Press Release: Source Biomagnetics Diagnostics Corporation

Biomagnetics Concludes Contract Talks With U.S. Government Lab - Preparing Gates Foundation Grant Application Tuesday October 27, 7:15 am PDT

ORANGEVALE, Calif.--(BUSINESS WIRE)--October 27, 2009--Biomagnetics Diagnostics Corp. (OTC: BMGP - News) a developer of revolutionary diagnostic systems and technology for HIV, hepatitis, tuberculosis, and malaria detection, today announced the Company has completed business negotiations with one of the U.S. Government's top national security research institutions regarding the acquisition of rights to the Integrated Optical Biosensor System (IBOS) technology developed by the laboratory personnel. Biomagnetics Diagnostics plans to utilize this technology to enter the significantly underserved market for handheld biosensors capable of detecting a broad range of disease-causing viruses, bacteria and fungi.

“We are very pleased to complete our negotiations as the market’s interest level in this form of technology is significant,” commented Clayton Hardman, CEO of Biomagnetics Diagnostics Corporation. “We have already signed a letter of intent with Bright Dairy, which is China's third largest dairy operation and several other organizations have contacted us about availability of the IBOS platform. In November, we will be meeting with India’s Health Ministry Blood Bank, in New Delhi, specializing in malaria with the goal of conducting clinical trials for product commercialization throughout India. We have also begun to prepare our application for Round 4 of the Bill and Melinda Gates Foundation Grand Challenges grant due November 2nd. The topic of Round 4 is the creation of low-cost diagnostics for priority global health conditions, which include malaria, tuberculosis, and HIV/AIDS. The Gates Foundation states the proposed diagnostics will ultimately need to fill many of the criteria found in the acronym ASSURED: Affordable by those at risk of infection, Sensitive, Specific, User-friendly (simple to perform with minimal training), Rapid and Robust, Equipment-free or minimal equipment, and Delivered to those who need it. We believe the IBOS technology we plan to introduce to the market fills the criteria very adequately and thus, we believe our chances of winning a Gate’s Foundation grant are very high. We look forward to bringing this state of the art technology to market over the coming months.”

According to the World Health Organization, some 3.2 billion people, or about half the world's population is at risk of malaria transmission in 107 countries and territories worldwide. While there are between 350 million and 500 million new cases of malaria each year, there are very few reliable and field deployable diagnostic tools available. In the case of malaria, early detection substantially improves treatability and survivability. Field deployable Integrated Optical Biosensor Systems (IBOS), such as those Biomagnetics Diagnostics is planning to soon introduce hold the promise to significantly speed the diagnostic testing process and to meaningfully lower costs and improve lives.

About Biomagnetics Diagnostics Corporation

Biomagnetics Diagnostics Corporation, 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.

For more information please visit: www.biomagneticsbmgp.com

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.

Biomagnetics Diagnostics, Corp
Clayton Hardman, 916-743-2914
CEO
or
Emerging Growth Research, LLP
Joe Noel, 925-922- 2560