Subsequent Events

6 Months Ended

Jun. 30, 2011

Notes to Financial Statements

Note 12.Subsequent Events

 Subsequent to June 30, 2011, in connection with the settlement of all litigation with NuRx involving QND, the Company received 12.0 million shares of common stock in NuRx, representing an approximate 25% equity interest in NuRx. 

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Consolidated Results of Operations

Comparison of the Three and Six Months Ended June 30, 2011 to the Three and Six Months Ended June 30, 2010

Total revenues for the three and six months ended June 30, 2011 were $1,888 and $10,788, respectively. Total revenues for the three and six months ended June 30, 2010 were $641,040 and $1,300,331, respectively.  The substantial decrease in total revenues in the 2011 periods is due to decreases in revenues pursuant to the terms of the Development Agreement with QND.  Due to the divestiture of its interest in QND resulting from the settlement with NuRx, no further amounts will be paid to the Company under the terms of the Development Agreement, and the Company expects only nominal revenues pending the successful launch of its PAD-based products.

Sales, general and administrative expense for the three months ended June 30, 2011 and 2010 was $37,265 and $279,526 respectively, and for the six months ended June 30, 2011 and 2010 was $55,632 and $583,103, respectively.  The substantial decrease in sales, general and administrative expense in the 2011 periods is due to decreased personnel and related expenses due to the suspension of active operations at December 31, 2010.

Professional fees for the three months ended June 30, 2011 and 2010, were $210,225 and $178,879, respectively, and for the six months ended June 30, 2011 and 2010, were $278,023 and $428,430, respectively. Professional fees include the costs of legal, consulting and auditing services provided to us. The decrease in professional fees in the 2011 periods are directly related to reduced operations due to the suspension of operations at December 31, 2010. Included in the 2011 three and six months are non-cash expenses of $113,308 related to stock and warrants issued as payment for professional services.

The Company’s net loss for the three months ended June 30, 2011 was $22,822 and net loss for the three months ended June 30, 2010 was $162,156. Net loss for the six months ended June 30, 2011 and 2010, was $357,846 and $164,092, respectively. The decrease in net losses in the three month period ended June 30, 2011 compared to the comparable period in 2010 is due to substantially lower general and administrative costs, while the increased net loss in the six month period ended June 30, 2011 compared to the comparable period in 2010 is due to the substantially lower revenues related to the Development Services Agreement with QND during said period.

The Company anticipates substantially lower costs and expenses during the year ended December 31, 2011 compared to the year ended December 31, 2010, with anticipated decreases being substantially attributable to the company desision to scale down active operations as management continues to evaluate and develop its future operating plan.

Liquidity and Capital Resources

As of June 30, 2011, the Company had cash and cash equivalents of $11,680, as compared to cash and cash equivalents of $229,944 as of December 31, 2010. The net decrease in cash of $218,264 for the six months ended June 30, 2011, is attributable to net cash used for operating activities and amounts used to settle certain accrued expenses and accounts payable.

The Company has not generated sufficient revenues from operations or its investment in intellectual property to meet its operating expenses. The Company has therefore historically financed its operations primarily through issuances of equity and debt securities, and, during the second and third quarters of 2010, through the sale of certain equity interests in FluoroPharma, and in the second quarter of 2011, the issuance of certain debt securities.  In the past, the Company has also provided for its cash needs by issuing common stock, options and warrants for certain operating costs, including consulting and professional fees.

SIGNATURES

Pursuant to 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.

Date: August 16, 2011	/s/ Shalom Hirschman
	Shalom Hirschman Principal Executive, Financial and Accounting Officer