peter A. Crossgrove Ontario, Canada			74			Director		Yes		1990
Kathryn E. Falberg California, USA			50			Director		Yes		2009
Ian J. Massey, Ph.D. California, USA			60			Director		Yes		2006
Joseph L. Turner Colorado, USA			59			Director		Yes		2010
L. Jack Wood British Columbia, Canada			74			Director		Yes		2001

There is no family relationship between any of our Directors or executive officers. The number of common shares owned by each of the nominees for election as a Director is set forth under “Security Ownership of Certain Beneficial Owners and Management” in this Proxy Statement.

Robert L. Butchofsky was appointed as President and Chief Executive Officer and a Director of QLT in February 2006 following his earlier appointment as Acting Chief Executive Officer of QLT in September 2005. Mr. Butchofsky joined QLT in 1998 as Associate Director, Ocular Marketing and was appointed Vice President, Marketing and Sales Planning in September 2001. Mr. Butchofsky was promoted to Senior Vice President, Marketing and Sales Planning in early 2005, responsible for QLT’s ongoing marketing of the pharmaceutical products, Visudyne^® and Eligard^®, including managing significant partnerships, as well as corporate strategy development and investor relations activities. From June 1990 to August 1998, Mr. Butchofsky was employed at Allergan Inc., a pharmaceutical company, where he built an extensive background with ocular pharmaceutical products and Botox^®, including sales, health economics, worldwide medical marketing, and product management. Prior to joining Allergan Inc., Mr. Butchofsky spent several years managing clinical trials at the Institute for Biological Research and Development. Mr. Butchofsky also serves as Chairman of the Board of Superna Life Sciences Inc., a privately-held pharmaceutical company located in Vancouver, British Columbia. Mr. Butchofsky has a Bachelor of Arts degree in Biology from the University of Texas and a Masters of Business Administration from Pepperdine University.

For the following reasons, the Board has concluded that Mr. Butchofsky has the requisite qualifications, skills, perspectives and experience that make him well qualified to serve on the Board. With greater than 20 years of experience in the biopharmaceutical industry, including extensive commercial and

development experience in the ocular therapeutic area and several years of experience in managing significant partnerships and developing and implementing corporate strategy, Mr. Butchofsky has a deep understanding of the pharmaceutical development and marketing process. Mr. Butchofsky’s greater than 10 years of experience with QLT, the most recent five years of which have been as President and Chief Executive Officer, provides him with intimate knowledge and experience with all aspects of the operations, opportunities and challenges of QLT.

Dr. Bruce L.A. Carter has been a Director of QLT since November 2006. Since November 2009, Dr. Carter has been the Executive Chairman of the Board of Immune Design Corp., a privately-held biotechnology company in Seattle, Washington, focused on the development and commercialization of therapeutic vaccines for treatment of infectious and malignant disease. From April 2005 until October 2010, Dr. Carter was also Chairman of the Board of ZymoGenetics, Inc., a publicly-traded biopharmaceutical company in Seattle, Washington, focused on the development and commercialization of therapeutic proteins for the treatment of viral infection, cancer, inflammatory disease and bleeding, which was acquired by Bristol-Myers Squibb in October 2010. In addition, Dr. Carter was ZymoGenetics’ Chief Executive Officer from April 1998 to January 2009, during which time ZymoGenetics developed and commercialized Recothrom, an aid to hemostasis. Dr. Carter first joined ZymoGenetics in 1986 as Vice President of Research and Development. In 1988, Novo Nordisk A/S acquired ZymoGenetics and, in 1994, Dr. Carter was promoted to Corporate Executive Vice President and Chief Scientific Officer for Novo Nordisk. In 2000, Dr. Carter led the negotiations that established ZymoGenetics as an independent company from Novo Nordisk. Dr. Carter also held various positions of increasing responsibility at G.D. Searle & Co., Ltd. from 1982 to 1986 and was a lecturer at Trinity College, University of Dublin from 1975 to 1982. Dr. Carter is also Chairman of the Board of Directors of TB Alliance, a global nonprofit organization focused on the acceleration of the discovery and development of new tuberculosis drugs, and Xencor, Inc., a privately-held biotechnology company. He also serves on the Board of Dr. Reddy Ltd. and Moksha8, Inc. both of which are global pharmaceutical companies. Dr. Carter has a B.Sc. with Honors in Botany from the University of Nottingham, England, and a Ph.D. in Microbiology from Queen Elizabeth College, University of London.

For the following reasons, the Board has concluded that Dr. Carter has the requisite qualifications, skills, perspectives and experience that make him well qualified to serve on the Board. Dr. Carter gained valuable management and leadership skills, as well as an understanding of the biopharmaceutical industry, through his experiences as Chief Executive Officer of ZymoGenetics and Chief Scientific Officer of Novo Nordisk A/S. Through his tenure as the Chairman of the Board of ZymoGenetics, Dr. Carter acquired insight into the role of the board of directors of a biotechnology company such as QLT. Dr. Carter’s experience in serving as a director or executive officer of North American, European and Asian companies gives him familiarity with health care trends internationally. He is well versed in the complex challenges of research and development of a pharmaceutical company, given his extensive educational and leadership background in the life sciences, and provides the QLT Board with invaluable insight into a broad range of issues that impact the Company’s research and development efforts.

C. Boyd Clarke has been a Director of QLT since 2003 and was appointed as Chairman of the Board in February 2006. Since September 2007, Mr. Clarke has been a Venture Advisor to ProQuest Investments, a healthcare venture capital firm. From March 2002 to May 2006, Mr. Clarke was President and Chief Executive Officer of Neose Technologies, Inc., a U.S. publicly-listed biotechnology company focused on the development of protein therapeutics. Mr. Clarke served on the Board of Directors of Neose from 2002 to May 2007. From December 1999 through March 2002, Mr. Clarke was President and Chief Executive Officer of Aviron, Inc., a biotechnology company developing vaccines, which was acquired by MedImmune, Inc., and was also Chairman from January 2001 through March 2002. From 1998 through 1999, Mr. Clarke was Chief Executive Officer and President of U.S. Bioscience, Inc., a biotechnology company focused on products to treat cancer, which was also acquired by MedImmune, Inc. Mr. Clarke

served as President and Chief Operating Officer of U.S. Bioscience, Inc. from 1996 to 1998. From 1977 to 1996, Mr. Clarke held a number of positions at Merck & Co., Inc., including being the first President of Pasteur-Merieux MSD, and most recently as Vice President of Merck Vaccines. Mr. Clarke was formerly a director of the Biotechnology Industry Association. He is currently a Director of NovaDigm Therapeutics, Inc., Rib-X Pharmaceuticals, Palkion, Inc. and Ligocyte Pharmaceuticals, Inc., and Chairman of the Board of Mersana Therapeutics, Inc., all of which are privately-held biotechnology companies. Mr. Clarke has a Bachelor of Science in biochemistry and a Master of Arts in History from the University of Calgary.

For the following reasons, the Board has concluded that Mr. Clarke has the requisite qualifications, skills, perspectives and experience that make him well qualified to serve on the Board. Mr. Clarke’s service on several boards of directors, including past service on the boards of publicly-held companies, provides him with extensive governance experience. Mr. Clarke developed his leadership skills over more than 30 years in the biotechnology industry, including his tenures as an executive officer at multiple pharmaceutical and biotechnology companies, which experience provides Mr. Clarke with seasoned tactical, operational and industry-specific experience.

Peter A. Crossgrove has been a Director of QLT since 1990. Mr. Crossgrove is currently Chairman and since April 2008, Chief Executive Officer, of Excellon Resources Inc., a mining company, Non-Executive Co-Chairman of Detour Gold Corporation, and is a trustee of Dundee Real Estate Investment Trust. From 1997 to April 2005, Mr. Crossgrove was the Chairman of Masonite International Corporation, formerly Premdor Inc., a door and industrial products manufacturing company which was acquired on March 31, 2005 by Stile Acquisition Corp. Mr. Crossgrove also currently serves on the Boards of the following mining companies: Barrick Gold Corporation (since June 1993), Lake Shore Gold Corp. (since November 2009, following its acquisition of West Timmins Mining Inc., where he served on the Board since September 2006) and Pelangio Exploration Inc. (since February 2008). Mr. Crossgrove also sits on the Audit Committees of Barrick Gold Corporation and Dundee Real Estate Investment Trust. Mr. Crossgrove is Chairman Emeritus of Cancer Care Ontario, represents the Province of Ontario on the Canadian Partnership Against Cancer Board and is a recipient of the Queen’s Golden Jubilee medal. In 2004, Mr. Crossgrove was appointed to the Order of Canada and, in 2010, to the Order of Ontario. Mr. Crossgrove has a Bachelor of Commerce from McGill University and Concordia University, an M.B.A. from the University of Western Ontario and was a Sloan Fellow in the Doctoral Program at Harvard Business School.

For the following reasons, the Board has concluded that Mr. Crossgrove has the requisite qualifications, skills, perspectives and experience that make him well qualified to serve on the Board. Mr. Crossgrove developed his rich understanding of healthcare while devoting much of his life to the improvement and advancement of Canada’s health care system, including raising millions of dollars in support of health care and guiding the mergers of several hospitals to create the University Health Network, Canada’s largest Health Sciences Centre. Mr. Crossgrove has honed his leadership, business and consensus building skills through his tenure as Chairman of several boards of directors, and his greater than 20 year tenure on QLT’s Board provides him with extensive knowledge of QLT’s governance practices. Mr. Crossgrove’s educational background and experience as a member of the audit committees of other publicly-held company boards of directors has provided him with the financial acumen and skills necessary to serve as a member of QLT’s Audit and Risk Committee.

Kathryn E. Falberg has been a Director of QLT since March 2009. Ms. Falberg is currently Senior Vice President and Chief Financial Officer of Jazz Pharmaceuticals, Inc., a specialty pharmaceutical company, since December 2009. From February 2009 to November 2009, Ms. Falberg was Chief Financial Officer and Chief Operating Officer of ARCA biopharma, Inc., a biopharmaceutical company. From 2003 to 2008, Ms. Falberg was President of Canyon Capital & Consulting, a private investment and consulting

firm, where she was an active investor and consultant to small companies. From October 2001 to June 2002, Ms. Falberg was a consultant to Inamed, a medical device company, and briefly served as its interim Chief Financial Officer. Ms. Falberg joined Amgen Inc., a global biotechnology company, in 1995 as Treasurer, and advanced through a series of positions of increasing responsibility, culminating in her appointment as Senior Vice President, Finance and Strategy, and Chief Financial Officer in 1998. Ms. Falberg left Amgen Inc. in July 2001. Ms. Falberg currently serves on the Board and Audit Committee (Chair) of ESS Technology, Inc., a privately-held semiconductor company, and the Board, Audit Committee (Chair), Compensation Committee and Nominating and Governance Committee of Halozyme Therapeutics, Inc., a publicly-traded biopharmaceutical company. In the last six years, Ms. Falberg also served on the Board and the Audit and Compensation Committees of Fresh Del Monte Produce Inc. until 2006, and the Board and Audit Committee (Chair) of Human Genome Sciences, Inc. until 2005. Ms. Falberg has an M.B.A. and B.A. in Economics from the University of California, Los Angeles.

For the following reasons, the Board has concluded that Ms. Falberg has the requisite qualifications, skills, perspectives and experience that make her well qualified to serve on the Board. Ms. Falberg has a deep understanding of financial management and reporting as a result of her greater than 23 years of financial experience with companies of varying sizes across multiple industries, including technology, life sciences, medical device and consumer products. Ms. Falberg has extensive experience serving as the Chief Financial Officer of biotechnology and pharmaceutical companies, including publicly-held companies, which provides her with valuable perspective on the financial performance, prospects and strategy of a biotechnology company such as QLT. Ms. Falberg’s current and past service as the audit committee chair of other publicly-traded biotechnology companies gives her insight and perspective into the best practices with respect to biotechnology companies and the audit committee function.

Dr. Ian J. Massey has been a Director of QLT since June 2006. In 2006, Dr. Massey joined Synosia Therapeutics, Inc., a private biotechnology company focused in the fields of neurology and psychiatry, as its President and Chief Executive Officer. In February 2011, Synosia Therapeutics, Inc. was acquired by Biotie Therapies Corp., following which Dr. Massey holds the offices of Chief Operating Officer and President of U.S. operations of Biotie Therapies Corp. From 2002 to 2006, Dr. Massey was the Senior Vice President and Head of Research and Preclinical Development at Roche Palo Alto, where he built and led a research and preclinical development organization of approximately 700 people in multiple therapeutic areas. From 1995 to 2002, Dr. Massey held positions of increasing responsibility at Roche Bioscience, including Senior Vice President, Head of Neurobiology Business Unit and Central Research & Development and Vice President and Director of Preclinical Research and Development. Prior to joining Roche, Dr. Massey was at Syntex Research for over 15 years where he held a number of senior positions, culminating in the position of Vice President and Director, Institute of Analytical Research. Dr. Massey has a D. Phil. degree in Organic Chemistry from the University of Oxford, England, a M.A. in Organic/Natural Product Chemistry and a B.A. in Chemistry.

For the following reasons, the Board has concluded that Dr. Massey has the requisite qualifications, skills, perspectives and experience that make him well qualified to serve on the Board. As a senior pharmaceutical executive with experience in all phases of the drug discovery and development process, Dr. Massey possesses valuable insight into the challenges and opportunities inherent to the drug development process. Dr. Massey’s extensive leadership experience in the biopharmaceutical industry, and in particular as an executive officer at Roche Palo Alto, provides Dr. Massey with an in-depth understanding of research and preclinical development in the pharmaceutical industry. Having gained experience in various levels of seniority within the research function of the pharmaceutical industry, Dr. Massey provides the valuable insight of a research scientist and is deeply familiar with the strategic, product development and technological issues of a pharmaceutical company such as QLT.

Joseph L. Turner has been a Director of QLT since February 2010. Most recently, Mr. Turner served as Chief Financial Officer at Myogen, Inc., a biopharmaceutical company, which he joined in 1999, remaining until it was acquired by Gilead Sciences in 2006. At Myogen, Mr. Turner was responsible for, among other things, all financial and accounting matters and assisted to raise over $300 million through a number of private and public financings. Previously, he was Chief Financial Officer at Centaur Pharmaceuticals, Inc. and Vice President, Finance and Administration at Cortech, Inc. Mr. Turner began his career at Eli Lilly and Company, where he served for 12 years in various financial positions. Since 2007, Mr. Turner has provided consulting services to LigoCyte Pharmaceuticals, Inc., and from 2009 to 2010, provided consulting services to ApopLogic Pharmaceuticals, Inc., both of which are privately-held biopharmaceutical companies. He currently serves on the Board of Directors of Sequel Pharmaceuticals, Inc., a privately-held biotechnology company and Kythera Biopharmaceuticals, Inc., a privately-held pharmaceutical company, and the Board of Directors and Audit Committee of each of Alexza Pharmaceuticals, Inc. (Chair of Audit Committee) and Corcept Therapeutics Incorporated, both of which are publicly-traded pharmaceutical companies. Since 2009, Mr. Turner has also served on the Board of Managers and the Finance Committee of Swarthmore College. Previously, Mr. Turner served on the Board of Directors of ApopLogic Pharmaceuticals, Inc., the Board and Audit Committee of SGX Pharmaceuticals, Inc., a publicly-traded pharmaceutical company, and the Board and as Chair of the Audit Committee of NovaCardia, Inc., a privately-held biotechnology company. Mr. Turner has an M.B.A. from University of North Carolina at Chapel Hill, an M.A. in Molecular Biology from University of Colorado, and a B.A. from Swarthmore College.

For the following reasons, the Board has concluded that Mr. Turner has the requisite qualifications, skills, perspectives and experience that make him well qualified to serve on the Board. Mr. Turner’s greater than 25 years of experience in financial management in the biotechnology and pharmaceutical industries, including 14 years as a Chief Financial Officer, has honed Mr. Turner’s leadership skills and made him well versed in the operational, financial and strategic challenges and opportunities of biotechnology companies such as QLT. Mr. Turner’s current and past service on boards of directors and audit committees of pharmaceutical companies brings valuable industry-specific insight and perspective to QLT’s board and audit committee.

L. Jack Wood has been a Director of QLT since 2001. Mr. Wood is currently a Director of Clinuvel Pharmaceuticals Ltd., a biotechnology company listed on the Australian Stock Exchange, and a Director and Treasurer of the West Vancouver Shoreline Preservation Society. From March 2004 to December 2010, Mr. Wood served as a Director and the Chairman of enGene Inc., a privately-held biotechnology company. From 1992 to 2004, Mr. Wood worked with CSL Limited, an Australian healthcare company listed on the Australian Stock Exchange, where he coordinated the company’s worldwide expansion in the plasma products industry. Prior to joining CSL, Mr. Wood was the President and Chief Executive Officer of Exogene Corporation, a biotechnology company. From 1988 to 1990, Mr. Wood was Senior Vice President of BioResponse Corporation, a biotechnology company sold to Baxter Healthcare Corporation. From 1980 to 1988, Mr. Wood worked for Bayer Corporation, a healthcare company, as a Vice President and General Manager for Europe, the Middle East and Africa. From 1963 to 1980, Mr. Wood held a series of operating and general management positions with Baxter Healthcare Corporation.

For the following reasons, the Board has concluded that Mr. Wood has the requisite qualifications, skills, perspectives and experience that make him well qualified to serve on the Board. Mr. Wood has an extensive background in international marketing and the manufacture of pharmaceutical products, which provides him with a valuable perspective in drug development and distribution. Mr. Wood’s greater than 40 years of experience in the biopharmaceutical and biotechnology industries provides seasoned insight into the operations and prospects of the business of a biotechnology company such as QLT, and his decade of service on QLT’s Board provides him with a valuable background in QLT’s business practices.

Vote Required and Board of Directors’ Recommendation

Director nominees will be elected by a plurality of the votes cast at the Annual Meeting. This means that the eight nominees with the highest number of affirmative votes cast at the Annual Meeting will be elected as Directors. You may choose to vote, or withhold your vote, separately for each nominee. Proxies cannot be voted for more than eight nominees for election to the Board.

The Board of Directors recommends that shareholders vote “FOR” the election of all eight nominees for Director. The proxyholders intend to vote the shares represented by proxies “FOR” the election of the eight nominees named in the Instrument of Proxy unless authority to vote for those persons is withheld.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth the shares of our common stock beneficially owned by (1) each of our Directors and director nominees, (2) each of our current named executive officers listed in the Summary Compensation Table below, (3) all of our Directors, director nominees and executive officers as a group, and (4) all persons known by us to beneficially own more than 5% of our outstanding voting shares. We have determined the beneficial ownership shown on this table in accordance with the rules of the SEC and the applicable Canadian securities regulators. Under those rules, shares are considered beneficially owned if held by the person indicated, or if such person, directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise has or shares the power to vote, to direct the voting of and/or to dispose of or to direct the disposition of such security. Except as otherwise indicated in the accompanying footnotes, beneficial ownership is shown as of April 14, 2011.

		Amount and Nature of Beneficial Ownership
						Shares for
						Which
						Beneficial
						Ownership								Total Beneficial
						Can Be								Ownership
		Shares				Acquired				Number				Number				Percent
		Beneficially				Within 60				of				of				of
Name of Beneficial Owner		Owned				Days(1)				DSUs(2)				Shares				Class(3)
Robert L. Butchofsky			168,847	(4)			940,278				—				1,109,125				2.2	%
Bruce L.A. Carter			20,000				—				30,417				50,417				*
C. Boyd Clarke			69,000				—				68,333				137,333				*
Peter A. Crossgrove			42,000				—				37,917				79,917				*
Kathryn E. Falberg			—				—				7,917				7,917				*
Linda M. Lupini			10,000				321,111				—				331,111				*
Alexander R. Lussow			10,000				361,111				—				371,111				*
Ian J. Massey			23,440				—				30,417				53,857				*
Cameron R. Nelson			35,000				336,111				—				371,111				*
Joseph L. Turner			—				—				2,708				2,708				*
L. Jack Wood			25,000				—				37,917				62,917				*
All Directors, nominees and executive officers as a group (11 persons)(5)			403,287				1,958,611				215,625				2,577,523				5.1	%
NB Public Equity K/S(6)			7,727,613				—				—				7,727,613				15.2	%
Axial Capital Management, LLC(7)			6,865,036				—				—				6,865,036				13.5	%
Renaissance Technologies LLC(8)			3,293,074				—				—				3,293,074				6.5	%
Kingstown Capital Management LP(9)			2,749,524				—				—				2,749,524				5.4	%
Roark, Rearden & Hamot Capital Management, LLC(10)			2,552,352				—				—				2,552,352				5.0	%

For additional information on our equity compensation plan, and our common shares that may be issued upon the exercise of options, warrants and other rights granted to employees, consultants or Directors under our existing equity compensation plan, see our Annual Report on Form 10-K which is available on our website at www.qltinc.com, SEDAR at www.sedar.com and EDGAR at www.sec.gov.

EXECUTIVE COMPENSATION

The following sets forth information about our named executive officers as of April 14, 2011. The named executive officers listed below serve in their respective capabilities at the discretion of our Board of Directors.

Robert L. Butchofsky

President and Chief Executive Officer

See the section entitled “Proposal No. 1 — Election of Directors” above for Mr. Butchofsky’s biography.

Cameron R. Nelson

Vice President, Finance and Chief Financial Officer

Mr. Nelson, age 45, joined QLT in May 2000 as Associate Director, Financial Analysis and Planning and has made many contributions to QLT during his time with the Company. He was promoted to Director, Financial Analysis and Planning in January 2002 and later to Senior Director, Financial Reporting and

Planning. In early 2005, he was promoted to Vice President, Finance and was named Chief Financial Officer in August 2005.

Prior to joining QLT, Mr. Nelson held finance and accounting positions with Mattel Inc. and Equity Marketing Inc. in Los Angeles. Mr. Nelson earned his Bachelor of Commerce from the University of British Columbia and his Master of Business Administration from Dartmouth College.

Linda M. Lupini

Senior Vice President, Human Resources and Organizational Development

Since joining QLT in 1997, Ms. Lupini, age 51, has managed all aspects of Human Resources and Facilities Management for QLT, including QLT’s growing demand for highly skilled science and technology specialists. She brings nearly 20 years of experience to the role, including 10 years experience with MacDonald Detwiler and Associates, a leading international software firm. Her broad experience encompasses all aspects of human resources management and organization development. Ms. Lupini is a past board member of BC Biotech and was previously a member of the BC Employment Standards Tribunal. She is currently on the advisory board of Simon Fraser University’s MBA in Biotechnology Program, and is a past member of the board of BioTalent Canada. Ms. Lupini holds a Bachelor of Arts degree in Psychology from the University of British Columbia and is currently working on a Masters in Organizational Psychology from the University of London (Birkbeck).

Alexander R. Lussow, PhD

Senior Vice President, Business Development & Commercial Operations

Alexander Lussow, age 48, joined QLT in July 2006 as Vice President, Business Development and became Senior Vice President, Business Development and Commercial Operations in May 2008. Mr. Lussow is responsible for QLT’s business development activities, including product licensing, acquisitions and strategic partnering opportunities, as well as QLT’s strategic marketing, product manufacturing and supply chain.

Before joining QLT, Mr. Lussow was Gryphon Therapeutics’ Chief Business Officer and Vice President of Business Development where he was responsible for the licensing of the company’s products, the formation of strategic alliances, corporate communications and fund raising. Before joining Gryphon, Mr. Lussow served as the head of business development at Sangstat Medical Corporation (now wholly-owned by Genzyme Corp.). He also has broad experience in biotechnology management consulting, advising on venture financing, strategic business planning and licensing transactions for several biotechnology companies.

Mr. Lussow received his BSc at McGill University in Montreal and his PhD in immunology at the University of Geneva, Switzerland. He has been an adjunct professor of pharmacology at the University of North Carolina, USA and has worked extensively for the World Health Organization (WHO) in West Africa.

Compensation Discussion and Analysis

This Compensation Discussion and Analysis section discusses our executive compensation policies and programs and the compensation decisions made in 2010 for our named executive officers during 2010, which consisted of Robert L. Butchofsky, our President and Chief Executive Officer; Cameron R. Nelson, our Vice President, Finance and Chief Financial Officer; Linda M. Lupini, our Senior Vice President, Human Resources and Organizational Development; Alexander R. Lussow, our Senior Vice President, Business Development & Commercial Operations; and Dipak Panigrahi, our former Senior Vice

President, Research and Development and Chief Medical Officer who joined the Company in April 2010 and departed from the Company in February 2011.

The Executive Compensation Committee administers the compensation policies and programs for our named executive officers. A summary discussion of this year’s activities follows below and in this Compensation Discussion and Analysis report.

Executive Summary

The Executive Compensation Committee evaluates and sets executive compensation consistent with our stated philosophy to provide a compensation package that attracts, retains and motivates executives and rewards business successes that have the potential to increase shareholder value. More specifically, the Executive Compensation Committee seeks to:

	•		provide a total compensation program that is competitive with other companies in the pharmaceutical and biotechnology industries with which we compete for executive talent;
	•		place a significant portion of executive compensation at risk by linking cash incentive compensation to the achievement of pre-established corporate financial and operational performance objectives and other individual key objectives within the executive’s area of responsibility and by using equity as a key component of our compensation program;
	•		provide long-term incentive compensation that focuses executives’ efforts on building shareholder value by aligning their interests with those of our shareholders; and
	•		promote stability and retention of our management team.

Consistent with our performance-based philosophy, we reserve a significant portion of potential compensation for performance- and equity-based programs. These programs include awards that are based on our financial and operational performance and provide compensation in the form of cash, and equity-based incentive awards that are tied to both our short-term and long-term performance. The performance-based bonus program rewards short-term performance; while our equity awards, solely in the form of nonqualified stock options, coupled with our stock ownership guidelines, reward long-term performance and align the interests of management with those of our shareholders.

          Highlights of Our 2010 Executive Compensation Program. The Executive Compensation Committee reviews our executive compensation program and practices throughout the year. Executive compensation program highlights for 2010 include:

          Base Salaries and Target Bonus Opportunities in 2010. After consideration of the practices of our comparator group and corporate and individual executive performance, for 2010, the Executive Compensation Committee approved base salary increases from 2009 levels for our Chief Executive Officer (10%) and our Chief Financial Officer (3%), resulting in base salaries at the 50th percentile of our comparator group. The base salaries for our other executive officers were not adjusted, as they were determined to be above the 50th percentile of our comparator group. For 2010, the Executive Compensation Committee also increased the target annual cash incentive award percentage for our Chief Executive Officer to 75% of base salary earnings to bring our Chief Executive Officer’s total cash compensation to fall at or around the 75th percentile of our comparator group. There was no change to the target annual cash incentive award percentages (45% of base salary earnings) for our other executive officers in 2010.

          Linking Compensation to the Attainment of Performance Goals. We use annual performance-based cash incentive awards to reward our executives for achieving annual financial and operational goals and to reward annual individual performance. The incentive potential is expressed as a percentage of base salary, determined with reference to the 75th percentile of our comparator group. This is intended to provide focus on annual corporate and individual goals without overemphasizing short-term performance, and to place at risk a significant portion of an executive’s annual cash compensation. The annual incentive award for our Chief Executive Officer is based 100% on the achievement of corporate goals. With regard to our other named executive officers, 75% of his or her annual incentive award is based on the achievement of corporate goals and 25% is based on the achievement of individual goals.

Our performance goals for the 2010 calendar year were based on the following: (i) Sustained Drug Delivery — Punctal Plug Development, (ii) Visudyne^®, (iii) Development Programs — QLT091001 (our synthetic retinoid program) and QLT091568, (iv) Management of Organizational Change/Growth and (v) Management of Business to Drive Intermediate-Term Shareholder Value. These goals focus on profitably increasing revenues for our current product and maintaining a significant research and development reinvestment rate to fuel our long-term growth. The Executive Compensation Committee determined that we achieved or exceeded certain of our 2010 corporate goals; however, overall we achieved only 64.75% of our 2010 corporate goals, principally because the target goal criteria for the latanoprost punctal plug delivery system (“L-PPDS”) and U.S. Visudyne sales were not achieved. Therefore, the cash incentive compensation payment to our Chief Executive Officer was approximately 48.6% of his base salary for 2010. With regard to our other named executive officers, the individual goal achievement in 2010 varied between 95% and 115% due to each executive achieving, and in some cases, exceeding, certain individual goals unrelated to the L-PPDS program and U.S. Visudyne sales. Therefore, our cash incentive compensation payments to our other executive officers ranged from approximately 32.5% to 34.8% of their base salaries for 2010.

          Using Equity as a Key Component of Compensation. Equity awards serve to align the interests of our executive officers with those of our shareholders. Therefore, stock options are a key component of our compensation program. Equity awards, solely in the form of stock options, represented approximately 40% of our executive officers’ aggregate cash and equity compensation in 2010. Stock options more closely align the interests of our executives with those of our shareholders because the recipient will only realize a return on the option if our stock price increases over the term of the option. In addition, awards of stock options align with our growth strategy and provide significant leverage if our growth objectives are achieved, and place a significant portion of compensation at risk if our objectives are not achieved.

          Minimum Share Ownership Guidelines. In September 2009, the Board, on the recommendation of the Executive Compensation Committee, approved share ownership guidelines for executive officers. The share ownership guidelines encourage our Chief Executive Officer to own an amount equal to 1.5 times his base salary as of the date of the implementation of the guidelines, to be satisfied within four years from the implementation of the guidelines, and our other executive officers to each own an amount equal to 0.5 times his or her base salary as of the latest of the date of the implementation of the guidelines and the date he or she becomes an executive officer, in all cases to be satisfied within four years from the applicable date. The value of QLT stock options held by the executive officers is not counted towards fulfilling the share ownership guidelines. The minimum share ownership guidelines continued for 2010. As of April 14, 2011, our Chief Executive Officer and Chief Financial Officer have already achieved their respective target share ownership guidelines.

The Executive Compensation Committee’s decisions with respect to 2010 are discussed in more detail below. In addition, the compensation and benefits provided to our named executive officers for the last three fiscal years are set forth in detail in the Summary Compensation Table and other tables that follow

this Compensation Discussion and Analysis, and in the footnotes and narrative material that accompany those tables.

          Compensation Governance and Best Practices. We are committed to having strong governance standards with respect to our compensation programs, procedures and practices. The Executive Compensation Committee has, among other things, taken the following actions:

	•		retained Radford, an Aon Consulting Company and independent compensation consultant, which reports directly to the Executive Compensation Committee;
	•		incorporated compensation analytical tools such as market data for our comparator group for all compensation components, compensation history for each executive and walk-away analysis as part of its annual executive compensation review;
	•		implemented share ownership guidelines which align our executives’ long-term interests with those of our shareholders and discourage excessive risk-taking;
	•		implemented equity compensation grant procedures that comply with evolving best practices; and
	•		implemented an annual process to review our incentive compensation and benefit programs and assess the risks related to our company-wide compensation structure, policies and programs.

Objectives of Our Compensation Program

          Compensation Philosophy. We are engaged in a highly specialized and competitive industry. Success in this environment requires talented and motivated executives. The goal of our named executive officer compensation program is to attract, retain and motivate executives and reward business successes that have the potential to increase shareholder value. The Executive Compensation Committee, which is composed of independent members of the Board, is responsible for implementing our executive compensation program and establishing corporate performance objectives and reviewing individual performance objectives that reward our named executive officers when those objectives are met. In considering executive compensation, the Executive Compensation Committee ensures that our total compensation program is competitive, supports our overall strategy and objectives, reflects both risk and reward for our named executive officers and aligns our executive officers’ interests with those of our shareholders. The combination of base salary, annual incentives and long-term incentives that we provide to our named executive officers is designed to accomplish this.

The Executive Compensation Committee obtains information from a number of sources, including North American surveys and reports on executive compensation in the biotechnology industry, as well as internally generated reports of executive compensation practices of a sub-group of biotechnology companies. To assist with its evaluation of executive compensation, the Executive Compensation Committee has the authority to retain independent compensation consultants. The Executive Compensation Committee has periodically engaged Radford to provide Director and executive compensation assessments and recommendations to the Executive Compensation Committee. Radford provides data on the compensation and relative performance of peer companies, provides opinions on the degree to which our compensation arrangements are consistent with market practices and our objectives, consults on other compensation matters as needed and, if applicable, recommends compensation guidelines and program designs. Additionally, a representative from Radford attends Executive Compensation Committee meetings at the request of the Executive Compensation Committee, including during in-camera sessions without members of management present, as appropriate.

          Components of the Compensation Package. At the foundation of the Executive Compensation Committee’s strategy is the principle that there should be both consequences for underperformance and incentives for outstanding performance. This is achieved through a compensation program that emphasizes fixed and variable components which make up the “pay mix” for each executive officer.

There are three major elements to our executive compensation:

	•		Base salary;
	•		Variable performance-based compensation, consisting of annual cash bonuses based on a comparison of individual and corporate performance to pre-set goals and objectives; and
	•		Long-term incentives, consisting of annual grants of long-term stock options.

In addition, our executives are eligible to participate in the benefit plans generally available to all of our employees and to receive an annual executive medical screening consultation (as described in “Health and Life Benefits” below).

Our executive officers are paid in Canadian dollars but, for reporting purposes only, their compensation is set out below in U.S. dollars.

Determining Compensation

          Compensation Consultant and Peer Group. In early 2010, the Executive Compensation Committee engaged Radford to provide market data and a comprehensive executive compensation assessment intended to help inform our Executive Compensation Committee for 2010. The Executive Compensation Committee periodically adjusts our comparator group so that QLT compares itself with industry-appropriate peers of comparable size, revenue, market capitalization, and stage of product pipeline. The following 12 public biotechnology companies in the Radford 2009 Global Life Sciences Survey of biotechnology and life-sciences entities, located in North America, comprise our 2010 comparator group:

Canadian Peer Companies		U.S. Peer Companies
Angiotech Pharmaceuticals, Inc.		Enzon Pharmaceuticals, Inc.
Cardiome Pharma Corporation		Inspire Pharmaceuticals, Inc.
Labopharm Inc.		Ista Pharmaceuticals, Inc.
		Jazz Pharmaceuticals, Inc.
		Questcor Pharmaceuticals, Inc.
		Santarus, Inc.
		Sucampo Pharmaceuticals, Inc.
		ViroPharma Incorporated
		ZymoGenetics, Inc.

In considering the market data provided by Radford, the Executive Compensation Committee uses certain percentiles or range of percentiles from the comparative data as a reference point in determining the amount and mix of compensation for our named executive officers. The Executive Compensation Committee also considers many other factors in determining compensation, consistent with the

Company’s compensation philosophy. The result of the Executive Compensation Committee’s review of 2010 executive compensation is described below.

          Base Salary. Annual base salary is designed to provide a competitive fixed rate of pay recognizing different levels of responsibility and performance within the Company. Base salaries for our named executive officers are benchmarked against the base salaries paid to executives with similar roles at the companies within our comparator group using the 50th percentile and the 75th percentile as reference points. Actual salaries reflect the Executive Compensation Committee’s consideration of numerous factors, including the individual named executive officer’s experience, length of service, position criticality, scope of responsibilities and performance. In determining whether to increase the base salary for a particular named executive officer, the Executive Compensation Committee considers the results of each named executive officer’s individual goal achievement and overall performance, comparative survey data for equivalent executive positions in our comparator group, along with the other elements of compensation received by our named executive officers.

After consideration of the Radford report and overall corporate and individual performance, in March 2010, the Board, on the recommendation of the Executive Compensation Committee, determined that the base salary of Mr. Butchofsky, our President and Chief Executive Officer, was significantly below the 50th percentile of our comparator group due to Mr. Butchofsky’s voluntary 10% base salary cut in 2007 (which reduced base salary remained constant through 2008 and 2009), and approved a 10% increase to Mr. Butchofsky’s salary, retroactive to January 1, 2010. Following the increase, Mr. Butchofsky’s base salary was restored to the 50th percentile of our comparator group. After consideration of the Radford report and Mr. Nelson’s sustained level of performance during his tenure, the Board, on the recommendation of the Executive Compensation Committee, also approved a 3% base salary increase for Mr. Nelson, our Chief Financial Officer, retroactive to January 1, 2010. Following the increase, Mr. Nelson’s base salary is at or around the 50th percentile of our comparator group.

The 2010 base salaries for Ms. Lupini and Mr. Lussow were determined to be above the 50th percentile of our comparator group at approximately the 75th percentile and, therefore, no adjustment was made by the Executive Compensation Committee. In reviewing Ms. Lupini and Mr. Lussow’s 2010 base salaries, the Executive Compensation Committee took into consideration the executives’ enhanced scope of responsibilities as a result of our corporate restructurings, their sustained performance levels and, in the case of Ms. Lupini, her 14 year tenure with the Company.

Dr. Panigrahi joined the Company in April 2010. According to survey data of equivalent positions, Dr. Panigrahi’s 2010 base salary was positioned between the 50th and 75th percentile of our comparator group. In approving Dr. Panigrahi’s base salary, the Executive Compensation Committee considered many factors, including the other components of Dr. Panigrahi’s total compensation package, the importance of the position for the Company and Dr. Panigrahi’s specialized qualification as an industry experienced ophthalmologist.

          Pay-at-Risk Compensation. We have a compensation philosophy that includes a pay-at-risk component under our annual cash incentive compensation program. The annual cash incentive award represents income at risk — it is only paid if and to the extent certain goals and objectives are met. The annual cash incentive compensation that each named executive officer is eligible to receive is based on a pre-determined target percentage of his or her base salary, determined in accordance with practices of our comparator group and taking into account scope and level of responsibility. The Executive Compensation Committee also believes that the success of the Company is based in part on the achievements of the named executive officers as a group and, therefore, the target annual award percentage is determined by considering competitive rates of incentive compensation for the named executive officers as a group and not just on a position-specific basis.

The target annual award percentage of base salary for each named executive officer is reviewed by the Executive Compensation Committee annually, using the 75th percentile of our comparator group as a reference point. When combined with base salaries, cash incentive awards provide the opportunity for a named executive officer to achieve total cash compensation, when targeted levels of performance are achieved or exceeded, exceeding the 50th percentile of our comparator group. We define “total cash compensation” as base salary plus annual target bonus under our annual cash incentive compensation program. The Executive Compensation Committee believes that, given our competitive industry, this pay-for-performance compensation strategy allows a biotechnology company in our location and of our size to competitively attract and retain talented executives while aligning the strategic interests of our executives and shareholders.

In March 2010, after consideration of the information provided by Radford, the Board, on the recommendation of the Executive Compensation Committee, determined to increase the target annual award percentage for Mr. Butchofsky, our President and Chief Executive Officer, from the existing target of 50% of base salary earnings to 75% of base salary earnings. The effect of this increase was to move Mr. Butchofsky’s target percentile of base salary to approximately 10% above the 75th percentile of our comparator group. The increased target percentage of base salary, when taken together with his above-noted 10% base salary increase to the 50th percentile of our comparator group, brought Mr. Butchofsky’s total cash compensation to fall at or around the 75th percentile of our comparator group. The Executive Compensation Committee believes this is an appropriate position for Mr. Butchofsky given the Company’s philosophy on pay-at-risk, which orients Mr. Butchofsky’s target annual total cash compensation such that it is more dependent on company performance, for which the President and Chief Executive Officer position is ultimately accountable.

According to the Radford report, the 45% target annual award percentage for each of Ms. Lupini and Messrs. Lussow and Nelson was determined to fall, in the case of Mr. Nelson, at the 50th percentile of our comparator group and, in the case of Ms. Lupini and Mr. Lussow, approximately 5% above the 75th percentile of our comparator group. Following a review of each of the named executive officer’s scope and level of responsibility within the Company, the Executive Compensation Committee did not adjust the 45% target annual award percentage for these named executive officers in 2010.

In light of the proposed scope of responsibilities assigned to Dr. Panigrahi in 2010, his target annual award percentage was also positioned at 45% of base salary earnings and, according to market data provided by Radford, fell at or around the 75th percentile of our comparator group in 2010.

The amount of annual cash incentive compensation that our executive officers were eligible to receive for 2010 is as follows:

Range of Possible Bonus

Weighting between

Target Bonus (as a % of

Payment (as a % of base

Corporate and

Level

base salary)

salary) (1)

Individual Goals

Chief Executive Officer

75%

0 - 150%

100% Corporate

Chief Financial Officer and Senior Vice Presidents

45%

0 - 90%

75% Corporate / 25% Individual

The breakdown between corporate and individual objectives that determine the cash payout amounts are weighted heavily toward overall achievement of corporate objectives to align our executives with objective measures of corporate performance while ensuring that specific functional/departmental objectives are also achieved so to align employees below the executive level.

Establishing Goals

          Individual Goals. At the beginning of each performance year period and thereafter each quarter, the criteria for assessing an individual named executive officer’s performance (other than that of the Chief Executive Officer) are developed and reviewed by the Chief Executive Officer in consultation with the particular named executive officer. The individual goals are primarily objective and measurable, relate to the individual named executive officer’s area of responsibility and are designed to facilitate the achievement of our corporate goals. It is possible for a named executive officer to attain between 0% and 200% of his or her individual goals depending on performance, although the Executive Compensation Committee has the discretion to recognize additional factors and award bonuses outside of this range. The extent to which those individual goals have been achieved or exceeded is determined largely from the annual performance recommendations for each of the other named executive officers prepared by the Chief Executive Officer and approved by the Executive Compensation Committee. Cash incentive compensation for the Chief Executive Officer is determined based solely on achievement of the corporate goals as approved by the Board.

          Corporate Goals. Also, at the beginning of each performance year period, the criteria for assessing QLT’s performance are: (i) developed by the Chief Executive Officer in consultation with management, (ii) reviewed and approved by the Executive Compensation Committee, (iii) approved by the Board, and (iv) communicated to the participants. In early 2010, on the recommendation of the Executive Compensation Committee, the Board approved specific corporate goals for QLT to achieve. The corporate goals for 2010, and our assessment of how successful we were in attaining those goals, are described below.

The Executive Compensation Committee recommended, and the Board set, the following high-level goals and the relative weighting for each goal for QLT for 2010. Our strategic plans, corporate goal achievements from prior years and industry trends assist in determining realistic but challenging goals for each year. The weights are intended to reflect the relative priority, importance and impact of each objective on the Company’s successes.

	•		Sustained Drug Delivery — Punctal Plug Development: 40% — based on the achievement of specified milestones related to clinical development and product research and development for the punctal plug drug delivery program;
	•		Visudyne®: 15% — based on the achievement of target U.S. Visudyne sales and the achievement of specified milestones related to U.S. distribution and sales force infrastructure;
	•		Development Programs: 20% — based on the achievement of specified milestones for the synthetic retinoid program related to clinical development progress and positive results and the achievement of specified milestones for the QLT091568 research and development program;
	•		Manage Organizational Change / Growth: 5% — based on the completion of certain key new hires; and
	•		Manage Business to Drive Intermediate-Term Shareholder Value: 20% — based on improving shareholder value by achieving target adjusted EBITDA plus Contingent Consideration of $15 million and pursuing strategic acquisition or in-licensing opportunities for our ocular pipeline.

Adjusted EBITDA plus Contingent Consideration is a non-GAAP financial measure we define as Operating Income (loss), plus Depreciation, plus Stock Based Compensation, plus Contingent Consideration earned during the period. Our “contingent consideration” represents amounts payable to us in connection with the sale of our U.S. subsidiary, QLT USA, Inc. For further information see the Company’s Annual Report on Form 10-K for fiscal 2010.

To reflect the relative value of each achievement to the resulting value for QLT and our shareholders, within each goal, the Executive Compensation Committee set out criteria that must be reached for the goal to be met. The Executive Compensation Committee did not modify any performance targets during 2010 to reflect changes in financial budgets or goals upon which the target objectives were dependent.

          Evaluating Goal Achievement

After each fiscal year, our Chief Executive Officer presents a recommendation to the Executive Compensation Committee for performance bonus payments based on the results achieved as compared to targets established for that fiscal year. The Executive Compensation Committee has the discretion to award the amount corresponding to that level of achievement, or to modify the award payable if it believes a modification would be in the best interests of QLT and its shareholders. In performing its assessment, the Executive Compensation Committee may also consider market, business or organizational factors that may have impacted achievement of a specific goal.

In early 2011, the Executive Compensation Committee considered the performance of QLT relative to the corporate objectives set in early 2010. Based on the achievement of QLT against those specific goals, the Executive Compensation Committee determined that QLT achieved 64.75% of its 2010 corporate goals. The following chart illustrates the level of achievement of the 2010 corporate goals:

Goal		Target %		Actual %
Sustained Drug Delivery — Punctal Plug Development		40%		13.75
Visudyne		15%		5%
Development Programs		20%		26%(1)
Manage Organizational Change/Growth		5%		5%
Manage Business to Drive Intermediate-Term Shareholder Value		20%		15%
Total		100%		64.75%

In evaluating our performance against the goals established for 2010, and determining the extent to which those goals were successfully achieved, the Executive Compensation Committee recognized the following factors, among others:

•

Sustained Drug Delivery — Punctal Plug Development: The Executive Compensation Committee recognized that certain progress was made in the punctal plug drug delivery program, including the Phase II clinical proof-of-concept study for the olopatadine punctal plug delivery system (“O-PPDS”) in patients with allergic conjunctivitis. However, the target goal criteria for the L-PPDS for glaucoma were not achieved in 2010 and the interim results of the O-PPDS study were determined in early 2011 to be equivocal, leading to a suspension of the O-PPDS program

			pending the outcome of the ongoing L-PPDS Phase II clinical study. As a result, QLT was determined to achieve only 13.75% out of a possible 40% with respect to this goal.
	•		Visudyne: Operational objectives for U.S. distribution and sales force infrastructure for Visudyne were achieved in 2010; however, we did not achieve our U.S. Visudyne sales goal. As a result, QLT achieved 5% out of a possible 15% for this goal.
	•		Development Programs: The results related to our other development programs were mixed. The Company completed formulation and development work on QLT091568 in 2010; however, as a result of this and in consideration of our research and development priorities, we discontinued development of QLT091568. In connection with QLT091001, our synthetic retinoid, the Executive Compensation Committee recognized that we achieved certain target milestones for our Phase Ib clinical proof-of-concept study for the treatment of Leber Congenital Amaurosis (“LCA”). The Executive Compensation Committee also gave consideration to additional achievements related to the synthetic retinoid program made during the year that were not articulated or contemplated in the 2010 criteria for the development programs objectives as follows: (i) the expansion of the Phase Ib clinical proof-of-concept trial to include adult patients with LCA, (ii) the expansion of the Phase Ib clinical proof-of-concept trial to include patients with Retinitis Pigmentosa (“RP”), and (iii) the receipt of orphan drug designations for QLT091001 to treat LCA and RP by the U.S. Food and Drug Administration and positive opinions for orphan drug designations for QLT091001 to treat LCA and RP by the European Medicines Agency Committee for Orphan Medicinal Products. Each of these achievements were considered significant developments in advancement of the program, and were determined to enhance the goal achievement by an aggregate 10%. As a result, it was determined that QLT achieved, overall, 26% out of a target 20% for this goal.
	•		Manage Organizational Change/Growth: The human resources organizational goals related to recruitment of key employees were accomplished, resulting in full goal achievement of 5% out of a possible 5%.
	•		Manage Business to Drive Intermediate-Term Shareholder Value: The results related to our goals to drive intermediate-term shareholder value were also mixed. In 2010, we achieved $15.6 million in adjusted EBITDA plus Contingent Consideration compared with our target adjusted EBITDA plus Contingent Consideration of $15 million; however, our goals related to business development through strategic in-license or acquisitions were not achieved. The Executive Compensation Committee also gave consideration to the QLT stock price appreciation of approximately 47% and improved capital structure in 2010, which were determined to enhance the goal achievement by an aggregate 5%. As a result of these factors, it was determined that QLT achieved, overall, 15% out of a possible 20% for this goal.

Analysis of Named Executive Officers Compensation and Goals

          President and Chief Executive Officer. Our President and Chief Executive Officer has no individual goals and our corporate goals determine our President and Chief Executive Officer’s bonus. As noted above, the Executive Compensation Committee determined that QLT achieved 64.75% of its corporate goals for 2010, resulting in a 2010 annual cash incentive compensation payment to Mr. Butchofsky of $254,904, which represented approximately 48.6% of his base salary for 2010.

          Vice President, Finance and Chief Financial Officer. In 2010, the following individual goals were established for Mr. Nelson: (i) maintain integrity of, and identify additional efficiencies for, financial reporting and Sarbanes-Oxley compliance for QLT and its subsidiaries, (ii) successfully implement systems for U.S. subsidiary sales force expense management, processing and reporting for

Visudyne, (iii) lead team through intra-entity transfer of intellectual property to, among other things, enhance operational efficiencies, and (iv) effectively manage capital structure. Mr. Nelson was determined to have met, partially met or exceeded each of these goals, to achieve, overall by percentage, 105% of his individual goals for 2010. Based upon the achievement of the corporate goals and his individual goals, and the relative weighting between them (75% dependant upon corporate goal achievement; 25% dependant upon individual goal achievement), Mr. Nelson was awarded a cash incentive compensation amount for 2010 equal to $114,906, which represented approximately 33.7% of his base salary for 2010.

          Senior Vice President, Human Resources and Organizational Development. In 2010, the following individual goals were established for Ms. Lupini: (i) recruit key hires for regulatory and research and development lead roles and other key personnel, including U.S. sales force and medical science liaisons, (ii) establish infrastructure, benefits program and compensation system for commercial subsidiaries, including overall policy development to support commercial activities and staff, and (iii) oversee management of leased facilities. Ms. Lupini was assessed as having met, partially met or exceeded each of these goals, to achieve, overall by percentage, 115% of her individual goals for 2010. Based upon the achievement of the corporate goals and her individual goals, and the relative weighting between them (75% dependant upon corporate goal achievement; 25% dependant upon individual goal achievement), Ms. Lupini was awarded a cash incentive compensation amount for 2010 equal to $96,655, which represented approximately 34.8% of her base salary for 2010.

          Senior Vice President, Business Development and Commercial Operations. In 2010, the following individual goals were established for Mr. Lussow: (i) identify, evaluate and negotiate strategic business development initiatives consistent with overall corporate strategy, (ii) complete out-license of rights to lemuteporfin, and (iii) oversee establishment of U.S. commercial operations and Visudyne compliance program. Mr. Lussow was assessed as having met, partially met or exceeded each of these goals, to achieve, overall by percentage, 95% of his individual goals for 2010. Based upon the achievement of the corporate goals and his individual goals, and the relative weighting between them (75% dependant upon corporate goal achievement; 25% dependant upon individual goal achievement), Mr. Lussow was awarded a cash incentive compensation amount for 2010 equal to $101,254, which represented approximately 32.5% of his base salary for 2010.

          Senior Vice President, Research and Development and Chief Medical Officer. In 2010, the following individual goals were established for Dr. Panigrahi, who was employed by the Company from April 2010 until February 2011: (i) initiate and execute Phase II punctal plug drug delivery clinical trials in each of the O-PPDS and L-PPDS programs, (ii) lead development of regulatory plan for QLT091001 in the U.S. and Europe, (iii) complete the Phase Ib clinical proof-of-concept study for QLT091001 in LCA patients, and (iv) advance development work on QLT091568. Dr. Panigrahi was assessed as having met, partially met or exceeded each of these goals, to achieve, overall by percentage, 95% of his individual goals for 2010. Based upon the achievement of the corporate goals and his individual goals, and the relative weighting between them (75% dependant upon corporate goal achievement; 25% dependant upon individual goal achievement), Dr. Panigrahi was awarded a cash incentive compensation amount for 2010 equal to $84,197, which represented approximately 32.7% of his base salary for 2010, prorated to reflect his employment commencement date of April 29, 2010.

In 2010, Dr. Panigrahi’s compensation package for joining the Company also included a $203,923 signing bonus and an aggregate $300,047 for reimbursement of expenses associated with Dr. Panigrahi’s resignation from a former employer, relocation to our corporate headquarters in Vancouver, leasing accommodation and personal and family healthcare services, all as more particularly described below in the 2010 Summary Compensation Table. Dr. Panigrahi’s compensation package was the result of arm’s length negotiation, and was approved by the Board on the recommendation of the Executive

Compensation Committee, following its consideration of a number of factors, including market data of equivalent positions provided by Radford, position criticality and specialization, the limited number of qualified candidates, Dr. Panigrahi’s specific qualifications and the need to relocate Dr. Panigrahi to Canada.

          Equity Grants Policy. Equity compensation represents a significant portion of named executive officer total compensation at QLT. The amount and type of equity awards are intended to align our named executive officers’ interests with shareholder interests, increasing named executive officer compensation derived from sustained increases in the value of our common stock. These equity-based awards also serve as a retention incentive. In setting the equity compensation levels of our named executive officers, the Executive Compensation Committee considers the prior grants of stock options to the named executive officer, the level of responsibility and expected future contributions of the named executive officer, the performance of the named executive officer in the year, the total cash compensation level of the named executive officer, the fair value of long term incentives awarded to executives in similar positions in our comparator group, and the ability of stock options to retain executive officers.

QLT currently maintains one equity compensation plan, the QLT Plan, as discussed under “Securities Authorized for Issuance Under Equity Compensation Plans” below in this Proxy Statement, which provides for the issuance of stock options to executive officers, Directors, employees and consultants of QLT and its affiliates. Option grants are meant to directly link executive compensation to value creation for shareholders, and the amount (if any) each executive ultimately realizes from the options depends solely on the increase in value of our shares from the date of grant through the date of exercise.

Our Board has adopted a policy for granting equity awards to all employees, including our executive officers. Pursuant to that policy, and as was our practice in the past, only our Board or the Executive Compensation Committee are authorized to grant equity awards and, except in the case of awards for new hires, equity awards will be decided once a year at a regularly scheduled meeting. Under the QLT Plan, as amended and restated effective May 5, 2009, all stock option grants are approved after the market close and the exercise price of stock options will not be less than the closing price on the TSX on the date of grant.

All options granted to our named executive officers are exercisable for a term of five years and vest in 36 equal monthly instalments. In addition, in the event a named executive officer’s employment is terminated without cause (other than due to a change of control), 50% of the options then unvested will automatically vest. Whether or not the executive officer’s employment with us continues, 100% of the then unvested options will vest upon the occurrence of a change of control of QLT. The terms provide our executives with certain financial security that enhances our ability to attract and retain key employees. Although no longer the predominant practice in the industry, monthly vesting, in our view, continues to provide a balance between ongoing incentives and longer term retention.

According to the Radford report, the 2009 stock option grant to each of our named executive officers was at the 25th percentile of our comparator group in terms of value delivered to the named executive officer due to the Company’s stock price at that time. In May 2010, after consideration of the competitive benchmarking of the fair value of stock options previously granted and other information provided by Radford, the Executive Compensation Committee authorized a grant to our Chief Executive Officer of an option to purchase 200,000 shares of our common stock and to our other named executive officers, other than Dr. Panigrahi, of an option to purchase 80,000 shares of our common stock, each of which reflects grants made at the 50th percentile of our comparator group in terms of fair value of the award made to the named executive officer. Dr. Panigrahi received an enhanced stock option grant of an option to purchase 300,000 shares of our common stock, reflecting a “new hire” grant, which is typically two times higher than an annual grant. The stock option grants to our named executive officers in 2010 were made in

accordance with our equity grants policy, are exercisable for a term of five years and vest in 36 equal monthly instalments.

          Minimum Share Ownership Guidelines for Executive Officers. To further align our executives’ financial interests with those of our shareholders, in September 2009, the Board, on the recommendation of the Executive Compensation Committee, approved share ownership guidelines for executive officers, encouraging share ownership as follows:

	•		Chief Executive Officer: an amount equal to 1.5 times the Chief Executive Officer’s annual base salary in September 2009 (the date of the share ownership guideline implementation), satisfied within four years from the date of assuming the position of Chief Executive Officer;
	•		Other named executive officers: an amount equal to 0.5 times the named executive officer’s annual base salary (determined on the latest of: (i) September 2009; (ii) the date they are hired into a position as an executive officer; and (iii) the date they assume a new position as an executive officer), satisfied within four years from such applicable date (for each of our current named executive officers, being September 2013).

The value of QLT stock options held by the executives is not counted towards fulfilling the share ownership guidelines. The value of the shares owned for the purposes of fulfilling the share ownership guidelines is determined as the greater of the acquisition cost or the market value at the time of the determination. Compliance with the share ownership guidelines is evaluated on an annual basis by the Corporate Governance and Nominating Committee. As of April 14, 2011, Messrs. Butchofsky and Nelson have satisfied the guidelines. Ms. Lupini and Mr. Lussow are progressing toward satisfying the guidelines. As Dr. Panigrahi is no longer employed by the Company, he is no longer subject to these guidelines.

          Health and Life Benefits. Our named executive officers receive medical, dental, life insurance and other benefits generally made available to all of our employees. In addition, our named executive officers may participate in a screening and disease prevention program, under which our named executive officers and their immediate family members are eligible to obtain a full medical and disease prevention evaluation each year reimbursed by QLT as a taxable benefit and subject to certain fee caps agreed upon by QLT with the external benefit provider.

          Registered Retirement Savings Plan (RRSP) Matching Program. Our named executive officers are eligible, along with all other QLT employees resident in Canada, to participate in our registered retirement savings plan (RRSP) matching program. Under this program, we match the amount contributed by the named executive officer into his or her RRSP annually (or into QLT’s group RRSP Plan) up to 50% of the annual maximum amount allowable by the Canada Revenue Agency, less any applicable tax withholdings.

          Tax and Accounting Considerations. The Board and the Executive Compensation Committee generally consider the financial accounting and tax implications of their named executive officer compensation decisions. While generally QLT is not subject to tax in the United States, when applicable, the Executive Compensation Committee and the Board will consider the potential future effects of Section 162(m) of the Internal Revenue Code on the compensation paid to our named executive officers. Section 162(m) disallows a tax deduction for any publicly-held corporation for individual compensation exceeding $1 million in any taxable year for our Chief Executive Officer and each of the other named executive officers (other than our Chief Financial Officer), unless compensation is performance-based. The Executive Compensation Committee, where it determines that Section 162(m) is applicable and it is reasonably practicable, will seek to qualify the variable compensation paid to our named executive officers for an exemption from the deductibility limitations of Section 162(m).

Compensation of Executive Officers

2010 Summary Compensation Table

The following table summarizes total compensation for the 2010, 2009 and 2008 fiscal years earned by our named executive officers.

																		Non-Equity
														Option				Incentive Plan				All Other
Name and Principal						Salary				Bonus				Award				Compensation				Compensation				Total
Position		Year				(US$)(1)				(US$)				(US$)(2)				(US$)				(US$)(3)				(US$)
Robert L. Butchofsky			2010			$	524,899				—			$	509,555			$	254,904			$	15,828	(4)		$	1,305,186
President and Chief Executive Officer			2009			$	430,599				—			$	218,323			$	153,939			$	8,763			$	811,624
			2008			$	460,976				—			$	563,471			$	374,543			$	12,697			$	1,411,687
Cameron R. Nelson			2010			$	341,317				—			$	203,822			$	114,906			$	10,196			$	670,241
Vice President, Finance and Chief			2009			$	299,027				—			$	87,329			$	105,800			$	21,074			$	513,230
Financial Officer			2008			$	320,122				—			$	187,824			$	129,587			$	12,753			$	650,286
Linda M. Lupini			2010			$	277,819				—			$	203,822			$	96,655			$	10,196			$	588,492
Senior Vice President, Human			2009			$	250,699				—			$	87,329			$	88,701			$	8,763			$	435,492
Resources and Organizational			2008			$	268,385				—			$	187,824			$	108,917			$	8,912			$	574,038
Development
Alexander R. Lussow			2010			$	311,161				—			$	203,822			$	101,254			$	13,498	(5)		$	629,734
Senior Vice President,			2009			$	280,786				—			$	87,329			$	99,346			$	9,201			$	476,662
Business Development and			2008			$	297,378				—			$	187,824			$	117,994			$	11,480			$	614,676
Commercial Operations
Dipak Panigrahi			2010			$	257,845			$	203,923	(7)		$	764,333			$	84,197			$	300,047	(8)		$	1,610,345
Senior Vice President, Research and Development and Chief Medical Officer(6)

Grants of Plan-Based Awards for the Fiscal Year Ended December 31, 2010 Table

The following table provides certain information concerning each grant of an award made to a named executive officer in fiscal 2010.

														All Other
														Option
														Awards:				Exercise
						Estimated Future Payouts								Number of				or Base				Grant Date
						Under Non-Equity Incentive								Securities				Price of				Fair Value
						Plan Awards								Underlying				Option				of Stock
						Target				Maximum				Options				Awards				and Option
Name		Grant Date				($)(1)				($)(1)				(#)				($/Sh)(2)				Awards ($)(3)
Robert L.						$	393,674			$	787,348
Butchofsky			05/21/10												200,000			$	6.09			$	509,555
Cameron R.						$	153,593			$	307,185
Nelson			05/21/10												80,000			$	6.09			$	203,822
Linda M.						$	125,019			$	250,037
Lupini			05/21/10												80,000			$	6.09			$	203,822
Alexander R.						$	140,022			$	280,044
Lussow			05/21/10												80,000			$	6.09			$	203,822
Dipak						$	116,030			$	232,061
Panigrahi			05/21/10												300,000			$	6.09			$	764,333

Outstanding Equity Awards at 2010 Fiscal Year-End Table

The following table provides information concerning unexercised options, stock that has not vested, and equity incentive plan awards for each named executive officer outstanding as of the end of the 2010 fiscal year.

Option Awards

Number of

Number of

Securities

Securities

Underlying

Underlying

Unexercised

Unexercised

Option

Options

Options

Exercise

Option

(#)

(#)

Price

Expiration

Name

Exercisable(1)

Unexercisable

($)(2)

Date(3)

Robert L. Butchofsky

38,889

161,111

$6.09 ($6.27 CAD)

May 20, 2015

131,944

118,056

$2.37 ($2.44 CAD)

May 3, 2014

387,500

62,500

$3.62 ($3.73 CAD)

May 16, 2013

250,000

—

$8.23 ($8.48 CAD)

May 16, 2012

250,000

—

$8.17 ($8.41 CAD)

March 12, 2011

Cameron R. Nelson

15,556

64,444

$6.09 ($6.27 CAD)

May 20, 2015

52,778

47,222

$2.37 ($2.44 CAD)

May 3, 2014

129,167

20,833

$3.62 ($3.73 CAD)

May 16, 2013

90,000

—

$8.23 ($8.48 CAD)

May 16, 2012

135,000

—

$8.17 ($8.41 CAD)

March 12, 2011

Linda M. Lupini

15,556

64,444

$6.09 ($6.27 CAD)

May 20,2015

52,778

47,222

$2.37 ($2.44 CAD)

May 3, 2014

129,167

20,833

$3.62 ($3.73 CAD)

May 16, 2013

75,000

—

$8.23 ($8.48 CAD)

May 16, 2012

80,000

—

$8.17 ($8.41 CAD)

March 12, 2011

Alexander R. Lussow

15,556

64,444

$6.09 ($6.27 CAD)

May 20, 2015

52,778

47,222

$2.37 ($2.44 CAD)

May 3, 2014

129,167

20,833

$3.62 ($3.73 CAD)

May 16, 2013

45,000

—

$8.23 ($8.48 CAD)

May 16, 2012

70,000

—

$7.56 ($7.79 CAD)

July 16, 2011

Dipak Panigrahi(4)

58,333

241,667

$6.09 ($6.27 CAD)

May 20, 2015

Option Exercises and Stock Vested Table

No stock options were exercised by our named executive officers in fiscal 2010. None of our named executive officers hold stock awards.

Pension Benefits Table

We do not have any pension plans for our named executive officers.

Nonqualified Deferred Compensation Table

We do not have any nonqualified deferred compensation plans for our named executive officers.

Post-Employment Compensation and Change in Control Arrangements

We have entered into the employment agreements summarized below with our named executive officers.

          Employment Agreement with Mr. Butchofsky. In 2005, Mr. Butchofsky entered into an employment agreement with QLT under which he was appointed Acting Chief Executive Officer. On February 27, 2006, he was promoted to President and Chief Executive Officer. Under the terms of Mr. Butchofsky’s employment agreement, in the event that QLT terminates Mr. Butchofsky’s employment without cause, Mr. Butchofsky is entitled to payment of salary and cash incentive compensation earned to the date of termination and (a) notice or pay in lieu of notice equal to (i) 18 months’ base salary, plus one month of additional base salary for each year of employment after September 2006, up to a maximum of 24 months, and (ii) cash incentive compensation for the applicable severance period at the target level, (b) an amount to compensate for the cost of lost health-related benefits, and (c) payment for out placement counselling services to assist the executive officer in seeking alternative employment. Following termination of employment, Mr. Butchofsky will be bound by the terms of a non-competition and non-solicitation agreement, which prohibits him from participating in a competitive business or soliciting our customers or employees for a period of two years following the termination of his employment.

          Employment Agreements with Ms. Lupini, Dr. Panigrahi and Messrs. Nelson and Lussow. Ms. Lupini, Dr. Panigrahi and Messrs. Nelson and Lussow each entered into employment agreements with QLT which are similar in form in all material respects. Under those employment agreements, during their employment, each executive officer is entitled to base salary, cash incentive compensation under our cash incentive compensation plan, participation in our stock option plan, and other health related benefits and registered retirement savings plan employer matching contributions. Except as stated below, in the event that QLT terminates the employment of the executive officer without cause, the employment agreements provide that each executive officer is entitled to six months’ notice (twelve months’ notice in the case of Mr. Lussow and Dr. Panigrahi) plus one additional month of base salary for each year of service (to a maximum of 24 months in total), (b) payment of salary and bonus earned to the date of termination as if all corporate and individual goals for that year have been achieved but not exceeded, (c) an amount to compensate the executive officer for lost benefits during the notice period, and (d) payment for out placement counselling services to assist the executive officer in seeking alternative employment. Following termination of employment, each executive will be bound by the terms of a non-competition and non-solicitation agreement, which prohibits the executive from participating in a competitive business or soliciting our customers or employees for a period of one year following the termination of his or her employment.

          Letter Agreement with Dr. Panigrahi. Dr. Panigrahi’s last day of employment with QLT was February 22, 2011. Pursuant to a letter agreement between Dr. Panigrahi and QLT relating to his departure, Dr. Panigrahi received a lump sum payment in the aggregate amount of $520,301 (the details of which are set forth in his table below under “Potential Payments upon Termination or Change of Control”), continuation of certain health-related benefits until March 21, 2011, and is entitled to receive accommodation payments up to $5,826 (CAD $6,000) per month while residing in Vancouver until February 21, 2012, all in full and final settlement of his contractual entitlements. Dr. Panigrahi executed a release in connection with receipt of his separation payments. Pursuant to the terms of his stock option agreement previously entered into with QLT, on February 22, 2011, 50% of his then unvested stock options automatically vested and became exercisable. Any unexercised options will expire on May 23, 2011.

          Stock Options. Stock options that have been awarded to a named executive officer, but that have not vested upon termination, are to be dealt with pursuant to the terms of the stock option agreements entered into between QLT and its named executive officers, which provide:

	•		In the event of retirement, unless otherwise determined by the Executive Compensation Committee, (1) if the executive officer has worked with the Company for at least 20 years, or (2) is at least 60 years of age and has worked continuously on behalf of the Company for at least five years, then all of his or her previously unvested stock options will vest, and all stock options will remain exercisable until the expiration date of the stock options. In the event of retirement where neither (1) or (2) above is applicable, and the retiree has received the consent of the Executive Compensation Committee, then the retiree’s stock options will immediately vest and will terminate upon the earlier of (a) 90 days following the retirement date, or (b) the expiration date of the stock option.
	•		In the event of death or termination due to disability, all previously unvested stock options of the named executive officer will vest, and all stock options will remain exercisable until the earlier of (a) twelve months following the date of death, or termination due to disability, of the named executive officer, or (b) the expiration date of the stock option.
	•		In the event of a termination of the named executive officer’s employment other than for cause, one-half of the previously unvested stock options of the executive officer will vest. All vested stock options will remain exercisable until the earlier of (a) 90 days following his or her termination of employment, or (b) the expiration date of the stock option.

          Change of Control Agreements. Separate change of control agreements have been entered into with our executive officers, including the President and Chief Executive Officer. The change of control agreements contain “double-trigger” change of control severance provisions, such that the change of control does not, by itself, trigger the severance entitlements. The change of control agreements provide that, in the event of termination by QLT of that executive officer’s employment without cause or by the executive officer after a triggering event (as the terms “cause” and “triggering event” are defined in the agreements) within a period of 24 months following a change of control in QLT, each executive officer will receive a severance payment equal to 18 months’ (or in the case of Mr. Butchofsky, 24 months’) base salary, an annual cash incentive compensation entitlement (calculated at the target cash incentive compensation entitlement that would otherwise have been paid during the severance period), the maximum Registered Retirement Savings Plan matching contribution to which the executive officer would otherwise be entitled during the severance period, amounts in lieu of certain other health and retirement benefits for the severance period, relocation expenses and out-placement counselling.

Under the stock option agreements entered into between QLT and its named executive officers, 100% of the then unvested options granted to the executive officers will vest upon the occurrence of a change in control.

A change of control includes an event in which any person acquires 35% or more of the voting securities of QLT, the sale of all or substantially all of the assets of QLT (other than to an affiliate of QLT or to an entity in which our shareholders held 65% of the voting securities prior to the sale), a merger or other reorganization involving QLT in which the original shareholders of QLT own less than 65% of the resulting merged entity, or a change in the majority of the Directors on the Board in any consecutive 24 month period or less such that a majority of the Board members ceases to comprise individuals who either have been (a) Board members continuously since the beginning of such period, or (b) appointed or nominated for election as Board members during such period by at least a majority of the Board members

described in subsection (a) above who were still in office at the time the Board approved such appointment or nomination.

          Potential Payments upon Termination or Change in Control. The amount of compensation payable to our named executive officers in the event of a termination of employment or a change in control is set forth in the tables below. The amounts in the tables below were calculated assuming the termination of the executive officer’s employment occurred as of December 31, 2010.

Robert L. Butchofsky

																		Termination
																		due to
																		Permanent
																		Disability								Termination
														Termination				Causing								within 24 months
Benefits and										Termination				other than for				Inability to								after a Change in
Payments upon		Resignation				Retirement				for Cause				Cause				Act				Death				Control of QLT
Termination		(US$)				(US$)				(US$)				(US$)				(US$)				(US$)				(US$)
Compensation:
Base Salary			—				—				—			$	962,314	(1)		$	962,314	(1)			—			$	1,049,797	(2)
Cash Bonus
2010 Performance Period			—				—				—			$	393,674	(3)		$	393,674	(3)		$	393,674	(3)		$	393,674	(3)
Subsequent Performance Periods			—				—				—				—				—				—			$	787,348
Stock Options
Unvested and Accelerated			—			$	605,736				—			$	302,868			$	605,736			$	605,736			$	605,736
Benefits and Perquisites:
RRSP Contributions(4)			—				—				—			$	10,682			$	10,682			$	10,682			$	32,735
Benefits Compensation			—				—				—			$	96,231	(5)		$	96,231	(5)		$	52,490	(6)		$	104,980	(7)
Out Placement Counselling			—				—				—			$	4,855			$	4,855	(8)			—			$	4,855
Moving Expenses			—				—				—				—				—				—			$	50,000	(9)
Total			—			$	605,736				—			$	1,770,624			$	2,073,492			$	1,062,581			$	3,029,124

Cameron R. Nelson

																		Termination
																		due to								Termination
																		Permanent								within 24
																		Disability								months after a
														Termination				Causing								Change in
Benefits and										Termination				other than for				Inability to								Control of
Payments upon		Resignation				Retirement				for Cause				Cause				Act				Death				QLT
Termination		(US$)				(US$)				(US$)				(US$)				(US$)				(US$)				(US$)
Compensation:
Base Salary			—				—				—			$	455,089	(1)		$	455,089	(1)			—			$	511,975	(2)
Cash Bonus
2010 Performance Period			—				—				—			$	153,593	(3)		$	153,593	(3)		$	153,593	(3)		$	153,593	(3)
Subsequent Performance Periods			—				—				—				—				—				—			$	230,389
Stock Options
Unvested and Accelerated			—			$	236,892				—			$	118,446			$	236,892			$	236,892			$	236,892
Benefits and Perquisites:
RRSP Contributions(4)			—				—				—			$	10,682			$	10,682			$	10,682			$	27,158
Benefits Compensation			—				—				—			$	45,509	(5)		$	45,509	(5)		$	34,132	(6)		$	51,198	(7)
Outplacement Counselling			—				—				—			$	4,855			$	4,855	(8)			—			$	4,855
Moving Expenses			—				—				—				—				—				—			$	50,000	(9)
Total			—			$	236,892				—			$	788,173			$	906,619			$	435,298			$	1,266,059

Linda M. Lupini

																		Termination
																		due to								Termination
																		Permanent								within 24
																		Disability								months after a
														Termination				Causing								Change in
Benefits and										Termination				other than for				Inability to								Control of
Payments upon		Resignation				Retirement				for Cause				Cause				Act				Death				QLT
Termination		(US$)				(US$)				(US$)				(US$)				(US$)				(US$)				(US$)
Compensation:
Base Salary			—				—				—			$	439,880	(1)		$	439,880	(1)			—			$	416,728	(2)
Cash Bonus
2010 Performance Period			—				—				—			$	125,019	(3)		$	125,019	(3)		$	125,019	(3)		$	125,019	(3)
Subsequent Performance Periods			—				—				—				—				—				—			$	187,528
Stock Options
Unvested and Accelerated			—			$	236,892				—			$	118,446			$	236,892			$	236,892			$	236,892
Benefits and Perquisites:
RRSP Contributions(4)			—				—				—			$	10,682			$	10,682			$	10,682			$	27,158
Benefits Compensation			—				—				—			$	43,988	(5)		$	43,988	(5)		$	27,782	(6)		$	41,673	(5)
Outplacement Counselling			—				—				—			$	4,855			$	4,855	(7)			—			$	4,855
Moving Expenses			—				—				—				—				—				—				—
Total			—			$	236,892				—			$	742,869			$	861,315			$	400,374			$	1,039,853

Alexander R. Lussow

																		Termination
																		due to								Termination
																		Permanent								within 24
																		Disability								months after a
														Termination				Causing								Change in
Benefits and										Termination				other than for				Inability to								Control of
Payments upon		Resignation				Retirement				for Cause				Cause				Act				Death				QLT
Termination		(US$)				(US$)				(US$)				(US$)				(US$)				(US$)				(US$)
Compensation:
Base Salary			—				—				—			$	414,881	(1)		$	414,881	(1)			—			$	466,741	(2)
Cash Bonus
2010 Performance Period			—				—				—			$	140,022	(3)		$	140,022	(3)		$	140,022	(3)		$	140,022	(3)
Subsequent Performance Periods			—				—				—				—				—				—			$	210,033
Stock Options
Unvested and Accelerated			—			$	236,892				—			$	118,446			$	236,892			$	236,892			$	236,892
Benefits and Perquisites:
RRSP Contributions(4)			—				—				—			$	10,682			$	10,682			$	10,682			$	27,158
Benefits Compensation			—				—				—			$	41,488	(5)		$	41,488	(5)		$	31,116	(6)		$	46,674	(7)
Outplacement Counselling			—				—				—			$	4,855			$	4,855	(8)			—			$	4,855
Moving Expenses			—				—				—				—				—				—				50,000	(9)
Total			—			$	236,892				—			$	730,374			$	848,820			$	418,712			$	1,182,376