10QSB

SEC SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-QSB

(X) QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES

EXCHANGE ACT OF 1934.

For the Quarterly Period Ended March 31, 2004

( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES

EXCHANGE ACT OF 1934.

For the transition period from ____________ to ____________

Commission File No. 1-14778

DOR BIOPHARMA, INC.

(Exact name of small business issuer as specified in its charter)

DELAWARE 41-1505029

(State or other jurisdiction of (I.R.S. Employer Identification

incorporation or organization) Number)

1691 Michigan Ave., Suite 435, Miami, FL 33139

(Address of principal executive offices) (Zip Code)

Issuer's telephone number, including area code (305) 534-3383

(Former name, former address and former fiscal year, if changed since last

report)

Check whether the issuer: (1) filed all reports required to be filed by Section

13 or 15 (d) of the Securities Exchange Act during the past 12 months (or for

such shorter period that the registrant was required to file such reports),

and (2) has been subject to such filing requirements for the past 90 days.

Yes [X] No [ ]

At May 1, 2004, 42,042,943 shares of the registrant's common stock

(par value, $.001 per share) were outstanding.

Transitional Small Business Disclosure Format (check one):

Yes [ ] No [X]

PART I. - FINANCIAL INFORMATION

ITEM 1 - FINANCIAL STATEMENTS

DOR BioPharma, Inc.
(A Development Stage Company)
Consolidated Balance Sheets
(unaudited)
	March 31,			December 31,
	2004			2003
Assets
Current assets:
Cash and cash equivalents	$	5,959,546		$	4,117,539
Receivable		87,050			20,954
Prepaid expenses		65,950			155,844
Total current assets		6,112,546			4,294,337
Equipment, net of accumulated depreciation of $147,203 and $141,650		56,486			60,795
Licenses and patent costs, net of accumulated amortization of $508,619 and $384,333		1,893,275			1,896,934
Total assets	$	8,062,307		$	6,252,066
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	233,807		$	211,587
Accrued royalties		200,000			320,000
Accrued compensation and other expenses		94,389			116,638
Debt		347,845			359,067
Total current liabilities		876,041			1,007,292
Stockholders’ equity:
Series B convertible preferred stock, $.05 par value. Authorized 200,000 shares; 126,488 issued and outstanding in 2003, at liquidation value		-			12,648,768
Common stock, $.001 par value. Authorized 100,000,000 shares; 42,042,943 and 34,893,765 issued, 41,870,601 and 34,721,423 outstanding		42,044			34,894
Additional paid-in capital		82,754,365			67,005,276
Deficit accumulated during the development stage		(75,141,876	)		(73,975,897	)
		7,654,533			5,713,041
Less: Cost of 172,342 shares of common stock in treasury		(468,267	)		(468,267	)
Total stockholders’ equity		7,186,266			5,244,774
Total liabilities and stockholders’ equity	$	8,062,307		$	6,252,066
See accompanying notes to consolidated financial statements.

DOR BioPharma, Inc.
(A Development Stage Company)
Consolidated Statement of Operations
(unaudited)
							Cumulative Period
	Three Months						February 15, 1985
	Ended March 31,						(inception) to
	2004			2003			March 15, 2004
Grant revenue	$	66,095		$	-		$	249,912
Expenses:
Cost of revenue		59,486			-			221,851
Proprietary research and development		702,677			387,901			23,679,401
General and administrative		478,578			2,033,877			21,017,168
Write-off of acquired in-process research and development		-			-			10,181,000
Total expenses		1,240,741			2,421,778			55,099,420
Loss from operations		(1,174,646	)		(2,421,778	)		(54,849,508	)
Other income (expense):
Interest income		16,712			6,672			3,616,715
Interest expense		(8,272	)		(3,012	)		(430,493	)
Other income		565			-			237,065
Equity in joint ventures		-			-			(22,179,091	)
Total other income (expense)		9,005			3,660			(18,755,804	)
Net loss		(1,165,641	)		(2,418,118	)		(73,605,312	)
Preferred stock dividends and charge for induced conversion		(503,195	)		(231,028	)		(7,763,826	)
Net loss applicable to common stockholders	$	(1,669,176	)	$	(2,649,146	)	$	(81,369,138	)
Basic and diluted net loss per share applicable to common stockholders	$	(0.05	)	$	(0.10	)
Basic and diluted weighted average common shares outstanding		36,796,223			27,261,478
See accompanying notes to consolidated financial statements.

DOR BioPharma, Inc.
(A Development Stage Company
Consolidated Statement of Cash Flows
(unaudited)
								CumulativePeriod
		Three Months						February 15, 1985
		Ended March 31,						(inception) to
		2004			2003			March 31, 2004
Operating activities:
Net loss	$	(1,165,641	)	$	(2,418,118	)	$	(73,605,312	)
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation and amortization		137,738			70,960			2,272,482
Gain on sale of marketable securities		-			-			(110,244	)
Non-cash stock compensation		-			1,479,385			2,123,554
Equity in (earnings) losses of joint ventures		-			-			22,179,091
Amortization of fair value of warrants		-			-			3,307,546
Gain on sale of assets		225			-			22,084
Write-off patent issuance cost		-			-			499,065
Write-off of acquired research and development		-			-			10,181,000
Change in operating assets and liabilities:
Receivable		(66,096	)		-			(87,050	)
Prepaid expenses		89,927			33,871			(65,950	)
Accounts payable and accrued expenses		(120,062	)		(33,011	)		499,196
Accrued compensation		-			15,508			29,000
Total adjustments		373,392			1,566,713			40,849,434
Net cash used by operating activities		(1,124,249	)		(851,405	)		(32,755,878	)
Investing activities:
Cash received in acquisition of CTD, net		-			-			1,392,108
Patent issuance costs		(128,750	)		(70,077	)		(1,954,301	)
Investment in joint ventures		-			-			(5,274,391	)
Purchases of leasehold improvements and equipment		(1,245	)		-			(1,889,297	)
Proceeds from assets sold		-			-			108,197
Purchases of marketable securities		-			-			(11,004,080	)
Proceeds from sale of marketable securities		-			-			11,114,324
Net Cash used by Investing Activities		(129,995	)		(70,077	)		(7,507,440	)
Financing activities:
Net proceeds from issuance (costs incurred related to issuance) of  common stock		3,045,500			(68,451	)		46,521,531
Proceeds from exercise of options		61,972			32,643			666,281
Proceeds from borrowings under line of credit		-			-			1,150,913
Repayment of amounts due under line of credit, notes payable and capital lease obligations		(11,222	)		(37,928	)		(1,445,626	)
Repayment of note payable issued in exchange for legal services		-			-			(71,968	)
Purchase and retirement of common stock		-			-			(130,000	)
Purchase of common stock for treasury		-			-			(468,267	)
Net cash provided by (used in) financing activities		3,096,250			(73,736	)		46,222,864
Net increase (decrease) in cash and cash equivalents		1,842,006			(995,218	)		5,959,546
Cash and cash equivalents at beginning of period		4,117,540			4,147,164			-
Cash and cash equivalents at end of period	$	5,959,546		$	3,151,946		$	5,959,546
Supplemental disclosure of cash flow:
Cash paid for interest	$	1,521		$	3,012
Preferred stock dividends and charges	$	503,195		$	231,028
See accompanying notes to consolidated financial statements.

DOR BioPharma, Inc.

(A Development Stage Company)

Notes to Consolidated

Financial Statements

These unaudited interim consolidated financial statements of DOR BioPharma, Inc. ("we" or "us") were prepared under the rules and regulations for reporting on Form 10-QSB. Accordingly, we omitted some information and footnote disclosures normally accompanying the annual financial statements. You should read these interim financial statements and notes in conjunction with our audited consolidated financial statements and their notes included in our annual report on Form 10-KSB as ammended for the year ended December 31, 2003, as amended. In our opinion, the consolidated financial statements include all adjustments necessary for a fair statement of the results of operations, financial position and cash flows for the interim periods. All adjustments were of a normal recurring nature. The resul ts of operations for interim periods are not necessarily indicative of the results for the full fiscal year. Certain prior year amounts have been reclassified to conform to the current period presentation, specifically the severance expense as presented as a separate line item in the statement of operations for the three months ended March 31, 2003, rather than as components of proprietary research and development and general and administrative costs.

NET LOSS PER SHARE

Net loss per share is presented in accordance with Statement of Financial Accounting Standards (SFAS) No. 128 for the current and prior periods. We had a net loss for all periods presented, which resulted in diluted and basic earnings per share being the same for all of those periods presented. The potential impact of warrants and stock options outstanding was not included in the calculation because their inclusion would have been anti-dilutive.

STOCK BASED COMPENSATION

We have stock-based employee compensation plans. SFAS No. 123, "Accounting for Stock-Based Compensation," encourages, but does not require companies to record compensation cost for stock-based employee compensation plans at fair value. We have chosen to continue using the intrinsic value method prescribed in Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees," and related interpretations, in accounting for our stock option plans.

We have potential common stock equivalents related to our outstanding stock options. These potential common stock equivalents were not included in diluted loss per share because the effect would have been anti-dilutive. Accordingly, basic and diluted loss per common share and the weighted average number of shares used in the computations are the same for each of the periods presented. There were options to purchase 7.5 million and 3.7 million shares of our common stock outstanding at March 31 2004, and 2003, respectively.

Had compensation cost been determined based upon the fair value at the grant date for awards under the stock option plans based on the provisions of SFAS No. 123, our pro forma net loss and net loss per share would have been as follows for the three months ended March 31:

	2004			2003
Net loss applicable to common stockholders as reported	$	(1,669,176	)	$	(2,649,146	)
Stock-based compensation as reported		-			1,479,385
Stock-based employee compensation expense determined  under fair value method		(575,817	)		(233,535	)
Pro forma net loss	$	(2,244,993	)	$	(1,403,296	)
Net loss per share:
as reported, basic and diluted	$	(0.05	)	$	(0.10	)
pro forma, basic and diluted	$	(0.06	)	$	(0.05	)

The fair value of options in accordance with SFAS 123 was estimated using the Black-Scholes option-pricing model and the following weighted-average assumptions: dividend yield 0%, expected life of four years, volatility of 105% and 105% in 2004 and 2003, respectively, and average risk-free interest rates of 4.5% and 4.5% in 2004 and 2003, respectively.

In 2003, we granted options to employees and directors that were conditional upon stockholder approval of an amendment to our 1995 omnibus option plan, which occurred September 15, 2003. Accordingly, a measurement date did not exist until that approval occurred, and on a quarterly basis through the measurement date, we recorded expense or reversal of expense based on the difference between the exercise price and the current market price. This resulted in a charge of $1,479,385 being recorded in the first quarter of 2003.

LICENSES AND PATENT COSTS

Patent costs, principally legal fees, are capitalized and, upon issuance of the patent, are amortized on a straight-line basis over the shorter of the estimated useful life of the patent or the regulatory life. Licenses of technology with alternative future use are capitalized and are amortized on a straight-line basis over the shorter of the estimated useful life or the regulatory life. Licenses of technology with no alternative future use are expensed as incurred. The useful lives of our licenses and patent costs at March 31, 2004 ranged from 11 to 16 years. The following is a summary of License and Patent assets:

	Weighted average
		Amortization				Accumulated
March 31, 2004		Period		Cost		Amortization		Net
Patents and Licenses			11.60 years	$	2,401,893	$	508,618	$	1,893,275

	Weighted average
		Amortization				Accumulated
December 31, 2003		Period		Cost		Amortization		Net
Patents and Licenses		11.85 years	$	2,281,267	$	384,333	$	1,896,934

Aggregate amortization expense for the three months ended March 31, 2004 was $124,285 .

Estimated amortization for the years ending December 31:

2004	$	255,000
2005		135,000
2006		135,000
2007		135,000
2008		135,000

IMPAIRMENT OF LONG-LIVED ASSETS

Equipment, leasehold improvements, licenses and patent costs, and amortizable intangible assets are reviewed for impairment yearly and whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If the sum of the expected undiscounted cash flows is less than the carrying value of the related asset or group of assets, a loss is recognized for the difference between the fair value and the carrying value of the related asset or group of assets. Such analyses necessarily involve the making of significant judgments.

STOCKHOLDERS' EQUITY

On February 27, 2004, we entered into an agreement with Élan Pharmaceutical Investments ltd., whereby Élan converted all of their outstanding shares of Series B preferred stock into shares of our common stock at a conversion price of $5.11 per share of common stock. In addition, we issued to Élan an additional 376,886 shares of our common stock as an inducement to convert the Series B preferred stock at price significantly higher than what was available on the market.

On March 12, 2004, we completed a private placement of 4,113,924 shares of common stock at $0.79 per share for total net proceeds of $3,045,500. In addition, each investor received a warrant to purchase 0.40 shares of common stock at an exercise price of $0.87 per share along with each share of common stock purchased in the placement. We also paid a commission to our placement agent of $162,500 in cash and warrants to purchase 257,120 shares of common stock at an exercise price of $0.87 per share.

ITEM 2 – MANAGEMENT’S DISCUSSION AND ANALYSIS

The following discussion and analysis provides information to explain our results of operations and financial condition. You should also read our unaudited consolidated interim financial statements and their notes included in this Form 10-QSB, and the our audited consolidated financial statements and their notes and other information included in our Annual Report on Form 10-KSB for the year ended December 31, 2003. This report contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, which are subject to the safe-harbor created by that Section. Forward-looking statements within this Form 10-QSB are identified by words such as "believes," "anticipates," "expects," "intends," "may," "will" "plans" a nd other similar expression;, however, these words are not the exclusive means of identifying such statements. In addition, any statements that refer to expectations projections or other characterizations of future events or circumstances are forward-looking statements. These forward-looking statements are subject to significant risks, uncertainties and other factors, including those identified in Exhibit 99.1 "Risk Factors" filed with this Form 10-QSB, which may cause actual results to differ materially from those expressed in, or implied by, these forward-looking statements. Except as expressly required by the federal securities laws, we undertake no obligation to publicly update or revise any forward-looking statements to reflect events or , circumstances or developments occurring subsequent to the filing of this Form 10-QSB with the SEC or for any other reason and you should not place undue reliance on these forward-looking statements. You should carefully review and consider the various disclosures the Company makes in this report and our other reports filed with t he SEC that attempt to advise interested parties of the risks, uncertainties and other factors that may affect our business.

Overview:

We are a biopharmaceutical company focused on the development of biodefense vaccines, and therapeutics intended for areas of unmet medical need. Through our biodefense program we are developing bioengineered vaccines designed to protect against the deadly effects of ricin toxin and botulinum toxin, both of which are considered serious bioterrorism threats. The underlying technologies are exclusively licensed by us from two leading university research centers.

Our lead therapeutic product, orBec® (oral Beclomethasone dipropionate), is in the final stages of a pivotal phase III clinical trial for the indication of treatment of grade II Graft-versus-Host Disease (GvHD) with gastrointestinal involvement, a frequent complication following allogeneic bone marrow transplant. OrBec® is a potent, topically-active corticosteroid and there are currently no Food and Drug Administration (FDA) approved products on the market indicated for Grade II GvHD with gastrointestinal involvement. The indication has been granted Fast Track status and received Orphan Drug Designation by the FDA. Our intent is to submit a New Drug Application (NDA) with the FDA by the end of 2004 for this indication. A clinical trial exploring the prophylactic potential of orBec® in acute intestinal GvHD is currently under consideration. OrBec® is also being considered for additional the rapeutic indications that involve inflammatory conditions of the gut, including Crohn’s Disease and Ulcerative Colitis.

We have developed lipid-based oral drug delivery systems for the delivery of proteins and water insoluble drugs. We have preclinical animal data demonstrating the oral delivery of the drug leuprolide, an FDA approved injectable anticancer product.

Plan of Operation:

Our business strategy is to (1) enhance the value of in-licensed technologies through research and development, specifically preclinical and clinical testing towards regulatory approval; (2) solicit government support for our biodefense program; (3) identify and acquire rights to new therapeutic compounds; (4) market biodefense vaccine products directly to the U.S. and European military and governmental agencies and; (5) sell or out-license therapeutic products that have reached an advanced state of development or no

longer meet our strategic criteria.

Our intent going forward is to (a) complete enrollment in the phase III orBec® clinical trial (b) prepare and submit a New Drug Application (NDA) to the U.S. Food and Drug Administration (FDA) for treatment of grade II Graft-versus-Host Disease with gastrointestinal (GI) involvement; (c) initiate additional clinical trials to explore the effectiveness of oral Beclomethasone Dipropionate in other therapeutic indications involving inflammatory conditions of the GI tract;; (d) identify a marketing and sales partner for orBec® in the U.S. and abroad; (e) win government funding for our biodefense programs through grant applications (f) identify and secure development and manufacturing partners for the biodefense vaccines and transition the biodefense programs from the academic institutions into commercial manufacturing facilities with the goal of soliciting government contracts (h) acquire or l icense new clinical-stage compounds for development. The details of our plan of operation are outlined below.

The enrollment phase in our pivotal Phase III clinical trial for orBec® is nearing completion and our intent is to begin submitting an NDA for orBec® in 2004. We have assembled an experienced team of employees and contractors who are currently working on all aspects of the NDA preparation, including data collection and management, data analysis, medical writing, etc. In addition, manufacturing of the requisite batches of drug product (registration batches) is complete, and these batches are currently being tested for stability over an extended period of time, allowing a determination of the drug’s shelf life.

We plan to evaluate additional clinical applications for orBec®, involving inflammatory conditions of the gut and liver, through investigational clinical trials. We have had preliminary discussions with a number of pharmaceutical companies, regarding the sale of orBec®, or a partnership for its marketing and distribution. It is our intent to secure a marketing partner in the U.S. and abroad in anticipation of commercialization of orBec®, and future development for potential additional indications.

With respect to our ricin vaccine program, work to date has been funded by us through a sponsored research agreement with the University of Texas Southwestern Medical Center. It is our intent to fund further development of the vaccine through government research grants and/or a strategic partnership with a commercial partner, however in the event that neither of these funding strategies are available, we will consider other options. The initial goal for this program is for our academic development partners, the University of Texas Southwestern Medical Center, to file an investigator sponsored Investigational New Drug (IND) application with the FDA for the purposes of conducting a safety and limited efficacy (phase I) clinical trial in healthy human volunteers. We anticipate the filing of this IN D in within the next six months. Currently the vaccine is being developed for intramuscular delivery; as well as a parallel development program in which we are working on a formulation of the vaccine that would be delivered nasally. A nasally-delivered formulation would serve to facilitate rapid inoculation of large groups of people, and potentially confer protection to the mucosal surfaces of the body, including the gut and lungs.

Our botulinum vaccine program has made some important strides, in addition to ongoing work with the lead antigen which we have previously developed; we are working on an additional antigen to address a second serotype of the botulinum toxin. To date much of the work, which is taking place at Thomas Jefferson University (TJU), has been funded by us and we plan to continue to fund the development of additional antigens against other serotypes of botulinum toxin. In addition we have applied for and will continue to apply for research grants from the U.S. government to initially fund the transition of the manufacturing of the lead antigen followed by subsequent antigens, from TJU to commercial facilities.

The goal of the biodefense program is to supply the United States government with qualified countermeasures to protect individuals against ricin toxin and botulinum toxin.

Finally, we are actively screening and pursuing potential in-licensing opportunities for clinical stage compound(s) for development

Critical Accounting Policies:

Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities and expenses, and related disclosure of contingent assets and liabilities. On an on-going basis, we evaluate these estimates and judgments. Currently, the most significant estimate or judgment that we make is whether to capitalize or expense patent and license costs. We make this judgment based on whether the technology has alternative future uses, as defined in SFAS 2, "Accounting for Research and Development Cost s." Based on this consideration, we capitalized all outside legal and filing costs incurred in the procurement and defense of patents, as well as amounts paid allowing us to license additional methods of vaccine delivery through the Southern Research Institute patents, and amounts paid to University of Texas Southwestern Medical Center allowing us the ability to license certain patents related to a vaccine protecting against ricin toxin. These intangible assets are reviewed for impairment yearly and whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If the sum of the expected undiscounted cash flows is less than the carrying value of the related asset or group of assets, a loss is recognized for the difference between the fair value and the carrying value of the related asset or group of assets.

Results of Operations:

We are a development stage company and to date have not generated any material revenues from operating activities.

For the three months ended March 31 2004, we had a net loss of $1,165,641 which was a decrease in net loss of $1,252,477, or 52%, as compared to a net loss of $2,418,118 for the same period in 2003. After giving effect to dividends on preferred stock, which are paid-in-kind in the form of additional shares of preferred stock and preferred stock charges, net loss available to common stockholders decreased $979,970, or 37%, to $1,669,176, or $0.05 per share, for the first three months of 2004 compared with $2,649,146, or $0.10 per share, for the same period of the prior year. This decrease was due primarily to stock compensation expense of $1,479,385 for the three months ended March 31, 2003. 

Research and development expenditures increased $314,776, or 81%, to $702,677, for the three months ended March 31, 2004, compared with $387,901 for the corresponding period ended March 31, 2003. The first quarter increase reflected our continued focus on our phase III clinical trial, as well as the addition of our Ricin and Botulinum Toxin vaccine programs to our product pipeline.

General and administrative expenses decreased $1,555,299, or 76%, to $478,578 for the three months ended March 31, 2004, as compared to $2,033,877 for the three months ended March 31, 2003. This decrease was due primarily to stock compensation expense of $1,479,385 for the three months ended March 31, 2003. That expense resulted from non-cash charges associated with options granted to employees, directors, and consultants that did not have a measurement date until approval by stockholders at our annual meeting of stockholders in September 2003.

Interest income for the three months ending March 31, 2004 was $16,712, an increase of $10,040, or 150%, compared to $6,672 for the same period in 2003. This increase was due to higher cash balances in the first three months of 2004.

FINANCIAL CONDITION AND LIQUDITY:

On March 31, 2004, we had cash and cash equivalents of $5,959,546, compared to $4,117,539 at December 31, 2003. Working capital was $5,236,505 at March 31, 2004, compared to $3,287,045 at December 31, 2003.

For the first three months of 2004, our cash outflows increased by $270,247, or 27%, to $1,265,465 compared to $995,218 for the same period in 2003. The overall increase resulted primarily from a reduction of $120,062 in our short term liabilities and an increase in our patent issuance costs of $128,750.

On February 27, 2004, we entered into an agreement with Élan Pharmaceutical Investments ltd., whereby Élan converted all of their outstanding shares of Series B preferred stock into shares of our common stock at a conversion price of $5.11 per share of common stock. In addition, we issued to Élan an additional 376,886 shares of our common stock as an inducement to convert the Series B preferred stock at price significantly higher than what was available on the market.

On March 12, 2004, we completed a private placement of 4,113,924 shares of common stock at $0.79 per share for total net proceeds of $3,045,500. In addition, each investor received a warrant to purchase 0.40 shares of common stock at an exercise price of $0.87 per share along with each share of common stock purchased in the placement. We also paid a commission to our placement agent of $162,500 in cash and warrants to purchase 257,120 shares of common stock at an exercise price of $0.87 per share.

Based on our current rate of cash outflows, we believe that our cash of $5,959,546 at March 31, 2004, will be sufficient to meet our anticipated cash needs for working capital and capital expenditures for at least the next 12 months. However, from time to time within this period we may decide to seek additional capital in the private and/or public equity markets to support a higher level of growth, to respond to competitive pressures, to develop new products and services and to support new strategic partnership expenditures. After that 12 month period, if any remaining cash balances and any cash generated from operations are insufficient to satisfy our liquidity requirements, we may need to raise additional funds through public or private financings, strategic relationships or other arrange ments. If we receive additional funds through the issuance of equity or equity-linked securities, stockholders may experience significant dilution and these equity securities may have rights, preferences or privileges senior to those of our common stock. The terms of any debt financing may contain restrictive covenants which limit our ability to pursue certain courses of action. Further, we may not be able to obtain additional financing when needed or on acceptable terms. If we are unable to obtain additional financing when needed, or to do so on acceptable terms, we may be unable to develop our products, take advantage of business opportunities, respond to competitive pressures or continue our operation.

PART II. - OTHER INFORMATION.

Item 2. Changes in Securities and Use of Proceeds

On February 27, 2004, we entered into an agreement with Élan Pharmaceutical Investments ltd., whereby Élan converted all of their outstanding shares of Series B preferred stock into shares of our common stock at a conversion price of $5.11 per share of common stock. In addition, we issued to Élan an additional 376,886 shares of our common stock as an inducement to convert the Series B preferred stock at price significantly higher than what was available on the market.

On March 12, 2004, we completed a private placement of 4,113,924 shares of common stock at $0.79 per share for total net proceeds of $3,045,500. In addition, each investor received a warrant to purchase 0.40 shares of common stock at an exercise price of $0.87 per share along with each share of common stock purchased in the placement. We also paid a commission to our placement agent of $162,500 in cash and warrants to purchase 257,120 shares of common stock at an exercise price of $0.87 per share.

Item 4. Submission of Matters to a Vote of Security Holders.

There were no items submitted to vote of security holders.

ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K

31.1	Certification of Chief Executive Officer pursuant to Exchange Act rule 13(a)-14(a) (under Section 302 of the Sarbanes-Oxley Act of 2002).
31.2	Certification of Principal FinancialOfficer pursuant to Exchange Act rule 13(a)-14(a) (under Section 302 of the Sarbanes-Oxley Act of 2002).
32.1	Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification of Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
99.1	Risk Factors

______________

Reports on Form 8-K:  

We filed a Current Report on Form 8-K on January 16, 2004 to report the change in our accountants from Ernst & Young LLP to Sweeney, Gates & Co. (Item 4 of Form 8-K).

We filed a Current Report on Form 8-K on March 4, 2004 to report our entering into definitive agreements for the sale of securities in a private placement to selected institutional and accredited investors for gross proceeds of approximately $3.25 million. We also reported the completion of the conversion of all our outstanding preferred stock into common stock (Item 5 of Form 8-K).

We filed a Current Report on Form 8-K on March 15, 2004 to report our completion of the sale of securities in a private placement to selected institutional and accredited investors for gross proceeds of approximately $3.25 million (Item 5 of Form 8-K).

SIGNATURES

In accordance with the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 DOR BIOPHARMA, INC.

May 17, 2004 by /s/ Ralph M. Ellison

  Ralph M. Ellison

  Chief Executive Officer and President

May 17, 2004 by /s/ William D. Milling

  William D. Milling

  Controller (principal financial and accounting officer)

EX-99.1

Risk Factors

You should carefully consider the risks, uncertainties and other factors described below before you decide whether to buy shares of our common stock. Any of the factors could materially and adversely affect our business, financial condition, operating results and prospects and could negatively impact the market price of our common stock. Also, you should be aware that the risks and uncertainties described below are not the only ones facing us. Additional risks and uncertainties that we do not yet know of, or that we currently think are immaterial, may also impair our business operations. The trading price of the common stock offered in this prospectus could decline, and you may lose all or a part of your investment. You should also refer to the other information contained in and incorporated by reference into this prospectus, including our financial statements and the related notes.

Risks Related to our industry

We have had significant losses and anticipate future losses; if additional funding cannot be obtained, we may reduce or discontinue our product development and commercialization efforts and we may be unable to continue our operations.

We are a development stage company that has experienced significant losses since inception and have a significant accumulated deficit. We expect to incur additional operating losses in the future and expect our cumulative losses to increase. All of our products are currently in development, preclinical studies or clinical trials, and we have not generated any revenues from sales or licensing of these products. Through April 30, 2004, we had expended approximately $4.2 million developing our current product candidates for preclinical research and development and clinical trials, and we currently have commitments to spend at least $2.2 million over the next two years in connection with development of our vaccines and therapeutic products, licenses, employee agreements, and consulting agreements. Unless and until we are able to generate licensing revenue from orBec®, our leading product candidate, or another one of our product candidates, we will require additional funding to meet these commitments, sustain our research and development efforts, provide for future clinical trials, and continue our operations. We may not be able to obtain additional required funding on terms satisfactory to our requirements, if at all. If we are unable to raise additional funds when necessary, we may have to reduce or discontinue development, commercialization or clinical testing of some or all of our product candidates or take other cost-cutting steps that could adversely affect our ability to achieve our business objectives. If additional funds are raised by our issuing equity securities, stockholders may experience dilution of their ownership interests, and the newly issued securities may have rights superior to those of the common stock. If additional funds are raised by the issuance of debt, we may be subject to limitations on our operations.

If we are unsuccessful in developing our products, our ability to generate revenues will be significantly impaired.

To be profitable, our organization must, along with corporate partners and collaborators, successfully research, develop and commercialize our technologies or product candidates. Our current product candidates are in various stages of clinical and preclinical development and will require significant further funding, research, development, preclinical and/or clinical testing, regulatory approval and commercialization, and are subject to the risks of failure inherent in the development of products based on innovative or novel technologies. Specifically, each of the following is possible with respect to orBec® or any of our other product candidates:

• that we will not be able to maintain our current research and development schedules;
• that we will encounter problems in clinical trials; or
• that the technology or product will be found to be ineffective or unsafe.
  

If any of the risks set forth above occurs, or if we are unable to obtain the necessary regulatory approvals as discussed below, we may not be able to successfully develop our technologies and product candidates and our business will be seriously harmed. Furthermore, for reasons including those set forth below, we may be unable to commercialize or receive royalties from the sale of orBec® or any other technology we develop, even if it is shown to be effective, if:

• it is uneconomical or the market for the product does not develop or diminishes;
• we are not able to enter into arrangements or collaborations to manufacture and/or market the product;
• the product is not eligible for third-party reimbursement from government or private insurers;
• others hold proprietary rights that preclude us from commercializing the product;
• others have brought to market similar or superior products; or
• the product has undesirable or unintended side effects that prevent or limit its commercial use.

Our business is subject to extensive governmental regulation, which can be costly, time consuming and subjects us to unanticipated delays.

All of our product offerings, as well as the processes and facilities by which they are manufactured, are subject to very stringent United States, federal, foreign, state and local government laws and regulations, including the Federal Food, Drug and Cosmetic Act, the Environmental Protection Act, the Occupational Safety and Health Act, and state and local counterparts to these acts. These laws and regulations may be amended, additional laws and regulations may be enacted, and the policies of the FDA and other regulatory agencies may change.

The regulatory process applicable to our products requires pre-clinical and clinical testing of any product to establish its safety and efficacy. This testing can take many years and require the expenditure of substantial capital and other resources. We may be unable to obtain, or we may experience difficulties and delays in obtaining, necessary domestic and foreign governmental clearances and approvals to market a product. Also, even if regulatory approval of a product is granted, that approval may entail limitations on the indicated uses for which the product may be marketed. Clinical trials of our lead product candidate orBec® began in 2001 and are not expected to be completed in the next three months.

Following any regulatory approval, a marketed product and its manufacturer are subject to continual regulatory review. Later discovery of problems with a product or manufacturer may result in restrictions on such product or manufacturer. These restrictions may include withdrawal of the marketing approval for the product. Furthermore, the advertising, promotion and export, among other things, of a product are subject to extensive regulation by governmental authorities in the United States and other countries. If we fail to comply with applicable regulatory requirements, we may be subject to fines, suspension or withdrawal of regulatory approvals, product recalls, seizure of products, operating restrictions and/or criminal prosecution.

We will be dependent on government funding, which is inherently uncertain, for the success of our biodefense operations.

We are subject to risks specifically associated with operating in the biodefense industry, which is a new and unproven business area. We do not anticipate that a significant commercial market will develop for our biodefense products. Because we anticipate that the principal potential purchasers of these products, as well as potential sources of research and development funds, will be the U.S. government and governmental agencies, the success of our biodefense division will be dependent in large part upon government spending decisions. The funding of government programs is dependent on budgetary limitations, congressional appropriations and administrative allotment of funds, all of which are inherently uncertain and may be affected by changes in U.S. government policies resulting from various po litical and military developments.

Our products, if approved, may not be commercially viable due to health care changes and third party reimbursement limitations.

Recent initiatives to reduce the federal deficit and to change health care delivery are increasing cost-containment efforts. We anticipate that Congress, state legislatures and the private sector will continue to review and assess alternative benefits, controls on health care spending through limitations on the growth of private health insurance premiums and Medicare and Medicaid spending, price controls on pharmaceuticals, and other fundamental changes to the health care delivery system. Any changes of this type could negatively impact the commercial viability of our products, if approved. Our ability to successfully commercialize our product candidates, if they are approved, will depend in part on the extent to which appropriate reimbursement codes and authorized cost reimbursement levels of these products and related treatment are obtained from governmental authorities, private health insurers and other organizations, such as health maintenance organizations. In the absence of national Medicare coverage determination, local contractors that administer the Medicare program may make their own coverage decisions. Any of our product candidates, if approved and when commercially available, may not be included within the then current Medicare coverage determination or the coverage determination of state Medicaid programs, private insurance companies or other health care providers. In addition, third-party payers are increasingly challenging the necessity and prices charged for medical products, treatments and services.

We may not be able to retain rights licensed to us by third parties to commercialize key products or to develop the third party relationships we need to develop, manufacture and market our products.

We currently rely on license agreements from, the University of Texas Southwestern Medical Center, The University of Texas Medical Branch at Galveston, Thomas Jefferson University, Southern Research Institute, the University of Alabama Research Foundation, and George B. McDonald M.D. for the rights to commercialize key product candidates. We may not be able to retain the rights granted under these agreements or negotiate additional agreements on reasonable terms, or at all. We have also entered into a letter of intent with the University of Texas Southwestern Medical Center, under which we plan to license issued patent and pending patent applications for technologies relating to nasal delivery of ricin vaccine. Although this letter of intent provides for defined business terms, we may not be ab le to come to definitive agreements with the institutions and, as a result, may not obtain critical intellectual property rights on which we expect to rely.

Furthermore, we currently have very limited product development capabilities and no manufacturing, marketing or sales capabilities. For us to research, develop and test our product candidates, we need to contract or partner with outside researchers, in most cases with or through those parties that did the original research and from whom we have licensed the technologies. If products are successfully developed and approved for commercialization, then we will need to enter into collaboration and other agreements with third parties to manufacture and market our products. We may not be able to induce the third parties to enter into these agreements, and, even if we are able to do so, the terms of these agreements may not be favorable to us. Our inability to enter into these agreements could delay o r preclude the development, manufacture and/or marketing of some of our product candidates or could significantly increase the costs of doing so. In the future, we may grant to our development partners rights to license and commercialize pharmaceutical and related products developed under the agreements with them, and these rights may limit our flexibility in considering alternatives for the commercialization of these products. Furthermore, third-party manufacturers or suppliers may not be able to meet our needs with respect to timing, quantity and quality for the products.

Additionally, if we do not enter into relationships with third parties for the marketing of our products, if and when they are approved and ready for commercialization, we would have to build our own sales force. Development of an effective sales force would require significant financial resources, time and expertise. We may not be able to obtain the financing necessary to establish a sales force in a timely or cost effective manner, if at all, and any sales force we are able to establish may not be capable of generating demand for our product candidates, if they are approved.

We may suffer product and other liability claims; we maintain only limited product liability insurance, which may not be sufficient.

The clinical testing, manufacture and sale of our products involves an inherent risk that human subjects in clinical testing or consumers of our products may suffer serious bodily injury or death due to side effects, allergic reactions or other unintended negative reactions to our products. As a result, product and other liability claims may be brought against us. We currently have clinical trial and product liability insurance with limits of liability of $5 million , which may not be sufficient to cover our potential liabilities. Because liability insurance is expensive and difficult to obtain, w e may not be able to maintain existing insurance or obtain additional liability insurance on acceptable terms or with adequate coverage against potential liabilities. Furthermore, if any claims are brought against us, even if we are fully covered by insurance, we may suffer harm such as adverse publicity.

We may not be able to compete successfully with our competitors in the biotechnology industry.

The biotechnology industry is intensely competitive, subject to rapid change and sensitive to new product introductions or enhancements. Virtually all of our existing competitors have greater financial resources, larger technical staffs, and larger research budgets than we have, as well as greater experience in developing products and conducting clinical trials. Our competition is particularly intense in the gastroenterology and transplant areas and is also intense in the therapeutic area of inflammatory bowel disease. We face intense competition in the area of biodefense from various public and private companies and universities as well as governmental agencies, such as the U.S. Army, which may have their own proprietary technologies that may directly compete with our technologies. In addition , there may be other companies that are currently developing competitive technologies and products or that may in the future develop technologies and products that are comparable or superior to our technologies and products. We may not be able to compete successfully with our existing and future competitors.

We may be unable to commercialize our products if we are unable to protect our proprietary rights, and we may be liable for significant costs and damages if we face a claim of intellectual property infringement by a third party.

Our success depends in part on our ability to obtain and maintain patents, protect trade secrets and operate without infringing upon the proprietary rights of others. In the absence of patent and trade secret protection, competitors may adversely affect our business by independently developing and marketing substantially equivalent or superior products and technology, possibly at lower prices. We could also incur substantial costs in litigation and suffer diversion of attention of technical and management personnel if we are required to defend ourselves in intellectual property infringement suits brought by third parties, with or without merit, or if we are required to initiate litigation against others to protect or assert our intellectual property rights. Moreover, any such litigation may not be resolved in our favor.

Although we and our licensors have filed various patent applications covering the uses of our product candidates, patents may not be issued from the patent applications already filed or from applications that we might file in the future. Moreover, the patent position of companies in the pharmaceutical industry generally involves complex legal and factual questions, and recently has been the subject of much litigation. Any patents we have obtained, or may obtain in the future, may be challenged, invalidated or circumvented. To date, no consistent policy has been developed in the United States Patent and Trademark Office regarding the breadth of claims allowed in biotechnology patents.

In addition, because patent applications in the United States are maintained in secrecy until patents issue, and because publication of discoveries in the scientific or patent literature often lags behind actual discoveries, we cannot be certain that we and our licensors are the first creators of inventions covered by any licensed patent applications or patents or that we or they are the first to file. The Patent and Trademark Office may commence interference proceedings involving patents or patent applications, in which the question of first inventorship is contested. Accordingly, the patents owned or licensed to us may not be valid or may not afford us protection against competitors with similar technology, and the patent applications licensed to us may not result in the issuance of patents.

It is also possible that our patented technologies may infringe on patents or other rights owned by others, licenses to which may not be available to us. We are aware of at least one issued U.S. patent assigned to the U.S. Government relating to one component of one of our vaccine candidates that we may be required to license in order to commercialize those vaccine candidates. We may not be successful in our efforts to obtain a license under such patent on terms favorable to us, if at all. We may have to alter our products or processes, pay licensing fees or cease activities altogether because of patent rights of third parties.

In addition to the products for which we have patents or have filed patent applications, we rely upon unpatented proprietary technology and may not be able to meaningfully protect our rights with regard to that unpatented proprietary technology. Furthermore, to the extent that consultants, key employees or other third parties apply technological information developed by them or by others to any of our proposed projects, disputes may arise as to the proprietary rights to this information, which may not be resolved in our favor.

Our business could be harmed if we fail to retain our current personnel or if they are unable to effectively run our business.

We have only nine employees; we depend upon these nine employees to manage the day-to-day activities of our business. Because we have such limited personnel, the loss of any of them or our inability to attract and retain other qualified employees in a timely manner would likely have a negative impact on our operations. Furthermore, these few employees on whom our business depends have limited experience in managing and operating our business. Dr. Ralph Ellison, our Chief Executive Officer and President, was hired in March 2003; Geoff Green, our Chief Operating Officer, was hired in July 2003; Dr. Gregory Davenport, our Vice President of Business Development, was hired in December 2003; William Milling, our Controller, Treasurer and Corporate Secretary was hired in September 2002; and Dr. R obert Brey, our Chief Scientific Officer was hired in December 2002. In addition, Alexander Haig, our Chairman of the Board, was appointed in January 2003. Because of this inexperience in operating our business, there continues to be significant uncertainty as to how our management team will perform. We will not be successful if this management team cannot effectively manage and operate our business.

Risks Related to our Common Stock

Our stock price is highly volatile.

The market price of our common stock, like that of many other development stage public pharmaceutical and biotechnology companies, has been highly volatile and may continue to be so in the future due to a wide variety of factors, including, actual or anticipated fluctuations in our results of operations, announcements of innovations by us or our competitors, additions or departures of key personnel or general market conditions. For example, when ricin was discovered in an apartment in London and we announced that we had retained Mr. Haig as our Chairman of the Board on January 7, 2003; our stock price increased from $0.58 per share to $1.05 per share in one day and has fluctuated between $0.63 per share and $1.57 per share from that date through May 07, 2004. From July 1, 2000 through May 07, 2 004, the per share price of our common stock ranged from a high of $9.44 per share to a low of $0.11 per share, including a high of $2.10 per share and low of $0.11 per share since the beginning of 2002. The fluctuation in the price of our common stock has sometimes been unrelated or disproportionate to our operating performance.

Our stock may not remain listed on the American Stock Exchange

Because we continue to incur losses from continuing operations in fiscal 2003, the stockholders’ equity standard applicable to us of the American Stock Exchange’s continued listing requirements increased to $6 million for fiscal years ending 2003 and beyond. Moreover, our net equity of $2.3 million as of June 30, 2003 did not satisfy the $4 million minimum stockholders’ equity requirement applicable to calendar quarters ending during 2003, and we received notification from the AMEX that we were no longer in compliance with their minimum listing requirements. On August 4, 2003 we submitted a compliance plan, and the AMEX accepted our plan and allowed us 18 months to regain compliance in accordance with the terms of our plan. If, however, we do not conform to our plan, or if after the 18 month period we are not in compliance with the minimum listing requirements, we may be delisted from the AMEX. Furthermore, we cannot assure you that we will continue to satisfy other requirements necessary to remain listed on the AMEX or that the AMEX will not take additional actions to delist our common stock. If for any reason, our stock were to be delisted from the AMEX, we may not be able to list our common stock on another national exchange or market. If our common stock is not listed on a national exchange or market, the trading market for our common stock may become illiquid. Upon any such delisting, our common stock would become subject to the penny stock rules of the SEC, which generally are applicable to equity securities with a price of less than $5.00 per share, other than securities registered on certain national securities exchanges or quoted on the NASDAQ system, provided that current price and volume information with respect to transactions in such securities is provided by the exchan ge or system. The penny stock rules require a broker-dealer, before a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document prepared by the SEC that provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer also must provide the customer with bid and ask quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction and monthly account statements showing the market value of each penny stock held in the customer’s account. In addition, the penny stock rules require that, before a transaction in a penny stock that is not otherwise exempt from such rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser’s written agreement to the transaction. As a result of these requirements, if our common stock were to become subject to the penny sto ck rules, it is likely that the price of our common stock would decline and that our stockholders would find it more difficult to sell their shares.

Stockholders may suffer substantial dilution.

We have a number of agreements or obligations that may result in dilution to investors. These include:

• warrants to purchase a total of approximately 15.4 million shares of our common stock at a current weighted average exercise price of approximately $ 1.40;
• anti-dilution rights associated with a portion of the above warrants which can permit purchase of additional shares and/or lower exercise prices under certain circumstances; and
• options to purchase approximately 8.5 million shares of our common stock of a current weighted average exercise price of approximately $0.72.

To the extent that anti-dilution rights are triggered, or warrants or options are exercised, our stockholders will experience substantial dilution and our stock price may decrease.

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Ralph M. Ellison, certify that:

1. I have reviewed this quarterly report on Form 10-QSB of DOR BioPharma, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The small business issuer’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the small business issuer and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Evaluated the effectiveness of the small business issuer’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(c) Disclosed in this report any change in the small business issuer’s internal control over financial reporting that occurred during the small business issuer‘s most recent fiscal quarter (the small business issuer’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the small business issuer‘s internal control over financial reporting; and

5. The small business issuer’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of small business issuer’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the small business issuer’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer’s internal control over financial reporting.

	DOR BioPharma, Inc.
Date: 05/17/2004	By:	/s/ Ralph M. Ellsion
		Chief Executive Officer
		Title

 

EX-31.2

Exhibit 31.2

CERTIFICATION

I, William D. Milling, certify that:

1. I have reviewed this quarterly report on Form 10-QSB of DOR BioPharma, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The small business issuer’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the small business issuer and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Evaluated the effectiveness of the small business issuer’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(c) Disclosed in this report any change in the small business issuer’s internal control over financial reporting that occurred during the small business issuer‘s most recent fiscal quarter (the small business issuer’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the small business issuer‘s internal control over financial reporting; and

5. The small business issuer’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of small business issuer’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the small business issuer’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer’s internal control over financial reporting.

	DOR BioPharma, Inc.
Date: 05/17/2004	By:	/s/ William D. Milling
		Chief Accounting Officer
		Title

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of DOR BioPharma, Inc. (the "Company") on Form 10-QSB for the period that ended March 31, 2004, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Ralph M. Ellison, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

	DOR BioPharma, Inc.
Date: 05/17/2004	By:	/s/ Ralph M. Ellison
		Chief Executive Offocer
		Title

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of DOR BioPharma, Inc. (the "Company") on Form 10-QSB for the period that ended March 31, 2004, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, William D. Milling, Controller of the Company, certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

	DOR BioPharma, Inc.
Date: 05/17/2004	By:	/s/ William D. Milling
		Chief Accounting Officer
		Title