Product Update

RNS Number:4223G
AOI Medical, Inc.
26 October 2007



                               AOI Medical, Inc.

                           BAMF Spine Product Update

London, UK, 26 October 2007 - AOI Medical Inc. (the "Company" or "AOI") (AIM:
AOI), the medical device company focusing on innovative orthopaedic medial
devices for the spine and trauma markets, today announces that the US Food and
Drug Administration ("FDA") has asked AOI to conduct a clinical study of its
BAMF Spine technology. Full details of the content and timing of the study are
presently being negotiated with FDA and AOI will provide an update on those
negotiations once completed.  As described in the Company's Admission Document,
the Directors had anticipated the FDA regulatory path may include clinical
information to support the 510(k) application. While the ultimate path is not
clear, AOI Medical currently has a plan in place to respond to the FDA.

The study will be designed to support substantial equivalence of the BAMF Spine
technology. Study endpoints will include successful deployment and cement
delivery, as well as clinical outcome measures.  As a result of this decision,
the commercial launch of BAMF Spine in the US is now expected to occur in H2
2008.

BAMF Spine is an investigational product which provides a set of tools intended
to be used to address compression fractures of the spine caused by osteoporosis,
cancer or trauma.  BAMF Spine will comprise two main instruments: a cutting
device that creates a cavity in cancellous bone, and a balloon-like device which
is used to restore the height of the fractured vertebra and to deliver and
contain the cement in the cavity.  The set of tools is designed to offer a
potential enhancement over current techniques.

Current techniques used to treat progressive vertebral compression fractures
include vertebroplasty and kyphoplasty (so named by Kyphon, the company that
developed the technology). In July 2007, it was announced that Medtronic (NYSE:
MDT) had acquired Kyphon for $3.9 billion. This acquisition fully underpins the
market opportunity that lies within this area as patients and doctors continue
to seek modern, minimally invasive spinal treatments that enhance patient
life-styles and are simpler, faster and less-invasive than the traditional
surgical treatments. The Directors of AOI believe that the Company has a product
that can significantly challenge the current products on the market.

In 2004, the worldwide market for devices targeted towards spinal conditions had
a value of around $3.5 billion and most recent estimates indicate that the
spinal products market will approach $10 billion by 2010.  The growth is being
driven by increasing incidences of osteoporosis in an ageing population and a
growing number of sports related injuries as people become more active.  In
2009, the BAMF Spine global market size is estimated to be over $500 million.

Bill Christy, CEO of AOI, said:

"We believe the clinical study requested by FDA will demonstrate the successful
performance and ease of use of the BAMF System. The Company is prepared to begin
the study immediately upon FDA's issuance of the investigational device
exemption. A clinical study will provide the Company with useful clinical data
with which to support future marketing activity."

For further details please contact:
AOI Medical Inc.                                      Tel: [phone]
William J. Christy, CEO
Angela Johnston, CFO

Financial Dynamics                                    Tel: [phone]
Ben Atwell

Numis Securities                                      Tel: [phone]
David Poutney
Bruce Garrow



Background to AOI Medical Inc.

AOI is a medical device company focussing on the development and
commercialisation of innovative orthopaedic medical devices for the spine and
trauma markets.  It is progressing the development of three separate technology
platforms: BAMF Spine, BAMF Trauma and Cervical Plate.

Further information can be found at www.aoimedical.net




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