<PAGE>

================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                  ------------

                                  SCHEDULE 14A

                PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                  Filed by the Registrant [X]
                  Filed by a Party other than the Registrant [ ]

                     Check the appropriate box:
                        [ ] Preliminary Proxy Statement
                        [ ] Confidential, for Use of the Commission only 
                            (as permitted by Rule 14a-6(e)(2))
                        [X] Definitive Proxy Statement
                        [ ] Definitive Additional Materials
                        [ ] Soliciting Material Pursuant to Rule 14a-11(c) 
                            or Rule 14a-12


                                    QLT INC.
                ------------------------------------------------
                (Name of Registrant as Specified in Its Charter)


    ------------------------------------------------------------------------
    (Name of Person(s) Filing Proxy Statement, if other than the Registrant)


Payment of Filing Fee (Check the appropriate box):
   [X] No Fee Required
   [ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11

                            CALCULATION OF FILING FEE

<TABLE>
<CAPTION>

==================================================================================================================
                                                   PER UNIT PRICE OR OTHER
                                                     UNDERLYING VALUE OF
TITLE OF EACH CLASS OF      AGGREGATE NUMBER OF     TRANSACTION COMPUTED      PROPOSED MAXIMUM
 SECURITIES TO WHICH        SECURITIES TO WHICH     PURSUANT TO EXCHANGE     AGGREGATE VALUE OF
 TRANSACTION APPLIES:      TRANSACTION APPLIES:        ACT RULE 0-11:           TRANSACTION:        TOTAL FEE PAID
==================================================================================================================
<S>                        <C>                     <C>                       <C>                    <C>
==================================================================================================================
</TABLE>


       [ ] Fee paid previously with preliminary materials.

       [ ] Check box if any part of the fee is offset as provided by Exchange
           Act Rule 0-11(a)(2) and identify the filing for which the offsetting
           fee was paid previously. Identify the previous filing by registration
           statement number, or the Form or Schedule and the date of its filing.

       (1) Amount Previously Paid:
                                   ---------------------------------------------
       (2) Form, Schedule, or Registration Statement Number:
                                                            --------------------
       (3) Filing Party:
                        --------------------------------------------------------
       (4) Date Filed:
                      ----------------------------------------------------------

================================================================================

<PAGE>
[QLT INC. LETTERHEAD]



April 17, 2003



To the Shareholders of QLT Inc.


I am pleased to invite you to attend the Annual Meeting of Shareholders of QLT
Inc. (the "Company") to be held on Thursday, May 22, 2003, at 10:00 a.m.
(Vancouver Time) at The Four Seasons Hotel, 791 West Georgia Street, 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
business to be conducted at the Annual Meeting. A copy of QLT's Annual Report is
also enclosed and highlights some of QLT's achievements over the last year.

Your vote is important to us. Whether or not you plan to attend the Annual
Meeting, please sign, date and return the enclosed proxy card according to the
instructions in the Proxy Statement.

I look forward to seeing you at the Annual Meeting on May 22.


Sincerely,

QLT INC.





/s/ Paul J. Hastings

PAUL J. HASTINGS
President and Chief Executive Officer

<PAGE>
                                    QLT INC.
                             887 GREAT NORTHERN WAY
                           VANCOUVER, BRITISH COLUMBIA
                                     V5T 4T5


                    NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
                             TO BE HELD MAY 22, 2003

         NOTICE IS HEREBY GIVEN that the Annual Meeting of members
("Shareholders") of QLT Inc. ("QLT") will be held at The Four Seasons Hotel, 791
West Georgia Street, Vancouver, British Columbia, on Thursday, May 22, 2003 at
10:00 a.m. (Vancouver time) for the following purposes, each of which is
described in more detail in the accompanying Proxy Statement:

(1)      To receive the annual report, including the report of the directors of
         QLT (the "Directors"), and the Audited Consolidated Financial
         Statements of QLT for the year ended December 31, 2002 together with
         the Auditors' Report on those Financial Statements;

(2)      To appoint Deloitte & Touche LLP as independent auditors for the
         ensuing year and to authorise the Directors to fix the remuneration to
         be paid to the Auditors;

(3)      To fix the number of Directors for the ensuing year at seven;

(4)      To elect Directors for the ensuing year; and

(5)      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 Tuesday, April 8, 2003 (referred to as the "record date").

         If you are unable to attend the Annual Meeting in person, please read
the notes (the "Notes") accompanying the Instrument of Proxy enclosed with these
materials and then complete and return the Instrument of Proxy within the time
set out in those Notes. If on April 8, 2003, 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 valid
form of proxy from them issued in your name.

         The enclosed Instrument of Proxy is solicited by management of QLT but
you may amend it if you wish by striking out the names listed in the Instrument
of Proxy and inserting in the space provided the name of the person you wish to
represent you at the Annual Meeting.

         DATED at Vancouver, British Columbia, this 17th day of April, 2003.

                       BY ORDER OF THE BOARD OF DIRECTORS
                                   JANET GROVE
                               CORPORATE SECRETARY

--------------------------------------------------------------------------------
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE SIGN, DATE AND
RETURN THE ENCLOSED INSTRUMENT OF PROXY AS PROMPTLY AS POSSIBLE. IF YOU ARE ABLE
TO ATTEND THE ANNUAL MEETING AND WISH TO VOTE YOUR SHARES IN PERSON, YOU MAY DO
SO AT ANY TIME BEFORE THE PROXY IS EXERCISED.
--------------------------------------------------------------------------------

<PAGE>
                                    QLT INC.
                             887 GREAT NORTHERN WAY
                           VANCOUVER, BRITISH COLUMBIA
                                     V5T 4T5

                               PROXY STATEMENT FOR
                         ANNUAL MEETING OF SHAREHOLDERS

                             TO BE HELD MAY 22, 2003



ANNUAL MEETING AND PROXY SOLICITATION
-------------------------------------

PURPOSE OF PROXY

These proxy materials are furnished in connection with the solicitation of
proxies by the management of QLT Inc. ("QLT" or the "Company"), a British
Columbia company, for the annual general meeting of members (the "Shareholders")
of QLT (the "Annual Meeting"). Because many of QLT's 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 17, 2003 to all
Shareholders of record as at the close of business on Tuesday, April 8, 2003.
References in this Proxy Statement to the Annual Meeting include any adjournment
of postponement of that meeting.

DATE, TIME, PLACE AND PURPOSE OF THE QLT ANNUAL MEETING

QLT's Annual Meeting will be held at The Four Seasons Hotel, 791 West Georgia
Street, Vancouver, British Columbia, on Thursday, May 22, 2003, at 10:00 a.m.
(Vancouver time).

The purpose of the Annual Meeting is to:

(a)      receive the annual report, including the report of the directors of QLT
         (the "Directors"), and the Audited Consolidated Financial Statements of
         QLT for the year ended December 31, 2002, together with the Auditors'
         Report on those Financial Statements;

(b)      appoint Deloitte & Touche LLP as independent auditors for the ensuing
         year and to authorise the Directors of QLT to fix the remuneration to
         be paid to the auditors;

(c)      fix the number of Directors for the ensuing year at seven;

(d)      elect Directors for the ensuing year; and

(e)      transact such other business as may properly come before the Annual
         Meeting, or at any adjournments or postponements thereof.



<PAGE>
                                       2



VOTING RECOMMENDATION OF THE BOARD OF DIRECTORS

QLT's Board of Directors believes the election of its seven nominees to the
Board of Directors and the appointment of Deloitte & Touche LLP as independent
auditors are in the best interests of QLT and its Shareholders and, accordingly,
recommends that each Shareholder vote his or her shares "FOR" each of the
Board's nominees for election to the Board of Directors and "FOR" each of the
other proposals.

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.

QUORUM FOR THE ANNUAL MEETING

To transact business at the Annual Meeting, a quorum of Shareholders must be
present at the commencement of the Annual Meeting, either in person or by proxy.
Under QLT's incorporation documents, the quorum for the Annual Meeting is two
Shareholders, or two proxyholders representing two Shareholders, or one
Shareholder and a proxyholder representing another Shareholder entitled to vote
at the Annual Meeting, present in person at the beginning of the Annual Meeting
and collectively holding in the aggregate not less than 20% of the issued and
outstanding Common Shares of QLT.

VOTE REQUIRED

A SIMPLE MAJORITY OF THE VOTES CAST AT THE ANNUAL MEETING IS REQUIRED TO FIX THE
NUMBER OF DIRECTORS AT SEVEN AND TO APPOINT DELOITTE & TOUCHE LLP AS INDEPENDENT
AUDITORS OF QLT. DIRECTORS ARE ELECTED BY A PLURALITY OF VOTES CAST AT THE
ANNUAL MEETING, WHICH MEANS THAT THOSE NOMINEES FOR ELECTION TO THE BOARD OF
DIRECTORS, UP TO THE MAXIMUM NUMBER OF DIRECTORS FIXED BY SHAREHOLDERS, WHO
RECEIVE THE LARGEST NUMBER OF FAVOURABLE VOTES WILL BE ELECTED AS DIRECTORS OF
QLT. ONLY THOSE VOTES CAST IN PERSON OR BY PROXY WILL BE INCLUDED.

ABSTENTIONS AND BROKER NON-VOTES WILL BE INCLUDED FOR QUORUM PURPOSES FOR THE
ANNUAL MEETING BUT WILL NOT BE INCLUDED IN THE COMPUTATION OF THE VOTE ON ANY
PARTICULAR RESOLUTION.

VOTING BY PROXY

You may vote by proxy or in person at the Annual Meeting if you were a
Shareholder of record of QLT at the close of business on Tuesday, April 8, 2003.
You are encouraged to vote by proxy using the enclosed Instrument of Proxy even
if you plan to attend the Annual Meeting. If you properly grant your proxy and
submit it on time, as instructed below, the individual named as your proxy will
vote your shares as you have instructed. To vote using the enclosed Instrument
of Proxy, you must:

1.       specify your choice on each matter by marking the appropriate box on
         the enclosed Instrument of Proxy;

2.       sign and date the Instrument of Proxy where indicated. To be valid, the
         Instrument of Proxy must be signed and dated by you or your attorney
         authorized in writing. If the Shareholder is a corporation, the
         Instrument of Proxy must be dated and signed under that corporate
         Shareholder's corporate seal or by a duly authorized officer or
         attorney of the corporation; and


<PAGE>
                                       3



3.       return the Instrument of Proxy in the enclosed envelope or by facsimile
         to QLT's Registrar and Transfer Agent, Computershare Trust Company of
         Canada, Proxy Department, 100 University Avenue, 9th Floor, Toronto,
         Ontario, M5J 2Y1, facsimile: within North America at 1-866-249-7775 or
         outside North America at (416) 263-9524, no later than Tuesday, May 20,
         2003 at 4:30 p.m. (Toronto time). The Instrument of Proxy may also be
         delivered to the Chairman at the Annual Meeting as to any matter in
         respect of which a vote will not have 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 PROXYHOLDER NEED NOT BE A
SHAREHOLDER OF QLT.

NOTICE TO BENEFICIAL SHAREHOLDERS

A Shareholder's shares may be registered in the name of a third party, such as a
brokerage firm, securities dealer, trust company, bank or other similar
intermediary. Generally, such non-registered Shareholders will receive a package
from their intermediary containing either: (i) a request for voting
instructions; or (ii) a form of proxy which may be signed by the intermediary
and specify the number of shares beneficially owned, but is otherwise
uncompleted. If a non-registered Shareholder who receives one of the above forms
wishes to vote in person at the Annual Meeting, the non-registered Shareholder
should strike out the names of management's representatives named in the form of
proxy and insert the non-registered Shareholder's name in the blank space
provided. In either case, non-registered Shareholders should carefully follow
the instructions of their intermediary with respect to the procedures for
voting.

All references to "Shareholders" or "you" in this Proxy Statement and the
accompanying Instrument of Proxy and Notice of Annual Meeting are to members of
record of QLT on April 8, 2003 unless specifically stated otherwise.

MANNER IN WHICH PROXIES WILL BE EXERCISED

THE PROXYHOLDER WILL VOTE ACCORDING TO INSTRUCTIONS IN THE INSTRUMENT OF PROXY
ON ANY BALLOT WHICH 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 BOARD OF DIRECTOR'S NOMINEES FOR ELECTION TO
THE BOARD OF DIRECTORS AND THE OTHER MOTIONS PROPOSED TO BE MADE AT THE ANNUAL
MEETING AS STATED IN THE INSTRUMENT OF PROXY.

THE INSTRUMENT OF PROXY ALSO CONFERS UPON THE PROXYHOLDER 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. THE MANAGEMENT OF QLT
KNOWS 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 QLT'S MANAGEMENT SHOULD PROPERLY COME BEFORE THE ANNUAL MEETING,
THE PROXIES WILL BE VOTED, OR NOT VOTED, BY THE PROXYHOLDER IN THEIR DISCRETION.

REVOKING A PROXY ONCE GIVEN

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:


<PAGE>
                                       4


1.       the instrument revoking the proxy must be signed by you or by your
         attorney authorised 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 authorised officer or
         attorney of the corporation; and

2.       the instrument revoking the proxy as to any matter in respect of which
         a vote shall not already have been cast pursuant to such proxy must be
         delivered to QLT's Registered Office, 26th Floor, Toronto Dominion Bank
         Tower, 700 West Georgia Street, Vancouver, British Columbia, V7Y 1B3 or
         deposited with the Chairman at the Annual Meeting.

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 effect that
change.

COST OF THE PROXY SOLICITATION

QLT 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 QLT's shares that are beneficially owned by others. QLT
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 QLT's shares. In addition, proxies may
be solicited by certain directors, executive 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.

MAKING NOMINATIONS FOR DIRECTORS

The Company Act (British Columbia) does not provide for the consideration of
Shareholder proposals at general meetings of Shareholders of QLT. QLT complies
with the proxy solicitation requirements of British Columbia corporate law and
Canadian securities legislation. QLT, as a "foreign private issuer", is exempt
from the United States Securities and Exchange Commission ("SEC") rules
regarding proxy solicitations (and certain related matters) and therefore is not
subject to the procedural requirements of Rule 14a-5(e).

If a written nomination for a Director is submitted not less than 35 days before
the date of the 2004 Annual Meeting, signed by Shareholders holding in the
aggregate not less than 10% of QLT's issued and outstanding Common Shares and
accompanied by the information as to the nominee required to be furnished in the
Proxy Statement relating to the 2004 Annual Meeting, QLT will include the name
or names of the nominee or nominees in the Instrument of Proxy and the
information as to the nominee or nominees in the Proxy Statement relating to the
2004 Annual Meeting.


<PAGE>
                                       5


          VOTING SECURITIES AND PRINCIPAL HOLDERS OF VOTING SECURITIES

Only those holders of record of QLT's Common Shares as of the close of business
on Tuesday, April 8, 2003 will be entitled to vote at the Annual Meeting in
person or by proxy. As of the close of business on March 20, 2003, there were
68,564,253 Common Shares issued and outstanding, each of which entitles the
holder to one vote on each matter to be voted on at the Annual Meeting. There
are no other classes of voting securities other than the Common Shares.

The following table sets out information as of March 20, 2003 with respect to
all Shareholders known to QLT to beneficially own, directly or indirectly, or to
exercise control or direction over, more than 5% of the outstanding Common
Shares of QLT. It also shows beneficial ownership for each Director, nominee
Director, each executive officer named in the Summary Compensation Table
appearing on page 19 of this Proxy Statement, and all Directors, nominee
Directors and executive officers of QLT as a group. This information is based on
reports filed with the British Columbia Securities Commission or was furnished
by the respective beneficial owners (or their nominees), Directors, nominee
Directors, executive officers and QLT's Registrar and Transfer Agent.

Under applicable United States securities laws, a person is considered to be a
"beneficial owner" of Common Shares in QLT if that person has, or shares with
another person, the power to direct the vote or investment of the Common Share.
In addition, a person is also deemed to be a beneficial owner of a Common Share
if that person has the right to acquire the share within 60 days (whether or
not, in the case of a stock option, the current market price of the underlying
Common Share is below the stock option exercise price). Therefore, the table
also reflects for each such beneficial owner the exercise of options exercisable
by May 19, 2003 owned by each beneficial owner, but, in determining the
percentage ownership and general voting power of such person, does not assume
the exercise of options or the conversion of securities owned by any other
person.

Except as otherwise set forth below, each person has sole voting and dispositive
power with respect to the shares shown.



<PAGE>
                                       6



<TABLE>
<CAPTION>
           NAME AND ADDRESS OF                                  AMOUNT AND NATURE OF BENEFICIAL      PERCENT OF CLASS
             BENEFICIAL OWNER                                            OWNERSHIP (1)(2)
---------------------------------------------------------       -------------------------------      ----------------

<S>                                                                      <C>                                <C>  
McLean Budden Ltd.                                                       6,827,735(3)                       9.96%
145 King Street                                                                                           
Toronto, Ontario, Canada, M5H 1J8                                                                         
---------------------------------------------------------------------------------------------------------------------
Guardian Capital Inc.                                                    6,079,445(4)                       8.87%
Commerce Court West, Suite 3100, P.O. Box 201                                                             
Toronto, Ontario, Canada, M5L 1E8                                                                         
---------------------------------------------------------------------------------------------------------------------
Azab, Mohammad                                                             137,367(5)                         *
---------------------------------------------------------------------------------------------------------------------
Crossgrove, Peter A                                                          2,000                            *
---------------------------------------------------------------------------------------------------------------------
Curaudeau, Alain H                                                          57,627(6)                         *
---------------------------------------------------------------------------------------------------------------------
Dlouhy, Jan                                                                 40,000(7)                         *
---------------------------------------------------------------------------------------------------------------------
Doty, Michael J                                                             44,001(8)                         *
---------------------------------------------------------------------------------------------------------------------
Hastings, Paul J                                                           255,823(9)                         *
---------------------------------------------------------------------------------------------------------------------
Henriksen, Ronald D                                                         26,000(10)                        *
---------------------------------------------------------------------------------------------------------------------
Levy, Julia G                                                              673,522(11)                        *
---------------------------------------------------------------------------------------------------------------------
Mendelson, Alan C                                                            8,000(12)                        *
---------------------------------------------------------------------------------------------------------------------
Newell, William J                                                           62,778(13)                        *
---------------------------------------------------------------------------------------------------------------------
North, John R. (14)                                                              0(15)                        *
---------------------------------------------------------------------------------------------------------------------
Scott, E. Duff                                                              30,000(16)                        *
---------------------------------------------------------------------------------------------------------------------
Wood, L. Jack                                                               16,833(17)                        *
---------------------------------------------------------------------------------------------------------------------
All directors, nominees and executive officers as a group                1,637,525(18)                       2.4%
(17 persons)                                                                                          
---------------------------------------------------------------------------------------------------------------------
</TABLE>

                                                       *Represents less than 1 %

NOTES:

      (1)  This disclosure is made pursuant to certain rules and regulations
           promulgated by the SEC.

      (2)  Includes Common Shares that may be acquired upon exercise of
           outstanding options as of May 19, 2003 by the persons named in the
           table above and by all directors and executive officers as a group.

      (3)  Based on certain information filed with the SEC on a Form 13F filed
 
          February 13, 2003.

      (4)  Based on certain information filed with the SEC on a Schedule 13G/A
           filed March 20, 2003.

      (5)  Includes options to purchase 137,167 Common Shares.

      (6)  Includes options to purchase 57,627 Common Shares.

      (7)  Includes options to purchase 20,000 Common Shares.

      (8)  Includes options to purchase 43,001 Common Shares.

      (9)  Includes options to purchase 247,223 Common Shares.

      (10) Includes options to purchase 20,000 Common Shares.

      (11) Includes options to purchase 224,042 Common Shares.


<PAGE>
                                       7



      (12) Includes options to purchase 6,000 Common Shares.

      (13) Includes options to purchase 62,778 Common Shares.

      (14) Dr. North left his position as an executive officer of QLT effective
           as of November 15, 2002 and remained a non-executive employee of QLT
           until January 3, 2003.

      (15) As of March 20, 2003, Dr. North held options to purchase 142,375
           Common Shares. However, pursuant to the terms of QLT's Incentive
           Stock Option Plan, those options expired and were cancelled on April
           3, 2003, being 90 days following the cessation of Dr. North's
           employment with QLT.

      (16) Includes options to purchase 20,000 Common Shares.

      (17) Includes options to purchase 13,333 Common Shares.

      (18) Includes options to purchase 1,121,445 Common Shares.




             SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), requires registrant's Directors and executive officers, and persons who
own more than 10% of a registered class of a registrants' securities, to file
with the SEC initial reports of ownership and reports of changes in ownership of
Common Shares and other equity securities of the registrant. In light of the
fact that QLT is a "foreign private issuer" pursuant to Rule 3a12-3 of the
Exchange Act, QLT and the persons referred to above are exempt from the
reporting and liability provisions of Section 16(a). QLT's executive officers
are required to comply with reporting obligations under Canadian securities
legislation, including the filing with the Canadian Securities Commissions of
initial reports of ownership and reports of changes in ownership of Common
Shares and other equity securities of QLT.


<PAGE>
                                       8


 
                             ELECTION OF DIRECTORS

DIRECTOR NOMINEES FOR ELECTION

The Board of Directors of QLT is currently comprised of eight individuals. Dr.
Jan Dlouhy has advised the Board of Directors that he will be retiring from the
Board at the time of the 2003 Annual Meeting. With the exception of Dr. Dlouhy,
all current Directors intend to stand for re-election to the Board. Therefore,
the Board of Directors recommends that Shareholders approve an ordinary
resolution fixing the number of Directors for the ensuing year at seven. With
the exception of Dr. Dlouhy, the Board of Directors has put forward the names of
the current Directors as nominees as outlined below. Proxies cannot be voted for
a greater number of nominees for election to the Board of Directors than the
number of Directors fixed by the Shareholders.

In accordance with the Articles of QLT and the Company Act (British Columbia),
each Director elected will hold office until the next Annual Meeting or until
their successor is duly elected, unless such office is vacated. The Board of
Directors of QLT 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 proxyholder to elect another nominee, if presented, or to
reduce the number of Directors accordingly. As of the date of this Proxy
Statement, the Board of Directors is not aware of any nominee who is unable or
who intends to decline to serve as a Director, if elected.

As at the date of this Proxy Statement, QLT has received no further nominations
for Directors pursuant to Section 111 of the Company Act (British Columbia) as
set out in the Advance Notice of Annual Meeting, published in The Vancouver Sun
newspaper on March 26, 2003.

Both the President and Chairman of QLT intend to vote the shares represented by
proxies, in which either of them is designated a proxyholder, "FOR" the election
of the nominees named in the Instrument of Proxy, unless authority to vote for
those persons is withheld.

INFORMATION ON NOMINEES FOR DIRECTORS

The following provides the names and ages of the nominees for re-election to the
Board of Directors, the year in which each first became a Director, and their
principal occupations or employment during at least the past five years. This
information has been provided to QLT by the respective nominees.


<PAGE>
                                       9



<TABLE>
<CAPTION>
         NAME OF NOMINEE AND 
         MUNICIPALITY OF RESIDENCE          AGE    CURRENT POSITION                    DIRECTOR SINCE
         -------------------------          ---    ----------------                    --------------
<S>                                         <C>    <C>                                      <C> 
         E. Duff Scott                      66     Chairman and Director                    1990
         Toronto, Ontario                        
         --------------------------------------------------------------------------------------------
         Paul J. Hastings                   43     President, Chief Executive               2002
         Vancouver, British Columbia               Officer and Director
         --------------------------------------------------------------------------------------------
         Peter A. Crossgrove                66     Director                                 1990
         Caledon, Ontario                        
         --------------------------------------------------------------------------------------------
         Ronald D. Henriksen                63     Director                                 1997
         Plainfield, Indiana, USA                
         --------------------------------------------------------------------------------------------
         Julia G. Levy, Ph.D.                68     Executive Chairman, Scientific           1983
         Vancouver, British Columbia               Advisory Board and Director
         --------------------------------------------------------------------------------------------
         Alan C. Mendelson                  55     Director                                 2002
         Atherton, California, USA               
         --------------------------------------------------------------------------------------------
         L. Jack Wood                       66     Director                                 2001
         West Vancouver, British Columbia      
         --------------------------------------------------------------------------------------------
</TABLE>



(a)      E. DUFF SCOTT

         Mr. Scott has been a Director of QLT since 1990 and was appointed
         Chairman in 1991. Mr. Scott is the President of Multibanc NT Financial
         Corp. (a financial services company), a position he has held since
         1990. Mr. Scott was Chairman of Prudential-Bache Securities Canada
         Limited (an investment company) from 1988 to 1990 and The Toronto Stock
         Exchange from 1987 to 1989. Mr. Scott is a director of a number of
         other Canadian companies including three companies which are publicly
         listed in the US: Perle Systems Ltd. (an internet protocol connectivity
         company), Aberdeen Commonwealth Income Fund, Inc. (an investment fund)
         and Lions Gate Entertainment Corporation (a producer and distributor of
         motion pictures and other media).

(b)      PAUL J. HASTINGS

         Mr. Hastings was appointed President, Chief Executive Officer and a
         Director of QLT in February 2002. Since starting his career in 1984
         with Hoffman La Roche, Mr. Hastings has held various positions of
         increasing responsibility with notable biotech and pharmaceutical
         companies. From January 2001 to February 15, 2002, Mr. Hastings was
         President, Chief Executive Officer and a Director of Axys
         Pharmaceuticals, Inc. From June 1999 to January 2001, Mr. Hastings was
         President of Chiron BioPharmaceuticals. From 1998 to 1999, Mr. Hastings
         was President and Chief Executive Officer of LXR Biotechnology. From
         1994 to 1998, Mr. Hastings held a series of management positions at
         Genzyme Corporation, the last of which was President of Genzyme
         Therapeutics Worldwide. From 1988 to 1994, Mr. Hastings held positions
         of increasing responsibility at Synergen, including Vice-President,
         Marketing and Sales of Synergen, Inc. and Vice-President, General
         Manager of Synergen Europe, Inc. Mr. Hastings holds a Bachelor of
         Science from the University of Rhode Island. Mr. Hastings is a member
         of the boards of directors of several private organizations, including
         ViaCell Inc., B.C.'s Leading Edge 



<PAGE>
                                       10


         Endowment Fund, Arriva Pharmaceuticals, the B.C. Biotech Association
         and Vancouver's St. Paul's Hospital. 

(c)      PETER A. CROSSGROVE

         Mr. Crossgrove has been a director of QLT since 1990. He is currently
         the Chairman of Masonite International Corporation (formerly Premdor
         Inc.) (a door and industrial products manufacturing company), a
         position he has held since June 1997. Mr. Crossgrove is a director of a
         number of Canadian and US publicly listed companies, including,
         Masonite International Corporation, Barrick Gold Corporation (a mining
         company), Dundee Realty Corporation (a real estate company) and Philex
         Gold Inc. (a gold mining company).

(d)      RONALD D. HENRIKSEN

         Mr. Henriksen has been a Director of QLT since 1997. Mr. Henriksen is
         the Chief Investment Officer of Twilight Venture Partners, LLC. From
         1988 to 2002, Mr. Henriksen was the President of the Advanced Research
         and Technology Institute of Indiana University, an organization that is
         responsible for the technology transfer, licensing and new business
         start-up activities at Indiana University. From 1995 through 1998, Mr.
         Henriksen served as a consultant in business development, financing and
         general management to pharmaceutical and biotechnology companies.
         During that time, he was also the Chief Executive Officer of Itasca
         Ventures, LLC (a US venture capital company). From 1993 to December
         1995, Mr. Henriksen was the President and Chief Executive Officer of
         Khepri Pharmaceuticals Inc. (a US biotechnology company) until its
         merger with Arris Pharmaceuticals. From 1970 to 1993, he held a series
         of managerial and executive positions at Eli Lilly and Company (a US
         integrated healthcare company). Mr. Henriksen is also a director of
         MacroPore Biosurgery, Inc. (a US medical device company listed on the
         Neuer Market segment of the Frankfurt Stock Exchange) and Gliatech,
         Inc. (a biopharmaceutical company).

(e)      JULIA G. LEVY, PH.D.

         Dr. Levy, a co-founder of QLT and Director, retired as President and
         Chief Executive Officer of QLT in February 2002 and is now Executive
         Chairman of the Scientific Advisory Board of QLT. From 1986 to 1996,
         Dr. Levy held positions with QLT as a Vice President, Senior Vice
         President and Acting President and Chief Executive Officer. She was
         also a Professor of Microbiology at the University of British Columbia
         from 1973 to 1999 and is a Fellow of the Royal Society of Canada and
         past President of the Canadian Federation of Biological Sciences. Dr.
         Levy received a B.A. (Hon.) from the University of British Columbia in
         1955 and a Ph.D. in experimental pathology from the University of
         London in 1958. She has been awarded honorary degrees from the
         University of Ottawa, Mount Saint Vincent University, the University of
         Western Ontario, Simon Fraser University and the University of British
         Columbia, was selected Female Entrepreneur of the Year for
         International Business in 1998 by Canadian Business magazine, and
         appointed to the Order of Canada in 2001. Dr. Levy is the author of
         many published scientific articles and is a director of a number of
         private biotechnology companies, the Working Opportunity Fund (a
         labour-sponsored mutual fund) and a Canadian public biotechnology
         company, AnorMED Inc.


<PAGE>
                                       11



(f)      ALAN C. MENDELSON

         Mr. Mendelson became a Director of QLT in 2002. Mr. Mendelson is a
         senior partner of Latham & Watkins LLP, a private law firm and has been
         with that firm since May 2000. Previously, Mr. Mendelson was with
         Cooley Godward LLP, a private law firm, for 27 years and served as the
         managing partner of its Palo Alto office from May 1990 to March 1995
         and from November 1996 to October 1997. Mr. Mendelson served as Acting
         General Counsel of Cadence Design Systems, Inc., an electronic design
         automation software company, from November 1995 to June 1996. Mr.
         Mendelson previously served as Secretary and Acting General Counsel of
         Amgen, Inc., a biopharmaceutical company, from April 1990 to March
         1991. Mr. Mendelson is currently a director of two US public companies,
         USSearch.com, Inc. and Valentis, Inc. Mr. Mendelson received his J.D.
         from Harvard Law School and his A.B. in political science from the
         University of California, Berkeley.

(g)      L. JACK WOOD

         Mr. Wood has been a Director of QLT since 2001. From 1992 to the
         present, Mr. Wood worked with CSL Limited, an Australian healthcare
         company listed on the Australian Stock Exchange. Mr. Wood is currently
         Executive Vice President with CSL. Prior to joining CSL, from 1990 to
         1992, 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.

All of the nominees are residents of Canada except Mr. Henriksen and Mr.
Mendelson who are residents of the United States.

INFORMATION CONCERNING BOARD MEETINGS AND COMMITTEES

The Board of Directors held a total of five meetings (in person or by
teleconference) and acted once by written consent during the year ended December
31, 2002. Each Director attended more than 75% of the combined total meetings of
the Board of Directors and the Committees on which the Director served at any
time during the year.

To assist in the discharge of its responsibilities, the Board of Directors has
designated several standing committees. They are currently: the Audit and Risk
Committee, the Executive Compensation Committee, and the Corporate Governance
and Nominating Committee. As described below, until February, 2003, there also
existed a separate Nominating Committee of the Board of Directors, the duties of
which have now been assumed by the Corporate Governance and Nominating
Committee. In addition, from time to time, the Board of Directors may establish
special committees to assist the Board in respect of certain issues.

A description of the mandate and composition of the Committees of the Board of
Directors is as follows:

(a)      AUDIT AND RISK COMMITTEE

The Audit and Risk Committee consists of three unrelated and independent
Directors who are not employees of or involved in the daily operations of QLT.
The Audit and Risk Committee assists the


<PAGE>
                                       12



Board of Directors in fulfilling its responsibilities for oversight of QLT's
accounting and financial reporting practices by reviewing the quarterly and
annual consolidated financial statements, reviewing the adequacy of the system
of internal controls, reviewing any relevant accounting, financial and
securities regulatory matters, reviewing the management of corporate risks,
recommending the appointment of independent auditors, engaging the independent
auditors, and receiving the reports of the Chief Executive Officer and the Chief
Financial Officer with respect to their assessment of internal controls. The
Committee also provides a mechanism for communication between the Board of
Directors and QLT's independent auditors and regularly meets with the auditors
without management present. The members of this Committee are Dr. Dlouhy, Mr.
Crossgrove and Mr. Mendelson. This Committee held six meetings during 2002.

(b)      EXECUTIVE COMPENSATION COMMITTEE

The Executive Compensation Committee consists of three unrelated and independent
Directors who are not employees of or involved in the daily operations of QLT.
The Executive Compensation Committee is responsible for making recommendations
to the Board of Directors regarding the compensation of all executive officers
and for reviewing and making recommendations with respect to compensation policy
and programs generally. In addition, this Committee, pursuant to authority
delegated by the Board of Directors, makes recommendations to the Board of
Directors on the granting of options under QLT's incentive stock option plans.
The members of this Committee are Mr. Crossgrove, Mr. Henriksen and Mr. Wood.
This Committee held four meetings during 2002.

(c)      CORPORATE GOVERNANCE AND NOMINATING COMMITTEE

In the fall of 2002, the Board of Directors established a Corporate Governance
Committee, to be comprised of the Chairman of the Board and the chairs of each
of the Audit and Risk Committee and the Executive Compensation Committee and
such other unrelated and independent director(s) as the Board shall appoint. The
initial task of the Corporate Governance Committee was to evaluate and consider
the appropriate breadth of its overall mandate, after which it submitted to the
Board of Directors a draft Committee Charter. One of the recommendations made by
the Corporate Governance Committee to the Board of Directors was that the
Corporate Governance Committee would assume the responsibilities of the
Nominating Committee, among many others. The proposal for the combined Corporate
Governance and Nominating Committee and its Charter were approved by the Board
of Directors on February 19, 2003.

Before it was replaced by the Corporate Governance and Nominating Committee, the
Nominating Committee consisted of three Directors who were responsible for
reviewing and making recommendations as to the size and composition of the Board
of Directors. That Committee, then comprised of Mr. Scott, Mr. Henriksen and Mr.
Wood, met in February of 2003 to review the performance of the Board during
2002, and to make recommendations as to nominees to the Board of Directors for
2003. As described above, after February 19, 2003, the Nominating Committee's
responsibilities were assumed by the newly established Corporate Governance and
Nominating Committee.

The Corporate Governance and Nominating Committee has been given the mandate to
develop and oversee Board governance principles and review the performance and
effectiveness of the Board. This Committee will make recommendations to the
Board of Directors regarding committee membership, develop a continuing
education program for Board members, and evaluate the performance of individual
Board members. The Corporate Governance and Nominating Committee will also
review and consider nominations to the Board of Directors. The members of the
Corporate Governance Committee are Mr. Scott, Mr. Crossgrove, Dr. Dlouhy and Mr.
Mendelson.


<PAGE>
                                       13



COMPENSATION OF DIRECTORS

Cash Compensation

Directors of QLT who are also employees of QLT are not separately compensated
for their service as a Director. For 2002, QLT paid each Director who is not an
employee a retainer fee of US$20,000 per year, payable quarterly. Non-employee
directors receive US$1,625 for each Board of Directors and Committee meeting
attended in person or by telephone. The Chairman of the Board of Directors is
entitled to an additional annual retainer fee of US$100,000 and each of the
Chairs of each committee of the Board of Directors are entitled to an additional
retainer fee of US$4,000 annually. The members of the Board of Directors are
also eligible for reimbursement of their expenses incurred in connection with
attendance at Board meetings in accordance with QLT's policies.

Equity Compensation

QLT's non-employee Directors are also eligible to receive stock option grants as
compensation for their services as Directors. Upon initially being elected or
appointed to the Board of Directors, and on each subsequent annual re-election
to the Board of Directors, each non-employee Director is eligible to be granted
options to purchase a specified number of Common Shares at an exercise price
equal to the fair market value of the Common Shares at the time of the grant.

In April 2002, the Board of Directors approved an amendment to QLT's 2000
Incentive Stock Option Plan which placed a limit on the total number of options
held at any one time by QLT's non-employee Directors. As a result, the Common
Shares represented by unexercised options held at any one time by non-employee
Directors may not exceed, in the aggregate, 0.25% of the total issued and
outstanding Common Shares of QLT. At the same time as the Board of Directors
approved that limit on the number of options available to be granted to
non-employee Directors, the non-employee Directors (excluding the Directors
appointed at the 2001 and 2002 Annual Meetings) voluntarily surrendered, in the
aggregate, 200,000 options previously issued to them.

Prior to 2002, Directors received upon their inaugural appointment to the Board
of Directors, and then each year thereafter, options to purchase 20,000 Common
Shares in QLT. In 2002, QLT generally reduced the number of options being
granted to its Directors, officers and employees. As part of that overall
reduction, the Board of Directors also decided that the number of options to be
granted to Directors of QLT would also be reduced to 18,000 per year, or such
lesser number as may be required in order to keep the number of options held by
non-employee Directors under the 0.25% limitation referred to above. In
addition, in concert with the surrender of stock options by certain of QLT's
non-employee Directors, the non-employee Directors standing for re-election to
the Board of Directors in 2002 declined to receive, and did not receive, any
stock options in 2002. Mr. Mendelson was granted options to purchase up to
18,000 Common Shares in QLT upon his initial appointment to the Board of
Directors on April 25, 2002.

All options granted to Directors vest in 36 equal monthly instalments, except in
the event of a change in control in QLT, upon which all unexercised options are
deemed to vest on the day immediately preceding such event.


<PAGE>
                                       14


                             EXECUTIVE COMPENSATION

R
EPORT OF THE EXECUTIVE COMPENSATION COMMITTEE

The Executive Compensation Committee of the Board of Directors of QLT (the
"Compensation Committee") is comprised of three non-employee Directors of QLT.
See above under the heading "Information Concerning Board Meetings and
Committees". The Compensation Committee is responsible for making
recommendations to the Board of Directors regarding the compensation to be paid
to the Chief Executive Officer and each of the other executive officers of QLT
and for reviewing and making recommendations with respect to compensation
policies and programs generally for all employees at QLT. In addition, the
Compensation Committee makes recommendations to the Board of Directors on the
granting of options to all employees and Directors under QLT's incentive stock
option plans.

OVERVIEW AND PHILOSOPHY

The objectives of QLT's executive compensation policies and programs are to:

(A)      motivate executive officers to achieve important corporate and
         individual performance objectives and reward them when such objectives
         are met; and

(B)      recruit and subsequently retain highly qualified executive officers by
         offering overall compensation which is competitive with that offered
         for comparable positions in other profitable biotechnology and
         biopharmaceutical companies.

The Compensation Committee reviews the compensation of the Chief Executive
Officer and each of the other executive officers of QLT generally prior to the
first meeting of the Board of Directors in each fiscal year. The Compensation
Committee receives recommendations from the Chief Executive Officer with respect
to compensation for the other executive officers of QLT and from the Chairman of
the Board of Directors with respect to compensation for the Chief Executive
Officer.

QLT's executive compensation programs currently comprises base salary, annual
cash incentive compensation, long-term incentive compensation in the form of
stock options, and various health plan benefits generally available to all
employees of QLT. The relative emphasis placed on base salary, annual cash
incentive compensation and long-term compensation in the form of stock options
is set out below.

ENSURING COMPETITIVE COMPENSATION PRACTICES

The Compensation Committee annually reviews compensation data from international
surveys in order to ensure that the overall level of executive compensation is
competitive with other biotechnology and biopharmaceutical companies.

In determining the levels of compensation for QLT's executive officers for each
of 2002 and 2003, the Compensation Committee reviewed reports of competitive
compensation data obtained from a number of sources and sought the advice of an
international management and human resources consulting firm on certain
competitive compensation practices. Included among the reports reviewed by the
Compensation Committee was a report on executive compensation data prepared by a
well known human resource and management consulting firm from an extensive
external survey of several hundred US biotechnology companies (a substantial
number of which are included in the Nasdaq Biotechnology Index). In addition, in
2003, the Compensation Committee reviewed a survey of executive compensation
data prepared internally by QLT's human resources personnel analysing executive
compensation at a number of other 



<PAGE>
                                       15


profitable biotechnology companies. The Compensation Committee believes that in
order to be competitive, each component of QLT's executive compensation should
be between the fiftieth and the seventy-fifth percentile of biotechnology and
biopharmaceutical companies.

DETERMINATION OF BASE SALARY

Base salaries for executive officers of QLT are reviewed and determined each
year by the Compensation Committee. In determining whether to increase the base
salary for a particular executive officer, the Compensation Committee considers
the results of each executive officer's individual annual performance review
described below, the results of the surveys on competitive compensation for
equivalent executive positions, along with the other elements of compensation
received by QLT's executive officers.

In early 2002, the Compensation Committee placed greater emphasis on performance
by increasing the targets for cash incentive compensation for the executive
officers in lieu of increases to their base salary. During 2002, based upon a
further review of competitive information, two executive officers received
increases to their base salaries. The Compensation Committee has also now
completed its evaluation of executive compensation for 2003. Based on that
evaluation, base salary increases for executive officers in 2003 range from 0%
to 11.5%, with increases at the higher end of that range being awarded to
executive officers who were promoted from their prior positions with QLT.

DETERMINATION OF CASH INCENTIVE

The annual cash incentive compensation that each executive officer is eligible
to receive is based on a pre-determined target percentage of the base salary for
each executive officer and varies by position among the executive officers. The
target cash incentive entitlement for the Chief Executive Officer was set at 50%
of his base salary and the target cash incentive entitlement for the Chief
Financial Officer and Chief Business Officer for 2002 was set at 40% of their
respective base salaries. The target cash incentive entitlement for each other
executive officer was set at 35% of his or her respective base salary for 2002.
In addition, in 2002, the Compensation Committee recognized that cash incentive
compensation in excess of the target levels could be attained to reward
extraordinary individual performance.

The cash incentive compensation actually paid to each of QLT's executive
officers for their performance in 2002 relative to their respective targets was
determined by the Compensation Committee based on the extent to which certain
pre-determined corporate and individual goals were achieved in the year by QLT
and the executive officer, respectively.

The individual goals used in determining cash incentive compensation are
primarily objective and measurable goals. The individual goals relate to the
individual executive officer's area of responsibility and are designed to
facilitate the achievement of QLT's corporate goals. The extent to which those
individual goals have been achieved is determined based largely on the annual
performance evaluations prepared by the President and Chief Executive Officer
for each of the other executive officers. In the course of that evaluation
process, individual goals are also set for each executive officer for the
ensuing year.

The corporate goals used by the Compensation Committee in determining cash
incentive compensation are also primarily objective and measurable goals
designed to reflect the advancement of QLT's business and the potential for
increased shareholder value. The 13 corporate goals for 2002 related to the
achievement of pre-determined development milestones for certain products in
QLT's clinical development pipeline, achieving a pre-determined level of sales
for Visudyne(R) and achieving a specified level of earnings per share. Of the 13
goals in 2002, only one was subjective and related to the 



<PAGE>
                                       16


maintenance of a productive working environment and corporate culture. Based on
that analysis, and giving equal weight to each of the 13 goals, the Board of
Directors determined that corporate goals were 92.31% achieved for 2002.

The relative weight applied by the Compensation Committee to the corporate and
individual goals in determining the amount of cash incentive compensation to
which each executive officer was entitled relative to their target cash
incentive compensation was based on the following:

1.       For the President and Chief Executive Officer - 80% based on the
         achievement of corporate goals and 20% based on the achievement of
         individual goals;

2.       For Senior Vice Presidents - 70% based on the achievement of corporate
         goals and 30% based on the achievement of individual goals; and

3.       For Vice Presidents - 60% based on the achievement of corporate goals
         and 40% based on the achievement of individual goals.

Based on the above criteria, for performance during 2002, the Compensation
Committee approved an average cash incentive award of approximately 38% of base
salary for each of the Chief Financial Officer and the Chief Business Officer,
and an average cash incentive award of approximately 33% of base salary for the
remainder of the executive officers for performance related to the 2002 fiscal
year. These entitlements were consistent with the achievement of corporate and
individual goals. The Compensation Committee approved a cash incentive award of
approximately 50% of base salary to QLT's Senior Vice President and Chief
Medical Officer for his performance during 2002. The cash incentive compensation
paid to QLT's Senior Vice President and Chief Medical Officer was in excess of
his target bonus in recognition of his significant value to QLT and his
substantial contributions to QLT during 2002.

For 2003, consistent with a shift toward a larger "pay at risk" component to
QLT's executive compensation, the Compensation Committee approved increases in
cash incentive compensation targets for executive officers (other than the
President and Chief Executive Officer, described below) to 40% or 45% of base
salary. Each of the executive officers will also be eligible to receive an
additional cash incentive compensation amount equal to 5% of his or her base
salary if two exceptional targets are met by QLT. The two exceptional targets
relate to the achievement of pre-determined earnings per share and Visudyne(R)
sales levels above and beyond those levels set out in the corporate goals.

In addition, for 2003, in assessing QLT's corporate goals, greater weight will
be given to the achievement of QLT's financial goals, with 40% of the weight
given to the achievement of a pre-determined earnings per share amount, 30%
given to the achievement of a pre-determined level of sales of Visudyne(R) and
30% given to the remainder of the corporate goals. In addition, greater weight
will be placed on the achievement of corporate goals versus individual goals
than for 2002 in determining each executive officers' respective cash incentive
payment.

DETERMINATION OF EQUITY COMPENSATION

In 2002, except for the President and Chief Executive Officer (for whom equity
compensation is described below), the annual aggregate grant of stock options
was reduced for executive officers of QLT from the amounts awarded in prior
years (excluding grants made as part of signing arrangements with 


<PAGE>
                                       17


new executive officers). The reduction was made after reviewing current industry
trends for stock options, based on the surveys described above, and to better
ensure sustainability of the current pool of options available under QLT's 2000
Incentive Stock Option Plan.

During the year 2002, the Board of Directors approved grants of options to QLT's
executive officers (including the President and Chief Executive Officer) to
purchase an aggregate of 470,000 Common Shares. Depending on the date of grant,
the exercise price of these options ranged from Cdn.$19.71 to Cdn.$28.75 per
Common Share, being the fair market value at the date of the grant. In March
2003, the Compensation Committee approved grants of options to executive
officers (including the President and Chief Executive Officer) to purchase a
total of 290,000 Common Shares at an exercise price of Cdn.$13.35 per Common
Share. The grant levels made to those executive officers in 2003 were generally
consistent with the already reduced grant levels made in 2002. In future years,
the Compensation Committee intends to tie the award of stock options even more
closely to individual and corporate performance within certain guidelines.

All options issued to QLT's executive officers are exercisable for a term of
five years and vest in 36 equal monthly instalments. In the event an executive
officer's employment is terminated without cause, 50% of the options then
unvested will automatically vest. In addition, provision exists for 100% of the
then unvested options to vest upon the occurrence of a change of control of QLT.

SUMMARY OF THE COMPENSATION OF THE CHIEF EXECUTIVE OFFICER IN 2002

The Chief Executive Officer is eligible to participate in the same executive
compensation plans available to other executive officers of QLT. In February
2003, the Chairman of the Board provided recommendations to the Compensation
Committee with respect to Mr. Hastings' compensation.

Base Salary

Mr. Hastings' base salary for 2002 was set at US$500,000 at the time he agreed
to join QLT and was based on a review of competitive compensation information at
that time. In early 2003, after reviewing the external survey data described
above, including an external report on chief executive officer compensation
specific to the biotechnology industry, it was determined that Mr. Hastings'
base salary was within current competitive salary ranges and would not be
increased for 2003.

Cash Incentive Compensation

As stated above under "Determination of Cash Incentive", Mr. Hastings' cash
incentive compensation is based on the achievement of pre-determined corporate
and individual goals to reward performance, with 80% of his cash incentive
compensation tied to the achievement of corporate goals and the remaining 20%
tied to his individual performance. Mr. Hastings' individual goals for 2002
included both objective and subjective goals and were focused on areas of fiscal
responsibility and profitability for QLT, emphasizing a performance driven
corporate culture among QLT's employees and establishing and integrating QLT's
executive management team. The Compensation Committee determined that Mr.
Hastings had achieved 100% of his individual goals in 2002. As described above,
the Compensation Committee determined that 92.31% of the corporate goals were
achieved. Accordingly, in February 2003, the Compensation Committee approved a
cash incentive compensation amount equal to US$199,112 to Mr. Hastings
(representing approximately 44.7% of his prorated base salary for 2002, out of a
target entitlement of 50%).

In reviewing the cash incentive portion of Mr. Hastings' compensation in early
2003, the Compensation Committee determined that a target cash incentive
compensation of 50% of base salary was at the lower 



<PAGE>
                                       18


end of the range for Chief Executive Officers in the biotechnology and
biopharmaceutical companies analyzed and should be increased to remain
competitive. As a result, for 2003, and in lieu of any increase in Mr. Hastings'
base salary, the Compensation Committee approved an increase in the range for
Mr. Hastings' target cash incentive compensation. In addition, since it is the
responsibility of Mr. Hastings to lead QLT to achieve its corporate goals, Mr.
Hastings' entitlement to cash incentive compensation will be based solely on the
extent to which QLT achieved its corporate goals. Therefore, if QLT achieves
100% of its corporate goals in 2003, Mr. Hastings will be eligible to receive
cash incentive compensation equal to 75% of his base salary. As is the case for
the other executive officers for 2003, Mr. Hastings will also be eligible to
receive an additional cash incentive compensation amount equal to 5% of base
salary if QLT achieves certain exceptional earnings per share and Visudyne(R)
sales benchmarks related to increased shareholder value. This approach is again
in keeping with a pay for performance philosophy where a large component of
compensation is "pay at risk".

Stock Options

The number of stock options to which Mr. Hastings is entitled is set out in his
employment agreement. On December 18, 2001, QLT awarded to Mr. Hastings options
to purchase 500,000 Common Shares at an exercise price of Cdn.$37.99 as a
condition of, and upon entering into, his employment agreement with QLT. In
accordance with that agreement, in April 2002, the Board of Directors granted to
Mr. Hastings options to purchase 100,000 Common Shares at an exercise price of
Cdn.$23.50 per Common Share, and in March 2003, the Compensation Committee
granted to Mr. Hastings options to purchase 100,000 Common Shares at an exercise
price of Cdn.$13.35 per Common Share. All options granted to Mr. Hastings were
granted at a price which reflected the fair market value on the date of grant.
All such options are exercisable for a term of five years and are subject to
vesting in 36 equal monthly instalments. In the event Mr. Hastings' employment
is terminated without cause, 50% of the options then unvested will automatically
vest. In addition, provision exists for 100% of the then unvested options to
vest upon the occurrence of a change of control of QLT.

A description of the terms of the employment agreement between QLT and Mr.
Hastings are set out below under the heading "Termination of Employment, Change
in Responsibilities and Employment Contracts".

           Peter A. Crossgrove (Chair), Ronald D. Henriksen, Jack Wood
                 MEMBERS OF THE EXECUTIVE COMPENSATION COMMITTEE




                           SUMMARY COMPENSATION TABLE

The following table sets forth certain information regarding the annual and
long-term compensation for the fiscal years ending December 31, 2000, 2001 and
2002 of those persons who were either (i) the Chief Executive Officer of QLT
during the fiscal year ended December 31, 2002, (ii) one of the four most highly
compensated executive officers serving as an executive officer at December 31,
2002, or (iii) any additional executive officers who would have satisfied those
criteria but for the fact that individual was not serving as such an executive
officer of QLT as at December 31, 2002 (collectively, the "Named Executive
Officers").

<PAGE>
                                        19

                           SUMMARY COMPENSATION TABLE


<TABLE>
<CAPTION>
                                                                                      LONG-TERM
                                                                                     COMPENSATION
                                                    ANNUAL COMPENSATION(1)              AWARDS
                                            ------------------------------------    -------------
                                                                    OTHER ANNUAL     SECURITIES        ALL OTHER
                                             SALARY       BONUS     COMPENSATION     UNDERLYING      COMPENSATION
NAME AND PRINCIPAL POSITION         YEAR      (US$)       (US$)       (US$)(8)      OPTIONS(9)(#)     (1)(10)(US$)
---------------------------         ----    --------    --------    ------------    -------------    -------------
<S>                                 <C>     <C>         <C>           <C>             <C>              <C>   
PAUL J. HASTINGS(2)                 2002    $445,591    $199,112       $42,914        100,000           $26,294
President and Chief Executive       2001          --          --            --        500,000                --
Officer                             2000          --          --            --             --                --
---------------------------------------------------------------------------------------------------------------
MOHAMMAD AZAB                       2002    $246,932    $123,258       $23,513         20,250            $5,610
Senior Vice President and Chief     2001     199,273      47,914        46,857         45,000             5,418
Medical Officer                     2000     199,816      43,003        41,055         45,000            25,723
---------------------------------------------------------------------------------------------------------------
MICHAEL J. DOTY (3)                 2002    $249,381     $94,354      $173,097         40,500           $12,750
Senior Vice President and Chief     2001      41,190      15,434        10,298         48,918                --
Financial Officer                   2000          --          --            --             --                --
---------------------------------------------------------------------------------------------------------------
ALAIN H. CURAUDEAU (4)              2002    $219,009     $72,526       $62,863         20,250            $5,658
Senior Vice President, Project      2001     180,394      47,223        68,430         27,000               986
Planning and Management             2000      94,178      56,251        54,271         32,199            34,018
---------------------------------------------------------------------------------------------------------------
WILLIAM J. NEWELL (5)               2002    $162,378     $63,954      $108,127        200,000              $698
Senior Vice President and Chief     2001          --          --            --             --                --
Business Officer                    2000          --          --            --             --                --
---------------------------------------------------------------------------------------------------------------
JULIA G. LEVY (6)                   2002    $188,135     $64,598            --         12,125            $4,994
Former President and Chief          2001     351,580     159,756       $14,265         80,000               736
Executive Officer, Current          2000     352,536     135,238            --         80,000               761
Executive Chairman, Scientific                                   
Advisory Board                                                   
---------------------------------------------------------------------------------------------------------------
JOHN R. NORTH (7)                   2002    $213,319     $67,175       $20,686         20,250          $284,350
Former Senior Vice President,       2001     196,583      47,272        33,730         45,000             5,132
Scientific Affairs and Chief        2000     197,118      37,504        21,179         45,000             3,889
Scientific Officer                                               
---------------------------------------------------------------------------------------------------------------
</TABLE>

                                                                
Notes:

 (1)   The salaries for the listed Named Executive Officers, other than Dr.
       Levy, are payable in US dollars under their employment agreements.
       Although they may be entitled to receive payment in US dollars, certain
       executives have elected to receive, or do receive, all or a portion of
       their salaries, bonuses and benefits in Canadian dollars. Dr. Levy's
       salary is payable in Canadian dollars but she has elected to receive 50%
       of her salary in US dollars at a pre-determined exchange rate. Where
       amounts shown on the Summary Compensation Table were actually paid in
       Canadian funds, the amounts set out in the Summary Compensation Table
       represent the US dollar equivalent of those payments. Amounts have been
       converted using the weighted average exchange rate that QLT has
       calculated for each year for financial reporting purposes, being equal to
       US$1.00 = Cdn.$1.4907 for 2000, US$1.00 = Cdn.$1.5412 for 2001 and
       US$1.00 = Cdn.$1.5699 for 2002. Note that small differences between
       amounts shown above and those set out in the employment agreement for a
       Named Executive Officer may appear because of fluctuations in exchange
       rates.

 (2)   Mr. Hastings became President and Chief Executive Officer of QLT on
       February 17, 2002.

<PAGE>
                                       20


 (3)   Mr. Doty became an executive officer of QLT on November 1, 2001.

 (4)   Mr. Curaudeau became an executive officer of QLT on June 12, 2000.

 (5)   Mr. Newell became an executive officer of QLT on June 10, 2002.

 (6)   Dr. Levy retired as President and Chief Executive Officer of QLT on
       February 17, 2002. Dr. Levy remained a non-executive officer of QLT after
       that date and assumed the role of Chairman of QLT's Scientific Advisory
       Board. Dr. Levy is also a member of the Board of Directors of QLT.

 (7)   Dr. North left his position as Senior Vice President and Chief Scientific
       Officer effective November 15, 2002. Dr. North remained a non-executive
       employee until January 3, 2003. See also note 10 below.

 (8)   For Mr. Hastings, the amount for 2002 consists primarily of relocation
       expenses reimbursed to Mr. Hastings in connection with his relocation to
       QLT and includes US$13,500 for real estate commissions, US$9,780 in
       moving expenses and US$8,166 for property transfer tax. For Dr. Azab, the
       amount includes US$20,125 in 2000 and US$19,465 in 2001 relating to a tax
       differential payments in those years, and US$20,125 in 2000, US$19,465 in
       2001 and US$19,109 in 2002 relating to the forgivable portions of a home
       relocation loan. For Mr. Doty, the amount for 2001 and 2002 includes
       US$10,298 and US$59,087, respectively, relating to tax differential
       payments. The amounts for Mr. Doty for 2002 also include relocation
       expenses reimbursed to Mr. Doty in connection with his relocation to QLT,
       including US$85,296 in property transfer taxes and real estate
       commissions, US$19,208 in moving expenses and US$5,383 in accounting
       fees. For Mr. Curaudeau, the amount shown for 2000, 2001 and 2002
       includes US$23,545, US$39,799 and US$36,786 relating to a tax
       differential payment in each of those years, respectively, US$19,465 in
       2001 and US$20,686 in 2002 relating to the forgivable portions of a home
       relocation loan and US$29,632 in 2000 to reimburse Mr. Curaudeau for
       moving expenses and the commission on the sale of his home following his
       relocation to QLT. For Mr. Newell, the amount for 2002 consists of
       relocation expenses reimbursed to Mr. Newell in connection with his
       relocation to QLT and includes US$79,792 in property transfer taxes and
       real estate commissions and US$25,046 in moving expenses. For Dr. North,
       the amount shown for 2000 and 2001 also includes US$19,712 and US$10,874,
       respectively, relating to a tax and currency differential payment and
       US19,465 in 2001 and US$20,686 in 2002 relating to the forgivable
       portions of a home relocation loan. The above amounts also include
       portions relating to imputed interest benefits on the non-interest
       bearing portion of home relocation loans made to certain Named Executive
       Officers, as disclosed previously, and payment of vacation amounts in
       each of 2001 and 2002 to certain Named Executive Officers.

 (9)   Options granted to executive officers were made pursuant to the Company's
       1998 and 2000 Incentive Stock Option Plans, which provide, among other
       things, that (i) the exercise price of such options must not be less than
       fair market value of the time of grant; and (ii) the maximum term of such
       options may not exceed five years. Options granted to executive officers
       contain provisions for acceleration of vesting in the event of a change
       of control, as defined in each option agreement.

(10)   These amounts represent premiums on life insurance policies and medical
       services premiums for the benefit of the employee and cash payments by
       the Company to match the individual's contribution to a registered
       retirement savings plan. For Mr. Hastings, the amount shown includes a
       signing bonus of US$25,678 paid to Mr. Hastings in 2002. For Dr. North,
       the amount shown includes a US$279,181 separation payment which QLT
       agreed in 2002 to make to Dr. North in 2003 upon his departure from QLT.
       For Mr. Curaudeau, the amount shown for 2000 also includes a one-time
       signing bonus of US$33,719.

The total cash compensation (salary and cash incentive compensation) paid to all
executive officers as a group (13) for the year ended December 31, 2002 was
US$3,316,245 (see note 1 to the Summary Compensation Table above).

TERMINATION OF EMPLOYMENT, CHANGE IN RESPONSIBILITIES AND EMPLOYMENT CONTRACTS

Mr. Paul J. Hastings, President and Chief Executive Officer

In 2001, Mr. Hastings entered into an employment agreement with QLT under which
he was appointed President and Chief Executive Officer of QLT effective February
17, 2002 for an indefinite term. Under the terms of Mr. Hastings' employment
agreement, Mr. Hastings was entitled to a one-time signing bonus of US$25,000
and is entitled to a base salary of US$500,000 per year, target cash incentive
compensation (see "Executive Compensation - Summary of Compensation of the Chief
Executive Officer in 2002") and other standard health and retirement benefits.
As part of his employment agreement, Mr. Hastings was awarded options to
purchase 500,000 Common Shares on December 18, 2001 and is entitled to receive
an annual grant of options to purchase 100,000 Common Shares in QLT commencing
in April 2002. 

<PAGE>
                                       21


Pursuant to his employment agreement, in February 2002, Mr. Hastings also
received a home relocation loan equal to US$400,000 in the form of a four year
forgivable non-interest bearing loan which is secured against Mr. Hastings'
residence. The loan is forgivable in four equal annual instalments of US$100,000
for each year of continuous employment of Mr. Hastings. In the event that Mr.
Hastings' employment ceases prior to the end of the four-year term, then, in the
case of his resignation or termination for cause, the remaining balance would be
converted into an interest-bearing term loan for the remaining portion of the
four-year term on standard commercial conditions for residential mortgages, or,
in the case of Mr. Hastings' termination without cause or death, the entire
amount then outstanding under the loan would be forgiven by QLT. In the event
that QLT terminates Mr. Hastings' employment without cause, Mr. Hastings is
entitled to notice or pay in lieu of notice equal to 24 months' base salary and
cash incentive compensation based on his target cash incentive compensation
amount, payment of salary and bonus earned to the date of termination and an
amount to compensate Mr. Hastings for lost benefits during the 24 month notice
period.

Other Employment Agreements

The following Named Executive Officers (other than the President and Chief
Executive Officer, described above) have each entered into employment agreements
with QLT which are similar in form. Under those employment agreements, the
executive officer is entitled to their base salary, cash incentive compensation
under QLT's cash incentive compensation plan (see "Executive Compensation -
Determination of Cash Incentive"), participation in QLT's stock option plan and
other standard health and retirement savings benefits. Mr. Curaudeau and Mr.
Doty are entitled to home relocation loans under their employment agreements as
described below. The home relocation loans are non-interest bearing loans
secured against the residence of the particular Named Executive Officer. The
home relocation loan is forgivable in equal annual instalments over a stated
term for each year of continuous employment with QLT. In the event that the
employment of the Named Executive Officer ceases prior to the end of the loan
term, the remaining portion of the loan balance would be converted into an
interest-bearing term loan for the remaining portion of the term on standard
commercial conditions for residential mortgages. Except as stated below, in the
event that QLT terminates the employment of the Named Executive Officer without
cause, the Named Executive Officer is entitled to notice or pay in lieu of
notice (calculated by reference to base salary) equal to 6 months (or in the
case of Mr. Doty, 12 months) plus one additional month for each year of service,
payment of salary and bonus earned to the date of termination and an amount to
compensate the Named Executive Officer for lost benefits during the notice
period.

         (i)    Dr. Mohammad Azab, Senior Vice President and Chief Medical
                Officer

         Dr. Azab was promoted to Chief Medical Officer in February 2003. Upon
         his promotion, Dr. Azab entered into a new employment agreement with
         QLT confirming his position as Senior Vice President and Chief Medical
         Officer for an indefinite term. Under the terms of Dr. Azab's
         employment agreement, Dr. Azab is entitled to a base salary of
         US$290,000 per year and the other compensation and benefits described
         above.

         (ii)   Mr. Alain H. Curaudeau

         Mr. Curaudeau entered into an employment agreement with QLT in 2000 and
         has been appointed as Senior Vice President, Project Planning and
         Management for an indefinite term. Under the terms of Mr. Curaudeau's
         employment agreement, Mr. Curaudeau is entitled to a base salary,
         currently US$221,502 per year, certain tax differential payments and
         the other compensation and benefits described above. Pursuant to his
         employment agreement, in October 2000, Mr. Curaudeau also received a
         home relocation loan equal to US$100,624 (see note 1 to the Summary
         Compensation Table above) which is forgivable in five equal annual
         instalments (see

<PAGE>
                                       22


         note 1 to the Summary Compensation Table above) for each year of
         continuous employment with QLT and otherwise is subject to the terms
         described above.

         (iii)  Mr. Michael J. Doty, Senior Vice President and Chief Financial
                Officer

         Mr. Doty entered into an employment agreement with QLT in 2001 in which
         he was appointed as Senior Vice President and Chief Financial Officer
         of QLT for an indefinite term. Under the terms of Mr. Doty's employment
         agreement, Mr. Doty is entitled to a base salary, currently US$247,200,
         certain tax differential payments and other compensation and benefits
         described above. Pursuant to his employment agreement, in April 2002,
         Mr. Doty also received a home relocation loan equal to US$100,000 in
         the form of a three-year non-interest bearing loan, forgivable in three
         equal annual instalments of US$33,333.33 for each year of continuous
         employment with QLT and otherwise subject to the terms described above.

         (iv)   Mr. William J. Newell, Senior Vice President and Chief Business
                Officer

         Mr. Newell entered into an employment agreement with QLT in 2002 in
         which he was appointed as Senior Vice President and Chief Business
         Officer of QLT effective June 10, 2002 for an indefinite term. Under
         the terms of Mr. Newell's employment agreement, Mr. Newell is entitled
         to a base salary of US$290,000 per year and other compensation and
         benefits described above. Mr. Newell is also entitled to receive a
         one-time bonus of US$15,925 (converted from Cdn.$25,000 using the
         exchange rate for 2002 described in note 1 to the Summary Compensation
         Table above) on the first anniversary of his employment with QLT.
         Pursuant to his employment agreement, as part of his consideration for
         joining QLT, Mr. Newell received 200,000 options to purchase Common
         Shares in QLT at a price equal to Cdn.$19.71.

Dr. Julia Levy

Dr. Levy retired as QLT's President and Chief Executive Officer in February
2002. Dr. Levy remains on the Board of Directors of QLT and is now a
non-executive officer employee of QLT, assuming the position of Chairman of
QLT's Scientific Advisory Board. Dr. Levy is also entitled to participate in
QLT's stock option plan and receives other standard health and retirement
savings benefits made generally to all employees of QLT.

Dr. John R. North

Dr. North left his position as a Senior Vice President and Chief Scientific
Officer on November 15, 2002 and ended his employment with QLT effective January
3, 2003. At that time, QLT paid to Dr. North his cash incentive compensation for
2002 and the other amounts disclosed in the Summary Compensation Table above. In
addition, the vesting of 50% of the stock options in QLT held by Dr. North was
accelerated, which options expired (if not exercised) on April 3, 2003.

TERMINATION OR RESIGNATION FOLLOWING A CHANGE OF CONTROL

Separate change of control agreements have been entered into with all executive
officers of QLT, including the President and Chief Executive Officer. The change
of control agreements provide for certain payments and other benefits to the
executive officer in the event of termination by QLT of that executive officers'
employment without cause or by the employee for specific reasons (as defined in
the agreement) within a period of 24 months following a change of control in
QLT. 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

<PAGE>
                                       23


QLT's 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 majority
of the Directors on the Board of Directors of QLT in any two consecutive years.
Upon the occurrence of such an event, such executive officers will receive, in
addition to amounts owing up to the date of termination or resignation, a
severance payment equal to 18 months' (or in the case of the President and Chief
Executive Officer, 36 months') base salary, annual cash incentive compensation
entitlement (calculated at the maximum cash incentive compensation entitlement),
amounts in lieu of certain other health and retirement benefits for the 18 month
period and relocation expenses.


                      OPTION GRANTS IN THE LAST FISCAL YEAR

The following table summarises the number and terms of options granted during
the 2002 fiscal year to the named executive officers. In 2002, QLT did not grant
any stock appreciation rights and has not done so in prior years.

                      OPTION GRANTS IN THE LAST FISCAL YEAR


<TABLE>
<CAPTION>
                                                                                                            POTENTIAL REALISABLE
                                                                                                              VALUE AT ASSUMED 
                                                                                                            ANNUAL RATES OF STOCK 
                                                                                                           PRICE APPRECIATION FOR 
                                           INDIVIDUAL GRANTS                                                   OPTION TERM(2)
                          ------------------------------------------------------                         -------------------------
                                                                        MARKET
                                                                       VALUE OF
                                                                      UNDERLYING
                            NUMBER OF    % OF TOTAL                  SHARES AS AT
                           SECURITIES      OPTIONS       EXERCISE       DATE OF
                           UNDERLYING     GRANTED TO     PRICE(1)        GRANT
                             OPTIONS      EMPLOYEES      (CDN.$/        (CDN.$/         EXPIRATION            5%          10%
NAME                       GRANTED(1)      IN 2002       SHARE)         SHARE)             DATE            (CDN.$)      (CDN.$)
-----------------------    ----------    -----------    ---------    ------------    -----------------    ---------    ---------
<S>                          <C>            <C>          <C>            <C>          <C>                <C>            <C>      
Paul J. Hastings             100,000         9.5         23.50          23.50        April 23, 2007       648,861      1,433,710
--------------------------------------------------------------------------------------------------------------------------------
Mohammad Azab                20,250          1.9         23.50          23.50        April 23, 2007       131,394        290,326
--------------------------------------------------------------------------------------------------------------------------------
Michael J. Doty              40,500          3.9         28.75          28.75        February 6, 2007     321,497        710,373
--------------------------------------------------------------------------------------------------------------------------------
Alain H. Curaudeau           20,250          1.9         23.50          23.50        April 23, 2007       131,394        290,326
--------------------------------------------------------------------------------------------------------------------------------
John R. North                20,250          1.9         23.50          23.50        April 23, 2007(3)    131,394        290,326
--------------------------------------------------------------------------------------------------------------------------------
William J. Newell            200,000        19.1         19.71          19.71        June 9, 2007       1,088,430      2,404,973
--------------------------------------------------------------------------------------------------------------------------------
Julia G. Levy                12,125          1.2         23.50          23.50        April 23, 2007        78,674        173,837
--------------------------------------------------------------------------------------------------------------------------------
</TABLE>


Notes:

 (1)   Options granted to executive officers generally are subject to required
       vesting periods prior to the options becoming exercisable as described.

 (2)   Gains are reported net of option exercise price, but before income taxes
       associated with such exercise. The assumed rates of appreciation are
       prescribed by the SEC for illustrative purposes only and are not intended
       to forecast or predict future share prices. Actual gains, if any, on
       stock option exercises are dependent on the future performance of the

<PAGE>
                                       24


       Common Shares and overall market conditions, as well as the
       optionholders' continued employment through the vesting period. The
       amounts reflected in this table may not necessarily be achieved.

 (3)   The original expiry date for the options granted to Dr. North was April
       23, 2007. As a result of his departure from QLT, the options held by Dr.
       North expired on April 3, 2003.


The following table provides information with respect to option exercises during
the 2002 fiscal year by the Named Executive Officers and the number and value of
unexercised options held as at December 31, 2002.

               AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND
                          FISCAL YEAR-END OPTION VALUES


<TABLE>
<CAPTION>
                                                           
                                                            NUMBER OF SECURITIES           VALUE OF UNEXERCISED
                              SHARES                       UNDERLYING UNEXERCISED         IN-THE-MONEY OPTIONS AT
                            ACQUIRED ON      VALUE       OPTIONS AT DECEMBER 31, 2002   DECEMBER 31, 2002(2) (CDN.$)   
                             EXERCISE      REALISED(1)   ----------------------------   ----------------------------
                                (#)         (CDN.$)      EXERCISABLE    UNEXERCISABLE    EXERCISABLE   UNEXERCISABLE 
                            -----------    ----------    -----------    -------------    ----------    -------------  
<S>                           <C>          <C>             <C>             <C>             <C>              <C>   
Paul J. Hastings                 --            --          161,111         438,889            --             --
--------------------------------------------------------------------------------------------------------------------
Mohammad Azab                 16,668         41,235        146,582          37,000         96,245            --
--------------------------------------------------------------------------------------------------------------------
Michael J. Doty                  --            --           30,274          59,144            --             --
--------------------------------------------------------------------------------------------------------------------
Alain H. Curaudeau               --            --           46,044          33,405            --             --
--------------------------------------------------------------------------------------------------------------------
John R. North(3)                 --            --          142,180          37,000         22,155            --
--------------------------------------------------------------------------------------------------------------------
William J. Newell                --            --           33,333         166,667            --             --
--------------------------------------------------------------------------------------------------------------------
Julia G. Levy                 80,000       1,070,000       284,916          47,209         330,000           --
--------------------------------------------------------------------------------------------------------------------
</TABLE>


Notes:

 (1)   Value realised is (i) the fair market value on the date of exercise, less
       the option price, times (ii) the number of shares exercised.

 (2)   Potential unrealised value is (i) the fair market value at 2002 fiscal
       year end (Cdn.$13.40 per Common Share), less the option price, times (ii)
       the number of shares subject to the option.

 (3)   As a result of his departure from QLT, the options held by Dr. North
       expired on April 3, 2003.

<PAGE>
                                       25


                         SHARE PRICE PERFORMANCE GRAPH

The graph below compares cumulative total Shareholder return on the Common
Shares of QLT for the last five fiscal years with the total cumulative return of
the S&P/TSX Composite Index and the Nasdaq Total Return Pharmaceutical Industry
Index over the same period.

                          [GRAPHIC - PERFORMANCE GRAPH]

The graph above assumes Cdn$100 invested on December 31, 1997 in QLT and in each
index. The share price shown above for the Common Shares is historical and not
indicative of future price performance.

Notwithstanding anything to the contrary set forth in any of QLT's previous or
future filings under the United States Securities Act of 1933, the United States
Securities Exchange Act of 1934, or applicable Canadian securities legislation
that might incorporate this document or future filings with the SEC or with any
Canadian securities regulators, in whole or in part, the Report of the Executive
Compensation Committee on Executive Compensation of QLT and the Shareholder
Return Performance Graph sections of this Proxy Statement are not deemed to be
incorporated by reference into any such filing.

<PAGE>
                                       26


        INDEBTEDNESS OF DIRECTORS, EXECUTIVE OFFICERS AND SENIOR OFFICERS

No Directors, executive officers or senior officers of QLT or any subsidiaries
thereof, or proposed nominees for election as a Director of QLT, are currently
indebted to QLT or its subsidiaries, except for routine indebtedness to
executive officers in connection with the purchase of their homes as part of
relocation packages offered to them pursuant to their employment agreements,
which loans are secured by mortgages registered against their home. The home
relocation loans made to QLT's Named Executive Officers are described above (see
"Termination of Employment, Change in Responsibilities and Employment
Contracts"). Effective July 30, 2002, and in accordance with the United States
Sarbanes-Oxley Act of 2002 (the "Sarbanes-Oxley Rules"), QLT no longer offers
its executive officers housing loans as part of their relocation assistance. The
loans extended to QLT's executive officers prior to July 30, 2002 remained in
effect in accordance with the then existing terms and conditions.

 
          COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

None of QLT's executive officers serve as members of the compensation committee
or Board of Directors of any entity that has an executive officer serving as a
member of the Executive Compensation Committee or Board of Directors of QLT.

                  DIRECTORS' AND OFFICERS' LIABILITY INSURANCE

QLT maintains directors' and officers' liability insurance coverage through a
policy covering QLT and its subsidiaries, which has an annual aggregate policy
limit of US$50,000,000, subject to a corporate deductible of US$150,000 per loss
for all claims except securities claims for which the deductible is
US$1,000,000. This insurance provides coverage for indemnity payments made by
QLT to its directors and officers as required or permitted by law for losses,
including legal costs, incurred by officers and directors 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
directors and officers has customary exclusions, including libel and slander,
and those acts determined to be uninsurable under law, or deliberately
fraudulent or dishonest or to have resulted in personal profit or advantage.


           INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS

Unless otherwise disclosed in this Proxy Statement, none of the Directors,
executive officers or any beneficial owner of more than 5% of the outstanding
Common Shares of QLT, had any material interest, direct or indirect, in any
transaction during the past fiscal year or in any proposed transaction which has
materially affected or will materially affect QLT.

QLT has entered into indemnity agreements with certain officers and directors
which provide, among other things, that, subject to any requirements that may
exist under the Company Act (British Columbia) or the Articles of QLT, QLT will
indemnify such officer or director, under the circumstances and to the extent
specified, for expenses, damages, judgements, fines and settlements he or she
may be required to pay in actions or proceedings which he or she is or may be
made a party by reason of his or her position as a director or officer of QLT.


<PAGE>
                                       27


 
                  STATEMENT ON CORPORATE GOVERNANCE PRACTICES

The mandate of the Board of Directors is to provide objective, prudent
stewardship of QLT. In developing and supervising implementation of QLT's
strategic plan, the Board of Directors sets objectives for the Chief Executive
Officer and QLT's senior management. QLT's responsibilities to its Shareholders,
customers and employees are demonstrated by its commitment to effective
corporate governance and disclosure.

The Toronto Stock Exchange Committee on Corporate Governance in Canada has
issued a series of Guidelines for Improved Corporate Governance in Canada (the
"TSX Guidelines") and requires that listed companies disclose their corporate
governance system in their annual reports or information circulars (proxy
statements). QLT is committed to meeting or exceeding the recommendations set
out in the TSX Guidelines.

In addition, QLT has adopted, and will be continuing to adopt, specific
corporate governance requirements of the Sarbanes-Oxley Rules.

In 2002, in furtherance of the Board of Directors commitment to corporate
governance, the Board of Directors established a Corporate Governance and
Nominating Committee. That Committee will provide guidance to the Board of
Directors regarding the adoption and amendment of corporate governance
principles applicable to QLT, review existing processes and, where appropriate,
develop new ones to continue to ensure an effective process and structure for
the management of QLT at all levels.

The following information highlights the structures and processes of corporate
governance followed by QLT. To enhance disclosure to Shareholders, QLT's
Corporate Governance Practices in relation to each of the 14 TSX Guidelines are
specifically set out in Exhibit A attached to this Proxy Statement.

MANDATE OF THE BOARD OF DIRECTORS

The mandate of the Board of Directors is to supervise the management of the
business and affairs of QLT. In fulfilling its mandate, the Board of Directors,
as a whole, oversees the development and application of policies regarding
corporate governance and is responsible for:

(1)    the adoption of a strategic plan for QLT's business;

(2)    the identification of the principal risks of QLT's business and ensuring
       the implementation of the appropriate systems to manage these risks;

(3)    succession planning for QLT, including identifying, appointing, training
       and monitoring senior management;

(4)    overseeing the integrity of QLT's internal controls and management
       information systems; and

(5)    maintaining a continuing dialogue with 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.

The Board of Directors holds at least four regular meetings each year. There
were five meetings (in person or by teleconference) and one by written consent
of the Board of Directors during the year ended December 31, 2002. The frequency
of meetings, as well as the nature of the matters dealt with at each meeting,
will vary from year to year depending on the state of QLT's business and the
opportunities or 

<PAGE>
                                       28


risks which QLT faces from time to time. Within that framework, it is
anticipated that the Board of Directors will normally meet between four and
eight times each year.

The Board of Directors has established Committees with specific
responsibilities, namely an Audit and Risk Committee, a Corporate Governance and
Nominating Committee and an Executive Compensation Committee. An overview of the
mandate and composition of each of those Committees is set out above under the
heading "Information Concerning Board Meetings and Committees".

COMPOSITION AND INDEPENDENCE OF THE BOARD

The TSX Guidelines recommend that a board of directors be constituted with a
majority of individuals who come within the description of "unrelated
directors". An "unrelated director" is defined in the TSX Guidelines as a
director who is independent of management and is free from any interest and any
other business or other relationship which could, or could reasonably be
perceived to, materially interfere with the director's ability to act with a
view to the best interests of the company, other than interests and
relationships arising from shareholding.

The rules of the Nasdaq Stock Market also address the concept of director
independence. According to current Nasdaq rules, an independent director is a
person who is not an employee or officer of the company or who, in the opinion
of the board of directors, does not have a relationship with the company that
would interfere with the director's exercise of independent judgement in
carrying out a director's responsibilities. To qualify as an "independent"
director under the Nasdaq rules, the director must not: 

         (a)   have been employed by QLT or any of its affiliates for the
               current year or any of the past three years;

         (b)   have accepted any compensation from QLT or any of its affiliates
               in excess of US$60,000 during the previous fiscal year, other
               than compensation for board service, benefits under a
               tax-qualified retirement plan, or non-discretionary compensation;

         (c)   be a member of the immediate family of an individual who is, or
               has been in any of the past three years, employed by QLT or any
               of its affiliates as an executive officer;

         (d)   be a partner in, or a controlling shareholder or an executive
               officer of, any for-profit business organization to which QLT
               made, or from which QLT received, payments (other than those
               arising solely from investments in the corporation's securities)
               that exceed 5% of QLT's or the business organization's
               consolidated gross revenues for that year, or US$200,000,
               whichever is more, in any of the past three years; or

         (e)   be employed as an executive of another entity where any of QLT's
               executives serve on that entity's compensation committee.

The Directors have examined the relevant definitions in the TSX Guidelines and
Nasdaq rules and have individually considered their respective interests and
relationships in and with QLT. As a consequence, the Board of Directors has
determined that of its eight present Directors, six are unrelated and
independent Directors and two are "related", or not "independent", Directors
under the TSX Guidelines and Nasdaq rules, respectively. The two Directors who
are considered related and not independent are Mr. Hastings, in view of his role
as President and Chief Executive Officer of QLT, and Dr. Levy, who held the same
position prior to February 17, 2002 and who is currently employed by QLT as the
Chairman of its Scientific Advisory Board.

<PAGE>
                                       29


The number of Directors proposed to be fixed at the Annual Meeting is seven, of
whom five are unrelated and independent. The Board considers its proposed size
of seven Directors to be appropriate at the current time. The functions of the
Committees of the Board are described above.

INDEPENDENCE FROM MANAGEMENT

The TSX Guidelines state that the Board of Directors should have in place
appropriate structures and procedures to ensure that the Board of Directors can
function independently of management. This independence is most simply assured
by maintaining the positions of Chairman of the Board and Chief Executive
Officer as separate positions and appointing a Chairman who is not a member of
management. The Chairman of the Board, Mr. E. Duff Scott, is not a member of
management, and the Board of Directors considers that additionally, by virtue of
the fact that a significant majority of the members of the Board are unrelated
and independent Directors, it is independent from management. As the need
arises, the Board of Directors will meet independently of any related (or not
independent) Director. At each of its quarterly meetings the Board meets for a
given period of time without any related or non-independent Directors present.

DECISIONS REQUIRING PRIOR APPROVAL OF THE BOARD OF DIRECTORS

In addition to matters that must, by law or by the Articles of QLT, be approved
by the Board of Directors, management is required to seek approval from the
Board of Directors for the capital and operating budget for each fiscal year,
for major transactions, or for any single expense which exceeds certain
specified dollar values.

NOMINATION OF NEW DIRECTORS

It is the intention of the Board of Directors that as and when a new nominee is
identified, the Board of Directors 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, including copies of past
minutes of meetings of the Board of Directors, as well as information regarding
QLT's business and operations. The Corporate Governance and Nominating Committee
has been charged with reviewing the current orientation and education program
and recommending and initiating improvements to this program as warranted.

INVESTOR RELATIONS

Through its internal personnel and outside advisors, QLT receives and responds
to Shareholder inquiries. Shareholder inquiries and concerns are dealt with
promptly at the senior management level. In addition, management participates in
a conference telephone call with the investment community after release of each
quarterly or annual financial report (as required), and will do so on other
individual occasions if considered necessary in order to maintain an effective
dialogue with the investment community.

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 Board of
Directors acting in discharge of its duties to manage corporate governance
matters. The Audit and Risk Committee has authority to engage external advisors
as it considers warranted.


<PAGE>
                                       30


                     REPORT OF THE AUDIT AND RISK COMMITTEE

The members of the Audit and Risk Committee are "independent" as that term is
defined in the National Association of Securities Dealers listing standards
currently in effect. On March 6, 2001, the Board of Directors adopted a written
Audit and Risk Committee Charter, which was amended on February 7, 2002 and
appended in QLT's Proxy Statement delivered to Shareholders in 2002. As new
legislative requirements emerge, including those under the Sarbanes-Oxley Rules,
Nasdaq and under Canadian securities legislation, the Audit and Risk Committee
will continue to assess whether any modifications should be made to the Audit
and Risk Committee Charter and will seek Board approval to any changes to that
Charter which are considered warranted.

The Audit and Risk Committee met with management of QLT periodically during the
year to consider the adequacy of QLT's internal controls and the objectivity of
its financial reporting. The Audit and Risk Committee discussed these matters
with QLT's independent auditors and with appropriate financial personnel in QLT.
The Audit and Risk Committee also discussed with QLT's senior management and
independent auditors the disclosure controls and procedures which were designed
by QLT's Chief Executive Officer and Chief Financial Officer and received their
report thereon in advance of their making the certifications required by the
Securities and Exchange Commission and the Sarbanes-Oxley Rules for certain of
QLT's filings with the Securities and Exchange Commission.

The Audit and Risk Committee has reviewed and discussed the audited consolidated
financial statements for the year ended December 31, 2002 with the management of
QLT. In addition, the Audit and Risk Committee has discussed with the
independent auditors for QLT, Deloitte & Touche LLP, the matters required to be
discussed by Statement on Auditing Standards No. 61 (Communication with Audit
Committees). The Audit and Risk Committee has received the written disclosures
and the letter from the auditors required by the Independence Standards Board
Standard No. 1 (Independence Discussions with Audit Committees) and has
discussed with the auditors the auditors' independence. The Audit and Risk
Committee has received the report of the Chief Executive Officer and the Chief
Financial Officer with respect to their assessment of the Company's internal
controls. Based on the discussions and reviews noted above, the Audit and Risk
Committee recommended to QLT's Board of Directors that the audited financial
statements be included in QLT's Annual Report on Form 10-K for fiscal year 2002.

Notwithstanding anything to the contrary set forth in any of QLT's previous or
future filings under the United States Securities Act of 1933 or the Exchange
Act that might incorporate this document or future filings with the SEC, in
whole or in part, the foregoing report will not be deemed to be incorporated by
reference into any such filing.

           Jan Dlouhy (Chair), Peter A. Crossgrove, Alan C. Mendelson
                     MEMBERS OF THE AUDIT AND RISK COMMITTEE

<PAGE>
                                       31


                       APPOINTMENT OF INDEPENDENT AUDITORS

The firm of Deloitte & Touche LLP served as independent auditors for QLT for the
year ended December 31, 2002. Upon the unanimous recommendation of the Audit and
Risk Committee, the Board of Directors has proposed that Deloitte & Touche LLP
continue in this capacity for the current fiscal year. Deloitte & Touche LLP
were first appointed as independent auditors of QLT in 1983.

Both the President and Chairman intend to vote the Common Shares represented by
proxies for which either of them is appointed proxyholder "FOR" the appointment
of Deloitte & Touche LLP at a remuneration to be fixed by the Board of
Directors. If the resolution is not adopted, the Company Act (British Columbia)
provides that the current auditors, Deloitte & Touche LLP, will continue to act
for QLT until such time as the Shareholders approve alternate auditors.

For the years ended December 31, 2002 and 2001, professional services were
performed by Deloitte & Touche LLP, the member firms of Deloitte Touche
Tohmatsu, and their respective affiliates (collectively, "Deloitte & Touche") as
follows:


<TABLE>
<CAPTION>
FISCAL YEAR ENDED                                  2002                 2001
-----------------                             ------------          ------------
<S>                                           <C>                   <C>     
Audit Fees (for audit of QLT's annual         Cdn.$354,125          Cdn.$227,200
financial statements for the respective
year and reviews of QLT's quarterly
financial statements)

Audit-Related Fees (for accounting              Cdn.$7,600                    --
consultation)

TOTAL AUDIT AND AUDIT-RELATED FEES            Cdn.$361,725          Cdn.$227,200

Tax Fees (for advice relating to tax           Cdn.$29,300           Cdn.$30,210
planning and property taxes)

All Other Fees                                          --                    --


TOTAL FEES                                    Cdn.$391,025          Cdn.$257,410

</TABLE>


The Audit and Risk Committee considered and concluded that the provision by
Deloitte & Touche LLP of such financial information and systems design and
implementation services, and other services as were provided to QLT in 2002, is
compatible with maintaining the independence of Deloitte & Touche LLP.

QLT has been advised that a representative of Deloitte & Touche LLP will attend
the Annual Meeting and will have the opportunity to make a statement and respond
to appropriate questions from Shareholders.

                    AUDITED CONSOLIDATED FINANCIAL STATEMENTS

The Audited Consolidated Financial Statements of QLT for the year ended December
31, 2002 together with the Auditors' Report thereon, which are included in QLT's
Annual Report for Canadian regulatory purposes, will be presented at the Annual
Meeting. Additional copies of the Audited Consolidated Financial Statements are
available from QLT's web-site at www.qltinc.com or upon request directly to QLT
to the attention of "QLT Investor Relations", 887 Great Northern Way, Vancouver,
British Columbia, Canada, V5T 4T5 (Phone: 604-707-7000; Fax: 604-707-7001;
e-mail: ir@qltinc.com.

<PAGE>
                                       32


                                 OTHER BUSINESS

The Board of Directors is not aware of any other matter that may be presented at
the Annual Meeting. If other matters properly come before the Annual Meeting,
both the President and Chairman intend to vote the Common Shares represented by
proxy for which for which either of them is appointed in accordance with their
best judgement on such matters.

The contents and the sending of this Proxy Statement have been approved by the
Board of Directors.

DATED at Vancouver, British Columbia, this 17th day of April, 2003.

BY ORDER OF THE BOARD OF DIRECTORS

"Janet Grove"

Janet Grove

Corporate Secretary



<PAGE>
 
                                   EXHIBIT A
 

<Table>
<Caption>
          TSX GUIDELINES FOR EFFECTIVE                           QLT CORPORATE
              CORPORATE GOVERNANCE                           GOVERNANCE PRACTICES
------------------------------------------------  -------------------------------------------
<S>                                               <C>
(1)   THE BOARD OF DIRECTORS SHOULD EXPLICITLY    The Board of Directors of QLT assumes
      ASSUME RESPONSIBILITY FOR STEWARDSHIP OF    responsibility for the stewardship of QLT
      QLT, AND AS PART OF THE OVERALL             and the enhancement of Shareholder value.
      STEWARDSHIP RESPONSIBILITY, SHOULD ASSUME   The Board of Directors has formalized its
      RESPONSIBILITY FOR:                         position on corporate governance in a
                                                  documented mandate of the Board of
                                                  Directors which was accepted by the members
                                                  of the Board of Directors. The Board of
                                                  Directors has also established a Corporate
                                                  Governance and Nominating Committee with a
                                                  mandate to actively review and ensure that
                                                  good corporate governance practices are
                                                  followed. All key issues recommended by the
                                                  TSX Guidelines are included in the mandate
                                                  of the Board of Directors, and include the
                                                  following:

                                                  The Chief Executive Officer, with the
      (a)  ADOPTION OF STRATEGIC PLANNING         active involvement of the Board of
           PROCESS;                               Directors, is responsible for ensuring that
                                                  there are long-term goals and a strategic
                                                  planning process in place for QLT. On an
                                                  annual basis, the Board of Directors and
                                                  management meet together for a strategic
                                                  planning session, where the Board of
                                                  Directors reviews and approves a strategic
                                                  plan. On an on-going basis, the Board of
                                                  Directors monitors management's success in
                                                  implementing the strategies set out in the
                                                  plan and provides guidance and judgement to
                                                  the evolving strategic plan.

                                                  The Board of Directors, through its
      (b)  THE IDENTIFICATION OF THE PRINCIPAL    Committees and as a whole, has a mandate to
           RISKS OF QLT'S BUSINESS AND ENSURING   ensure that there are in place systems to
           THE IMPLEMENTATION OF APPROPRIATE      effectively monitor and manage business
           SYSTEMS TO MANAGE THESE RISKS;         risks, with a view to the long-term
                                                  viability of QLT. The Board of Directors
                                                  and the Audit and Risk Committee
                                                  continually review existing practices and
                                                  systems with a view to improving such
                                                  processes where appropriate.
</Table>


<PAGE>
                                       2


 

<Table>
<Caption>
          TSX GUIDELINES FOR EFFECTIVE                           QLT CORPORATE
              CORPORATE GOVERNANCE                           GOVERNANCE PRACTICES
------------------------------------------------  -------------------------------------------
<S>                                               <C>
      (c)  SUCCESSION PLANNING, INCLUDING         Through its Executive Compensation
           APPOINTING, TRAINING AND MONITORING    Committee, the Board of Directors ensures
           SENIOR MANAGEMENT;                     that QLT has a plan for continuity of its
                                                  officers and an executive compensation plan
                                                  that is motivational and competitive to
                                                  attract, hold and inspire the performance
                                                  of its executive management and other key
                                                  personnel.

      (d)  A COMMUNICATIONS POLICY FOR QLT;       The Board of Directors ensures that QLT has
                                                  in place a formal investment communications
                                                  policy to ensure a continued strong link
                                                  between the Board of Directors, its
                                                  Shareholders and its senior management.
                                                  QLT's Investor Relations and Corporate
                                                  Communication Department seeks and shares
                                                  feedback from institutional investors and
                                                  from Shareholders. The Board of Directors
                                                  is kept informed of any material issue of
                                                  concern to Shareholders and provides
                                                  direction for action as required.

      (e)  THE INTEGRITY OF QLT'S INTERNAL        The Audit and Risk Committee acts on behalf
           CONTROL AND MANAGEMENT INFORMATION     of the Board of Directors in monitoring
           SYSTEMS.                               internal accounting controls and monitoring
                                                  the business conduct of QLT. It reviews
                                                  matters on a quarterly basis relating to
                                                  the financial position of QLT in order to
                                                  provide reasonable assurances that QLT is
                                                  in compliance with applicable laws and
                                                  regulations, is conducting its affairs
                                                  ethically, and that effective controls are
                                                  maintained. The Chief Executive Officer and
                                                  the Chief Financial Officer report
                                                  regularly to the Audit and Risk Committee
                                                  with respect to the integrity of the
                                                  Company's internal controls. The Audit and
                                                  Risk Committee engages the independent
                                                  auditor directly, and meets regularly with
                                                  the independent auditor without management
                                                  present.

(2)   THE BOARD OF DIRECTORS SHOULD BE            A majority of the Board of Directors are
      CONSTITUTED WITH A MAJORITY OF THE          unrelated. Of the eight present Directors,
      INDIVIDUALS WHO QUALIFY AS "UNRELATED"      only two: Mr. Hastings and Dr. Julia Levy
      DIRECTORS (INDEPENDENT OF MANAGEMENT AND    are related Directors; six of the eight
      FREE FROM CONFLICTING INTEREST)             Directors are independent of management and
                                                  free from any business interests or
                                                  relationships that could materially
                                                  interfere with a Director's ability to act
                                                  in the best interests of QLT.
</Table>

 


<PAGE>
                                       3


 

<Table>
<Caption>
          TSX GUIDELINES FOR EFFECTIVE                           QLT CORPORATE
              CORPORATE GOVERNANCE                           GOVERNANCE PRACTICES
------------------------------------------------  -------------------------------------------
<S>                                               <C>
                                                  The TSX Guidelines also recommend that in
                                                  the circumstances where a company has a
                                                  "significant shareholder" (that is, a
                                                  shareholder with the ability to exercise
                                                  the majority of the votes for the election
                                                  of directors) the board of directors should
                                                  include a number of directors who do not
                                                  have interests in or relationships with the
                                                  company or the significant shareholder and
                                                  which fairly reflects the investment in the
                                                  company by the shareholders other than the
                                                  significant shareholder. As of the date of
                                                  this Proxy Statement, QLT does not have
                                                  such a "significant shareholder".

(3)   THE BOARD OF DIRECTORS WILL ASSESS AND      (i)   QLT carries out this assessment and
      DISCLOSE ON AN ANNUAL BASIS (I) WHETHER           discloses its conclusions and the
      THE BOARD OF DIRECTORS HAS A MAJORITY OF          basis therefor annually.
      UNRELATED DIRECTORS AND (II) THE ANALYSIS 
      OF THE APPLICATION OF THE PRINCIPLES
      SUPPORTING THIS CONCLUSION.

                                                  (ii)  In nominating candidates to the Board
                                                        of Directors, the business interests
                                                        and relationships of the candidates
                                                        are reviewed to ensure that such
                                                        nominee would be able to act in the
                                                        best interests of QLT. The Corporate
                                                        Governance and Nominating Committee
                                                        consists of four unrelated Directors
                                                        who are responsible for reviewing and
                                                        making recommendations on the size
                                                        and composition of the Board of
                                                        Directors and standing committees of
                                                        the Board of Directors and in
                                                        reviewing corporate governance
                                                        matters. This Committee, which
                                                        currently consists of Messrs. Scott,
                                                        Crossgrove, Dlouhy and Mendelson was
                                                        formally appointed in November of
                                                        2002 and held its inaugural meeting
                                                        in January of 2003. The Nominating
                                                        Committee, comprised of Messrs.
                                                        Scott, Henriksen and Wood, met in
                                                        early 2003 to assess the performance
                                                        of the Board during 2002 and to make
                                                        recommendations as to the nominees to
                                                        the Board for 2003. That Committee
                                                        will now be replaced by the Corporate
                                                        Governance and Nominating Committee,
                                                        which will assume this and other
                                                        responsibilities.
</Table>

 

<PAGE>
                                       4


 

<Table>
<Caption>
          TSX GUIDELINES FOR EFFECTIVE                           QLT CORPORATE
              CORPORATE GOVERNANCE                           GOVERNANCE PRACTICES
------------------------------------------------  -------------------------------------------
<S>                                               <C>
(4)   THE BOARD OF DIRECTORS SHOULD APPOINT A     This mandate was previously given by the
      COMMITTEE OF DIRECTORS, COMPOSED            Board to the Nominating Committee, and it
      EXCLUSIVELY OF OUTSIDE DIRECTORS (A         has now been given to the newly formed
      MAJORITY OF WHOM ARE UNRELATED DIRECTORS)   Corporate Governance and Nominating
      RESPONSIBLE FOR PROPOSING NEW NOMINEES TO   Committee. Both the earlier Nominating
      THE BOARD AND FOR ASSESSING DIRECTORS.      Committee and the new Corporate Governance
                                                  Committee are/were comprised of only
                                                  outside unrelated directors. The Corporate
                                                  Governance and Nominating Committee will
                                                  annually review the credentials of nominees
                                                  for re-election and ensure qualifications
                                                  are maintained.

(5)   THE BOARD OF DIRECTORS SHOULD IMPLEMENT A   This assessment was carried out by the
      PROCESS FOR ASSESSING THE EFFECTIVENESS OF  Nominating Committee in respect of the
      THE BOARD OF DIRECTORS, ITS COMMITTEES AND  performance of the Board during 2002. The
      THE CONTRIBUTION OF INDIVIDUAL DIRECTORS.   Board has charged the Corporate Governance
                                                  and Nominating Committee with developing a
                                                  more formal assessment process for
                                                  implementation during 2003. Through its
                                                  Nominating Committee, the Board of
                                                  Directors has reviewed the business
                                                  interests and monitors the quality of the
                                                  relationship between management and the
                                                  Board of Directors in order to recommend
                                                  ways to improve that relationship. This
                                                  review will be carried out in the future by
                                                  the Corporate Governance and Nominating
                                                  Committee.

(6)   EVERY COMPANY SHOULD HAVE AN ORIENTATION    As and when a new nominee is identified,
      AND EDUCATION PROGRAM FOR NEW RECRUITS TO   the Board of Directors ensures that a full
      THE BOARD OF DIRECTORS.                     program of orientation and education is
                                                  provided for the nominee, including (but
                                                  not limited to) provision of a complete
                                                  corporate history, including copies of past
                                                  minutes of meetings of the Board of
                                                  Directors, as well as information regarding
                                                  QLT's business and operations. The
                                                  Corporate Governance and Nominating
                                                  Committee has been charged with reviewing
                                                  this orientation and education program and
                                                  recommending improvements as may be
                                                  warranted.
</Table>


<PAGE>
                                       5


 

<Table>
<Caption>
          TSX GUIDELINES FOR EFFECTIVE                           QLT CORPORATE
              CORPORATE GOVERNANCE                           GOVERNANCE PRACTICES
------------------------------------------------  -------------------------------------------
<S>                                               <C>
(7)   EVERY BOARD OF DIRECTORS SHOULD EXAMINE     The Nominating Committee (and, in the
      ITS SIZE TO DETERMINE THE IMPACT OF THE     future, the Corporate Governance and
      NUMBER UPON EFFECTIVENESS, AND WHERE        Nominating Committee) and the Board of
      APPROPRIATE, UNDERTAKE A PROGRAM TO REDUCE  Directors as a whole annually examine the
      THE SIZE TO FACILITATE MORE EFFECTIVE       size of the Board of Directors to ensure
      DECISION MAKING.                            that it is optimum for decision making.

(8)   THE BOARD OF DIRECTORS SHOULD REVIEW        The amount and form of Director
      DIRECTOR COMPENSATION AND ENSURE SUCH       compensation is reviewed periodically by
      COMPENSATION REALISTICALLY REFLECTS THE     the Executive Compensation Committee, with
      RESPONSIBILITIES AND RISK INVOLVED IN       any resulting recommendations made to the
      BEING A DIRECTOR.                           full Board of Directors, to ensure that
                                                  such compensation realistically reflects
                                                  the responsibilities and risks of being an
                                                  effective Director.

(9)   COMMITTEES OF THE BOARD OF DIRECTORS        All Committees of the Board of Directors at
      SHOULD GENERALLY BE COMPOSED OF OUTSIDE     QLT are composed entirely of unrelated or
      DIRECTORS, A MAJORITY OF WHOM ARE           independent Directors.
      UNRELATED DIRECTORS.

(10)  THE BOARD OF DIRECTORS SHOULD ASSUME        The Corporate Governance and Nominating
      RESPONSIBILITY FOR, OR ASSIGN TO A          Committee of the Board of Directors ensures
      COMMITTEE OF DIRECTORS, GENERAL             that an effective and efficient approach to
      RESPONSIBILITIES FOR DEVELOPING QLT'S       corporate governance at QLT is developed
      APPROACH TO GOVERNANCE ISSUES.              and implemented. The Committee assesses the
                                                  effectiveness of corporate governance and
                                                  makes recommendations to the full Board of
                                                  Directors.
      
(11)  THE BOARD OF DIRECTORS TOGETHER WITH THE    The Board of Directors maintains an updated
      CHIEF EXECUTIVE OFFICER SHOULD DEVELOP      description of the duties and obligations
      POSITION DESCRIPTIONS FOR THE BOARD OF      for each of the Chair and the Chief
      DIRECTORS AND FOR THE CHIEF EXECUTIVE       Executive Officer, in addition to a mandate
      OFFICER. THE BOARD OF DIRECTORS SHOULD      of the Board. These position descriptions
      APPROVE OR DEVELOP THE CORPORATE            involve the definition of the limits to
      OBJECTIVES WHICH THE CHIEF EXECUTIVE        management's responsibilities. The Board of
      OFFICER IS RESPONSIBLE FOR MEETING.         Directors annually approves the corporate
                                                  objectives which the Chief Executive
                                                  Officer is responsible for meeting.

(12)  THE BOARD OF DIRECTORS SHOULD HAVE IN       The Board meets independently of management
      PLACE APPROPRIATE STRUCTURES AND            at each regular Board meeting. The Chairman
      PROCEDURES TO ENSURE THAT THE BOARD OF      of the Board is an unrelated and
      DIRECTORS CAN FUNCTION INDEPENDENTLY OF     independent member of the Board of
      MANAGEMENT.                                 Directors.
</Table>


<PAGE>
                                       6


 

<Table>
<Caption>
          TSX GUIDELINES FOR EFFECTIVE                           QLT CORPORATE
              CORPORATE GOVERNANCE                           GOVERNANCE PRACTICES
------------------------------------------------  -------------------------------------------
<S>                                               <C>
(13)  THE AUDIT COMMITTEE OF THE BOARD OF         The Audit and Risk Committee of the Board
      DIRECTORS SHOULD BE COMPOSED ONLY OF        of Directors is composed entirely of
      OUTSIDE DIRECTORS AND SHOULD HAVE (I)       outside, unrelated and independent
      SPECIALLY DEFINED ROLES AND                 Directors. The Audit and Risk Committee
      RESPONSIBILITIES; (II) DIRECT               consists of three Directors who are not
      COMMUNICATION CHANNELS WITH THE INTERNAL    involved in the daily operations of QLT.
      AND EXTERNAL AUDITORS; AND (III) OVERSIGHT  The Audit and Risk Committee assists the
      RESPONSIBILITY FOR MANAGEMENT REPORTING IN  Board of Directors in fulfilling its
      INTERNAL CONTROL.                           responsibilities for QLT's accounting and
                                                  financial reporting practices by reviewing
                                                  the quarterly and annual consolidated
                                                  financial statements, reviewing the
                                                  adequacy of the system of internal
                                                  controls, reviewing any relevant
                                                  accounting, financial and security
                                                  regulatory matters, reviewing the
                                                  management of corporate risks and
                                                  recommending the appointment of independent
                                                  auditors, who meet quarterly with
                                                  management and separately with management
                                                  excluded. The Audit and Risk Committee also
                                                  provides a mechanism for communication
                                                  between the Board of Directors and QLT's
                                                  independent auditors, who meet not less
                                                  than quarterly with management and
                                                  separately with management excluded.
                                                  This Committee engages the auditors on
                                                  behalf of the Company, and has the
                                                  authority to engage other external advisors
                                                  as it considers warranted.

                                                  This Committee, which currently consists of
                                                  Dr. Dlouhy, Mr. Crossgrove and Mr.
                                                  Mendelson, held six meetings during 2002.

(14)  THE BOARD OF DIRECTORS SHOULD IMPLEMENT A   Individual Directors may engage outside
      SYSTEM WHICH ENABLES AN INDIVIDUAL          advisers at the expense of QLT, with the
      DIRECTOR TO ENGAGE AN OUTSIDE ADVISOR AT    prior approval of the Chairman. The Audit
      QLT'S EXPENSE, IN APPROPRIATE               Committee has authority to engage external
      CIRCUMSTANCES.                              advisors as it considers warranted.
</Table>


<PAGE>

                              INSTRUMENT OF PROXY

                                    QLT INC.

                      THIS PROXY IS SOLICITED ON BEHALF OF
                   THE MANAGEMENT OF QLT INC. (THE "COMPANY")
                     FOR THE ANNUAL MEETING OF SHAREHOLDERS
                           TO BE HELD ON MAY 22, 2003



The undersigned shareholder of the Company revokes any proxy previously given
and appoints Mr. Paul J. Hastings, the President and Chief Executive Officer of
the Company, or failing him, Mr. E. Duff Scott, the Chairman of the Board of
Directors of the Company, or instead of either of them____________________ as
Proxy, with power of substitution, to attend and vote for the undersigned at the
Annual Meeting of shareholders of the Company to be held on May 22, 2003 at
10:00 a.m. (Vancouver time) at the Four Seasons Hotel, 791 West Georgia Street,
Vancouver, British Columbia, and at any adjournments or postponements thereof,
and to vote the common shares in the capital stock of the Company registered in
the same manner and to the same extent as if the undersigned were personally
present and, without limiting the generality of the foregoing, to vote as
directed below:

1.   To appoint the firm Deloitte & Touche LLP, Chartered Accountants, as
     auditors of the Company for the ensuing year and to authorize the directors
     to fix the remuneration to be paid to the auditors for the ensuing year.

       FOR (    ) WITHHOLD (     )

2.   To fix the number of directors for the ensuing year at seven (7).

       FOR (     )         AGAINST (     )



3.   To elect the following persons as directors of the Company for the ensuing
     year.

     Scott, E. Duff          FOR       (     )  WITHHOLD       (     )
     Hastings, Paul J.       FOR       (     )  WITHHOLD       (     )
     Levy, Julia G.          FOR       (     )  WITHHOLD       (     )
     Crossgrove, Peter A.    FOR       (     )  WITHHOLD       (     )
     Henriksen, Ronald D.    FOR       (     )  WITHHOLD       (     )
     Mendelson, Alan C.      FOR       (     )  WITHHOLD       (     )
     Wood, L. Jack           FOR       (     )  WITHHOLD       (     )


4.   To transact such other business as may properly come before the meeting,
     or at any adjournments or postponements thereof.


     ---------------------------------------------------------------------------
     Signature

     Name (Please Print)


     ---------------------------------------------------------------------------
     Address

     ---------------------------------------------------------------------------

     ---------------------------------------------------------------------------
     Date


     If NOT dated, will be deemed to be dated May 20, 2003.


     ---------------------------------------------------------------------------
     Number of Shares to be voted

     If left blank, all shares registered in your name will be deemed to be
     represented by this proxy.







<PAGE>


                        NOTES TO THE INSTRUMENT OF PROXY
                            FOR THE ANNUAL MEETING OF
                                    QLT INC.
                           TO BE HELD ON MAY 22, 2003


1.       THE COMMON SHARES REPRESENTED BY THIS PROXY WILL BE VOTED ON ITEMS 1 TO
         3 AS YOU MAY HAVE SPECIFIED BY MARKING AN "X" IN THE SPACES PROVIDED
         FOR THAT PURPOSE. IF NO CHOICE IS SPECIFIED, THE COMMON SHARES WILL BE
         VOTED AS IF YOU HAD SPECIFIED AN AFFIRMATIVE VOTE.

2.       IF YOU DO NOT WANT TO APPOINT THE PERSONS NAMED IN THE INSTRUMENT OF
         PROXY AS YOUR PROXY, YOU SHOULD STRIKE OUT THOSE NAMES AND INSERT IN
         THE BLANK SPACE PROVIDED THE NAME OF THE PERSON YOU WISH TO ACT AS YOUR
         PROXY. THAT OTHER PERSON NEED NOT BE A SHAREHOLDER OF THE COMPANY.

3.       If any amendments or variations to matters identified in the attached
         Notice of meeting are proposed at the meeting, or if any other matters
         properly come before the meeting, this Instrument of Proxy confers upon
         the person named as your proxy discretionary authority to vote on such
         amendments or variations or such other matters according to the best
         judgment of the person voting the Instrument of Proxy at the meeting.
         The management of the Company knows of no such amendment, variation or
         other matter to come before the meeting.

4.       The Instrument of Proxy will not be valid unless it is signed and dated
         by you or by your attorney authorized in writing or, if the shareholder
         is a corporation, dated and signed either under corporate seal or by a
         duly authorized officer or attorney of the corporation. If the
         Instrument of Proxy is executed by an attorney for an individual
         shareholder or a corporate shareholder, for the Instrument of Proxy to
         be effective, the power of attorney under which the Instrument of Proxy
         is signed must be deposited in the same manner set out below for the
         depositing of the Instrument of Proxy.

5.       The Instrument of Proxy, to be effective, must be deposited by mail or
         fax at the office of Computershare Trust Company of Canada by 4:30 p.m.
         (Toronto time) on May 20, 2003, or as to any matter in respect of which
         a vote shall not have already been cast at the meeting, by delivering
         the Instrument of Proxy to the Chairman of the meeting on the day of
         the meeting, or at any adjournments or postponements thereof. The
         address for Computershare Trust Company of Canada is:



                      COMPUTERSHARE TRUST COMPANY OF CANADA
                                PROXY DEPARTMENT
                              100 UNIVERSITY AVENUE
                                    9TH FLOOR
                                TORONTO, ONTARIO
                                     M5J 2Y1
 FAX: WITHIN NORTH AMERICA: 1-866-249-7775 OUTSIDE NORTH AMERICA: (416) 263-9524