AVMD Completes Final Prototypes of Ultrasonic Nebulizer Device; Files Worldwide Patent and Design Applications.

SYDNEY, Australia -- Advanced Medical Institute Inc. (Pink Sheets:AVMD) announced today that Intelligent Medical Technologies Pty Ltd ("IMT"), a 93% subsidiary of its wholly-owned Australian operating company, has completed two of its final prototypes suitable for mass production for an ultrasonic nebulizer device to be used in the treatment of sexual dysfunction and has filed worldwide patent and design applications covering its technology.

In November 2003, IMT was granted the exclusive worldwide rights to manufacture, sell and distribute and sub-license products relating to the technology and associated patents for use in the treatment of sexual dysfunction by Sheiman Ultrasonic Research Foundation. Under its license, IMT owns the right to all improvements to the base technology regardless of the field of application.

"We have now completed two final prototype devices which are suitable for mass production with another eight scheduled for completion shortly," said Dr. Jacov Vaisman, president, chief executive and chairman of the board. "We have been very pleased with the initial engineering results of our device. The nebulizer delivers a droplet size of approximately five micron, ideal for the delivery of drugs through inhalation. The flow rate of our device appears to be approximately five times the flow rate of the published flow rate results for a similar device produced by Omron, a medical device manufacturer which manufactures Nebulizers for drug delivery, the Omron NE Mesh Nebulizer. While we have been advised that clinical trials are not required for sale of the device in the U.S., Europe or Australia, we intend to shortly begin a pharmacokinetic clinical trial to test the ability of our device to deliver drugs, such as those used to treat sexual dysfunction, faster and more efficiently than previously possible. This testing will be conducted by an independent contract research organization specializing in clinical studies. We also expect to file an application to include the device on the register of medical devices with the Therapeutic Goods Administration (the Australian functional equivalent to the U.S. FDA) and the European Medicines Agency within the next three months, based on the current state of preparation of our applications," he added. "Our goal is to complete commercialization of the IMT Nebulizer to enable more efficient as well as cost effective delivery of proven medications in the field of sexual dysfunction. We believe that the use of nebulizers as a method of medication delivery will increase substantially over the next few years and we were pleased to note that the U.S. FDA recently approved delivery of insulin for treatment of certain types of diabetes though a nebulizer device," he continued.

About the Company

Advanced Medical Institute Inc. (Pink Sheets:AVMD), through its wholly owned subsidiary, Advanced Medical Institute Pty Limited (AMI Australia), headquartered in Sydney, Australia, is a leading provider of treatment programs for erectile dysfunction and premature ejaculation. The Company operates 21 treatment clinics in Australia and New Zealand, a centralized call center in Australia, has more than 195 employees, including 47 medical personnel, and since its inception has provided treatment to more than 250,000 patients. AMI Australia and its predecessor company began treating ED and PE patients successfully 6 years prior to the launch of Viagra, in 1999, in Australia.

This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current expectations or beliefs, including, but not limited to, statements concerning the company's operations and financial performance and condition. For this purpose, statements that are not statements of historical fact may be deemed to be forward-looking statements. The company cautions that these statements by their nature involve risks and uncertainties, and actual results may differ materially depending on a variety of important factors, including, among others, the impact of competitive products and pricing; changes in consumer preferences and tastes or perceptions of health-related issues; effectiveness of advertising or market-spending programs; changes in laws and regulations; fluctuations in costs of production, foreign exchange and interest rates; and other factors as those discussed in the Company's reports filed with the Securities and Exchange Commission from time to time.