Research Update

        
     PAION and ERGOMED complete enrolment of Phase IIa study with CNS 5161 in opioid-refractory cancer pain 
    - Open label study completed
- Analgesic effects observed at all doses
- Full data package available end Q1 2009
    Aachen (Germany) and Frankfurt (Germany) 22 December 2008 - The biopharmaceutical company PAION AG (ISIN
DE000A0B65S3; Frankfurt Stock Exchange, Prime Standard: PA8; London AIM: PAI) and ERGOMED Clinical Research Limited
today announce the completion of an open-label, single-centre Phase IIa study with PAION's intravenous NMDA receptor
antagonist CNS 5161. The study has been completed by PAION and ERGOMED under a Revenue Sharing and Co-Development
Agreement signed in July 2006.
    In the study, a total of 24 patients with opioid-refractory cancer pain were recruited into six ascending dose
groups. Patients received six doses of the compound over a 24 hour period. The goals of the study were to determine the
maximum tolerated dose and to assess efficacy and pharmacokinetic parameters of CNS 5161. Increasing analgesic effects
were detected with increasing doses. Significant side-effects or psychomimetic effects, often associated to the NMDA
receptor antagonist compound class, have not been observed. The company expects full results of the study at the end of
the first quarter 2009.
    CNS 5161 is an NMDA receptor antagonist for the treatment of neuropathic pain and late-stage cancer pain. Prior to
the now completed Phase IIa study, which was the first multiple administration study of CNS 5161, proof of concept
clinical trials have been conducted to profile the compound as a novel therapy to treat neuropathic pain. Two Phase I
studies have demonstrated the safety and tolerability of CNS 5161 as well as showing evidence of analgesia in a pain
model. In addition, two small Phase II studies have been completed giving single intravenous infusions of CNS 5161 to
patients with long standing intractable neuropathic pain. Both studies reported analgesic effects of CNS 5161 without
psychomimetic effects.
    Dr Wolfgang Söhngen, CEO of PAION commented: "It is very encouraging that despite the small study size, analgesic
effects were observed throughout all patient groups without significant side-effects. Together with ERGOMED, we are
going to decide on the next steps once the full results become available. Larger studies are required to fully prove the
promising profile demonstrated by this study and it is likely that partners will be sought to undertake these studies." 
    Dr Miroslav Reljanovic, CEO of ERGOMED added: "We are very pleased with the results from this study with CNS 5161
and we look forward to working with PAION to realise its full value." 
    Pain is an inevitable consequence of most solid cancers. It has been estimated that nearly three million patients in
the seven major markets will require treatment for cancer pain annually and that more than 70 % of late stage cancer
patients suffer from moderate to severe pain (Source Apex Healthcare). Opioids are commonly used for managing moderate
to severe cancer pain, but it has been estimated that around 20 % of patients will experience opioid-refractory pain
that has to be treated using alternative therapies.
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     About PAION 
    PAION is a biopharmaceutical company headquartered in Aachen, Germany. Since the acquisition of CeNeS
Pharmaceuticals, which was completed in June 2008, the company has a second site in Cambridge, UK. The company is
specializing in developing and commercializing innovative drugs for the hospital-based treatment of central nervous
system (CNS) disorders and thrombotic/cardiovascular diseases, indications for which there is a substantial unmet
medical need. PAION intends to further expand its portfolio of drugs by exploiting its core expertise in identifying
high-potential compounds, licensing or otherwise acquiring them and advancing them through the clinical development and
regulatory approval process. Where appropriate, particularly during the late stages of the clinical development and
approval process and the commercialization phase, PAION seeks to collaborate with experienced partners.
     About ERGOMED Group 
    ERGOMED is a specialized international clinical development company offering contract clinical research and
co-development partnerships to biotechnology and pharmaceutical companies worldwide in the fields of neurology, oncology
and immunology. ERGOMED's approach to clinical research ensures effective patient recruitment, reducing the time and
costs of clinical trials and complementing the drug discovery capabilities of its customers and partners. The Company
has a dual business model offering standard clinical trial management contracts and also co-development partnerships to
share the risks and rewards of clinical development.
    For further information visit www.ergomed-cro.com
     Contacts 
Dr Peer Nils Schröder
Director Corporate Communications & Investor Relations
PAION AG
Martinstrasse 10-12
52062 Aachen - Germany
Phone [phone]
E-mail [e-mail]
 www.paion.com
    Teathers
Nomad and broker (AIM)
Shaun Dobson/Claes Spång
Phone [phone]
    ERGOMED Group
Dr Miroslav Reljanovic
CEO
Phone [phone]
E-mail [e-mail]