FONAR Launches New Branding as the World's Only Upright™ Multi-Position™ MRI; Will Capitalize on New Department of Defense Contract

Business Wire, June 27, 2006

MELVILLE, N.Y. -- FONAR Corporation (NASDAQ: FONR), The Inventor of MR Scanning(TM), announced today the rebranding of the FONAR Upright(TM) MRI as the FONAR Upright(TM) Multi-Position(TM) MRI. Based on user feedback, the tremendous value of FONAR's unique product, while it scans patients in the usual recumbent position, is its added ability to scan patients and snap the picture of the patient in their position of pain, whether they experience pain standing, sitting, or bending. This breakthrough Multi-Position(TM) versatility transcends the limitations of the conventional single-position-recumbent MRI's in accuracy of diagnosis by its ability to see the full extent of the patient's pathology which single-position conventional MRIs cannot. As a result, it will lead to fewer failed back surgeries and, by helping surgeons get the surgery right the first time, it is expected to significantly lower insurance costs. These multiple advantages make it a more attractive purchase than a single-position MRI.

FONAR management commenced the rebranding campaign at this time to capitalize on the growth opportunities available to it resulting from the recently announced Department of Defense (DoD) contract.

FONAR's rebranding effort focuses on its product's Multi-Position(TM) uniqueness in a market that is otherwise crowded with single-position scanners.

Beyond Upright(TM) imaging - as the former branding had implied - FONAR's Upright(TM) Multi-Position(TM) MRI performs scans with patients in the standard recumbent (lying flat) position plus numerous other weight-bearing positions, such as in flexion, extension, rotation and lateral bending. Similarly, the device can scan cardiovascular patients and those suffering from cerebrovascular insufficiency in the upright positions most likely to engender symptoms. It diagnoses, for example, the important Chiari malformation of the brain wherein patients suffer from sudden blackouts and/or paralyses because the brain falls when the patients are upright and becomes temporarily entrapped in the opening at the base of the skull (foramen magnum). It is an important syndrome. Only the FONAR Upright(TM) Multi-Position(TM) MRI is able to see the entrapment of the upright brain within the foramen magnum. It also likewise readily diagnoses and evaluates, by its power to do upright weight-bearing flexion and extension, the cervical whiplash injury, a common consequence of automobile accidents.

The FONAR Upright(TM) Multi-Position(TM) MRI is the first and only whole-body MRI that performs imaging in a full array of weight-bearing positions, as well as in the recumbent position, so it offers purchasers multiple alternatives to the single-position scanner.

The new branding is being launched to help point out these advantages and spur preference for the Upright(TM) Multi-Position(TM) MRI in contrast to the single-position MRI.

"As a neurosurgeon I have had patients scanned on MRI machines from nearly every manufacturer. None of these scanners give me more value for the money than what I get from the FONAR Upright(TM) Multi-Position(TM) MRI," said Michael H. Brisman, M.D., F.A.C.S., and a Board Certified Neurosurgeon. "The FONAR Upright(TM) Multi-Position(TM) MRI is far more suggestive of an appropriate name for a scanner that has revolutionized the industry and which goes way beyond single-position imaging machines." In 2005, Dr. Brisman was appointed Chief of the Division of Neurosurgery and Co-Director of the Neuroscience Institute at Winthrop University Hospital in Mineola, New York. He is also a co-owner of a FONAR Upright(TM) Multi-Position(TM) MRI at Great Neck Standup MRI, Great Neck, New York. For more information go to: www.neurosurgeryli.com/drbrisman.html

In addition to traditional diagnostic necessities, FONAR's Upright(TM) Multi-Position(TM) MRI addresses a serious need for proper medical evaluation of the approximately 900,000 patients each year in the U.S. who undergo back surgery. The failure rate of this surgery is such that the medical profession has been forced to set aside a specific acronym, FBSS (Failed Back Surgery Syndrome), to identify the high failure rate associated with back surgery. For example there is no acronym for failed brain surgery or failed heart surgery.

Back surgery, spinal injuries and weight dependent orthopedic injuries (knee, foot, hip) are of particular importance to DoD. From the U.S. Army's foot soldiers carrying heavy back packs to the U.S. Air Force's pilots crouched in cockpits to those injured in battle only FONAR's Upright(TM) Multi-Position(TM) MRI addresses the many needs of active and retired military personnel. These include making available to military surgeons the ability to visualize the patient's fully weight-loaded spine in multiple-positions as compared to the single-position of conventional MRI's so that the high failure rate of back surgery can be minimized for military personnel.

In addition, making available the ability to see the pathologies of other weight-bearing orthopedic structures from a multitude of weight-bearing positions is important to DoD. No other single-position MRI product on the market can provide the multi-position weight-bearing MRI images that military surgeons need to optimize their outcomes for military patients.