News

12/05/2002
Press Release

Isonics Acquires Technologies to Detect Explosives, Chemical Weapons and Illegal Drugs and Expects to Begin U.S. Commercialization in Mid-2003
Thursday December 5, 7:31 am ET GOLDEN, Colo.--(BUSINESS WIRE)--Dec. 5, 2002--Isonics Corporation (NASDAQ:ISON - News), a leader in the development of isotopically engineered semiconductor materials, a supplier of silicon-on-insulator wafers, and isotopes for life sciences and health care applications, announced that its subsidiary, IUT Detection Technologies, has acquired the exclusive, world-wide rights to detection technologies for explosives, chemical weapons, illegal drugs and other chemical compounds from the Institut fur Umwelttechnologien GmbH (IUT) of Berlin, Germany, of which Isonics is a minority shareholder. According to James Alexander, Chairman and CEO of Isonics Corporation, "The technology portfolio we have acquired consists of a full product pipeline of devices and technologies based on neutron detection and gamma spectroscopy. A number of these technologies and potential products have been under development at IUT for approximately five years and have been qualified at German military and industrial installations. It is IUT Detection Technologies' mission to complete the development and bring these products to market expeditiously." "The most advanced product, currently in the prototype stage, should be commercially available in the middle of 2003. This product, named NeutroTest, is a portable instrument capable of interrogating small items, such as baggage or suspicious parcels or other objects. It can discriminate between explosives, chemical warfare agents, and benign or inert materials, even through steel casings. In its present form, it can be used to identify landmines and local police and fire departments can use it to assess potential threats in the field. To expand its application, we plan to configure this technology into a form for screening packages or hand carried luggage at airports, office building, and other high security locations." "In the short term, we plan to fund continued development and product manufacturing at IUT's German facility. We expect that this will minimize our start-up costs and allow us to get the products to market at the earliest possible time. It will also provide access to Research Professor, Dr. Jurgen Leonhardt, Founder and President of IUT, a world- renowned scientist, and proven business leader in Germany, who was able to turn his concepts and ideas into successful enterprises." Dr. Leonhardt commented, "We have known Isonics for a number of years and are very familiar with their people and capabilities. We believe that signing this agreement with a US based public company offers the best alternatives for IUT in its quest to reach the largest market for our products. In addition it provides several more options for securing funding needed to expand our business and continue developing our innovative detection technologies. Because of our extensive expertise in these technologies and experience in working with large companies, governments and military forces in Europe, we believe we will bring to the market a proven product line that will facilitate detection and identification of various chemical compounds in a wide- range of applications. We are encouraged by the feedback we have received on our products and are eager to enter the US marketplace." Mr. Alexander of Isonics further noted, "We expect that the industrial and environmental applications for our devices will considerably expand the potential market for these new products. Attracted by the market size and potential, some of the largest US corporations have entered the Homeland Security field through acquisitions, such as GE's recent purchase of Ion Track, a private manufacturer of IMS based systems. Based on our findings, a comparative review of all available technologies shows that our technology and its ability to penetrate closed containers by utilizing neutron detection, should prove to be a formidable competitor in the market." About IUT Detection Technologies Boris Rubizhevsky, Isonics' Vice-Chairman and Senior VP will serve as Chairman and CEO while Dr. Leonhardt will serve as Chief Technology Officer. Under the terms of the agreement IUT will receive a certain number of Isonics common shares and a minority equity interest in IUT Detection Technologies in exchange for exclusive world-wide rights to IUT's neutron detection technology. Isonics will evaluate entering into an investment banking relationship to raise funds for IUT-Detection Technologies either by selling shares in the subsidiary to investors or through strategic alliances with companies looking to expand their markets. A search is underway for an industry veteran with experience in the security field and marketing to government and military procurement operations to lead the company as its President and CEO. About the marketplace According to the Homeland Security Research Corporation, "Marketplace for detection devices will grow from $600 million in 2003 to $8 billion in 2010, and overall spending on the homeland security will grow from $38 billion in 2003 to over $100 billion in 2010." About Isonics Corporation Isonics is a world leader in isotopically engineered materials and produces isotopically pure silicon-28 chemicals and wafers and silicon-on-insulator wafers (SOI) for the semiconductor industry. Isonics also markets and sells stable isotopes for the health care industry such as Oxygen-18 for positron emission tomography (PET) imaging. The company is also a leading supplier of several radioactive isotopes used in medical imaging and therapy. Isotopes can be thought of as ultra pure materials. For additional information visit www.isonics.com. About IUT Berlin, Germany. Institute for Environmental Technology was founded by Dr. Jurgen Leonhardt in 1992 to commercialize scientific breakthroughs developed by him as a former East German Research Scientist. Dr. Leonhardt was educated in East Germany and Russia and has extensive practical experience in the field of nuclear physics. He has served for International Atomic Energy Agency as an expert in their projects and consults regularly on detection of nuclear, chemical and biological weapons. IUT employs 35 people and in addition to developing detection- based products, is a certified analytical laboratory for detecting toxic compounds, poisons, explosives, chemical weapons, heavy compounds in lakes and rivers. In addition, IUT is developing catalytic reactors based on proprietary Plasma Technology that are able to remove high toxicity organic pollutants from the airflow as well as removing bacteria and pathogenic compounds from the ventilation systems of hospitals. For additional information visit www.iut- berlin.com. Except for historical information contained herein, this document contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve known and unknown risks and uncertainties that may cause the Company's actual results or outcomes to be materially different from those anticipated and discussed herein, and which may result in the parties being unable or unwilling to complete the transaction described herein. Further, the Company operates in industries where securities values may be volatile and may be influenced by regulatory and other factors beyond the Company's control. Other important factors that the Company believes might cause such differences are discussed in the risk factors detailed in the Company's 10-KSB for the year ended April 30, 2002 as filed with the Securities and Exchange Commission, which include the Company's cash flow difficulties, dependence on significant customers, and rapid development of technology, among other risks. In assessing forward-looking statements contained herein, readers are urged to carefully read all cautionary statements contained in the Company's filings with the Securities and Exchange Commission. Contact: Investor Awareness, Inc. Tony Schor/Paul Arndt, 847/945-2222 www.investorawareness.com or Isonics Corporation James E. Alexander, 303/279-7900 www.isonics.com