Press Release: Source Biomagnetics Diagnostics Corporation

BioMag Granted Permission from the Mexican Government to Conduct Clinical Trials in Mexico Friday August 25, 9:01 am ET

ORANGEVALE, Calif.--(BUSINESS WIRE)--August 25, 2006--BioMag Corp. (OTC: BMGC - News) announced today that it has been approved by the Mexican Government and the Mexican Health Ministry to conduct clinical trials for the company's patented High Throughput Screening - Magnetic Testing Platform (HTS-MTP).

The company has partnered with the largest social institute in Latin America, Instituto Mexican del Seguro Social ("IMSS"), to conduct clinical trials in Mexico. The company has been assigned to Dr. Jose Dante Amato Martinez with IMSS who will be the company's coordinator, and has agreed to jointly conduct research, develop protocols and perform clinical trials to validate the company's HTS-MTP technology, leading to the commercialization of the company's products in Mexico. Amato has already introduced the company to leading IMSS doctors across Mexico that will be heading the project and developing the necessary protocols.

Clayton Hardman, president and CEO of BioMag Corp., stated, "Now that we have been approved to conduct clinical trials in Mexico, this streamlines the process immensely and prepares the company for a smooth transition from the prototype phase directly to clinical trials and, of course, ultimate commercialization. Once the prototypes have been completed we will move immediately into clinical trials with no delays. The company has attained many milestones this year, and we are making significant progress toward seeing our technologies commercialized."

The company believes that clinical trials will confirm that the system will offer the medical industry a unique method that provides confirmatory and viral load diagnostics at the same cost of screening assays. It is also expected that the HTS-MTP will detect any virus or bacteria and count the viral load in a matter of minutes, and has the capabilities of screening several hundred percent more assays per hour at a fraction of the cost of current technologies. The HTS-MTP patented diagnostics system uses Magnetic Resonance (MR) sensors integrated into the company's exclusive technology providing High Throughput Screening (HTS) with the company's proprietary immunoassays incorporating super paramagnetic or ferromagnetic micro-spheres in a ternary complex.

About BioMag Corp.

BioMag Corp., through its wholly owned subsidiary, Biospectrum Technologies Inc., a company that has designed and patented revolutionary diagnostic equipment and immunoassays, will identify market inadequacies and fill those needs with new technologies and highly specific and sensitive assays that are qualitative (yes/no) and quantitative (viral load/degree of infection), easily performed and cost-effective.

Forward-Looking Statement

This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All forward-looking statements are inherently uncertain as they are based on current expectations and assumptions concerning future events or future performance of the company. Readers are cautioned not to place undue reliance on these forward-looking statements, which are only predictions and speak only as of the date hereof. In evaluating such statements, prospective investors should review carefully various risks and uncertainties identified in this release and matters set in the company's SEC filings. These risks and uncertainties could cause the company's actual results to differ materially from those indicated in the forward-looking statements.

Contact: Paul Hardman, (916) 987-7078
Source: BioMag Corp.