Unassociated Document Contact: Dwight Babcock, CEO 520 240 4840 dbabcock@isoray.com ISORAY, INC. ANNOUNCES FISCAL YEAR 2010 RESULTS Expanding Applications and Diversification Expected to Fuel Growth and Sales RICHLAND, W

ISORAY, INC. ANNOUNCES FISCAL YEAR 2010

Expanding Applications and

Diversification Expected to Fuel Growth and Sales

RICHLAND, Washington (September 28,

2010) - IsoRay Inc. (AMEX: ISR,) a medical isotope company and the exclusive

manufacturer of Cesium-131 used in internal radiation therapy for the treatment

of lung, colon, head and neck, and prostate cancers, ocular melanoma, and other

malignant disease through the use of its proprietary radioisotope technology,

announced its financial results for the year ended June 30,

In fiscal year 2010, 97% of revenue was

generated from the sales of ProxcelanTM Cesium-131 brachytherapy seeds for the

treatment of prostate cancer while the other 3% of revenue was generated by

sales of Proxcelan seeds for the treatments of lung, head and neck, ocular and

colon cancer. Since the first implant in October 2004, over 5,000

patients have been treated with ProxcelanTM Cesium-131 brachytherapy seeds for

prostate alone with extraordinary results.

The Company had cash and cash

equivalents of $1,678,869 as of June 30, 2010.

Babcock, IsoRay Chairman and CEO, commented, "We have completed our first phase

of right-sizing the Company as we prepare for our future growth with sales

increasing in the application of Cesium-131 for the treatment of various new

cancer body sites. Our competitors in low dose rate brachytherapy

treating prostate cancer only, experienced another year of declining annual

sales of between 15%-25%. While the Company has yet to achieve its sales goals,

IsoRay remains uniquely positioned as the brachytherapy isotope provider of

choice due to the unique characteristics of Isoray's Cesium-131. Its high energy

and short half-life remain important distinctions."

says the future holds great promise. "With our existing FDA approvals

and established CMS codes, I believe we will see revenue growth from

non-prostate applications and growing numbers of cases as we continue to execute

our business plan and promote Cesium-131 brachytherapy for treatment of cancers

throughout the body. Increasingly, we are hearing from leading physicians,

worldwide, who are requesting Cesium-131 for patients who have an immediate need

for treatment. These physicians are seeking out Cesium-131 as a

solution to the management of challenging oncologic cases, which haven't had the

benefit of an alternative like our isotope available to them in the past," he

year ended June 30, 2010, the Company has seen dramatic improvements in the cost

of product sales, gross margin, operating expenses, net loss and cash burn rate

when compared to fiscal year 2009. We continue to evaluate several FDA-cleared

devices that would expand the use of our proprietary isotope in both seed and

liquid form to expand our reach. In addition, we are investigating other

non-medical uses of our isotope. These non-medical uses will further help to

ensure an expanding revenue base for IsoRay.

milestones achieved during the past fiscal year include several new product

innovations and the continuation of manufacturing process

IsoRay, Inc., through its subsidiary,

IsoRay Medical, Inc., is the sole producer of the Cesium-131 brachytherapy seed,

used to treat prostate and other cancers. The Cesium-131 seed offers a

significantly shorter half-life than the two other isotopes commonly used for

brachytherapy, which results in a substantially faster delivery of therapeutic

radiation, lower probability of cancer cell survival and reduction of the

longevity of common brachytherapy side effects (a)(b). IsoRay is based in

Richland, Washington. More information is available about

IsoRay at www.isoray.com.

Safe Harbor Statement

Statements in this news release about

IsoRay's future expectations, including: the advantages of our Cesium-131 seed,

future demand for IsoRay's existing and planned products, whether the increase

in gross margin and decreases in cost of product sales, operating expenses, net

loss and cash burn rate seen in fiscal 2010 as compared to fiscal 2009 will

continue in the future, whether revenue will increase in future periods, whether

IsoRay will be able to continue to expand its base beyond prostate cancer,

whether IsoRay's Cesium-131 seed will be used to treat additional cancers and

malignant disease, whether Cesium-131 will be successfully used in other

delivery devices to treat malignant disease or in non-medical applications,

whether changes in IsoRay's sales and marketing strategy will result in improved

sales, IsoRay's manufacturing needs and capabilities, whether expansion into new

markets (including non-medical markets) will be successful or result in improved

sales, whether IsoRay will continue to meet Health Canada's requirements and

expectations to sell Proxcelan in Canada, whether IsoRay will be successful in

launching any new products and whether such products will result in cost

increases, whether results of future studies and protocols will support the

findings from initial studies, and all other statements in this release, other

than historical facts, are "forward-looking statements" within the meaning of

the Private Securities Litigation Reform Act of 1995 ("PSLRA"). This statement

is included for the express purpose of availing IsoRay, Inc. of the protections

of the safe harbor provisions of the PSLRA. It is important to note that

actual results and ultimate corporate actions could differ materially from those

in such forward-looking statements based on such factors as physician

acceptance, training and use of IsoRay's products, changing levels of demand for

IsoRay's current and proposed future products, IsoRay's ability to reduce or

maintain net cash used by operating activities, whether the brachytherapy

industry as a whole continues to experience declining sales, whether later

studies and protocols support the findings of the initial studies, success of

future research and development activities, whether initial implants of

Cesium-131 to treat non-prostate cancers result in favorable patient outcomes in

both the short- and long-term, patient results achieved when Cesium-131 is used

for the treatment of cancers and malignant diseases beyond prostate cancer,

IsoRay's ability to successfully manufacture, market and sell its products,

IsoRay's ability to manufacture its products in sufficient quantities to meet

demand within required delivery time periods while meeting its quality control

standards, IsoRay's ability to enforce its intellectual property rights, changes

in reimbursement rates, changes in laws and regulations applicable to our

product both in the United States and internationally, and other risks detailed

from time to time in IsoRay's reports filed with the

Inc and Subsidiaries

Statements of Operations