FLUOROPHARMA, INC.
                          (a development stage company)

                          REVIEWED FINANCIAL STATEMENTS

                              AS OF MARCH 31, 2007
                                       AND
                              FOR THE THREE MONTHS
                          ENDED MARCH 31, 2007 AND 2006
                                       AND
                FOR THE PERIOD JUNE 13, 2003 (INCEPTION) THROUGH
                           MARCH 31, 2007 (UNAUDITED)



                                TABLE OF CONTENTS

                                                                            PAGE
                                                                            ----
ACCOUNTANTS' REVIEW REPORT ..............................................      2
FINANCIAL STATEMENTS
   Balance Sheets .......................................................      3
   Statements of Operations .............................................      4
   Statements of Cash Flows .............................................      5
   Notes to Financial Statements ........................................   6-17



[RUCCI, BARDARO & BARRETTPC LOGO]
Certified Public Accountants and Business Advisors

To the Directors and Stockholders
FLUOROPHARMA, INC. (a development stage company)
Boston, Massachusetts

                           ACCOUNTANT'S REVIEW REPORT

We have reviewed the accompanying balance sheets of FLUOROPHARMA, INC. (a
corporation) as of March 31, 2007 and the related statements of operations and
cash flows for the three months ended March 31, 2007 and March 31, 2006, and the
period June 13, 2003 (inception) through March 31, 2007 (unaudited) in
accordance with Statements on Standards for Accounting and Review Services
issued by the American Institute of Certified Public Accountants. All
information included in these financial statements is the representation of the
management of FLUOROPHARMA, INC.

A review consists principally of inquiries of Company personnel and analytical
procedures applied to financial data. It is substantially less in scope than an
audit in accordance with generally accepted auditing standards, the objective of
which is the expression of an opinion regarding the financial statements taken
as a whole. Accordingly, we do not express such an opinion.

Based on our reviews we are not aware of any material modifications that should
be made to the accompanying financial statements in order for them to be in
conformity with generally accepted accounting principles.

The balance sheet as of December 31, 2006 was audited by us, and we expressed an
unqualified opinion on it in our report dated June 29, 2007. We have presented
the balance sheet for comparative purposes only.

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in NOTE A to the
financial statements, the Company's recurring losses from operations,
stockholders' deficiency and working capital deficiency raise substantial
doubt about the Company's ability to continue as a going concern. Management's
plans concerning these matters are also described in NOTE A. The financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.


                                                   Rucci, Bardaro & Barrett, PC

                                                  Rucci, Bardaro, & Barrett, PC
                                                  Certified Public Accountants

Malden, Massachusetts
June 29, 2007

919 Eastern Avenue, Malden, MA 02148 Tel (781) 321-6065 Fax (781) 321-7747
7 Main Street, Atkinson, NH 03811 Tel (603) 362-8383 Fax (603) 362-5299

[Russell Bedford LOGO] A MEMBER OF RUSSELL BEDFORD INTERNATIONAL WITH AFFILIATED
                       OFFICES WORLDWIDE



                FLUOROPHARMA, INC. (a development stage company)

                                 BALANCE SHEETS

                      MARCH 31, 2007 AND DECEMBER 31, 2006

                                                  MARCH       DECEMBER
                                                31, 2007      31, 2006
                                              -----------   ----------
                                     ASSETS

CURRENT ASSETS
   Cash                                       $    23,045   $   175,488
   Deposits and prepaid expenses                   99,980       122,539
                                              -----------   -----------
         TOTAL CURRENT ASSETS                     123,025       298,027
                                              -----------   -----------
EQUIPMENT
   Office equipment                                 9,246         9,246
   Machinery and equipment                         57,321        10,218
                                              -----------   -----------
                                                   66,567        19,464
   Less: accumulated depreciation                  (3,765)       (2,501)
                                              -----------   -----------
         EQUIPMENT - NET                           62,802        16,693
                                              -----------   -----------
OTHER ASSETS
   License agreements, net                         68,800        71,677
   Website development costs                        8,961         9,814
   Loan receivable - related party                     --           508
                                              -----------   -----------
         TOTAL OTHER ASSETS                        77,761        81,999
                                              -----------   -----------
TOTAL ASSETS                                  $   263,588   $   396,989
                                              ===========   ===========

                     LIABILITIES AND STOCKHOLDERS' DEFICIT

CURRENT LIABILITIES
   Accounts payable                           $   298,233   $   235,110
   Accrued liabilities                             62,774        66,009
   Notes payable - related party                  500,000       250,000
                                              -----------   -----------
         TOTAL CURRENT LIABILITIES                861,007       551,119
                                              -----------   -----------
STOCKHOLDERS' DEFICIT
   Common stock                                     3,220         3,220
   Additional paid-in capital                   2,973,063     2,862,586
      Deficit accumulated during the
      development stage                        (3,573,702)   (3,019,936)
                                              -----------   -----------
         TOTAL STOCKHOLDERS' DEFICIT             (597,419)     (154,130)
                                              -----------   -----------
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT   $   263,588   $   396,989
                                              ===========   ===========

        SEE ACCOUNTANT'S REVIEW REPORT AND NOTES TO FINANCIAL STATEMENTS.


                                        3



                FLUOROPHARMA, INC. (a development stage company)

                            STATEMENTS OF OPERATIONS

             FOR THE THREE MONTHS ENDED MARCH 31, 2007 AND 2006 AND
     THE PERIOD FROM JUNE 13, 2003 (INCEPTION) TO MARCH 31, 2007 (UNAUDITED)



                                                                       JUNE 13,
                                                                         2003
                                                                      (INCEPTION)
                                              FOR THE THREE MONTHS        TO
                                                 ENDED MARCH 31,       MARCH 31,
                                             ----------------------      2007
                                                2007        2006      (Unaudited)
                                             ---------   ----------   -----------

REVENUES                                     $      --   $       --   $        --
                                             ---------   ----------   -----------
OPERATING EXPENSE
   General and administrative (including
      stock based expense of $85,427,
      $199,924 and $677,390, respectively)     254,888      296,121     1,960,460
   Research and development (including
      stock based expense of $25,109,
      $3,534 and $82,579, respectively)        291,600      125,794     1,605,970
                                             ---------   ----------   -----------
      TOTAL OPERATING EXPENSE                  546,488      421,915     3,566,430
                                             ---------   ----------   -----------
      OPERATING LOSS                          (546,488)    (421,915)   (3,566,430)
                                             ---------   ----------   -----------
OTHER INCOME (EXPENSE)
   Interest income                                   9           --        1,109
   Interest expense                             (7,288)          --       (8,382)
                                             ---------   ----------   -----------
      TOTAL OTHER EXPENSE                       (7,279)          --       (7,273)
                                             ---------   ----------   -----------
LOSS BEFORE INCOME TAXES                      (553,767)    (421,915)   (3,579,703)
 Provision for income taxes                         --           --            --
                                             ---------   ----------   -----------
         NET LOSS                            $(553,767)  $ (421,915)  $(3,573,703)
                                             =========   ==========   ===========
LOSS PER COMMON SHARE - BASIC AND
   DILUTED                                   $   (0.17)  $    (0.20)  $        --
                                             =========   ==========   ===========
WEIGHTED AVERAGE SHARES OUTSTAND -
   BASIC AND DILUTED                         3,220,500    2,145,344
                                             =========   ==========


        SEE ACCOUNTANT'S REVIEW REPORT AND NOTES TO FINANCIAL STATEMENTS.


                                        4



                FLUOROPHARMA, INC. (a development stage company)

                            STATEMENTS OF CASH FLOWS

             FOR THE THREE MONTHS ENDED MARCH 31, 2007 AND 2006 AND
 THE PERIOD FROM JUNE 13, 2003 (INCEPTION) THROUGH DECEMBER 31, 2006 (UNAUDITED)



                                                                                 JUNE 13, 2003
                                                         FOR THE THREE MONTHS     (INCEPTION)
                                                            ENDED MARCH 31,       TO MARCH 31,
                                                        ----------------------        2007
                                                           2007        2006       (Unaudited)
                                                        ---------   ----------   -------------

CASH FLOWS FROM OPERATING ACTIVITIES
NET LOSS                                                $(553,767)  $ (421,915)   $(3,573,703)
Adjustments to reconcile net loss to net
   cash used for operating activities:
      Amortization expense                                  3,730        1,788         17,635
      Depreciation expense                                  1,264           --          3,765
      Issuance of common stock for consulting                  --       23,488         23,488
      Expense related to employee stock options             3,425           --         32,231
      Non-cash fair value of stock options issued
         to non-employees for consulting                  107,052      273,895        777,744
      Non-cash administrative adjustment                        6           --              6
      Expenses paid by issuance of preferred stock             --           --         50,000
Changes in operating assets and liabilities:
   (Increase) decrease in:
      Deposits and prepaid expenses                        22,559      (70,437)       (99,980)
      Organizational costs                                     --           --             --
   Increase (decrease) in:
      Bank overdrafts                                          --           --             --
      Accounts payable                                     63,124     (121,395)       298,233
      Accrued liabilities                                  (3,234)    (141,319)        62,774
                                                        ---------   ----------    -----------
   NET CASH USED FOR OPERATING ACTIVITIES                (355,841)    (455,895)    (2,407,807)
                                                        ---------   ----------    -----------
CASH FLOWS FROM INVESTING ACTIVITIES
   Acquisition cost of license agreements                      --           --        (85,000)
   Costs for website development                               --           --        (10,394)
   Purchases of property and equipment                    (47,103)          --        (66,567)
                                                        ---------   ----------    -----------
NET CASH USED FOR INVESTING ACTIVITIES                    (47,103)          --       (161,961)
                                                        ---------   ----------    -----------
CASH FLOWS FROM FINANCING ACTIVITIES
   Proceeds from issuance of note - related party         250,000           --        500,000
   Advances to stockholder                                     --           --           (508)
   Repayment of advances to stockholder                       501           --            501
   Cash received from sale of common stock                     --    1,000,000      1,567,820
   Cash received from sale of preferred stock                  --           --        525,000
                                                        ---------   ----------    -----------
NET CASH PROVIDED BY FINANCING ACTIVITIES                 250,501    1,000,000      2,592,813
                                                        ---------   ----------    -----------
         NET (DECREASE) INCREASE IN CASH                 (152,443)     544,105         23,045
CASH - BEGINNING                                          175,488       23,432             --
                                                        ---------   ----------    -----------
CASH - ENDING                                           $  23,045   $  567,537    $    23,045
                                                        =========   ==========    ===========
SUPPLEMENTAL CASH FLOW INFORMATION
   Cash PAID for interest                               $      --   $       --    $       108
                                                        =========   ==========    ===========
   Cash PAID for income taxes                           $      --   $       --    $        --
                                                        =========   ==========    ===========
Supplemental non-cash disclosure
   Increase in receivable related to equity financing   $      --   $  566,023    $        --
                                                        =========   ==========    ===========


        SEE ACCOUNTANT'S REVIEW REPORT AND NOTES TO FINANCIAL STATEMENTS.


                                        5



                FLUOROPHARMA, INC. (a development stage company)

                          NOTES TO FINANCIAL STATEMENTS

         FOR THE THREE MONTHS ENDED MARCH 31, 2007 AND 2006 AND FOR THE
   PERIOD FROM JUNE 13, 2003 (INCEPTION) THROUGH DECEMBER 31, 2006 (UNAUDITED)

NOTE A - NATURE OF OPERATIONS

     FLUOROPHARMA, INC., (the "Company") a privately-held molecular imaging
     company headquartered in Boston, Massachusetts, engages in the discovery,
     development and commercialization of proprietary diagnostic imaging
     products. The Company's initial focus is the development of novel positron
     emission tomography (PET) imaging agents for the efficient detection and
     assessment of acute and chronic forms of coronary artery disease (CAD).

     The accompanying financial statements have been prepared assuming that the
     Company will continue to operate as a going concern, including the
     realization of its assets and settlement of its liabilities at their
     carrying values in the ordinary course of business for the foreseeable
     future. However, substantial doubt about the Company's ability to continue
     as a going concern has been raised because the Company has experienced
     significant operating losses, negative cash flows from operations since
     inception and has not established any revenue sources. The Company has
     sustained cumulative losses of approximately $3.57 million through March
     31, 2007 and has a working capital deficit of approximately $738,000 at
     that date. The accompanying financial statements do not include any
     adjustments relating to the recoverability and classification of assets and
     liabilities that might be necessary if the Company is unable to continue as
     a going concern.

     The ability of the Company to continue to operate as a going concern is
     primarily dependent upon the ability of the Company to generate the
     necessary financing to effectively produce and market Fluoropharma's
     products at competitive prices, to establish profitable operations and to
     generate positive operating cash flows. On March 10, 2006, the Company
     entered into an Investment Agreement (the "Agreement") with QUANTRX
     BIOMEDICAL CORPORATION (the "Investor"), pursuant to which the Investor has
     agreed to invest $1,566,000 in the Company and where the Company and the
     Investor intend for the Investor to acquire a majority interest in the
     Company through a series of staged investments, which will take the form of
     cash investments by the Investor in the Company at increasing valuations,
     with the Investor participating in each staged investment being at the
     Investor's sole discretion. See NOTE C - RELATED PARTY TRANSACTIONS.

NOTE B - INTERIM FINANCIAL STATEMENTS

     The accompanying unaudited financial statements at March 31, 2007 and 2006
     and for the three month periods then ended include the accounts of the
     Company. In our opinion, these unaudited financial statements have been
     prepared on the same basis as the audited financial statements for the year
     ended December 31, 2006 and 2005, and include all adjustments necessary to
     make the financial statements not misleading. Certain footnote disclosures
     normally included in financial statements prepared in accordance with
     accounting principles generally accepted in the United States of America
     have been condensed or omitted in accordance with Accounting Principles
     Board Opinion No. 28, Interim Financial Reporting. These financial
     statements should be read in conjunction with the audited financial
     statements for the years ended December 31, 2006 and 2005.

        SEE ACCOUNTANT'S REVIEW REPORT AND NOTES TO FINANCIAL STATEMENTS.


                                        6



                FLUOROPHARMA, INC. (a development stage company)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

         FOR THE THREE MONTHS ENDED MARCH 31, 2007 AND 2006 AND FOR THE
   PERIOD FROM JUNE 13, 2003 (INCEPTION) THROUGH DECEMBER 31, 2006 (UNAUDITED)

NOTE C - DEVELOPMENT STAGE OPERATIONS

     The Company was formed on June 13, 2003. The Company sold 1,070,000 shares
     of common stock to the founder and current Chairman of the Company.
     Research and development activities began during 2003. Operations
     subsequent to the formation of the Company have consisted of research and
     development of commercially viable product(s) that meet the standards of
     and are approved by the Food and Drug Administration, raising capital and
     attracting qualified advisors and personnel to further advance the
     Company's goals. The Company has approximately 25 stockholders.

     The Company is organized as a C corporation for income tax purposes.
     Accordingly, the Company pays federal and state income taxes on any profits
     and retains losses to be offset against any future taxable profits.
     Dividends are paid at the discretion of the Board of Directors; however,
     the Company has never declared a dividend and has no intention of declaring
     a dividend in the foreseeable future. The Company currently intends to
     retain any earnings for the operation and expansion of the business. The
     Company's continued need to retain any earnings for operations and
     expansion is likely to limit the Company's ability to pay future cash
     dividends.

NOTE D - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     Use of Estimates

     The preparation of financial statements in conformity with accounting
     principles generally accepted in the United States requires management to
     make estimates and assumptions that affect the reported amounts of assets,
     liabilities, revenues, expenses and contingencies at the date of the
     financial statements. Actual results could differ from those estimates.

     Concentrations of Credit Risk

     The Company places its available cash with a high quality financial
     institution in amounts, which may occasionally exceed current federal
     deposit insurance limits. Senior management continuously reviews this
     institution for financial stability.

     Property and Equipment

     The cost of property, plant and equipment is depreciated over the estimated
     useful lives of the assets. Depreciation is computed using the
     straight-line and accelerated methods. The cost and related accumulated
     depreciation of property, plant and equipment sold or otherwise disposed of
     are removed from the related accounts and the resulting gains or losses are
     reflected in income. Expenditures for normal maintenance and repairs are
     expensed while major betterments are capitalized.

     Financial Instruments

     The Company's financial instruments consist of cash and various licensing
     agreements. The estimated fair value of these financial instruments
     approximates their carrying value at March 31, 2007 and December 31, 2006.
     The estimated fair values have been determined through information obtained
     from market sources and management estimates. The Company does not have any
     derivative or other financial instruments.

        SEE ACCOUNTANT'S REVIEW REPORT AND NOTES TO FINANCIAL STATEMENTS.


                                        7



                FLUOROPHARMA, INC. (a development stage company)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

           FOR THE THREE MONTHS ENDED MARCH 31, 2007 AND 2006 AND FOR
 THE PERIOD FROM JUNE 13, 2003 (INCEPTION) THROUGH DECEMBER 31, 2006 (UNAUDITED)

NOTE D - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED

     Compensated Absences

     Employees of the Company are entitled to paid vacation days depending on
     job classification, length of service and other factors. It is
     impracticable to estimate the amount of compensation for future absences
     and, accordingly, no liability has been recorded in the accompanying
     financial statements. The Company's policy is to recognize the costs of
     compensated future absences when actually paid to employees.

     Recent Accounting Pronouncements

     In February 2007, the Financial Accounting Standards Board ("FASB") issued
     SFAS No. 155, Accounting for Certain Hybrid Financial Instruments. SFAS No.
     155 amends SFAS No. 1233, Accounting for Derivative Instruments and Hedging
     Activities, and SFAS No. 140, Accounting for Transfers and Servicing of
     Financial Assets and Extinguishments of Liabilities. SFAS No. 155, permits
     fair value remeasurement for any hybrid financial instrument that contains
     an embedded derivative that otherwise would require bifurcation, clarifies
     which interest-only strips and principal-only strips are not subject to the
     requirements of SFAS No. 133, establishes a requirement to evaluate
     interest in securitized financial assets to identify interests that are
     freestanding derivatives or that are hybrid financial instruments that
     contain an embedded derivative requirement bifurcation, clarifies that
     concentrations of credit risk in the form of subordination are not embedded
     derivatives, and amends SFAS No. 140 to eliminate the prohibition on the
     qualifying special-purpose entity from holding a derivative financial
     instrument the pertains to a beneficial interest other than another
     derivative financial instrument. This statement is effective for all
     financial instruments acquired or issued after the beginning of the
     Company's first fiscal year that begins after September 15, 2006. SFAS No.
     155 is not expected to have a material effect on the financial position or
     results of operations of the Company.

     In June 2006, the FASB issued Interpretation No. 48, Accounting for
     Uncertainty in Income Taxes - an interpretation of FASB Statement No 109
     ("FIN 48") which clarifies the accounting for uncertainty in income taxes
     recognized in financial statements in accordance with FASB No. 109,
     Accounting for Income Taxes. FIN 48 prescribes a recognition threshold and
     measurement attribute for the financial statement recognition and
     measurement of a tax position taken or expected to be taken in a tax
     return. The provisions of FIN 48 are effective for fiscal years beginning
     after December 15, 2006, with the cumulative effect of the change in
     accounting principle recorded as an adjustment to opening retained
     earnings. The Company does not expect the adoption of the pronouncement to
     have a material effect on the financial position or results of operations
     of the Company.

     Income Taxes

     Deferred tax assets and liabilities are recognized based on temporary
     differences between the financial statement and tax basis of assets and
     liabilities using enacted tax rates in effect for the years in which the
     temporary differences are expected to reverse. A valuation allowance is
     applied against net deferred tax assets if, based on available evidence, it
     is more likely than not that some or all of the deferred assets will not be
     realized.

        SEE ACCOUNTANT'S REVIEW REPORT AND NOTES TO FINANCIAL STATEMENTS.


                                        8



                FLUOROPHARMA, INC. (a development stage company)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

           FOR THE THREE MONTHS ENDED MARCH 31, 2007 AND 2006 AND FOR
 THE PERIOD FROM JUNE 13, 2003 (INCEPTION) THROUGH DECEMBER 31, 2006 (UNAUDITED)

NOTE D - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED

     Research and Development

     The cost of research and development is charged to expense as incurred.
     Development expenses include the cost to register and maintain patents.

     Stock Option/Warrants

     The Company accounts for stock option/warrant awards granted to officers,
     directors and employees under the recognition and measurement principles of
     SFAS No. 123(R), Share Based Payment, utilizing the "modified prospective"
     method as described in SFAS No. 123(R). The accounting standard is
     effective January 1, 2006. The Company has elected to apply the principles
     of the standard to its financial statements beginning with its fiscal year
     beginning January 1, 2005.

     In the "modified prospective" method, compensation cost is recognized for
     all share-based payments granted after the effective date and for all
     unvested awards granted prior to the effective date. In accordance with
     SFAS No. 123(R), prior period amounts were not restated. SFAS No. 123(R)
     also requires the tax benefits associated with these share-based payments
     to be classified as financing activities in the Statement of Cash Flows,
     rather than operating cash flows as required under previous regulations.
     There was no effect to the Company's financial position or results of
     operations, as of and for the year ended December 31, 2005, as a result of
     the adoption of this Standard.

     Prior to January 1, 2005, the Company did not have any stock based
     compensation that was required to be accounted for in accordance with
     Accounting Principles Board Opinion No. 25, Accounting for Stock Issued to
     Employees and related interpretations.

NOTE E - RELATED PARTY TRANSACTIONS

     Loan Receivable - Stockholder

     As of December 31, 2005, a loan was receivable from two shareholders. The
     loan, payable on demand, is non-interest bearing and is full recourse. As
     of December 31, 2006, the balance of the loan was $508. During the year
     ended December 31, 2006, there were no repayments made on the outstanding
     balance of the loan. During the three months ended March 31, 2007, the
     stockholders repaid $502 of the outstanding balance of the loan. At March
     31, 2007, the balance of $6 was written off through an administrative
     adjustment, leaving a balance $0.00 at March 31, 2007.

     Investment Agreement

     On March 10, 2006, the Company entered into the Agreement with the Investor
     for the issuance of 1,096,170 shares of the Company's common stock (the
     "Common Stock") and the issuance of an option to purchase an additional
     260,000 shares of the Company's common stock at an exercise price of $0.75
     per share (the "Option"), in exchange for investment of $1,566,023 (the
     "Payment Amount") by the investor in the Company. The intent of the parties
     is for the investor to acquire a majority interest in the Company through a
     series of staged investments, which will take the form of cash investments
     by the investor in the Company at increasing valuations, with the investor
     participating in each staged investment being at the investor's sole
     discretion.

        SEE ACCOUNTANT'S REVIEW REPORT AND NOTES TO FINANCIAL STATEMENTS.


                                        9



                FLUOROPHARMA, INC. (a development stage company)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

           FOR THE THREE MONTHS ENDED MARCH 31, 2007 AND 2006 AND FOR
THE PERIOD FROM JUNE 13, 2003 (INCEPTION) THROUGH DECEMBER 31, 2006 (UNAUDITED)

NOTE E - RELATED PARTY TRANSACTIONS - CONTINUED

     As of March 10, 2006, the Investor paid $750,000 towards its investment in
     the Company and was credited with $250,000 previously advanced to the
     Company. On various dates throughout 2006, the Investor advanced various
     amounts of cash to the Company in satisfaction of the remaining $566,023
     due to the Company under the investment agreement. The full amount of the
     investment was paid on December 8, 2006.

     The Chief Executive Officer of the Investor is also a member of the
     Company's Board of Directors.

     Note payables - Stockholder

     On December 13, 2006, the Company executed a $250,000 Promissory Note (the
     "Note") with the Investor. On February 16, 2007, the Company executed
     another $250,000 Promissory Note (the "Second Note") with the Investor with
     the same terms as the Note. As of March 31, 2007, the outstanding balance
     of the notes was $500,000.

          Significant terms of the Notes are as follows:

          (a)  Payment - the full principal balance, together with all accrued
               and unpaid interest, shall be, (i) at the option of the Note
               holder, credited (on a dollar for dollar basis) towards any
               further investment by the Investor under the Agreement or (ii)
               paid in full by the Company on March 31, 2007 (the "Maturity
               Date"). The Investor will notify the Company, in writing, on or
               before February 28, 2007, of its election under (i) or (ii) as
               previously discussed.

          (b)  Prepayments - The outstanding balance of the Note may not be
               paid, in full or in part, in advance of the Maturity Date.

          (c)  Interest - The stated rate of interest on the Notes is 8% per
               year and accrues on the outstanding principal (excluding accrued
               and unpaid interest) of the Notes. Accrued and unpaid interest
               becomes part of the outstanding balance upon the Investors
               election to under (a)(i) or (a)(ii) above. Overdue principal,
               interest, fees or other amounts due under the Note shall be
               payable on demand and bear interest at the rate of 12% per year.
               Interest is calculated based on the number of actual days elapsed
               and the daily interest computation is based on 365 or 366 days
               per year, as applicable. As of March 31, 2007 and December 31,
               2006, the Company incurred interest expense of $8,274 and $986
               respectively. The balance of $8,274 and $986 is included in
               accrued liabilities on the balance sheets as of March 31, 2007
               and December 31, 2006 respectively. See NOTE H - ACCRUED
               LIABILITIES.

        SEE ACCOUNTANT'S REVIEW REPORT AND NOTES TO FINANCIAL STATEMENTS.


                                       10



                FLUOROPHARMA, INC. (a development stage company)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

           FOR THE THREE MONTHS ENDED MARCH 31, 2007 AND 2006 AND FOR
 THE PERIOD FROM JUNE 13, 2003 (INCEPTION) THROUGH DECEMBER 31, 2006 (UNAUDITED)

NOTE E - RELATED PARTY TRANSACTIONS - CONTINUED

          (d)  Events of Default - The Notes contains customary events of
               default and includes: (i) the Company failing to pay any
               principal of or interest on this Note within three (3) business
               days of when due; (ii) admit in writing or otherwise fails to pay
               its debts and obligations as they come due; (iii) initiation of
               any bankruptcy proceeding, voluntary or involuntary including the
               application for the appointment of or consent to the appointment
               of a receiver, the winding-up or liquidation of the Company which
               continues undismissed or unstayed for sixty (60) days, admission
               of material allegations of a petition filed in conjunction with
               any aforementioned court proceeding, any general assignment for
               the benefit of creditors; (iv) the rendering of any monetary
               judgment equaling or exceeding $500,000 and either enforecement
               action has been taken or if any stay of enforcement by reason of
               pending appeal or otherwise is not in effect; (v) taking any
               corporate action to effect, or having any court decree issued
               approving or ordering, any of the foregoing; (vi) the rendering
               of any or all of the Note valid, binding and/or enforceable or
               the declaration by the Company of the same; (vii) breach of the
               Agreement of any other Transaction Document (as defined in the
               Agreement) by the Company; (viii) the illegality or becoming
               illegal of the Company to comply, in full or in part, with any
               terms of the Notes.

     Rental Arrangement

     Beginning in March 2006, the Company began renting office space from a
     company that is a related party. The Company is a related party by virtue
     of the fact that the company is a stockholder and holds options for the
     purchase of 162,000 shares of the Company's common stock and one of the
     founders, the managing partner of the company, is related to the Company's
     founder and chairman.

     License Agreements - Stockholders

     The Company entered into license agreements with its Chief Executive
     Officer and founder for certain patent rights. The agreements call for
     annual license fees to be paid by the Company to the stockholder in
     exchange for the granting of patent rights where the Company would have the
     sole exclusive, worldwide, royalty bearing rights. The agreements call for
     the stockholder to receive additional payments and royalties as the Company
     develops and implements these patents.

NOTE F - LICENSE AGREEMENTS

     During 2005, the Company entered into various patent license agreements
     with a local hospital located in Boston, Massachusetts for the licensing of
     certain patent rights. These licenses are capitalized and amortized over
     the terms of the respective agreements (9 years). During 2006, the Company
     also entered into a contract with a research and development company
     located in Worcester, Massachusetts for the providing of testing services.
     Although the stated term of the agreement is 15 years, the Company has
     capitalized the up front, non-refundable payment of $25,000 and is
     amortizing that payment over 5 years as the Company expects that a majority
     of the testing services for current projects will occur within that time
     frame.

        SEE ACCOUNTANT'S REVIEW REPORT AND NOTES TO FINANCIAL STATEMENTS.


                                       11



                FLUOROPHARMA, INC. (a development stage company)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

           FOR THE THREE MONTHS ENDED MARCH 31, 2007 AND 2006 AND FOR
 THE PERIOD FROM JUNE 13, 2003 (INCEPTION) THROUGH DECEMBER 31, 2006 (UNAUDITED)

NOTE F - LICENSE AGREEMENTS - CONTINUED

     As of March 31, 2007 and December 31, 2006, the balances of the Company's
     license agreements were as follows:

                                                    MARCH 31,   DECEMBER 31,
                                                       2007         2006
                                                    ---------   ------------
     Patent license agreements                      $ 60,000      $ 60,000
     Contract research and development agreements     25,000        25,000
                                                    --------      --------
                                                      85,000        85,000
        Less: accumulated amortization               (16,200)      (13,323)
                                                    --------      --------
                                                    $ 68,800      $ 71,677
                                                    ========      ========

NOTE G - WEBSITE DEVELOPMENT COSTS

     The Company has capitalized the costs incurred in connection with the
     initial development of its website, www.fluoropharma.com. These costs are
     being amortized over 3 years. Costs incurred in connection with the website
     subsequent to the website going live are expensed as incurred. Costs
     incurred in connection with the re-design, re-building or total replacement
     of the website would also be capitalized and amortized in accordance with
     Company policy.

     As of March 31, 2007 and December 31, 2006, the balances of the website
     development costs were as follows:

                                         MARCH 31,   DECEMBER 31,
                                            2007         2006
                                         ---------   ------------
     Website development costs            $10,394      $10,394
        Less: accumulated amortization     (1,433)        (580)
                                          -------      -------
                                          $ 8,961      $ 9,814
                                          =======      =======

      SEE ACCOUNTANT'S REVIEW REPORT AND NOTES TO FINANCIAL STATEMENTS.


                                       12



                FLUOROPHARMA, INC. (a development stage company)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

           FOR THE THREE MONTHS ENDED MARCH 31, 2007 AND 2006 AND FOR
 THE PERIOD FROM JUNE 13, 2003 (INCEPTION) THROUGH DECEMBER 31, 2006 (UNAUDITED)

NOTE H - ACCRUED LIABILITIES

     At March 31, 2007 and December 31, 2006 accrued liabilities consist of the
following:

                                                MARCH 31,   DECEMBER 31,
                                                   2007         2006
                                                ---------   ------------
     Consulting fees and directors' fees         $ 6,000       $    --
     Legal fees                                    8,500        31,023
     Miscellaneous general and administrative     18,000        12,000
     Related party interest expense                8,274           986
     Scientific Advisory Board fees               22,000        22,000
                                                 -------       -------
                                                 $62,774       $66,009
                                                 =======       =======

NOTE I - CAPITAL STOCK

     Number of Shares Authorized

     Under the Company's charter, 10,000,000 shares of $0.001 par value common
     stock and 700,000 shares of $0.001 par value "Series A" preferred stock
     were authorized as of December 31, 2005. As of December 31, 2005, 1,797,500
     shares of common stock and 287,500 shares of preferred stock are issued and
     outstanding.

     COMMON STOCK

     Transactions Occurring in Shares of Common Stock

     On March 10, 2006, in connection with the closing of the Agreement between
     the Company and all preferred stockholders, the Company exchanged 287,500
     shares of common stock for all of the outstanding shares of Preferred Stock
     (287,500) in a one-to-one stock swap.

     On March 10, 2006, in connection with the closing of the agreement between
     the Company and all preferred stockholders, the Company issued 22,905
     shares of common stock to its holders of Preferred Stock as an inducement
     to convert their shares of Preferred Stock to common stock. These shares
     were issued in conjunction with the execution of a separate common stock
     purchase agreement and considered a cost of raising capital, therefore
     resulting in a memorandum entry only, as conversion was a requirement for
     the execution of the separate definitive agreement.

     During 2006, as payment for a consulting contract with the Company, the
     Company issued 16,425 shares of its common stock, valued at $1.43 a share
     to the consultant. The fair value of these shares was calculated to be
     $23,488.

        SEE ACCOUNTANT'S REVIEW REPORT AND NOTES TO FINANCIAL STATEMENTS.


                                       13



                FLUOROPHARMA, INC. (a development stage company)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

         FOR THE THREE MONTHS ENDED MARCH 31, 2007 AND 2006 AND FOR THE
   PERIOD FROM JUNE 13, 2003 (INCEPTION) THROUGH DECEMBER 31, 2006 (UNAUDITED)

NOTE I - CAPITAL STOCK - CONTINUED

     On March 10, 2006, in connection with the closing of the Agreement between
     the Company and the Investor, the Company issued 1,096,170 shares of common
     stock to the Investor valued at $1.43 per share, for an aggregate
     investment in the Company by the Investor of $1,566,022.

     As of March 31, 2007 and December 31, 2006, there were 3,220,500 shares of
     common stock outstanding. There were no common shares issued during the
     three months ended March 31, 2007.

     PREFERRED STOCK

     Transactions Occurring in Shares of Preferred Stock

     During 2006, the following transaction occurred with respect to shares of
     the Company's Preferred Stock:

     On March 10, 2006, in connection with the agreement entered into on March
     11, 2006 between the company and all preferred stockholders, the company
     exchanged all of the outstanding shares of preferred Stock (287, 500) in a
     one-to-one swap for shares of the Company's common stock. In addition to
     the 287,500 shares of common stock issued upon conversion, the Company
     issued 22,905 additional shares of common stock to these stockholders as an
     inducement to convert.

     As a result of the aforementioned transactions, the Company had no issued
     of outstanding shares of series A preferred Stock as of March 31, 2007.

     COMMON STOCK WARRANTS

     As of December 31, 2004, the Company had outstanding common stock warrants
     for the purchase of 27,500 shares of common stock with an exercise price of
     $3.00 per share. All of these warrants were issued in conjunction with the
     issuance of preferred stock pursuant to the execution of certain definitive
     stock purchase agreements.

     During 2005, common stock warrants for the purchase of 25,000 shares of
     common stock with an exercise price of $3.00 per share were issued in
     conjunction with the issuance of preferred stock pursuant to the execution
     of certain definitive stock purchase agreements.

     During 2006, common stock warrants for the purchase of 57,500 shares of
     common stock with an exercise price of $1.43 per share were issued in
     conjunction with the conversion of all issued and outstanding preferred
     stock. These warrants were issued in conjunction with the execution of a
     separate common stock purchase agreement and considered a cost of raising
     capital, therefore resulting in a memorandum entry only, as conversion was
     a requirement for the execution of the separate definitive agreement.

     There were no common stock warrants issued during the quarter ended March
     31, 2007, and as a result there were 110,000 common stock warrants issued
     and outstanding at March 31, 2007.

        SEE ACCOUNTANT'S REVIEW REPORT AND NOTES TO FINANCIAL STATEMENTS.


                                       14



                FLUOROPHARMA, INC. (a development stage company)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

           FOR THE THREE MONTHS ENDED MARCH 31, 2007 AND 2006 AND FOR
 THE PERIOD FROM JUNE 13, 2003 (INCEPTION) THROUGH DECEMBER 31, 2006 (UNAUDITED)

NOTE I - CAPITAL STOCK - CONTINUED

     STOCK OPTIONS

     Stock Option Plan

     Description

     On January 1, 2004, the Company adopted its Equity Incentive Plan (the
     "Plan") which provides for the grant by the Company of options or other
     equity interests in the Company to employees, officers, directors,
     consultants, and advisors of the Company (the "Eligible Participants"), to
     purchase up to 560,000 shares of the Company's common stock, at an exercise
     price as determined by the Company's Board of Directors and for a term of
     up to no more than ten years after the date of grant. Effective September
     1, 2006, pursuant to Board ratification, the stock option plan pool was
     increased to allow for the issuance of 932,000 shares of the Company's
     common stock. Effective January 26, 2007, pursuant to Board ratification,
     the stock option plan pool was increased to allow for the issuance of
     1,350,000 shares of the Company's common stock. Generally, the Board of
     Directors determined the options vesting term; however, option grants
     designated as "Incentive Stock Options" (the "ISO") may be exercised for up
     to 25% of the total number of shares under the ISO on the first anniversary
     of the grant date and for an additional 6.25% of the total number of shares
     under the ISO on the last day of each three month period following the
     first anniversary date until 100% of the total number of shares under the
     ISO have vested by the fourth anniversary of the date of grant.

     Issuances of Stock Options

     As of December 31, 2005, the Company had issued options to various
     consultants to purchase 230,000 shares of the Company's common stock.

     During 2006, the Company's Board of Directors granted various options to
     various employees, consultants and advisors to purchase an aggregate of
     431,500 shares of the Company's common stock at exercise prices of $1.00
     and $1.43. These options were either fully vested on their respective grant
     dates or vested generally over one or two service period, at the end of
     which the options vested, provided that the grantee was still providing
     services to the Company on the anniversary date.

     The fair value of these options was estimated at the date of grant using
     the Black-Sholes option pricing model with the following assumptions for
     fiscal year 2006: risk-free interest rate of 4.51% to 5.14%; no dividend
     yield; an expected life of the options of 7 to 10 years; and a volatility
     factor of 120.17% to 166.31%. As a result of these transactions, the
     Company recorded $28,806 of stock-based compensation to employees and
     $411,849 of stock-based consulting expense for the year ended December 31,
     2006. Additionally, several immediately vested options granted to
     non-employees resulted in $100,039 of prepaid consulting at December 31,
     2006.

     During the three months ended March 31, 2007, the Company issued options
     for the purchase of 90,000 shares of the Company's common stock valued at
     $123,130.

        SEE ACCOUNTANT'S REVIEW REPORT AND NOTES TO FINANCIAL STATEMENTS.


                                       15



                FLUOROPHARMA, INC. (a development stage company)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

           FOR THE THREE MONTHS ENDED MARCH 31, 2007 AND 2006 AND FOR
 THE PERIOD FROM JUNE 13, 2003 (INCEPTION) THROUGH DECEMBER 31, 2006 (UNAUDITED)

NOTE I - CAPITAL STOCK - CONTINUED

     The fair value of these options was estimated at the date of grant using
     the Black-Sholes option pricing model with the following assumptions for
     fiscal year 2007: risk-free interest rate of 4.56% to 4.68%; no dividend
     yield; an expected life of the options of 10 years; and a volatility factor
     of 120.17% to 123.38%.

     In addition to the outstanding stock option plan options, as previously
     described, on March 10, 2006, the Company entered into the Agreement with
     the Investor for the issuance of 1,096,170 shares of the Company's common
     stock (the "Common Stock") and the issuance of an option to purchase an
     additional 260,000 shares of the Company's common stock at an exercise
     price of $0.75 per share (the "Option"), in exchange for investment of
     $1,566,023 (the "Payment Amount") by the investor in the Company. This
     issuance of the stock option in conjunction with the investment agreement
     was approved by the Board of Directors to fall outside the scope of the
     stock option plan and this individual option issuance was ratified by the
     Board.

NOTE J - EARNINGS PER SHARE

     The Company computes net income (loss) per common share in accordance with
     SFAS No. 128, "Earnings per Share." Net income (loss) per share is based
     upon the weighted average number of outstanding common shares and the
     dilutive effect of common share equivalents, such as options and warrants
     to purchase common stock, convertible preferred stock and convertible
     notes, if applicable, that are outstanding each year. Basic and diluted
     earnings per share were the same at the reporting dates of the accompanying
     financial statements, as including common stock equivalents in the
     calculation of diluted earnings per share would have been antidilutive.

     As of March 31, 2007, the Company had outstanding common stock options of
     1,011,500 and common stock warrants of 110,000, and no convertible
     preferred shares or preferred warrants. The above options and warrants were
     deemed to be antidilutive for the Company's quarter ended March 31, 2007.

     As of March 31, 2006, the Company had outstanding common stock options of
     702,000 and common stock warrants of 110,000. The above options, warrants,
     and convertible securities were deemed to be antidulitive for the Company's
     quarter ended March 31, 2006.

NOTE K - INCOME TAXES

     In accordance with Statement of Financial Accounting Standards No. 109,
     "Accounting for Income Taxes" (FAS 109), the Company recognizes deferred
     tax assets or liabilities for the future tax expense arising from the
     different methods of recognition for certain items of income and expense
     for financial statement and income tax reporting purposes. Amounts
     presented on the balance sheet represent the net amount of deferred tax
     assets and liabilities recognized during the year.

        SEE ACCOUNTANT'S REVIEW REPORT AND NOTES TO FINANCIAL STATEMENTS.


                                       16



                FLUOROPHARMA, INC. (a development stage company)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

            FOR THE THREE MONTHS ENDED MARCH 31, 2007 AND 2006 AND FOR
 THE PERIOD FROM JUNE 13, 2003 (INCEPTION) THROUGH DECEMBER 31, 2006 (UNAUDITED)

NOTE K - INCOME TAXES - CONTINUED

     At March 31, 2007 and March 31, 2006, the Company had deferred tax assets
     calculated at an expected blended rate 38% of approximately $1,100,000 and
     $480,000 respectively, principally arising from net operating loss
     carryforwards for income tax purposes. As management of the Company can not
     determine that it is more likely than not that the Company will realize the
     benefit of the deferred tax asset, a valuation allowance equal to the
     deferred tax asset has been established at Match 31, 2007 and March
     31, 2006.

     At March 31, 2007, the Company has net operating loss carry forwards of
     approximately $2,900,000, which expire in the years 2023 through 2027. The
     net change in the allowance account was an increase of $500,000 for the
     three months ended March 31, 2007.

NOTE L - COMMITMENTS

     Beginning in March 2006, the Company began renting office space from a
     related party as a tenant at will. Under the arrangement, the Company paid
     $2,000 per month until October 2006 for the rented office space. The rent
     paid increased to $4,000 in October 2006 when the Company increased the
     amount of office space that it rented from the related party. There is no
     formal operating lease arrangement.

     For the three months ended March 31, 2007 and 2006, rent expense was
     $12,000 and $2,000, respectively.

     As of March 31, 2007 the Company had commitments for consulting agreements
     related to clinical trials of $267,437 and for capital expenditures related
     to the purchase of a modular lab in the amount of $45,000. At March 31,
     2006 the Company had no material commitments.

NOTE M - SUBSEQUENT EVENTS

     Change in Majority Stockholder

     On April 13, 2007, upon closing the Stage 2 transactions as described in
     the Agreement, the Investor became the majority stockholder of the Company.
     Prior to April 13, 2007, the majority stockholder was the founder and
     Chairman of the Company.

     Upon becoming the majority stockholder, the Investor can avail itself of
     certain and various rights including representation on the Board of
     Directors and other rights that accrue by virtue of being the majority
     stockholder of the Company.

        SEE ACCOUNTANT'S REVIEW REPORT AND NOTES TO FINANCIAL STATEMENTS.


                                       17