UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             Washington, D. C. 20549

                                   FORM 10-KSB

(x)  ANNUAL REPORT  PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES  EXCHANGE
     ACT OF 1934 (FEE REQUIRED)

         For the fiscal year ended       December 31, 2002
                                   ------------------------------

( )  TRANSITION  REPORT  PURSUANT  TO SECTION 13 OR 15 (d) OF THE  SECURITIES
     EXCHANGE ACT OF 1934 (NO FEE REQUIRED)

         For the transition period from _______________ to _________________

         Commission File number      0-7473
                                ---------------


                              AMEXDRUG CORPORATION
               --------------------------------------------------
               (Exact name of registrant as specified in charter)


                 Nevada                                  90-0017017
         --------------------------------         -------------------------
         State or other jurisdiction of          (I.R.S. Employer I.D. No.)
         incorporation or organization

         8909 West Olympic Blvd., Suite 112, Beverly Hills, CA       90211
         -----------------------------------------------------    ------------
              (Address of principal executive offices)             (Zip Code)

         Issuer's telephone number, including area code      (310) 855-0475
                                                         ----------------------

         Securities registered pursuant to section 12 (b) of the Act:

         Title of each class          Name of each exchange on which registered
                None                                       None
         -------------------          -----------------------------------------

         Securities registered pursuant to section 12 (g ) of the Act:

                                      None
                       ----------------------------------
                                (Title of Class)

Check whether the Issuer (1 ) filed all reports required to be filed by section
13 or 15 (d) of the 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.

 (1) Yes [x]   No [  ]                             (2)  Yes [x]    No [  ]

Check if disclosure of delinquent filers in response to Item 405 of Regulation
S-B is not contained in this form, and no disclosure will be contained, to the
best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB. [ ]

State issuer's revenues for its most recent fiscal year:  $22,249,952

State the aggregate market value of the voting stock held by non-affiliates of
the registrant. The aggregate market value shall be computed by reference to the
price at which the stock was sold, or the average bid and asked prices of such
stock, as of a specified date within the past 60 days.


<PAGE>



At March 21, 2003, the aggregate market value of the voting stock held by
non-affiliates was $882,021, based upon 217,783 shares held by non-affiliates,
and the average of the bid price ($4.05 per share) and the asked price ($4.15
per share) of $4.10 per share.

      ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS

Check whether the issuer has filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court.

         Yes [x]   No [  ]

                    APPLICABLE ONLY TO CORPORATE REGISTRANTS

As of March 28, 2003, the registrant had 8,052,783 shares of common stock issued
and outstanding.

                       DOCUMENTS INCORPORATED BY REFERENCE

List hereunder the following documents if incorporated by reference and the part
of the form 10- KSB (e.g., part I, part II, etc.) into which the document is
incorporated: (1) Any annual report to security holders; (2) any proxy or other
information statement; and (3) Any prospectus filed pursuant to rule 424 (b) or
(c) under the Securities Act of 1933: None




                                       2
<PAGE>


                                TABLE OF CONTENTS
                                -----------------
                                                                            Page
                                                                            ----
PART I
------

ITEM 1.    DESCRIPTION OF BUSINESS..........................................  4

ITEM 2.    DESCRIPTION OF PROPERTIES........................................ 13

ITEM 3.    LEGAL PROCEEDINGS................................................ 15

ITEM 4.    SUBMISSION OF MATTERS TO VOTE OF SECURITY HOLDERS................ 15


PART II
-------

ITEM 5.    MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS......... 15

ITEM 6.    MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION........ 17

ITEM 7.    FINANCIAL STATEMENTS............................................. 19

ITEM 8.    CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
           AND FINANCIAL DISCLOSURE......................................... 30


PART III
--------

ITEM 9.    DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS, AND CONTROL
           PERSONS; COMPLIANCE WITH SECTION 16 (a) OF THE EXCHANGE
              ACT........................................................... 30

ITEM 10.   EXECUTIVE COMPENSATION........................................... 32

ITEM 11.   SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
              MANAGEMENT.................................................... 34

ITEM 12.   CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS................... 35

ITEM 13.   EXHIBITS AND REPORTS ON FORM 8-K................................. 36

ITEM 14.   CONTROLS AND PROCEDURES.......................................... 36


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<PAGE>


                                     PART I

MANY STATEMENTS MADE IN THIS REPORT ARE FORWARD-LOOKING STATEMENTS THAT ARE NOT
BASED ON HISTORICAL FACTS. ANY FORWARD-LOOKING STATEMENTS INCLUDED IN THIS
REPORT REFLECT MANAGEMENT'S BEST JUDGMENT BASED ON FACTORS CURRENTLY KNOWN AND
INVOLVE RISKS AND UNCERTAINTIES. BECAUSE THESE FORWARD-LOOKING STATEMENTS
INVOLVE RISKS AND UNCERTAINTIES, THERE ARE IMPORTANT FACTORS THAT COULD CAUSE
ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE EXPRESSED OR IMPLIED BY THESE
FORWARD-LOOKING STATEMENTS. ACTUAL RESULTS MAY VARY MATERIALLY.

------------------------------------------------------------------------------

                         ITEM 1. DESCRIPTION OF BUSINESS

------------------------------------------------------------------------------

General

Amexdrug Corporation, a Nevada corporation, is primarily a full-line, wholesale
distributor of pharmaceuticals, over-the-counter products, health and beauty
care products, and nutritional supplements. Amexdrug Corporation distributes its
products primarily to independent pharmacies in the western and southeastern
regions of the United States, and secondarily to small and medium-sized pharmacy
chains, alternative care facilities and other wholesalers and retailers. Over
the next several months, Amexdrug Corporation anticipates expanding its market
area to include other regions in the continental United States.

References in this report to "we," "our," "us," the "Company" and "Amexdrug"
refer to Amexdrug Corporation and also to our subsidiary, Allied Med, Inc. where
appropriate.

Amexdrug currently has 50,000,000 shares of authorized common stock $.001 par
value, of which 8,052,783 are issued and outstanding.

Significant acquisitions

                                Allied Med, Inc.
                                ----------------

On December 31, 2001, Amexdrug acquired all of the issued and outstanding common
shares of Allied Med, Inc., an Oregon corporation ("Allied") in a share
exchange. Amexdrug acquired the 50,000 issued and outstanding shares of Allied
Med, Inc. from its sole shareholder, Jack Amin, in exchange for 7,000,000
restricted common shares of Amexdrug, and Amexdrug assumed responsibility for
payment of a $100,000 promissory note and accrued interest thereon owned by Mr.
Amin to Allied Med, Inc. At all times during the negotiations of the
transaction, Mr. Amin was an officer, director and controlling shareholder of
both companies. Allied Med, Inc. is sometimes referred to herein as "Allied".

Consideration for the acquisition was determined through negotiations between
the boards of directors of both companies and was based on Allied's past
operating history and future potential growth.

Allied was formed as an Oregon corporation in October 1997, to operate as a full
line wholesaler of pharmaceuticals, over-the-counter and non-drug products and
health and beauty aids. In 1998, Allied's gross sales were approximately $2.8
million. In 1999, Allied's gross sales exceeded $5 million.


                                       4
<PAGE>

In 2000, Allied's gross sales exceeded $8 million. In 2001, Allied's gross sales
were  approximately   $21.2  million.   In  2002,   Allied's  gross  sales  were
approximately $22.2 million.

As discussed herein, Amexdrug has assumed the operations of Allied as its
primary operations, and Amexdrug intends to build on the wholesale
pharmaceutical operations of Allied. All future operations in the wholesale
pharmaceutical industry will be conducted through Allied.

Industry trends

                      Pharmaceutical and healthcare markets

According to IMS Health, a company specializing in information services for the
pharmaceutical and health care industries, the United States is the world's
largest pharmaceutical market, with 2000 sales of $150 billion, including
diagnostics and over-the-counter drugs. That figure is expected to rise to $263
billion in 2005, a projected compound annual growth rate of 11.8%. This
continued growth rate of the sales of pharmaceutical products was attributed to
a number of factors including:

     .    the value added by the introduction of new drugs into the marketplace,
          which more than offsets the value lost by medications losing patent
          protection;
     .    new patterns of drug lifestyle management, resulting in higher sales
          occurring earlier in the life cycle of a medication;
     .    increased money spent on direct-to-consumer marketing initiatives; and
     .    an unprecedented period of investment by pharmaceutical companies
          worldwide.

Amexdrug believes that, currently, the pharmaceutical and health care product
markets are serviced primarily by traditional full-line wholesalers.

                                    Internet

The Internet has emerged as the fastest growing communications medium in history
and is dramatically changing how businesses and individuals communicate and
share information. International Data Corporation estimates that the number of
Internet users will grow from 97 million at the end of 1998 to 320 million by
2002. The Internet has created new opportunities for conducting commerce, such
as business-to-consumer and person-to-person e-commerce. Recently, the
widespread adoption of intranets and the acceptance of the Internet as a
business communications platform has created a foundation for
business-to-business e-commerce that offers the potential for organizations to
streamline complex processes, lower costs and increase productivity.
Internet-based business-to-business e-commerce may be poised for rapid growth
and could represent a significantly larger opportunity than business-to-consumer
or person-to- person e-commerce. According to Gartner Group, worldwide
business-to-business Internet revenue was $433.3 billion in 2000, and in 2001
that total was projected to reach $919 billion. North America accounted for 59%
of the worldwide total in 2000, with business-to-business Internet commerce
totaling $255 billion, and is anticipated to represent 52% of the projected $480
billion in 2001. By 2005, worldwide business-to-business Internet commerce is
expected to be more than $8.5 trillion, and the North American region will total
$3.6 trillion, which will be 42% of the overall market. Amexdrug hopes, although
it cannot guarantee, that it will benefit from this growth.


                                       5
<PAGE>


The dynamics of business-to-business e-commerce relationships differ
significantly from those of other e-commerce relationships. Business-to-
business e-commerce solutions frequently automate processes that are fundamental
to a business' operations by replacing various paper-based transactions with
electronic communications. In addition, business-to-business e-commerce
solutions must often be integrated with a customer's existing systems, a process
that can be complex, time-consuming and expensive. Consequently, selection and
implementation of a business-to-business e-commerce solution represents a
significant commitment by the customer, and the costs of switching solutions are
high. In addition, because business transactions are typically recurring and
non-discretionary, the average order size and lifetime value of a
business-to-business e-commerce customer is generally greater than that of a
business-to-consumer e-commerce customer. These solutions are likely to be most
readily accepted by industries characterized by a large number of buyers and
sellers, a high degree of fragmentation among buyers, sellers or both,
significant dependence on information exchange, large transaction volume and
user acceptance of the Internet.

Objectives and strategy

Amexdrug's key business objective is to become a leading full-line wholesale
distributor of pharmaceuticals, over-the-counter products, health and beauty
care products and nutritional supplements, with an emphasis on online sales.

To accomplish this objective, Amexdrug plans to:

     .    market its name, products and services to create brand recognition and
          generate and capture traffic on its websites;
     .    provide quality products at competitive prices and efficient service;
     .    develop strategic relationships that increase Amexdrug's product
          offerings; and
     .    attract and retain exceptional employees.

Sales and marketing, customer service and support

Our products are sold both through traditional wholesale distribution lines and
e-commerce venues, including our website, www.amwdrug.com. We believe our
e-commerce, business-to-business model will allow the Company to leverage its
existing wholesale distribution business, thus increasing its ability to
effectively market and distribute its products. The Company uses a variety of
programs to stimulate demand for its products and increase traffic to its
websites, including a direct sales force, telemarketing, blast faxing and
advertising.

                                  Direct sales

The Company maintains employees to act as its direct sales force to target
organizations that buy and sell the products it carries.

                                  Telemarketing

The Company maintains an in-house telemarketing group for use in customer
prospecting, lead generation and lead follow-up.


                                       6
<PAGE>


                                  Blast faxing

The Company has an automated system which it uses to fax weekly updates to its
customers informing them of special offers during the week.

                                   Advertising

The Company advertises in trade journals, and at trade shows, and the Company
will seek to engage in co-branding arrangements in the future. In addition to
strategic agreements and traditional advertising, the Company, will, as revenue
allows, implement online sales and marketing techniques in an attempt to
increase brand recognition and direct traffic to its website. Some of these
techniques may include banner ads on search engine websites and Internet
directories, direct links from healthcare home pages, and mass e-mailings.

                          Customer service and support

Amexdrug believes that it can establish and maintain long-term relationships
with its customers and encourage repeat visits if, among other things, the
Company has excellent customer support and service. The Company currently offers
information regarding its products and services and answers customer questions
about the ordering process, and investigates the status of orders, shipments and
payments. A customer can access the Company by fax or e-mail by following
prompts located on the Company's website or by calling the Company's toll-free
telephone line.

                              Promotion of website

As revenue allows, the Company will promote, advertise and increase recognition
of its website through a variety of marketing and promotional techniques,
including:

     .    developing co-marketing agreements with major online sites and
          services;
     .    enhancing online content and ease of use of its website;
     .    enhancing customer service and technical support;
     .    advertising in trade journals and at industry trade shows;
     .    conducting an ongoing public relations campaign; and
     .    developing other business alliances and partnerships.

Distribution

The Company distributes products from its facility in Portland, Oregon. The
Company fills orders with a combination of existing inventory and products it
orders from suppliers. Currently, customers are receiving their products within
24 to 48 hours of order placement. As funds allow, the Company will increase its
in-house inventory of products to allow for shorter delivery times.

Purchasing

The Company purchases its products primarily from manufacturers and secondarily
from other wholesalers and distributors. The Company's purchasing department
constantly monitors the market to take advantage of periodic volume discounts,
market discounts and pricing changes.


                                       7
<PAGE>


Technology and security

The Company website is hosted and maintained by a third party. This provider
delivers a secure platform for server hosting, including various safety features
to protect the information residing in its servers. Moreover, the Company does
not release information about its customers to third parties without the prior
written consent of its customers unless otherwise required by law.

Notwithstanding these precautions, the Company cannot assure that the security
mechanisms will prevent security breaches or service breakdowns. Despite the
implemented security measures, servers can be vulnerable to computer viruses,
physical or electronic break-ins or other similar disruptions. Such a disruption
could lead to interruptions or delays in service, loss of data, or an inability
to accept and fulfill online customer orders. Any of these events could
materially affect the Company's business.

Management information system

The Company's information system is maintained on an IBM AS 400 platform. The
accounting information for sales, purchases, perpetual inventory transactions,
cash receipts and disbursements and sophisticated management reports are
provided timely for analytical and bookkeeping purposes. Also, the order entry
system was designed specifically for the Company and allows its customers to
order product 24 hours per day either via fax, internet or phone modem. The
system provides data to management enabling it to review sales trends and
customer base, monitor inventory levels, credit and collection issues, and
purchasing frequency and cost anticipation. Communication and availability of
data is possible through a local area network ring.

Competition

Amexdrug faces strong competition both in price and service from national,
regional and local full-line, short-line and specialty wholesalers, service
merchandisers, self-warehousing chains and from manufacturers engaged in direct
distribution. Many of our current and potential competitors have longer
operating histories and much larger customer bases than we have. In addition,
many of our competitors have greater brand recognition and significantly greater
financial, marketing and other resources. To compete successfully, we have had
to constantly monitor our competitive situation and develop strategies to allow
us to compete with other companies who are able to:

     .    secure merchandise from vendors on more favorable terms;
     .    devote greater resources to marketing and promotional campaigns; and
     .    adopt more aggressive pricing or inventory availability policies.

In addition, many of our competitors have developed or may be able to develop
e-commerce operations that compete with our e-commerce operations, and may be
able to devote substantially more resources to website development and systems
development than we do. The online commerce market is new, rapidly evolving and
intensely competitive. The Company expects competition to intensify in the
future because barriers to entry are minimal, and current and new competitors
can launch new websites at relatively low cost. The Company believes that the
critical success factors for companies seeking to create Internet
business-to-business e-commerce solutions include the following:


                                       8
<PAGE>


     .    breadth and depth of product offerings;
     .    brand recognition;
     .    depth of existing customer base; and . ease of use and convenience.

Unlike other well-publicized product categories such as online book or compact
disc retailing, there is no current market leader in its online business-to-
business market segment. The Company's immediate goal is to position itself as a
leading business-to-business e-commerce and online trade exchange provider for,
pharmaceuticals, over-the-counter products, health and beauty care products and
nutritional supplements. To that end, we believe that our early entry into the
online market may enable us to establish critical competitive advantages over
future competitors. We believe that such competitive advantages include:

     .    the establishment of a recognizable brand;
     .    the development of online marketing and media relationships;
     .    the development of important relationships with manufacturers,
          distributors, wholesalers and content providers; and
     .    exposure to an existing customer base.

However, competitive pressures created by any one of its current or future
competitors, or by its competitors collectively, could materially affect the
Company's business. We believe that the principal competitive factors in its
market are and will be:

         . brand recognition             . selection
         . speed and accessibility       . customer service
         . quality of site content       . reliability and speed of
                                           fulfillment
         . convenience                   . price

Government regulations and legal uncertainties

                              Healthcare regulation
                              ---------------------

The manufacturing, packaging, labeling, advertising, promotion, distribution and
sale of most of the products we distribute are subject to regulation by numerous
governmental agencies, particularly the United States Food and Drug
Administration, which regulates most of the products we distribute under the
Federal Food, Drug and Cosmetic Act, and the United States Federal Trade
Commission, which regulates the advertising of many of the products we
distribute under the Federal Trade Commission Act. The products we distribute
are also subject to regulation by, among other regulatory agencies, the Consumer
Product Safety Commission, the United States Department of Agriculture, the
United States Department of Environmental Regulation and the Occupational Safety
and Health Administration. The manufacturing, labeling and advertising of the
products we distribute is also regulated by the Occupational Safety and Health
Administration through various state and local agencies.

Furthermore, Amexdrug and/or its customers are subject to extensive licensing
requirements and comprehensive regulation governing various aspects of the
healthcare delivery system, including the so called "fraud and abuse" laws. The
fraud and abuse laws preclude:

     .    persons from soliciting, offering, receiving or paying any
          remuneration in order to induce the referral of a patient for


                                       9
<PAGE>


          treatment or for inducing the ordering or purchasing of items or
          services that are in any way paid for by Medicare or Medicaid, and
      .   physicians from making referrals to certain entities with which they
          have a financial relationship.

The fraud and abuse laws and regulations are broad in scope and are subject to
frequent modification and varied interpretations. Significant criminal, civil
and administrative sanctions may be imposed for violation of these laws and
regulations.

The Company's advertising of dietary supplement products is also subject to
regulation by the Federal Trade Commission under the Federal Trade Commission
Act, in addition to state and local regulation. The Federal Trade Commission Act
prohibits unfair methods of competition and unfair or deceptive acts or
practices in or affecting commerce. The Federal Trade Commission Act also
provides that the dissemination or the causing to be disseminated of any false
advertisement pertaining to drugs or foods, which would include dietary
supplements, is an unfair or deceptive act or practice. Under the Federal Trade
Commission's Substantiation Doctrine, an advertiser is required to have a
"reasonable basis" for all objective product claims before the claims are made.

Failure to adequately substantiate claims may be considered either deceptive or
unfair practices. Pursuant to this Federal Trade Commission requirement, the
Company is required to have adequate substantiation for all material advertising
claims made for its products.

The Company may be subject to additional laws or regulations by the Food and
Drug Administration or other federal, state or foreign regulatory authorities,
the repeal of laws or regulations which the Company considers favorable, such as
the Dietary Supplement Health and Education Act of 1994, or more stringent
interpretations of current laws or regulations, from time to time in the future.
We cannot predict the nature of such future laws, regulations, interpretations
or applications, nor can we predict what effect additional governmental
regulations or administrative orders, when and if promulgated, would have on our
business in the future. The Food and Drug Administration or other governmental
regulatory bodies could, however, require the reformulation of certain products
to meet new standards, the recall or discontinuance of certain products not able
to be reformulated, imposition of additional record keeping requirements,
expanded documentation of the properties of certain products, expanded or
different labeling and scientific substantiation. Any or all of such
requirements could have a material and adverse effect on our business.

The products we distribute function within the structure of the healthcare
financing and reimbursement system of the United States. As a result of a wide
variety of political, economic and regulatory influences, this system is
currently under intense scrutiny and subject to fundamental changes. In recent
years, the system has changed significantly in an effort to reduce costs. These
changes include increased use of managed care, cuts in Medicare, consolidation
of pharmaceutical and medical-surgical supply distributors, and the development
of large, sophisticated purchasing groups. In addition, a variety of new
approaches have been proposed to continue to reduce cost, including mandated
basic healthcare benefits and controls on healthcare spending through
limitations on the growth of private health insurance premiums and Medicare and
Medicaid spending. The Company anticipates that Congress and state legislatures
will continue to review and assess alternative

                                       10
<PAGE>

healthcare  delivery  systems  and payment  methods and that public  debate with
respect  to  these  issues  will  likely  continue  in the  future.  Because  of
uncertainty  regarding  the ultimate  features of reform  initiatives  and their
enactment and implementation,  the Company cannot predict which, if any, of such
reform proposals will be adopted,  when they may be adopted, or what impact they
may have on the Company. The Company expects the healthcare industry to continue
to  change  significantly  in the  future.  Some  of  these  changes,  such as a
reduction in governmental  support of healthcare  services or adverse changes in
legislation or regulations governing the privacy of patient information,  or the
delivery  of pricing of  pharmaceuticals  and  healthcare  services  or mandated
benefits,  may cause  healthcare  industry  participants  to greatly  reduce the
amount of the  Company's  products and services  they purchase or the price they
are willing to pay for the  products we  distribute.  Changes in  pharmaceutical
manufacturers'  pricing or distribution policies could also significantly reduce
our income.

While the Company uses its best efforts to adhere to the regulatory and
licensing requirements, as well as any other requirements affecting the products
we distribute, compliance with these often requires subjective legislative
interpretation. Consequently, we cannot assure that our compliance efforts will
be deemed sufficient by regulatory agencies and commissions enforcing these
requirements. Violation of these regulations may result in civil and criminal
penalties, which could materially and adversely affect our operations.

                               Internet regulation
                               -------------------

Few laws currently regulate the Internet. Because of the Internet's popularity
and increasing use, new laws and regulations may be adopted. Such laws and
regulations may cover issues such as:

           . user privacy             . distribution
           . pricing                  . taxation
           . content                  . characteristics and quality of
                                        products
           . copyrights               . services

Laws and regulations directly applicable to electronic commerce or Internet
communications are becoming more prevalent. We believe that our use of third
party material on our website is permitted under current provisions of copyright
law. Because legal rights to certain aspects of Internet content and commerce
are not clearly settled, our ability to rely upon exemptions or defenses under
copyright law is uncertain. Also, although not yet enacted, Congress is
considering laws regarding Internet taxation. In addition, various jurisdictions
already have enacted laws that are not specifically directed to electronic
commerce but that could affect its business. The applicability of many of these
laws to the Internet is uncertain and could expose the Company to substantial
liability. Any new legislation or regulation regarding the Internet, or the
application of existing laws and regulations to the Internet, could materially
and adversely affect the Company. If the Company were alleged to violate
federal, state or foreign, civil or criminal law, even if the Company could
successfully defend such claims, it could materially and adversely affect the
Company.

Additionally, several telecommunications carriers are seeking to have
telecommunications over the Internet regulated by the Federal Communications
Commission in the same manner as other telecommunications services. Furthermore,
local telephone carriers have petitioned the Federal


                                       11
<PAGE>

Communications Commission to regulate Internet service providers and online
service providers in a manner similar to long distance telephone carriers and to
impose access fees on such providers. If either of these petitions are granted,
the costs of communicating on the Internet could increase substantially. This,
in turn, could slow the growth of use of the Internet. Any such legislation or
regulation could materially and adversely affect its business, financial
condition and operating results.

Proprietary rights

We believe that protecting the Company's trademarks and registered domain name
is important to our business strategy of building strong brand name recognition
and that such trademarks have significant value in the marketing of the
Company's products. To protect our proprietary rights, the Company will rely on
copyright, trademark and trade secret laws, confidentiality agreements with
employees and third parties, and license agreements with consultants, vendors
and customers. Despite such protections, however, we may be unable to fully
protect our intellectual property.

Dependence on major suppliers

During the year ended December 31, 2002 purchases from three suppliers accounted
for 65%, 14% and 10% of our total purchases, respectively. During the year ended
December 31, 2001 purchases from one of our suppliers accounted for 84% of our
total purchases. We presently enjoy a good relationship with our suppliers. If
for any reason our business with our suppliers was interrupted or discontinued
in the future, we would be able to acquire most, if not all, of the same
products from other suppliers at similar competitive prices.

No dependence on major customers

Not one of our customers accounted for more than 10% of our sales during either
of the years ended December 31, 2002 or 2001.

Employees

The Company currently employs 7 employees. Labor unions do not represent any of
these employees. The Company considers its employee relations to be good.
Competition for qualified personnel in its industry is intense, particularly for
technical staff responsible for marketing, advertising, web development, and
general and administrative activities.

Employees will be permitted to participate in employee benefit plans of the
Company that may be in effect from time to time, to the extent eligible.

Physical facilities

The Company's principal business operations are housed in 800 square feet of
office space and 1,200 square feet of warehouse space in Portland, Oregon. The
Company leases this space under a two-year lease agreement. Rent for the first
year, which expires April 30, 2003, is $1,528 per month. Rent for the second
year is $1,563 per month. The lease expires in April 2004. The Company is
currently negotiating a one year extension of its lease. The Company believes
this space will be sufficient for the next twelve months.


                                       12
<PAGE>


The Company's principal executive offices are located in Beverly Hills,
California. The Company leases approximately 800 square feet of office space for
$925 per month. This space is leased on a month to month basis. The Company
believes this space will be sufficient for at least the next twelve months.

Company history prior to the acquisition of Allied Med, Inc.

The Company was incorporated under the laws of the State of California on April
30, 1963 with authorized common stock of 10,000,000 shares at a par value of
$.10 and 1,000,000 preferred shares with a par value of $1.00 under the name of
Harlyn Products, Inc. Harlyn Products, Inc. was engaged in the business of
selling jewelry to department stores and retail jewelry stores until the
mid-1990s.

On March 21, 1997 Harlyn Products, Inc. filed for bankruptcy in the United
States Bankruptcy Court, Central District of California in the Los Angeles
Division under Chapter 11, with Howard M. Ehrenberg as trustee, and emerged from
bankruptcy on April 25, 2000 under Chapter 7 with no remaining assets or
liabilities.

Pursuant to the bankruptcy settlement, the name of the Company was changed to
Amexdrug Corporation. The bankruptcy settlement resulted in a change in officers
and directors of the Company, with the result that the persons who served as
officers and/or directors of the Company at the time of the bankruptcy filing
are no longer associated with the Company. New officers and directors were
elected. The settlement also provided that the par value of the common shares of
the Company be reduced from $.10 to $.001, the authorized and any outstanding
preferred shares were canceled, the outstanding common stock was reverse split
on a one hundred shares for one share basis, and 1,000,000 post reverse split
common shares were issued to Jack Amin, currently the President and a director
of the Company, in exchange for $100,000 which was paid into the bankruptcy
court. The total of the post reverse split outstanding shares, following
completion of the terms of the settlement, was 1,052,783.

Amended Articles of Incorporation completing the terms of the bankruptcy were
filed by the trustee in the State of California on June 22, 2000.

Solely for the purpose of changing domicile from California to Nevada, on
December 12, 2001, Amexdrug Corporation, a California corporation, entered into
a certain Merger Agreement with a newly formed, wholly-owned subsidiary Nevada
corporation named Amexdrug Corporation. The Nevada corporation had been
incorporated on December 4, 2001. As a result of the merger, which became
effective on December 17, 2001, the Company became a Nevada corporation and the
separate existence of the California corporation ceased. At the time of the
merger, the Company changed its fiscal year end from June 30 to December 31.

------------------------------------------------------------------------------

                        ITEM 2. DESCRIPTION OF PROPERTIES

------------------------------------------------------------------------------

Operating facilities

Amexdrug's operating facilities are located at 2519 North Hayden Island Drive,
Portland, Oregon 97217. Amexdrug leases approximately 2,000 square feet of


                                       13
<PAGE>

building space for its operating facilities, which includes four offices in
approximately 800 square feet and a warehouse that occupies the remaining 1,200
square feet.

Amexdrug leases its operating facilities under an operating lease from an
unrelated third party. The present lease will expire in April 2004. The monthly
rental payment under this lease is approximately $1,528 with a $35 per month
increase scheduled to take place in April 2003. We believe this space will be
sufficient for the next twelve months.

Executive offices

Amexdrug's executive offices are located at 8909 W. Olympic Boulevard, Suite
112, Beverly Hills, California 90211, and consists of three offices and a
reception area comprising approximately 800 square feet.

Amexdrug leases its executive facilities on a month to month basis under an oral
lease agreement from an unrelated third party. The monthly lease payment under
this lease is $925.00.

Additional properties

Effective December 20, 2002, Jack Amin and his wife contributed four undeveloped
parcels of real property to Allied Med, Inc. as an additional
capital contribution to the Company. The Company did not pay anything to Mr. or
Mrs. Amin for the properties. The properties are held by the Company for
investment purposes. A description of each of the properties has been included
below:

     1. One property is located in San Bernardino County, California and is
approximately two and one-half (2.5) acres in size. The property is not
encumbered by any mortgage, trust deed or other encumbrance. The property is
undeveloped and vacant. The Company has no present plans to develop or use the
property in its business. The Company intends to hold the property for
investment purposes. The property may eventually be sold by the Company in the
future to generate cash that can be used to fund operations and possible
expansion of the Company's business.

     2. One property is located in San Bernardino County, California and is
approximately five (5) acres in size. The property is not encumbered by any
mortgage, trust deed or other encumbrance. The property is undeveloped and
vacant. The Company has no present plans to develop or use the property in its
business. The Company intends to hold the property for investment purposes. The
property may eventually be sold by the Company in the future to generate cash
that can be used to fund operations and possible expansion of the Company's
business.

     3. One property is located in Los Angeles County, California and is
approximately two and one-half (2.5) acres in size. The property is not
encumbered by any mortgage, trust deed or other encumbrance. The property is
undeveloped and vacant. The Company has no present plans to develop or use the
property in its business. The Company intends to hold the property for
investment purposes. The property may eventually be sold by the Company in the
future to generate cash that can be used to fund operations and possible
expansion of the Company's business.


                                       14
<PAGE>

     4. One property is located in Lake County, Oregon and is less than one-half
(0.5) acre in size. The property is not encumbered by any mortgage, trust deed
or other encumbrance. The property is undeveloped and vacant. The Company has no
present plans to develop or use the property in its business. The Company
intends to hold the property for investment purposes. The property may
eventually be sold by the Company in the future to generate cash that can be
used to fund operations and possible expansion of the Company's business.

------------------------------------------------------------------------------

                            ITEM 3. LEGAL PROCEEDINGS

------------------------------------------------------------------------------

Amexdrug is not a party to any material pending legal proceedings. Amexdrug's
property is not subject to any material pending legal proceedings. To the best
of Amexdrug's knowledge, no governmental authority or other party has threatened
or is contemplating the filing of any material legal proceeding against
Amexdrug.

------------------------------------------------------------------------------

          ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS

-----------------------------------------------------------------------------

No matter was submitted to a vote of our security holders, through the
solicitation of proxies or otherwise, during the fourth quarter of the fiscal
year covered by this report. The merger which occurred in December 2001 to
change the Company's domicile from California to Nevada was accomplished without
a vote of the public company's shareholders, as permitted by applicable
corporate law.

                                     PART II

------------------------------------------------------------------------------

        ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

------------------------------------------------------------------------------

Market information

Our common stock is presently traded in the over-the-counter market and quoted
on the National Association of Securities Dealers' OTC Bulletin Board under the
ticker symbol "AXRX". The shares are thinly traded and a limited market
presently exists for the shares. The following table describes, for the
respective periods indicated, the prices of Amexdrug common stock in the
over-the-counter market, based on inter-dealer bid prices, without retail
mark-up, mark-down or commissions and may not necessarily represent actual
transactions. The prices have been adjusted to reflect a 1 for 100 reverse split
of Amexdrug's common stock which occurred August 3, 2001. The quotations have
been provided by market makers in common stock and/or Pink Sheets LLC. The
prices have been adjusted to reflect a 1 for 100 reverse split of Amexdrug's
common stock which occurred August 3, 2001.


                                       15
<PAGE>

Quarter ended                 High bid          Low bid
-------------                 --------          -------

March 31, 2000                 $0.10             $0.10
June 30, 2000                  $0.10             $0.10
September 30, 2000             None              None
December 31, 2000              $0.10             $0.10
March 31, 2001                 $1.50             $0.10
June 30, 2001                  $6.00             $2.70
September 30, 2001             $3.00             $0.10
December 31, 2001              $0.50             $0.25
March 31, 2002                 $1.01             $0.25
June 30, 2002                  $3.00             $0.60
September 30, 2002             $2.80             $0.55
December 31, 2002              $4.95             $1.30

Holders

The number of record holders of Amexdrug's common stock as of March 28, 2003 is
approximately 189.

Dividends

Amexdrug has not declared any cash dividends with respect to its common stock
during the last two fiscal years, and we do not intend to declare dividends in
the foreseeable future. There are no material restrictions limiting, or that are
likely to limit, Amexdrug's ability to pay dividends on our securities, except
for any applicable limitations under Nevada corporate law.

Recent sales of unregistered securities

During the past three years, Amexdrug has sold the following shares of its
common stock without registering them under the Securities Act of 1933:

     1. On April 25, 2000, the Bankruptcy Court approved the sale of 1,000,000
shares of Amexdrug's common stock for $100,000 paid by Jack Amin. Mr. Amin
borrowed the $100,000 from Allied Med, Inc.

     2. On December 31, 2001, Jack Amin exchanged all of the issued and
outstanding shares of Allied Med, Inc. to Amexdrug for 7,000,000 shares of
Amexdrug common stock. In addition, Amexdrug assumed the obligation of Mr. Amin
to pay a $100,000 note payable to Allied Med, Inc., and all accrued interest
thereon.

With respect to both of the sales of Amexdrug common stock described above,
Amexdrug relied on the Section 4(2) exemption from securities registration under
the federal securities laws for transactions not involving any public offering.
No advertising or general solicitation was employed in offering the shares. The
shares were sold to an accredited investor. The securities were offered for
investment purposes only and not for the purpose of resale or distribution, and
the transfer thereof was appropriately restricted by Amexdrug.

In both private offerings, the securities were sold directly by Amexdrug through
its officers and directors without the payment of any commissions or other
offering compensation. No underwriters were engaged to sell the securities
offered.


                                       16
<PAGE>


-----------------------------------------------------------------------------

        ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

------------------------------------------------------------------------------

Overview

Amexdrug Corporation is located 8909 West Olympic Boulevard, Suite 112, Beverly
Hills, California 90211. Its phone number is (310) 855-0475. Its fax number is
(310) 855-0477. Its website is www.amexdrug.com. The President of Amexdrug has
had experience working in the pharmaceutical industry for the past 20 years.

Through its wholly-owned subsidiary, Allied Med, Inc., Amexdrug is engaged in
the pharmaceutical wholesale business of selling brand name and generic
pharmaceutical products, over-the-counter (OTC) and health and beauty products
in 7 or 8 states. Amexdrug is expanding its business, and it would like to
eventually sell and distribute products in all 50 states.

Amexdrug Corporation was initially incorporated under the laws of the State of
California on April 30, 1963 under the name of Harlyn Products, Inc. Harlyn
Products, Inc. was engaged in the business of selling jewelry to department
stores and retail jewelry stores until the mid-1990s.

The name of the Company was changed to Amexdrug Corporation in April 2000 to
reflect the change in the Company's business to the sale of pharmaceutical
products. The officers and directors of the Company also changed in April 2000.
The domicile of the Company was changed from California to Nevada in December
2001. At that time the Company changed its fiscal year end from June 30 to
December 31.

On December 31, 2001, Amexdrug acquired all of the issued and outstanding common
shares of Allied Med, Inc. ("Allied") in a share exchange. Amexdrug acquired all
50,000 issued and outstanding shares of Allied common stock from its sole
shareholder, Mr. Jack Amin, in exchange for 7,000,000 restricted common shares
of Amexdrug and the assumption of a $100,000 promissory note, and all accrued
interest thereon owed by Mr. Amin to Allied. At all times during the
negotiations of the transaction, Mr. Amin was an officer, director and
controlling shareholder of both companies. Consideration for the acquisition was
determined through negotiations between the boards of directors of both
companies and was based on Allied's past operating history and future potential
growth.

Allied was formed as an Oregon corporation in October 1997, to operate in the
pharmaceutical wholesale business of selling brand name and generic
pharmaceutical products, over-the-counter (OTC) and health and beauty products.
In 1998, Allied's gross sales were approximately $2.8 million. In 1999, Allied's
gross sales exceeded $5 million. In 2000, Allied's gross sales exceeded $8
million. In 2001, Allied's gross sales were approximately $21.2 million.

Amexdrug has assumed the operations of Allied as its primary operations, and
Amexdrug intends to build on the pharmaceutical wholesale operations of Allied.

The accompanying financial information includes the operations of Allied Med,
Inc. for all periods presented and the operations of Amexdrug Corporation from
April 25, 2000.



                                       17
<PAGE>

Results of operations

For the year ended September 30, 2002, Amexdrug reported sales of $22,249,952,
comprised entirely of income from the Allied Med, Inc. pharmaceutical wholesale
business of selling brand name and generic pharmaceutical products, and
over-the-counter (OTC) and health and beauty products. This was $995,871 more
than the $21,254,081 of sales reported for the year ended December 31, 2001.
Cost of goods sold for the year ended December 31, 2002 was $21,628,472, an
increase of $713,592 over the $20,914,880 cost of goods sold for the year ended
September 30, 2001. During the year ended December 31, 2002 gross profit
improved by $282,279 to $621,480 or 2.8% of sales from the $339,201 or 1.6% of
sales recorded for the year ended December 31, 2001.

Selling, general and administrative expense was $633,104 for the year ended
December 31, 2002, an increase of $206,111 from the $426,993 recorded for the
year ended December 31, 2001. This increase in selling, general and
administrative expense is attributable to an increase in expenses related to the
increase in the Company's operations.

During the year ended December 31, 2002, Amexdrug experienced a net loss of
$18,040, as compared to the $92,078 net loss incurred for the year ended
December 30, 2001. Amexdrug's decrease in the size of its net loss during the
year ended December 31, 2002 is attributable to increases in sales and profit
margins in prescription generic products.

Liquidity and capital resources - December 31, 2002

     Assets

     As of December 31, 2002, Amexdrug reported total current assets of
$1,417,095, comprised of cash of $338,529, accounts receivable, net of $682,627
and inventory of $395,939. Total assets as of December 31, 2002 were $1,490,603,
which included total current assets of $1,417.095, plus net property and
equipment of $73,308 and deposits of $200.


     Liabilities

     Amexdrug's liabilities as of December 31, 2002 consist of accounts payable
of $1,535,684, accrued liabilities of $2,344, current portion of capital lease
obligations of $18,373, and total long-term liabilities of $50,025.


Forward-looking statements

This document includes various forward-looking statements with respect to future
operations of Amexdrug that are subject to risks and uncertainties.
Forward-looking statements include the information concerning expectations of
future results of operations and such statements preceded by, followed by or
that otherwise include the words "believes," "expects," "anticipates,"
"intends," "estimates" or similar expressions. For those statements, Amexdrug
claims the protection of the safe harbor for forward-looking statements
contained in the Private Litigation Reform Act of 1995.


                                       18
<PAGE>


-----------------------------------------------------------------------------

                          ITEM 7. FINANCIAL STATEMENTS

------------------------------------------------------------------------------

Amexdrug's consolidated audited balance sheets as of December 31, 2002 and 2001,
and Amexdrug's consolidated audited statements of operations, stockholders'
equity (deficit), and cash flows for the fiscal years ended December 31, 2002
and 2001 are included below.






                       AMEXDRUG CORPORATION AND SUBSIDIARY


                          INDEX TO FINANCIAL STATEMENTS


                                                                            Page

Report of Independent Certified Public Accountants...........................F-2

Consolidated Balance Sheets-- December 31, 2002 and 2001.....................F-3

Consolidated Statements of Operations for the Years Ended December 31,
   2002 and 2001.............................................................F-4

Consolidated Statements of Stockholders' Deficit for the Years Ended
   December 31, 2001 and 2002................................................F-5

Consolidated Statements of Cash Flows for the Years Ended December 31,
   2002 and 2001.............................................................F-6

Notes to Consolidated Financial Statements...................................F-7






                                       19
<PAGE>


 HANSEN, BARNETT & MAXWELL                                   (801) 532-2200
 A Professional Corporation                               Fax (801) 532-7944
CERTIFIED PUBLIC ACCOUNTANTS                           5 Triad Center, Suite 750
                                                      Salt Lake City, Utah 84180
                                                           www.hbmcpas.com



               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS


To the Board of Directors and the Stockholders
Amexdrug Corporation

We have audited the accompanying consolidated balance sheets of Amexdrug
Corporation and subsidiary as of December 31, 2002 and 2001, and the related
consolidated statements of operations, stockholders' deficit and cash flows for
the years then ended. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the  United  States of  America.  Those  standards  require  that we plan and
perform the audits to obtain  reasonable  assurance  about whether the financial
statements are free of material misstatement.  An audit includes examining, on a
test basis,  evidence  supporting  the amounts and  disclosures in the financial
statements.  An audit also includes assessing the accounting principles used and
significant  estimates  made by  management,  as well as evaluating  the overall
financial  statement  presentation.   We  believe  that  our  audits  provide  a
reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly, in all material respects, the financial position of Amexdrug Corporation
and  subsidiary  as of  December  31,  2002,  and the  consolidated  results  of
operations and cash flows of Amexdrug  Corporation  for the years then ended, in
conformity with accounting principles generally accepted in the United States of
America.

The accompanying  consolidated  financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in Note 1 to the
financial statements, the Company has suffered recurring losses from operations.
During the years ended December 31, 2002 and 2001, the Company had net losses of
$18,040 and $92,078,  respectively, and during the year ended December 31, 2002,
the  Company's  operations  used  $199,861 of cash.  At December 31,  2002,  the
Company had a working capital deficiency of $139,306 and a capital deficiency of
$115,823.  These matters raise  substantial doubt about the Company's ability to
continue as a going concern.  Management's  plans in regard to these matters are
also  described  in  Note  1.  The  financial  statements  do  not  include  any
adjustments  relating to the recoverability and classification of asset carrying
amounts or the amount and classification of liabilities that might result should
the Company be unable to continue as a going concern.


                                                      HANSEN, BARNETT & MAXWELL
Salt Lake City, Utah
March 24, 2003






an independent member of
BAKER TILLY                                    Member of AICPA Division of Firms
INTERNATIONAL                                                    Member of SECPS
                                      F-2
<PAGE>
<TABLE>
<CAPTION>


                                            AMEXDRUG CORPORATION AND SUBSIDIARY
                                                CONSOLIDATED BALANCE SHEETS
                                                DECEMBER 31, 2002 AND 2001


                                                                                               2002             2001
                                                                                        ----------------  ---------------
                                         ASSETS
<S>                                                                                     <C>               <C>
Current Assets
     Cash ..............................................................................$        338,529  $       562,004
     Accounts receivable, net of allowance for doubtful accounts of $152,083 and
       $61,362 and allowance for sales returns of $166,741 and $0, respectively.........         682,627          920,716
     Inventory, plus allowance for sales returns of $162,255 and $0, respectively.......         395,939          235,724
                                                                                        ----------------  ---------------
         Total Current Assets...........................................................       1,417,095        1,718,444
                                                                                        ----------------  ---------------

Property and Equipment
     Office and computer equipment......................................................         119,828          119,828
     Leasehold improvements.............................................................          15,700           15,700
                                                                                        ----------------  ---------------
                                                                                                 135,528          135,528
     Less accumulated depreciation......................................................         (62,220)         (31,346)
                                                                                        ----------------  ---------------
         Net Property and Equipment.....................................................          73,308          104,182
                                                                                        ----------------  ---------------
Investment in Real Estate (Note 1)......................................................              --               --

Deposits ...............................................................................             200            2,842
                                                                                        ----------------  ---------------
Total Assets   .........................................................................$      1,490,603  $     1,825,468
                                                                                        ================  ===============



                          LIABILITIES AND STOCKHOLDERS' DEFICIT

Current Liabilities
     Accounts payable...................................................................$      1,535,684  $     1,768,265
     Accrued liabilities................................................................           2,344            1,720
     Accrued settlement obligations.....................................................              --           50,737
     Current portion of capital lease obligations.......................................          18,373           18,369
                                                                                        ----------------  ---------------
         Total Current Liabilities......................................................       1,556,401        1,839,091
                                                                                        ----------------  ---------------
Long-Term Liabilities
     Accrued settlement obligations, net of current portion.............................              --            7,875
     Capital lease obligations, net of current portion..................................          50,025           76,285
                                                                                        ----------------  ---------------
         Total Long-Term Liabilities....................................................          50,025           84,160
                                                                                        ----------------  ---------------
Stockholders' Deficit
     Common stock, $0.001 par value; 50,000,000 shares authorized
     and 8,052,783 issued and outstanding...............................................           8,053            8,053
     Additional paid in capital.........................................................           7,969            7,969
     Accumulated deficit................................................................        (131,845)        (113,805)
                                                                                        ----------------  ---------------
         Total Stockholder's Deficit....................................................        (115,823)         (97,783)
                                                                                        ----------------  ---------------
Total Liabilities and Stockholders' Deficit.............................................$      1,490,603  $     1,825,468
                                                                                        ================  ===============



                               See accompanying notes to consolidated financial statements.
                                                            F-3
</TABLE>

<PAGE>
<TABLE>
<CAPTION>



                                 AMEXDRUG CORPORATION AND ALLIED MED, INC.
                                   CONSOLIDATED STATEMENTS OF OPERATIONS



                                                                                   For the Years Ended
                                                                                       December 31,
                                                                                  2002           2001
                                                                             ------------    ------------
<S>                                                                          <C>             <C>
Sales ....................................................................   $ 22,249,952    $ 21,254,081
Cost of goods sold .......................................................     21,628,472      20,914,880
                                                                             ------------    ------------

Gross Profit .............................................................        621,480         339,201

Selling, general and administrative expense ..............................       (633,104)       (426,993)
Interest expense .........................................................         (8,419)         (6,498)
Gain from forgiveness of debt ............................................          8,526            --
Interest and other income ................................................           --             2,212
                                                                             ------------    ------------

Loss Before Cumulative Effect of Change in Accounting Principle ..........        (11,517)        (92,078)

Cumulative effect of change in depreciation method .......................         (6,523)           --
                                                                             ------------    ------------

Net Loss .................................................................   $    (18,040)   $    (92,078)
                                                                             ============    ============

Basic and Diluted Loss Per Common Share
     Loss before cumulative effect of change in accounting principle .....   $       --      $      (0.01)
     Cumulative effect of change in depreciation method ..................           --              --
                                                                             ------------    ------------
     Net loss ............................................................   $       --      $      (0.01)
                                                                             ============    ============

     Basic and diluted weighted-average common shares outstanding ........      8,052,783       8,052,783
                                                                             ============    ============

Supplemental Pro Forma Amounts Assuming Retroactive Application
  of New Depreciation Method
     Net loss ............................................................   $    (11,517)   $   (104,397)
                                                                             ============    ============
     Basis and diluted loss per common share .............................   $       --      $      (0.01)
                                                                             ============    ============



                       See accompanying notes to consolidated financial statements.

                                                    F-4
</TABLE>

<PAGE>
<TABLE>
<CAPTION>


                                         AMEXDRUG CORPORATION AND ALLIED MED, INC.
                                      CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                                      FOR THE YEARS ENDED DECEMBER 31, 2002 AND 2001



                                                                                                                  Total
                                                       Common Stock            Additional                    Stockholders'
                                                ---------------------------      Paid-In       Accumulated      Equity
                                                   Shares         Amount         Capital         Deficit       (Deficit)
                                                ------------   ------------   ------------    ------------   ------------
<S>                                             <C>            <C>            <C>             <C>            <C>
Balance, December 31, 2000......................   8,052,783   $      8,053   $    120,930    $   (108,901)  $     20,082

Distributions to shareholder....................          --             --        (39,592)             --        (39,592)
Capital contribution by shareholder, no
  additional shares issued......................          --             --         13,805              --         13,805
Net loss........................................          --             --        (87,174)         (4,904)       (92,078)
                                                ------------   ------------   ------------    ------------   ------------
Balance, December 31, 2001......................   8,052,783   $      8,053   $      7,969    $   (113,805)  $    (97,783)

Real estate contributed by shareholder,
  no additional shares issued...................          --             --             --              --             --
Net loss........................................          --             --             --         (18,040)       (18,040)
                                                ------------   ------------   ------------    ------------   ------------
Balance, December 31, 2002......................   8,052,783   $      8,053   $      7,969    $   (131,845)  $   (115,823)
                                                ============   ============   ============    ============   ============






                               See accompanying notes to consolidated financial statements.

                                                            F-5
</TABLE>

<PAGE>
<TABLE>
<CAPTION>


                                      AMEXDRUG CORPORATION AND ALLIED MED, INC.
                                        CONSOLIDATED STATEMENTS OF CASH FLOWS



                                                                                           For the Years Ended
                                                                                              December 31,
                                                                                         2002              2001
                                                                                   ----------------  ---------------
<S>                                                                                <C>               <C>
Cash Flows from Operating Activities
     Net income (loss)............................................................ $        (18,040) $       (92,078)
     Adjustments to reconcile net loss to net cash used in operating activities:
       Depreciation...............................................................           24,351           12,032
       Bad debt expense...........................................................           90,721           20,030
       Cumulative effect of change in accounting principle........................            6,523               --
     Changes in operating assets and liabilities:
         Accounts receivable......................................................          147,368         (541,130)
         Inventory................................................................         (160,215)         187,703
         Accounts payable.........................................................         (232,581)         676,860
         Related party accounts payable...........................................               --           (8,901)
         Accrued liabilities......................................................              624           (5,585)
         Accrued settlement obligations...........................................          (58,612)        (106,530)
                                                                                   ----------------  ---------------
              Net Cash Provided By (Used In) Operating Activities.................         (199,861)         142,401
                                                                                   ----------------  ---------------

Cash Flows from Investing Activities
     Decrease (increase) in deposits..............................................            2,642           (2,642)
                                                                                   ----------------  ----------------
              Net Cash Provided by (Used In) Investing Activities.................            2,642           (2,642)
                                                                                   ----------------  ----------------

Cash Flows from Financing Activities
     Principal payments on capital lease obligations..............................          (26,256)          (7,254)
     Capital contributions by shareholder.........................................               --           13,805
     Distributions to shareholders................................................               --          (39,592)
                                                                                   ----------------  ----------------
              Net Cash Used In Financing Activities...............................          (26,256)         (33,041)
                                                                                   ----------------  ----------------

Net Increase (Decrease) in Cash...................................................         (223,475)         106,718
Cash at Beginning of Year.........................................................          562,004          455,286
                                                                                   ----------------  ---------------

Cash at End of Year............................................................... $        338,529  $       562,004
                                                                                   ================  ===============

Supplemental Cash Flows Information
     Cash paid for interest........................................................$          8,419  $         6,498
                                                                                   ================  ===============

Noncash Investing and Financing Activities
     Property and equipment acquired by capital lease..............................$             --  $       101,908
     Real estate contributed by shareholder........................................              --               --



                             See accompanying notes to consolidated financial statements.


</TABLE>
                                                         F-6
<PAGE>

                    AMEXDRUG CORPORATION AND ALLIED MED, INC.
             NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS


NOTE 1 - Organization and Nature of Operations

Organization  and Nature of  Operations--  Allied Med,  Inc.  was  organized  in
October 1997 in the State of Oregon as a wholly-owned  corporation of Jack Amin.
Allied Med,  Inc. is a  full-line,  wholesale  distributor  of  pharmaceuticals,
over-the-counter  products,  health and beauty care  products,  and  nutritional
supplements.  Allied Med, Inc.  distributes its products primarily in the United
States of America, to small and medium-sized  pharmacy chains,  alternative care
facilities and other wholesalers and retailers.

In April 2000,  the  Company  loaned  Jack Amin  $100,000 to purchase  1,000,000
shares of common stock of Harlyn Products,  Inc., a publicly-traded  Company. On
April  25,  2000,  the  sale  was  approved  and  the  shares  were   purchased.
Additionally,   there  were  52,783   additional  common  shares  that  remained
outstanding of Harlyn Products,  Inc. after a 1-for-100  reverse stock split. In
June 2000, Harlyn Products, Inc. changed its name to Amexdrug Corporation.

Harlyn Products, Inc. had no prior operations that continued after the purchase.
As a result,  the  acquisition  of the majority of its common stock by Jack Amin
was accounted for as the  acquisition of its monetary  assets,  which there were
none, for $100,000; therefore, the $100,000 payment was charged to operations of
Amexdrug  Corporation  on the date it was paid.  The  $100,000  note  payable to
Allied Med, Inc. was due on demand and bore interest at 5%.

On December  31, 2001,  Jack Amin  exchanged  all of the issued and  outstanding
common stock of Allied Med, Inc. for 7,000,000  shares of Amexdrug  Corporation.
In addition,  Amexdrug Corporation assumed the note payable and accrued interest
payable to Allied Med,  Inc.  Since this  exchange  was between  entities  under
common  control,  it was  accounted  for at historical  cost.  The  accompanying
consolidated statements of operations include the operations of Allied Med, Inc.
and  Amexdrug  Corporation  (referred  to herein,  on a combined  basis,  as the
Company)  for all periods  presented.  Stockholders'  deficit and loss per share
information  have been  restated for all periods  presented to give  retroactive
effect to the reorganization on December 31, 2001. All significant  intercompany
accounts and transactions have been eliminated in consolidation.

Business  Condition -- During the years ended  December  31, 2002 and 2001,  the
Company had losses from  operations  of $18,040 and $92,078,  respectively,  and
during the year ended December 31, 2002, the Company's  operations used $199,861
of cash. At December 31, 2002, the Company had a working  capital  deficiency of
$139,306 and a capital  deficiency of $115,823.  These matters raise substantial
doubt about the  Company's  ability to continue as a going  concern.  Management
believes the Company can sell certain real estate  properties  to fund the needs
of  the  Company;  however,  there  is no  assurance  that  management  will  be
successful in selling the  properties,  or if the properties are sold,  that the
proceeds  will be  sufficient  for the needs of the  Company.  The  accompanying
financial   statements   do  not  include  any   adjustments   relating  to  the
recoverability  and  classification  of asset carrying amounts or the amount and
classification  of liabilities that might result should the Company be unable to
continue as a going concern.

Use of Estimates -- The  preparation of financial  statements in conformity with
accounting  principles  generally  accepted  in the  United  States  of  America
requires  management to make estimates and assumptions  that affect the reported
amounts  of assets and  liabilities  and  disclosure  of  contingent  assets and
liabilities at the date of the financial  statements and the reported amounts of
revenues and expenses during the reporting  period.  Actual results could differ
from these estimates.

Cash  Equivalents  --  For  purposes  of  the  statements  of  cash  flows,  all
highly-liquid  debt  instruments  purchased  with an original  maturity of three
months or less have been considered cash equivalents.


                                      F-7
<PAGE>

                    AMEXDRUG CORPORATION AND ALLIED MED, INC.
             NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS

Concentrations and Credit Risk -- At December 31, 2002, the Company had cash in
excess of federally insured limits of $237,017.

The Company's  historical revenues and receivables have been derived solely from
the pharmaceutical industry.  Although the Company primarily sells products on a
cash-on-delivery  basis,  the Company also sells  products to certain  customers
under credit terms.  The Company  performs  ongoing  credit  evaluations  of its
customers'  financial  condition and usually requires a delayed check depository
from its  customers at the date products are shipped.  The Company  maintains an
allowance for accounts receivable that may become uncollectible.

During the year ended December 31, 2002  purchases from three vendors  accounted
for 65%, 14%, and 10% of total  purchases,  respectively.  During the year ended
December  31,  2001  purchases  from  one  vendor  accounted  for  84% of  total
purchases.  The loss of any of these vendors  could have a significant  negative
effect upon the Company's future operations.

Fair Value of Financial  Instruments  -- The carrying  amounts of capital  lease
obligations  approximate  their  fair  values  based on current  interest  rates
available to the Company.

Inventory -- Inventory  includes  purchased products for resale and is stated at
the lower of cost  (using  the  first-in,  first-out  method)  or market  value.
Provisions,  when required,  are made to reduce excess and expired  inventory to
its  estimated  net  realizable  value.   Although  competitive   pressures  and
pharmaceutical advancements expose the Company to the risk that estimates of the
net  realizable  value could change in the near term,  the Company's  agreements
with  most  vendors  provide  for the right of return  of  outdated  or  expired
inventory.  The Company is exposed to other ownership  related risks  associated
with inventory.

Property  and  Equipment  --  Property  and  equipment  are  stated at cost less
accumulated  depreciation.  Major additions and  improvements  are  capitalized,
while  minor  repairs  and   maintenance   costs  are  expensed  when  incurred.
Depreciation is computed using straight-line and declining-balance  methods over
the estimated useful lives of the related assets, which are as follows:



   Office and computer equipment....................       3 - 10 years
   Leasehold improvements...........................       2 - 5 years

Depreciation  expense was $24,351 and $12,032 for the years ended  December  31,
2002 and 2001,  respectively.  On  retirement  or  disposition  of property  and
equipment,  the cost and related  accumulated  depreciation and amortization are
removed from the accounts and any  resulting  gain or loss is  recognized in the
statement of operations.

Change in Accounting  Principle -- During the year ended  December 31, 2002, the
Company changed  depreciation methods from the  declining-balance  method to the
straight-line  method.  The  change  was made to more  closely  match the use of
underlying  property and equipment.  This resulted in a decrease in depreciation
expense for the year of $15,801.  Under the prior method,  depreciation  expense
would have been approximately $41,060.

The effect of the change in 2002 was an  increase  of net loss by  approximately
$6,523.  The cumulative effect of applying the new method to years prior to 2002
was included in the results of operations  of 2002.  The pro forma amounts shown
on the statement of operations  have been adjusted for the effect of retroactive
application of the new depreciation on prior years.


                                      F-8
<PAGE>

                    AMEXDRUG CORPORATION AND ALLIED MED, INC.
             NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS


Investment  in Real  Estate  -- On  December  19,  2002,  Jack Amin and his wife
contributed four parcels of real estate to the Company. The real estate has been
recorded  at its  historical  cost of $0.  The  real  estate  is not used in the
Company's operations and is held for sale.

Impairment of Long-Lived Assets -- The Company reviews its long-lived assets for
impairment when events or changes in circumstances  indicate that their carrying
value may not be recoverable. The Company evaluates, at each balance sheet date,
whether  events  and   circumstances   have  occurred  which  indicate  possible
impairment.  The Company uses an estimate of future  undiscounted net cash flows
from the related asset or group of assets over their remaining life in measuring
whether the assets are recoverable. As of December 31, 2002, the Company did not
consider any of its long-lived assets to be impaired.

Revenue  Recognition  -- The  Company  generates  revenues  from the  resale  of
pharmaceuticals,  over-the-counter products, health and beauty care products and
nutritional supplements.  The Company accounts for these revenues at the time of
shipment  to the  customer.  An  allowance  for sales  returns is  provided  for
products sold on a  cash-on-delivery  basis that are not accepted or paid for by
the customer.

Income Taxes -- Allied Med, Inc. and its  shareholder  elected to be taxed under
the provisions of Subchapter S of the internal Revenue Code through December 31,
2001, when that election  terminated.  Under those provisions,  Allied Med, Inc.
did not pay federal or state corporate income taxes or receive the benefits from
its operating  loss carry  forwards.  Instead,  its  stockholder  was liable for
individual  federal and state income taxes and benefited from Allied Med. Inc.'s
operating losses. As a result, all income or loss from Allied Med, Inc. has been
recognized  as having  been  constructively  distributed  to the Allied Med Inc.
shareholder and contributed to the capital of Allied Med, Inc.

The Company  recognizes an asset or liability for the deferred tax  consequences
of all temporary  differences between the tax bases of assets or liabilities and
their reported  amounts in the financial  statements that will result in taxable
or deductible amounts in future years when the reported amounts of the assets or
liabilities  are recovered or settled.  These deferred tax assets or liabilities
are  measured  using  the  enacted  tax rates  that  will be in effect  when the
differences   are  expected  to  reverse.   Deferred  tax  assets  are  reviewed
periodically  for  recoverability  and valuation  allowances  are  provided,  as
necessary.

Basic and  Diluted  Loss Per  Common  Share -- Basic  loss per  common  share is
computed by dividing net loss by the  weighted-average  number of common  shares
outstanding.  Diluted  loss per common share is computed by dividing net loss by
the  weighted-average  number  of common  shares  and the  dilutive  potentially
issuable common shares outstanding.  As of December 31, 2001 the Company did not
have any potentially issuable common shares.

Recent  Accounting  Pronouncements  -- In August 2001, the Financial  Accounting
Standards Board (FASB) issued  Statement of Financial  Account  Standards (SFAS)
No. 144,  Accounting for the Impairment or Disposal of Long-Lived  Assets.  SFAS
No.  144  establishes  a single  accounting  model for  long-lived  assets to be
disposed of by sale and the recognition of impairment of long-lived assets to be
held and used. The Company  implemented SFAS No. 144 effective  January 1, 2002.
The adoption of this standard had no material effect on the Company's  financial
position or results of operations.

In April 2002, the FASB issued SFAS No. 145,  Rescission of FASB  Statements No.
4, 44 and 64,  Amendment of FASB  Statement No. 13, and  Technical  Corrections.
Among other provisions,  the statement  modifies the criteria  classification of
gains and losses on debt  extinguishments  such that they


                                      F-9
<PAGE>

                    AMEXDRUG CORPORATION AND ALLIED MED, INC.
             NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS

are not required to be classified as extraordinary items if they do not meet the
criteria for classification as extraordinary items in APB Opinion No. 30. The
Company elected to adopt this standard during the year ended December 31, 2002.
Accordingly, the gain recognized from forgiveness of debt associated with
renegotiating the terms of certain capital lease obligations during the year
ended December 31, 2002 was recognized in the loss from operations rather than
as an extraordinary item.

In July 2002, the FASB issued SFAS No. 146, Accounting for Costs Associated with
Exit or Disposal Activities. The statement requires companies to recognize costs
associated  with exit or disposal  activities when they are incurred rather than
at the date of a  commitment  to an exit or  disposal  plan.  Examples  of costs
covered by the standard  include lease  termination  costs and certain  employee
plan severance  costs that are  associated  with a  restructuring,  discontinued
operation,  plant closing, or other exit or disposal activity.  The Company will
be  required  to apply this  statement  prospectively  for any exit or  disposal
activities  initiated  after December 31, 2002. The adoption of this standard is
not expected to have any material effect on the Company's  financial position or
results of operations.

In December  2002,  the FASB issued SFAS No.  148,  Accounting  for  Stock-Based
Compensation-Transition  and  Disclosure.  This  statement  amends SFAS No. 123,
Accounting for Stock-Based  Compensation,  to amend the disclosure provisions of
SFAS No. 123 to require  prominent  disclosure about the effects on reported net
income or loss of an  entity's  accounting  policy  decisions  with  respect  to
stock-based employee  compensation.  SFAS No. 148 also requires disclosure about
those effects in interim  financial  information.  The adoption of this standard
had no  material  effect on the  Company's  financial  position  or  results  of
operations.

NOTE 2 - ACCRUED SETTLEMENT OBLIGATIONS

In 1999, the Company  entered into settlement  agreements with numerous  vendors
due to the  Company's  inability  to pay the  vendors.  Under  these  settlement
agreements  the Company  agreed to pay these  vendors a total of  $588,140.  The
Company paid a portion at the initial  execution of the  agreement  and has paid
the remaining  balance based on various payment plans.  The payment plans ranged
from 24 to 36 months.  During the years  ended  December  31,  2002 and 2001 the
Company made payments of $58,612 and $106,530 on the agreements. At December 31,
2002, the Company had no further obligation under the settlement agreements.

NOTE 3 - Leases

Capital  Lease  Obligations  --Certain  equipment is leased under  capital lease
agreements.  The  following  is a summary  of assets  held under  capital  lease
agreements at December 31, 2002:

            Property and equipment.............................  $     101,908
            Less: Accumulated amortization.....................        (45,275)
                                                                 --------------
                                                                 $      56,633
                                                                 ==============


                                      F-10
<PAGE>

                    AMEXDRUG CORPORATION AND ALLIED MED, INC.
             NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS


The following is a schedule of future minimum lease payments under capital lease
agreements together with the present value of the net minimum lease payments:

    Year Ending December 31,
    ------------------------
           2003.............................................  $      23,279
           2004.............................................         22,776
           2005.............................................         21,445
           2006.............................................         11,132
           2007.............................................             --
                                                               -------------
           Total minimum lease payments.....................         78,632
          Less:  Amount representing interest...............        (10,234)
                                                               -------------
          Present value of net minimum lease payments.......         68,398
          Less:  Current portion............................        (18,373)
                                                               -------------
           Long-term portion................................   $     50,025
                                                               =============

Operating Leases --The Company leases its operating facilities un non-cancelable
operating lease that expires during April 2004. The monthly lease payment in the
first  year of the lease is $1,528  increasing  to  $1,563 in the  second  year.
Additionally,  the  Company  leases its  executive  offices on a  month-to-month
basis.  The monthly  rental  payment is $950.  Rent  expense for the years ended
December 31, 2002 and 2001 was $27,024 and $18,473, respectively

Future  minimum  payments due under the  operating  leases were as follows as of
December 31, 2002:

 Year Ending December 31,
-------------------------
      2003...............................................  $      18,616
      2004...............................................          6,252
                                                           -------------
      Total..............................................  $      24,868
                                                           =============

NOTE 4 - Income taxes

The components of the net deferred tax asset as of December 31, 2002 and 2001
are as follows:

                                                    2002             2001
                                               -------------    -------------
        Operating loss carry forwards..........$       7,851    $       4,694
        Valuation allowance....................       (7,851)          (4,694)
                                               -------------    -------------
        Net Deferred Tax Asset.................$          --    $          --
                                               =============    =============

As of December 31, 2002 the Company had net operating loss carry forwards for
federal income tax reporting purposes of $26,231 which will expire, beginning in
2021.

The following is a reconciliation of the income tax at the federal statutory tax
rate with the provision of income taxes for the years ended December 31, 2002
and 2001:
                                                       2001            2000
                                                  -------------   -------------
   Income tax benefit at statutory rate (34%).....$      (4,225)  $      (1,667)
   Change in valuation allowance..................        2,602           1,829
   State benefit net of federal tax...............       (1,623)           (162)
                                                  -------------   -------------
   Provision for Income Taxes.....................$          --   $          --
                                                  =============   =============


                                      F-11
<PAGE>


------------------------------------------------------------------------------

            ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
                       ACCOUNTING AND FINANCIAL DISCLOSURE

------------------------------------------------------------------------------

Amexdrug has had no changes in its certified public accountants or experienced
other matters required to be disclosed pursuant to Item 304 of Regulation S-B
during the two most recent fiscal years or any later interim period, except as
disclosed in a Form 8-K Current Report filed March 18, 2002.


                                    PART III

------------------------------------------------------------------------------

        ITEM 9. DIRECTORS AND EXECUTIVE OFFICERS, PROMOTERS, AND CONTROL
           PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

------------------------------------------------------------------------------

Identification of directors and executive officers

The following table as of March 28, 2003, includes the name, age, and position
of each executive officer and director of Amexdrug and the term of office of
each director.

Name               Age    Position                Director and/or Officer Since
----               ---    --------                -----------------------------

Jack Amin          44     President, Secretary,           April 2000
                          Treasurer and Director

Rodney S. Barron,  50     Director                        December 2001
M.D.

Behrooz Meimand    54     Director                        December 2001

Each director of the Company serves for a term of one year and until his
successor is elected at the Company's annual shareholders' meeting and is
qualified, subject to removal by the Company's shareholders. Each officer
serves, at the pleasure of the board of directors, for a term of one year and
until his successor is elected at the annual meeting of the board of directors
and is qualified.

Included below is certain biographical information regarding each of the
Company's executive officers and directors.

Jack Amin has served as the President, Secretary, Treasurer and as a director of
Amexdrug since April 2000. He holds a Bachelor of Science in Electronic
Engineering from Western State College of Engineering of LA, California in 1982.
Since 1980 Mr. Amin has been engaged in various capacities, including sales and
management, within the pharmaceutical industry. Mr. Amin has served as the
President, Chief Executive Officer and director of Amexdrug's wholly-owned
subsidiary, Allied Med, Inc., a company which he founded in 1997.

Rodney S. Barron, M.D., has served as a director of Amexdrug since December
2001. Dr. Barron obtained his medical degree from New York Medical College in
1978. He then performed a residency in general surgery from 1978 to 1980, and a
residency in urology from 1980 to 1983. Dr. Barron has been involved in the


                                       30
<PAGE>


private practice of medicine in Los Angeles, California from 1983 through the
present time. Behrooz Meimand has served as a director of Amexdrug since
December 2001. Mr. Meimand obtained a master's degree in insurance from the
National University of Iran in 1970. He has had 30 years of experience in the
insurance industry. Mr. Meimand has been the president of Behrooz Meimand
Insurance Services, Inc. for a period of time exceeding the past 5 years.
Currently Mr. Meimand is also a director of Magbid Foundation and Nessah
Education & Culture Center.

Significant employees

Amexdrug has no present employees who are expected to make a significant
contribution to its business other than its current officers and directors. It
is expected that current members of management will be the only persons whose
activities will be material to Amexdrug's operations. Members of management are
the only persons who may be deemed to be promoters of Amexdrug.

Family relationships

         There are no family relationships between any directors or executive
officers of Amexdrug and/or the managers of its subsidiary company, Allied Med,
Inc., either by blood or by marriage.

Involvement in certain legal proceedings

         During the past five years, no present or former director, person
nominated to become a director, executive officer, promoter or control person of
Amexdrug:

                  (1) was a general partner or executive officer of any business
         which filed a petition in bankruptcy or against which any bankruptcy
         petition was filed, either at the time of the bankruptcy or two years
         prior to that time;

                  (2) was convicted in a criminal proceeding or named subject to
         a pending criminal proceeding (excluding traffic violations and other
         minor offenses);

                  (3) was subject to any order, judgment or decree, not
         subsequently reversed, suspended or vacated, of any court of competent
         jurisdiction, permanently or temporarily enjoining, barring, suspending
         or otherwise limiting his involvement in any type of business,
         securities or banking activities; or

                  (4) was found by a court of competent jurisdiction (in a civil
         action), the Securities and Exchange Commission or the Commodity
         Futures Trading Commission to have violated a federal or state
         securities or commodities law, and the judgment has not been reversed,
         suspended or vacated.

Section 16(a) beneficial ownership reporting compliance

From the time Amexdrug ceased operations in 1997 until Mr. Amin became an
officer and director in April 2000, the Company knows of no person who was a
director, officer, beneficial owner of more than ten percent of any class of
equity securities of the Company registered pursuant to Section 12 ("Reporting
Person"), who failed to file on a timely basis any reports


                                       31
<PAGE>

required to be furnished pursuant to Section 16 (a). Based upon a review of
Forms 3 and 4 furnished to the Company under Rule 16a-3(d) during its most
recent fiscal year, other than as disclosed below, the Company knows of no
Reporting Person that failed to file the required reports during the most recent
fiscal year or prior years:

                  (1) Jack Amin filed his initial Form 3 report on October 10,
         2000, approximately five months late. Mr. Amin filed a Form 5 report
         that was due to have been filed February 15, 2002 on approximately
         March 1, 2002. The Form 5 report describes a gift of 165,000 shares of
         Amexdrug common stock which Mr. Amin made in December 2001 and the
         acquisition of 7,000,000 shares by Mr. Amin which occurred on December
         31, 2001.

                  (2) Dr. Rodney Barron filed a Form 3 report on May 2, 2002
         which should have been filed on or before December 27, 2001. He does
         not currently own any shares of the Company's common stock.

                  (3) Mr. Behrooz Meimand filed a Form 3 report on May 2, 2002
         which should have been filed on or before December 27, 2001. He does
         not currently own any shares of the Company's common stock.

------------------------------------------------------------------------------

                         ITEM 10. EXECUTIVE COMPENSATION

------------------------------------------------------------------------------

Cash compensation

The following table sets forth the aggregate compensation paid by Amexdrug
and/or its subsidiary, Allied Med, Inc., for services rendered during the
periods indicated:

                           SUMMARY COMPENSATION TABLE

                                        Long Term Compensation
                    Annual Compensation Awards              Payouts
                    --------------------------              -------

(a)        (b)       (c)     (d)    (e)     (f)       (g)       (h)   (i)

                                                     Secur-
                                                     ities          All
Name and   Year or                  Other    Rest-   Under-   LTIP  Other
Principal  Period    Salary  Bonus  Annual   ricted  lying    Pay-  Compen-
Position   Ended       ($)    ($)   Compen-  Stock   Options  outs  sation
--------------------------------------------------------------------------

Jack Amin    12/31/00 $89,338   0       0      0          0      0     0
President/   12/31/01 $63,592   0       0      0          0      0     0
Director     12/31/02 $24,000   0       0      0          0      0     0

Except as described above, no cash compensation, deferred compensation or
long-term incentive plan awards were issued or granted to Amexdrug's management
during the fiscal years ended December 31, 2002 and 2001. Further, no member of
Amexdrug's management has been granted any option or stock appreciation rights.
Accordingly, no tables relating to such items have been included within this
Item.


                                       32
<PAGE>

There are no present plans whereby Amexdrug will issue any of its securities to
management, promoters, their affiliates or associates in consideration of
services rendered or otherwise, except as described herein.

Compensation of directors

Amexdrug has no arrangement for compensating its directors for their services as
directors or for serving on any committees. However, directors may be
compensated for services which they render as officers and/or as employees of
Amexdrug.

Employment contracts and termination of employment and change-in-control
arrangements

There are no employment contracts, compensatory plans or arrangements, including
payments to be received from Amexdrug with respect to any executive officer of
Amexdrug which would in any way result in payments to any such person because of
his or her resignation, retirement or other termination of employment with
Amexdrug or its subsidiary, any change in control of Amexdrug or a change in the
person's responsibilities following a change in control of Amexdrug.

Nor are there any agreements or understandings for any director or executive
officer to resign at the request of another person. None of Amexdrug's directors
or executive officers is acting on behalf of or will act at the direction of any
other person.

Amexdrug intends to enter into an employment agreement with Jack Amin in the
near future that will provide for an initial salary of $150,000 per year
retroactive to January 1, 2003, and possible bonuses as the board of directors
may determine are appropriate. In the event Amexdrug is unable to pay the full
$150,000 per year annual salary to Mr. Amin, he has indicated that he may accept
a portion of the salary in the form of Amexdrug common stock.

Compensation pursuant to plans; pension table

There were no stock awards, restricted stock awards, stock options, stock
appreciation rights, long-term incentive plan compensation or similar rights
granted to any of our officers or directors. None of our officers or directors
presently holds directly any stock options or stock purchase rights. We have no
retirement, pension, profit sharing, or other plan covering any of our officers
and directors.

We have adopted no formal stock option plans for our officers, directors and/or
employees. We reserve the right to adopt one or more stock options plans in the
future. Presently we have no plans to issue additional shares of our common or
preferred stock or options to acquire the same to our officers, directors or
their affiliates or associates.

Other compensation

None.


                                       33
<PAGE>


------------------------------------------------------------------------------

     ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

------------------------------------------------------------------------------

Security ownership of certain beneficial owners

The following table sets forth the share holdings of those persons who are known
to Amexdrug to be the beneficial owners of more than five percent of Amexdrug's
common stock as of March 28, 2003. Each of these persons has sole investment and
sole voting power over the shares indicated.

                                Number                  Percent
Name and Address      of Shares Beneficially Owned      of Class
----------------      ----------------------------      --------

Jack Amin                      7,835,000                  97.3%
8909 West Olympic Blvd.
Suite 112
Beverly Hills, CA 90211


Security ownership of management

The following table sets forth the share holdings of Amexdrug's directors and
executive officers as of March 28, 2003. Each of these persons has sole
investment and sole voting power over the shares indicated.

                                   Number               Percent
Name and Address        of Shares Beneficially Owned    of Class
----------------        ----------------------------    --------

Jack Amin                       7,835,000                 97.3%
Rodney Barron, M.D.                     0                  0.0%
Behrooz Meimand                         0                  0.0%

All directors and executive
officers as a group (3)         7,835,000                 97.3%

All common shares held by the officers, directors and principal shareholders
listed above are "restricted or control securities" and are subject to
limitations on resale. The shares may be sold in compliance with the
requirements of Rule 144, after a minimum one year holding period has been met.

Rule 13d-3 generally provides that beneficial owners of securities include any
person who directly or indirectly has or shares, voting power and/or investment
power with respect to such securities; and any person who has the right to
acquire beneficial ownership of such security within 60 days.

Any securities not outstanding which are subject to options, warrants or
conversion privileges exercisable within 60 days are treated as outstanding for
the purpose of computing the percentage of outstanding securities owned by that
person. But such securities are not treated as outstanding for the purpose of
computing the percentage of the class owned by any other person.

Changes in control

There are no present arrangements or pledges of Amexdrug's securities, known to
management, which may result in a change in control of Amexdrug.


                                       34
<PAGE>

-----------------------------------------------------------------------------

             ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

------------------------------------------------------------------------------

Transactions with management and others

Except as indicated below, and for the periods indicated, there were no material
transactions, or series of similar transactions, during the last two fiscal
years ended December 31, 2002, or since December 31, 2002, or any currently
proposed transactions, or series of similar transactions, to which the Company
was or is to be party, in which the amount involved exceeds $60,000, and in
which any director or executive officer, or any security holder who is known by
the Company to own of record or beneficially more than 5% of any class of the
Company's common stock, or any member of the immediate family of any of the
foregoing persons, has an interest, other than the following:

     1. On December 31, 2001, Jack Amin exchanged all of the issued and
outstanding shares of common stock of Allied Med, Inc. to Amexdrug for 7,000,000
shares of the common stock of Amexdrug. In addition, Amexdrug assumed
responsibility for payment of the Allied Loan and all accrued interest payable
thereon.

     2. Amexdrug anticipates that it will enter into an employment agreement
with Jack Amin in the near future. It is expected that the employment agreement
will be retroactive to January 1, 2003, and that it will provide for an initial
annual salary of $150,000 and possible bonuses as the board of directors may
determine are appropriate. The employment agreement may give Mr. Amin the option
to take a portion of the salary in shares of the Company's common stock.

     3. Effective December 20, 2003 Jack Amin and his wife transferred four
undeveloped parcels of real property to Allied Med, Inc. as an
additional capital contribution to the Company. The Company did not pay anything
to Mr. or Mrs. Amin for the properties. The properties are held by the Company
for investment purposes. For more information concerning the properties, see
"Item. 2  Description of  Properties".

Parents of the company

Amexdrug has no parents, except to the extent that Mr. Amin may be deemed to be
a parent by virtue of his large percentage stockholdings of the Company's common
stock. See the caption "Security ownership of certain beneficial owners and
management" in item 11 of this report for a description of Mr. Amin's stock
ownership.

Transactions with promoters

The Company was organized more than five years ago therefore transactions
between the Company and its promoters or founders are not deemed to be material.


                                       35
<PAGE>

-----------------------------------------------------------------------------

                    ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K

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(a) Exhibits

Exhibit
Number            Description
------            -----------

 2.1              Agreement and Plan of Merger
                  (to change domicile from California to Nevada)*

 2.2              Agreement and Plan of Reorganization
                  (to acquire Allied Med, Inc.)**

 3.1              Articles of Incorporation***

 3.2              By-Laws***

21.1              List of Subsidiaries of Amexdrug Corporation***

99.1              906 Certifications

                  Summaries of all exhibits contained within this
                  report are modified in their entirety by reference
                  to these Exhibits.

                  *   Exhibit 2.1 is incorporated by reference from
                      Amexdrug's Form 8-K Current Report filed December 31, 2001
                      as Exhibit 10.01

                  **  Exhibit 2.2 is incorporated by reference from
                      Amexdrug's Form 8-K Current Report filed January 15, 2002
                      as Exhibit 10.01

                  *** Exhibits 3.1, 3.2 and 21.1 are incorporated by
                      reference from Amexdrug's 2001 Form 10-KSB filed
                      April 1, 2002.

(b) Reports on Form 8-K

Amexdrug filed no reports on Form 8-K during the last quarter of the period
covered by this report:

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                        ITEM 14. CONTROLS AND PROCEDURES

------------------------------------------------------------------------------

         Based on his most recent review, which was completed within ninety days
of the filing of this report, Jack Amin, Amexdrug's Chief Executive Officer and
Principal Financial Officer, concluded that Amexdrug's disclosure controls and
procedures are effective to ensure that information required to be disclosed by
Amexdrug in the reports it files or submits under the Securities Exchange Act of
1934, as amended, is accumulated and communicated to the Company's management,
including its Chief Executive Officer and Principal Financial Officer, as


                                       36
<PAGE>

appropriate to allow timely decisions regarding required disclosure and are
summarized and reported within the time periods specified in the Securities and
Exchange Commission's rules and forms. There were no significant changes in
Amexdrug's internal controls or in other factors that could significantly affect
those controls subsequent to the date of Mr. Amin's evaluation.




                                       37
<PAGE>


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                                   SIGNATURES

------------------------------------------------------------------------------

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

                                AMEXDRUG CORPORATION



Date: March 31, 2003            By /s/ Jack Amin
                                  ------------------------------------------
                                  Jack Amin, Director, President and
                                  Chief Executive Officer


In accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.



Date: March 31, 2003            By /s/ Jack Amin
                                  ------------------------------------------
                                  Jack Amin, Director, President and
                                  Chief Executive Officer, Chief
                                  Financial Officer and Chief
                                  Accounting Officer



Date: March ___, 2003           By
                                  ------------------------------------------
                                  Rodney Barron, M.D., Director,



Date: March 31, 2003            By /s/ Behrooz Meimand
                                  ------------------------------------------
                                  Behrooz Meimand, Director,


                                       38
<PAGE>


                    CERTIFICATION OF CHIEF EXECUTIVE OFFICER


     I, Jack Amin, certify that:

     1. I have reviewed this annual report on Form 10-KSB of Amexdrug
Corporation;

     2. Based on my knowledge, this annual 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 annual
report;

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

     4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

     (a)  designed such disclosure controls and procedures to ensure that
          material information relating to the registrant, including its
          consolidated subsidiaries, is made known to us by others within those
          entities, particularly during the period in which this annual report
          is being prepared;

     (b)  evaluated the effectiveness of the registrant's disclosure controls
          and procedures as of a date within 90 days prior to the filing date of
          this annual report (the "Evaluation Date"); and

     (c)  presented in this annual report our conclusions about the
          effectiveness of the disclosure controls and procedures based on our
          evaluation as of the Evaluation Date;

     5. The registrant's other certifying officers and I have disclosed, based
on our most recent evaluation, to the registrant's auditors and the audit
committee of the registrant's board of directors (or persons performing the
equivalent functions):

     (a)  all significant deficiencies in the design or operation of internal
          controls which could adversely affect the registrant's ability to
          record, process, summarize and report financial data and have
          identified for the registrant's auditors any material weaknesses in
          internal controls; and

     (b)  any fraud, whether or not material, that involves management or other
          employees who have a significant role in the registrant's internal
          controls; and

     6. The registrant's other certifying officers and I have indicated in this
annual report whether there were significant changes in internal controls or in
other factors that could significantly affect internal controls


                                       39
<PAGE>


subsequent to the date of our recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.



Date:  March 31, 2003                   /s/ Jack Amin
                                        ----------------------------------
                                        Jack Amin, Chief Executive Officer





                                       40
<PAGE>


                    CERTIFICATION OF CHIEF FINANCIAL OFFICER


     I, Jack Amin, certify that:

     1. I have reviewed this annual report on Form 10-KSB of Amexdrug
Corporation;

     2. Based on my knowledge, this annual 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 annual
report;

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

     4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

     (d)  designed such disclosure controls and procedures to ensure that
          material information relating to the registrant, including its
          consolidated subsidiaries, is made known to us by others within those
          entities, particularly during the period in which this annual report
          is being prepared;

     (e)  evaluated the effectiveness of the registrant's disclosure controls
          and procedures as of a date within 90 days prior to the filing date of
          this annual report (the "Evaluation Date"); and

     (f)  presented in this annual report our conclusions about the
          effectiveness of the disclosure controls and procedures based on our
          evaluation as of the Evaluation Date;

     5. The registrant's other certifying officers and I have disclosed, based
on our most recent evaluation, to the registrant's auditors and the audit
committee of the registrant's board of directors (or persons performing the
equivalent functions):

     (c)  all significant deficiencies in the design or operation of internal
          controls which could adversely affect the registrant's ability to
          record, process, summarize and report financial data and have
          identified for the registrant's auditors any material weaknesses in
          internal controls; and

     (d)  any fraud, whether or not material, that involves management or other
          employees who have a significant role in the registrant's internal
          controls; and

     6. The registrant's other certifying officers and I have indicated in this
annual report whether there were significant changes in internal controls or in
other factors that could significantly affect internal controls


                                       41
<PAGE>


subsequent to the date of our recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.



                                              /s/ Jack Amin
Date:  March 31, 2003                         ----------------------------------
                                              Jack Amin, Chief Financial Officer



                                       42
<PAGE>


                                  EXHIBIT INDEX

Exhibit                                                                 Exhibit
Number            Description                                           Location
------            -----------                                           --------

 2.1              Agreement and Plan of Merger                              *
                  (to change domicile from California

 2.2              Agreement and Plan of Reorganization                      **

 3.1              Articles of Incorporation                                 ***

 3.2              By-Laws                                                   ***

21.1              List of Subsidiaries of Amexdrug  Corporation             ***

99.1              906 Certifications                                        43

               Summaries of all exhibits contained within this report are
               modified in their entirety by reference to these Exhibits.

                    *      Exhibit 2.1 is incorporated by reference from
                           Amexdrug's Form 8-K Current Report filed December 21,
                           2001 as Exhibit No. 10.01.

                    **     Exhibit 2.2 is incorporated by reference from
                           Amexdrug's Form 8-K Current Report filed January
                           15, 2002 as Exhibit No. 10.01.

                    ***    Exhibit 3.1, 3.2 and 21.1 are incorporated by
                           reference from Amexdrug's 2001 Form 10-KSB filed
                           on April 1, 2002.



                                       43

<PAGE>

                                  EXHIBIT 99.1


                            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 Amexdrug Corporation on Form
10-KSB for the period ending December 31, 2002 as filed with the Securities and
Exchange Commission on the date hereof (the "Report"), I, Jack Amin, certify,
pursuant to 18 U.S.C. ss. 1350, as adopted pursuant to ss. 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 results of the
          operation of the Company.


/s/ Jack Amin
-------------------------------------------
Jack Amin
Chief Executive Officer
March 31, 2003



                            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 Amexdrug Corporation on Form 10-KSB
for the period ending December 31, 2002 as filed with the Securities and
Exchange Commission on the date hereof (the "Report"), I, Jack Amin, certify,
pursuant to 18 U.S.C. ss. 1350, as adopted pursuant to ss. 906 of the
Sarbanes-Oxley Act of 2002, that:

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

     (4)  The information contained in the Report fairly presents, in all
          material respects, the financial condition and results of the
          operation of the Company.


/s/ Jack Amin
-------------------------------------------
Jack Amin
Chief Financial Officer
March 31, 2003




                                       44