Inion takes action to significantly reduce headcount        

Tampere, Finland and Takeley, UK 27^th December 2006…Inion Oy (LSE: IIN.L) (“Inion”), a company focused on the development of novel biodegradable medical implants, has today taken the first step in implementing its plans to make significant reductions in its cost base by giving the representatives of employees notice of co-operation negotiations.

Finnish law requires the employer to negotiate with representatives of employees prior to making any decisions on workforce reduction. This process resembles the ‘fair consultation’ required from UK employers in a similar situation.

According to the notice served to the representatives of the employees the Company currently anticipates the loss of 20-30 jobs. The process followed by the employer and the representatives of the employees will explore the grounds, impact and alternatives to headcount reduction. The need and extent of job losses and thus ultimately the cost savings from headcount reduction will be confirmed after the process is complete. In a situation where the employer anticipates the loss of ten or more jobs the statutory minimum length of the process is approximately seven weeks.

Inion currently employs 114 people.

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For further information, please contact:

Inion Oy      

Dr Auvo Kaikkonen, Chief Executive Officer
Julien Cotta, Chief Financial Officer
Tel: +44 (0)1279 874 222

Citigate Dewe Rogerson

Mark Swallow / David Dible / Helena Galilee
Tel: +44 (0)207 638 9571
Mobile +44 (0)7903 737703

About Inion (www.inion.com)

Inion Oy is a Finnish company that specialises in the development of biodegradable medical implants.

The Inion 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 implants are made from its proprietary Inion 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 five strategic business areas – cranio-maxillofacial surgery, orthopaedic trauma, sports medicine, dental surgery and most recently in the spinal implant area – in nearly 50 countries worldwide.

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 operations in the UK, R&D and production facilities 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.