PAION announces dosing of first healthy volunteers in Phase I study with its sedative/anaesthetic CNS 7056

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First-in-man study started

Aachen (Germany), Cambridge (United Kingdom), 25 July 2008 - The
biopharmaceutical company PAION AG (ISIN DE000A0B65S3; Frankfurt
Stock Exchange, Prime Standard: PA8, London AIM: PAI) today announces
that it has dosed the first healthy volunteers in the first-in-man
Phase I study with its sedative/anaesthetic CNS 7056.

CNS 7056 is a new short-acting sedative that acts on GABAA receptors
in the brain. Pre-clinical studies demonstrate that, after
intravenous administration, the compound quickly induces sedation.
Importantly, the sedative effects disappear extremely rapidly after
cessation of administration.

The Phase I study will focus on the safety, tolerability and
pharmacokinetics of single ascending doses of CNS 7056 in healthy
volunteers. In addition, the efficacy of the substance will be
ascertained by assessing the sedation of the volunteers. The
double-blind, placebo-controlled study will enrol up to 91 subjects
and is expected to be completed by the end of the year. A group
treated with Midazolam, the standard drug used for procedural
sedation, will also be included in order to start elucidating the
comparative efficacy profile.

Healthy male or female volunteers will receive a short intravenous
infusion of study drug (CNS 7056, placebo, or midazolam). At the end
of each cohort, a Safety Committee will meet to evaluate the study
data prior to allowing escalation to the next higher dose cohort, if
appropriate. The Safety Committee will be able to stop the trial at
any point.

CNS 7056 is initially being developed as a sedative agent for
hospital and outpatient procedures, such as endoscopies. It has
further potential for the induction and maintenance of anaesthesia
and for long term sedation in the intensive care unit.

Wolfgang Söhngen, CEO of PAION commented: "CNS 7056 is one of the
most prominent compounds in our portfolio and we are very pleased to
see that the Phase I study has now started, soon after we opened the
IND. With its expected quick on/off sedative profile and thus
anticipated faster recovery, CNS 7056 could mark an important
progress for patients undergoing endoscopic procedures such as cancer
screening colonoscopy which is estimated to be carried out 1.6 to 1.7
million times per year in the US alone while the demand is even
higher. We expect that based on the extensive study protocol, even
including a comparator, we will be able to achieve proof-of-concept
for the mode of action within the now started study."

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About CNS 7056
CNS 7056 is a new short-acting sedative and general anaesthetic that
acts on GABAA receptors. The substance was added to PAION's portfolio
by acquiring CeNeS who in turn had acquired the substance from
GlaxoSmithKline. CNS 7056 is a water-soluble, rapid and short-acting
GABAA receptor modulator interacting with the benzodiazepine site.
Data generated to date show that, after intravenous administration,
CNS 7056 rapidly induces sedation which is maintained during
continuous administration. Importantly the sedative effects rapidly
disappear after cessation of administration. The rapid offset of
effect of the compound is due to its metabolism by esterase enzymes
that are widely distributed throughout the body. Therefore it is
anticipated that CNS 7056 can be clinically developed as a sedative
agent for day case procedures, the induction and maintenance of
anaesthesia and as a sedative for mechanical ventilation in the
Intensive Care Unit (ICU). In 2007, CeNeS completed a license
agreement for CNS 7056 with Ono Pharmaceuticals. Under this
agreement, Ono will develop and commercialize CNS 7056 for the
Japanese territory.

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.

Contact
Dr. Peer Nils Schröder, Corporate Communications & Investor Relations
PAION AG
Martinstrasse 10-12
52062 Aachen - Germany
Phone +49 241 4453-152
E-mail pn.schroeder@paion.de
www.paion.de

Landsbanki Securities (UK) Limited
Nomad and broker
Shaun Dobson/Claes Spång
Phone +44 20 7426 9000

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PAION AG
Martinstrasse 10 - 12 Aachen Germany

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