Isonics Protection Plus Homeland Security Subsidiary Awarded Federal GSA Schedule

GOLDEN, Colo. - Isonics Corporation, committed to the development of next-generation technology for the homeland security and semiconductor markets, today announced that its Protection Plus Security Consultants (PPSC) subsidiary has been awarded a U.S. General Services Administration (GSA) Federal Supply Schedule. The GSA Schedule significantly streamlines the process through which PPSC can win contracts to provide security-related services to federal agencies, and is expected to facilitate similar high-value opportunities at the state and local levels.

Receipt of the GSA Schedule is the latest milestone in Isonics' recently announced business initiative to expand PPSC's focus from the private to the public sector, in an effort to develop new high-value revenue sources through government contracts. The U.S. Senate recently passed a $31.8 billion Homeland Security spending bill.

"The GSA Schedule provides a significant validation by the federal government of the strength and quality of homeland security services provided by our PPSC subsidiary," said Boris Rubizhevsky, President of Isonics Corporation's Homeland Security and Defense Corporation. "Further, the award supports our intentions to develop government business and revenue opportunities for both services and products in the months and years ahead."

The GSA award shortens the contract negotiation process by detailing pre-approved specifics relating to pricing and services. Importantly, the GSA Schedule is expected to greatly facilitate the Company's ability to finalize similar security contracts for services to state government agencies and local municipalities. In 2004, the government spent more than $377 million within the specific areas outlined in PPSC's GSA Schedule award. This is the first of many Schedule categories that PPSC will petition for under the GSA award process.

Isonics PPSC subsidiary provides a wide range of defense-related services, including armed escort personnel, electronic security systems, mobile vehicle controls, forensic analysis, communications security, and other security expertise. In 2004, PPSC generated unaudited revenues of approximately $13 million through its business in the private sector. Isonics believes the award of government services contracts may significantly increase PPSC revenues. PPSC was acquired by Isonics this year as part of the Company's strategy to build a multi-dimensional, high-growth homeland security business capable of delivering a range of next-generation technologies and services to the global marketplace. Isonics' next-generation security and defense technology includes the NeutroTest(TM) portable explosive detection device, other neutron-based technologies and other advanced technologies. Isonics recently announced the first sales of the first-generation handheld NeutroTest(TM) explosive detection product. Isonics has executed a Letter of Intent to acquire IUT-Berlin, a longtime business and technology development partner developing a portfolio of advanced homeland security and defense technology.

In related news, Isonics announced the hiring of two new professionals who will concentrate on government-related business duties within the Isonics' Homeland Security & Defense Corporation. They will be based in Isonics' Washington, D.C., area offices.

Victoria Bokhari has been appointed to the position of Contracts Manager, in which she will be responsible for the search, review, response and management of the Company's federal, state and local contract activities.

Eric Tibbs, scheduled to assume the position of Sales Manager in August, comes to the Company from the U.S. Air Force, where he had risen to the rank of Captain. Mr. Tibbs, who graduated from the Air Force Academy with an engineering degree, has been trained in chemical, biological and nuclear warfare defense, and has experience in Operational Test and Evaluation and Acquisition Management. He also served in the Air Force as Test Manager for Vehicle Explosive Detection Systems.