Inion Trading Update

Tampere, Finland and Takeley, UK. 11^th May 2005.
Inion (LSE: IIN) today provides an update on trading during 2005 to date and its expectations for the remainder of the year.

Since the announcement of the Company's preliminary results on 8^th March 2005, revenues from all of Inion's key product categories have been significantly below management's expectations as a result of a number of factors.

As previously announced Inion has recently changed distributor for its orthopaedic (OTPS™) and cranio-maxillofacial (CPS™) products in several key markets. To date, although the Company has continued to receive positive feedback on its products from surgeons and patients, sales to its new distributor have been developing significantly more slowly than previously anticipated. At the same time, sales to a number of the Company's other distributors have also been below management's expectations.

The Company is continuing to work with all of its distributors to ensure that they have sufficient marketing support from Inion and that the Company's products receive sufficient attention from distributors’ sales representatives. Inion is also in continuing discussions with potential new distributors for its innovative sports and dental product ranges and its new spinal products, which are expected to receive regulatory approval later in the year.

At the time of its preliminary results, the Company indicated that it believed that triple-digit revenue growth from 2004 to 2005 was a challenging but achievable target. In the light of current trading and the management's revised expectations, the Company now believes that significant growth over 2004 will be dependent on achieving a rapid improvement on current trading performance in Inion's CPS™ and OTPS™ lines as well as securing a major dental and sports distribution partner and/or launching the Company's upcoming spinal products in one or more major markets.                        

-Ends-

For further information, please contact:

Inion Oy    

Dr Auvo Kaikkonen, Chief Executive Officer                                               
+358 3 230 6600

Jari Kortesluoma, Chief Financial Officer

Citigate Dewe Rogerson                                                                                                                                   +44 (0)20 7638 9571

David Dible / Mark Swallow

About Inion (www.inion.com)

Inion Oy is a Finnish company that specialises in the development of biodegradable medical implants. Inion’s core expertise and technology lies in the design and manufacture of innovative biodegradable plates, screws, pins and membranes that are used to enhance the healing of skeletal injuries (bone and soft tissue), such as those caused by trauma or by reconstructive surgery. Inion’s implants are made from its proprietary OPTIMA™ family of biomaterials, with properties tailored for specific surgical applications, in terms of strength, flexibility and rate of degradation.

Inion has developed and launched products in four strategic business areas – craniomaxillofacial surgery, orthopaedic trauma, sports medicine and dental surgery – in more than 35 countries worldwide, and has a number of international distribution agreements in place, with among others Stryker Corporation, Citagenix Inc. and Aesculap (part of B.Braun).

Inion was incorporated in early 2000 by an international team of experts in biodegradable materials and their clinical applications, and listed on the Official List of the UK Listing Authority in December 2004. The Company has production and R&D facilities at its corporate headquarters in Tampere, Finland, and a US office in Oklahoma City, OK.

This announcement includes "forward-looking statements" which include all statements other than statements of historical facts, including, without limitation, those regarding the Group's financial position, business strategy, plans and objectives of management for future operations (including development plans and objectives relating to the Group's products), and any statements preceded by, followed by or that include forward-looking terminology such as the words "targets", "believes", "estimates", "expects", "aims", "intends", "will", "can", "may", "anticipates", "would", "should", "could" or similar expressions or the negative thereof. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors beyond the Group's control that could cause the actual results, performance or achievements of the Group to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous assumptions regarding the Group's present and future business strategies and the environment in which the Group will operate in the future. Among the important factors that could cause the Group's actual results, performance or achievements to differ materially from those in forward-looking statements include those relating to Inion’s funding requirements, regulatory approvals, reliance on third parties, intellectual property, key personnel and other factors. These forward-looking statements speak only as at the date of this announcement. The Group expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained in this announcement to reflect any change in the Group's expectations with regard thereto or any change in events, conditions or circumstances on which any such statements are based. As a result of these factors, prospective investors are cautioned not to rely on any forward-looking statement.