MONTREAL, QUEBEC–(EMWNews – July 21, 2008) – Further to Velan Inc. (TSX:VLN) press release of June 30th whereby Velan announced that it has entered into a definitive agreement with BPS S.r.l. (“BPS”) for the sale of its 50% interest in Velan S.r.l. (“SRL”), the sale was completed on July 21st, 2008.

BPS has paid $44.4 million (EUR27,650,000) and Velan expects to record a gain of approximately $37.5 million in the first quarter of its fiscal 2009 year.

Velan and BPS, which is owned by five senior executives of SRL, established SRL in 2003 to manufacture Trunnion Mounted API6D and 6A ball valves. SRL, whose name has been changed to Valbart, will continue to supply valves to the Velan Group.

Mr. Tom Velan, Velan’s President, said “We are very proud of the world class company that has grown out of a meeting of the minds which took place just 5 years ago. Both partners have agreed to keep a business relationship in the future on a different commercial basis in order to continue to supply superior quality API 6D and 6A ball valves to the Oil & Gas industries.”

Except for historical information provided herein, this press release may contain information and statements of a forward-looking nature concerning the future performance of the Company. These statements are based on suppositions and uncertainties as well as on management’s best possible evaluation of future events. As a result, readers are advised that actual results may differ from expected results.

T.C. Velan

President