September 21, 2004

New Wholly Owned Subsidiary Established by Olympus Corporation OLYMPUS BIOMATERIAL CORP. to Specialize in Biomaterials and Tissue Engineering

OSferion : artificial bone replacement material

On September 1, 2004, Olympus Corporation (President: Tsuyoshi Kikukawa) established OLYMPUS BIOMATERIAL CORP. (President: Hitoshi Mizuno) as a wholly owned subsidiary. The new company, which will commence operation on October 1, 2004, will specialize in biomaterials and tissue engineering, encompassing R&D, production and sales. Product areas will include not only bone tissue engineering, in which Olympus has been commercially involved since the fall of 2002, but also artificial bone replacement materials and other related products.

In 1999 Olympus commenced sales of OSferion, an artificial bone replacement materials based on ß-TCP (beta-tricalcium phosphate). Used in orthopedic surgery, this product has unique properties that allow it to be absorbed and replaced to bone tissue as it is absorbed into the body. Olympus moved into the tissue engineering field in 2002 with the aim of creating a commercial bone tissue engineering business based on ß-TCP.

The need for minimally-invasive technologies and enhanced quality of life will increase as society ages. By restructuring its biomaterials and tissue engineering activities as a separate, dedicated entity, Olympus aims to achieve three goals:

1)  accelerate business through faster decision-making; 2)  establish an integrated business structure; and 3)  reinforce synergies between biomaterials and tissue engineering businesses.

In the future, the Olympus Group intends to expand into related areas, including other types of biomaterials such as artificial bone replacement material for dental use, as well as articular cartilage tissue engineering and tissue engineering for tissues and organs other than bones.

OSferion : artificial bone replacement material

Profile of OLYMPUS BIOMATERIAL CORP.

Company name OLYMPUS BIOMATERIAL CORP. Officers President and Representative Director: Hitoshi Mizuno (currently General Manager, Medical New Business Project., Corporate R&D Center, Olympus Corporation) Part-time Director: Shuichi Takayama (also Executive Officer and Division Manager, R&D Planning Division, Corporate R&D Center, Olympus Corporation) Part-time Director: Hisashi Mori (also Division Manager, Corporate Planning Division, Olympus Corporation) Part-time Auditor: Tadao Imai (also Executive Auditor, Olympus Corporation) Head office Shinjuku Monolith, 3-1 Nishi-Shinjuku 2-chome, Shinjuku-ku, Tokyo 163-0914, Japan Business activities Research and development, manufacturing and sales in the fields of biomaterials and tissue engineering and related products Capital 48 million yen Ownership structure Wholly owned by Olympus Corporation Establishment date September 1, 2004 Commencement of operation October 1, 2004 (tentative) Employees 24 (as of October 1, 2004)