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

                                   FORM 10-QSB

      QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                                   ACT OF 1934

                For the quarterly period ended September 30, 2005

                         Commission File No. 33-55254-28

                             INNOVATE ONCOLOGY, INC.
             (Exact name of registrant as specified in its charter)


             NEVADA                                       87-0438641
(State or other jurisdiction of                (IRS Employer Identification No.)
 incorporation or organization)


                712 Fifth Avenue, 19th Floor, New York, NY 10019
                -------------------------------------------------
                    (Address of principal executive offices)

        Registrant's telephone number including area code: (646) 723-8944

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934
during the preceding 12 months (or such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.            Yes [X] No [ ]


The number of shares outstanding of the registrant's common stock, par value
$0.001, as of December 15, 2005, was 18,178,242.


<PAGE>

                             INNOVATE ONCOLOGY, INC.

              Form 10-QSB for the quarter ended September 30, 2005


                                      Index


                                                                           Page
                                     Part I

Item 1. Financial Statements                                                 3

Item 2. Management Discussion and Analysis or Plan of Operation             10

Item 3. Controls and Procedures                                             20

                                     Part II

Item 1. Legal Proceedings                                                   21

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds         21

Item 3. Default on Senior Securities                                        21

Item 4. Submission of Matters to a Vote of Security Holders                 21

Item 5. Other Information                                                   21

Item 6. Exhibits and Reports on Form 8-K                                    21

Signatures                                                                  22

                                        2


<PAGE>

                             INNOVATE ONCOLOGY, INC.
                          (A Development Stage Company)
                           CONSOLIDATED BALANCE SHEET
                                   (Unaudited)

                                                                   September 30,
                                                                       2005
ASSETS
Current Assets
Cash and cash equivalents                                           $       580
                                                                    -----------
TOTAL ASSETS                                                        $       580
                                                                    ===========

LIABILITIES AND STOCKHOLDERS' DEFICIT
Current Liabilities
Accounts payable                                                    $   174,064
Accrued expenses                                                         46,000
Amounts due to related parties                                          160,000
Notes due to related party                                            4,212,624
                                                                    -----------
TOTAL LIABILITIES                                                     4,592,688
                                                                    -----------

STOCKHOLDERS' DEFICIT
Preferred Stock, 25,000,000 shares authorized;                               --
none issued and outstanding
Common Stock, par value $.001; 125,000,000 shares                        17,953
authorized, 17,953,242 issued and outstanding
Additional paid in capital                                              (17,953)
Deficit accumulated during development stage                         (4,592,108)
                                                                    -----------
Total Stockholder's Deficit                                          (4,592,108)
                                                                    -----------
TOTAL LIABILITIES AND STOCKHOLDER'S DEFICIT                         $       580
                                                                    ===========


The accompanying notes are an integral part of these financial statements.


                                        3

<PAGE>

                             INNOVATE ONCOLOGY, INC
                          (A Development Stage Company)
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                Nine Months     Nine Months       Quarter         Quarter      From Inception
                                                   Ended           Ended           Ended           Ended       July 21, 2004
                                               September 30,   September 30,   September 30,   September 30,  to September 30,
                                                   2005            2004            2005            2004            2005
                                               ------------    ------------    ------------    ------------    ------------
<S>                                            <C>             <C>             <C>             <C>             <C>
Operating expenses
Research and development                       $  2,550,534    $         --    $    494,820    $         --    $  3,435,466
General and administrative                          842,337         310,079         230,430         310,079       1,069,742
                                               ------------    ------------    ------------    ------------    ------------
Net operating (loss)                             (3,392,871)       (310,079)       (725,250)       (310,079)     (4,505,208)
Loan interest expense                                79,200              --          30,000              --          86,900
                                               ------------    ------------    ------------    ------------    ------------
(Loss) attributable to common stockholders       (3,472,071)       (310,079)       (755,250)       (310,079)     (4,592,108)
Other comprehensive income (loss)
Foreign currency translation adjustments                 --              --              --              --              --
                                               ------------    ------------    ------------    ------------    ------------
Total comprehensive (loss)                     $ (3,472,071)   $   (310,079)   $   (755,250)   $   (310,079)   $ (4,592,108)
                                               ============    ============    ============    ============    ============
Net loss per share, basic and diluted          $      (0.19)   $      (0.21)   $      (0.04)   $      (0.21)
                                               ============    ============    ============    ============
Weighted average number of share outstanding     17,953,242       1,453,242      17,953,242       1,453,242
                                               ============    ============    ============    ============
</TABLE>


The accompanying notes are an integral part of these financial statements.

                                        4

<PAGE>

                             INNOVATE ONCOLOGY, INC
                          (A Development Stage Company)
                 CONSOLIDATED STATEMENT OF STOCKHOLDERS' DEFICIT
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                                                     Total
                                                               Common Stock            Paid -In     Accumulated   Stockholders'
                                                           Shares         Amount       Capital        Deficit        Deficit
                                                        -----------    -----------    -----------    -----------    -----------
<S>                                                       <C>          <C>            <C>            <C>            <C>
Initial capitalization                                    1,453,242    $     1,453    $    (1,453)   $        --    $        --
Shares issued on reorganization October 01, 2004         16,500,000         16,500        (16,500)            --             --
Net loss for the period ended December 31, 2004                                                       (1,120,037)    (1,120,037)
                                                        -----------    -----------    -----------    -----------    -----------
Balance December 31, 2004                                17,953,242         17,953        (17,953)    (1,120,037)    (1,120,037)

Net loss for the nine months ended September 30, 2005            --             --             --     (3,472,071)    (3,472,071)
                                                        -----------    -----------    -----------    -----------    -----------
Balance September 30, 2005                               17,953,242    $    17,953    $   (17,953)   $(4,592,108)   $(4,592,108)
                                                        ===========    ===========    ===========    ===========    ===========
</TABLE>


The accompanying notes are an integral part of these financial statements.

                                        5

<PAGE>

                             INNOVATE ONCOLOGY, INC.
                          (A Development Stage Company)
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                       Nine Months    Nine Months    From Inception
                                                           Ended          Ended     July 21, 2004 to
                                                      September 30,  September 30,    September 30,
                                                           2005           2004             2005
                                                       -----------    -----------      -----------
<S>                                                    <C>            <C>              <C>
Cash flows from operating activities:
    Net loss                                           $(3,472,071)   $  (310,079)     $(4,592,108)

Changes in operating assets and liabilities:

Decrease in prepaid expenses                                42,106             --               --
Increase in accounts payable                               174,064             --          174,064
Increase in accrued expenses                                11,000         95,842           46,000
Increase in amount due to related party                     90,000             --          160,000
                                                       -----------    -----------      -----------
Net cash (used in) operating activities                 (3,154,901)      (214,237)      (4,212,044)
                                                       -----------    -----------      -----------

CASH FLOWS FROM FINANCING ACTIVITIES:

Notes payable to related parties                         3,155,481        214,237        4,212,624
                                                       -----------    -----------      -----------

Net cash provided by financing activities                3,155,481        214,237        4,212,624
                                                       -----------    -----------      -----------

Effect of changes in exchange rates                             --             --               --

                                                       -----------    -----------      -----------
Net increase in cash and cash equivalents                      580             --              580

Cash and cash equivalents at beginning of the period            --             --               --

                                                       -----------    -----------      -----------
Cash and cash equivalents at the end of the period     $       580    $        --      $       580
                                                       ===========    ===========      ===========
</TABLE>


The accompanying notes are an integral part of these financial statements.

                                        6

<PAGE>

                             INNOVATE ONCOLOGY, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                               September 30, 2005
                                   (Unaudited)

NOTE 1 - Basis of Presentation

The accompanying unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting principles for interim
financial information and pursuant to the rules and regulations of the
Securities and Exchange Commission. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting principles
for complete financial statements. The financial statements should be read in
conjunction with the financial statements and notes thereto included in the
Innovate Oncology, Inc. (the "Company") Annual Report on Form 10-KSB for the
year ended December 31, 2004. The material under the heading "Management's
Discussion and Analysis or Plan of Operation" is written with the presumption
that the readers have read or have access to the 2004 Annual Report on Form
10-KSB, which contains Management's Discussion and Analysis or Plan of Operation
as of December 31, 2004 and for the period then ended.

In the opinion of management, the unaudited financial statements contain all
adjustments, consisting only of normal recurring adjustments, necessary for a
fair statement of the balance sheet as of September 30, 2005 and the statements
of operations and cash flows for the three months and nine months ended
September 30, 2005. The results of operations for the three and nine months
ended September 30, 2005 are not necessarily indicative of the results of
operations to be expected for the entire fiscal year ending December 31, 2005.

NOTE 2 - Going Concern

The accompanying consolidated financial statements have been prepared on the
basis of accounting principles applicable to a going concern, which assume that
the Company will continue in operation for at least one year and will be able to
realize its assets and discharge its liabilities in the normal course of
operations. However, as of September 30, 2005, the Company did not have
significant cash or other material assets, nor did it have an established source
of revenues sufficient to cover its operating costs and allow it to continue as
a going concern. The Company is presently entirely dependent for its capital
requirements on a credit facility of $5 million advanced by, Bioaccelerate, Inc.
a subsidiary of its major shareholder. The Company's future capital requirements
will depend upon numerous factors including, but not limited to, continued
progress in developing its products, market penetration and profitable
operations from the sale of its products. These financial statements do not
reflect adjustments that would be necessary if the Company were unable to
continue as a going concern. While members of the Company's management have been
successful in raising capital for other ventures in the past, and plan to raise
equity capital for the Company, there can be no assurance that these plans will
be achieved on acceptable terms.

                                        7

<PAGE>

NOTE 3 - Stock Based Compensation

The Company has elected to adopt the disclosure only provisions of SFAS No. 148
and will continue to follow APB Opinion No. 25 and related interpretations in
accounting for stock options granted to its employees and directors.
Accordingly, employee and director compensation expense is recognized only for
those options whose price is less than the market value at the measurement date.
When the exercise price of the employee or director stock options is less then
the estimated fair value of the underlying stock on the grant date, the Company
records deferred compensation for the difference and amortizes this amount to
expense in accordance with FASB Interpretation No. 28, Accounting for Stock
Appreciation Rights and Other Variable Stock Options or Award Plans, over the
vesting period of the options. No options have been granted to date.

Stock options and warrants issued to non-employees are recorded at their fair
value as determined in accordance with SFAS No. 123 and Emerging Issues Task
Force (EITF) No. 96-18, Accounting for Equity Instruments That Are Issued to
Other Than Employees for Acquiring or in Conjunction With Selling Goods or
Services, and recognized over the related service period. During fiscal 2004,
the Company issued 1,000,000 common stock warrants at an exercise price of $1
per share expiring July 22, 2009. The value of these warrants using the
Black-Scholes pricing model with the following assumptions: 60 months expected
life, 100% stock volatility, 3.625% risk-free interest rate and no dividends, is
immaterial and no value has been assigned to these warrants.


NOTE 4 - Loss per Share

In accordance with SFAS No. 128, Earnings per Share, and SEC Staff Accounting
Bulletin (SAB) No. 98, basic net loss per common share is computed by dividing
net loss for the period by the weighted average number of common shares
outstanding during the period. Under SFAS No. 128, diluted net income (loss) per
share is computed by dividing the net income (loss) for the period by the
weighted average number of common and common equivalent shares, such as stock
options and warrants, outstanding during the period. Such common equivalent
shares have not been included in the computation of net loss per share as their
effect would be anti-dilutive.

Numerator - Net loss                                               $ (3,472,071)

Denominator- Weighted average shares outstanding                     17,953,242

Net loss per share                                                 $      (0.19)

Incremental common shares (excluded from the
Denominator because they are anti-dilutive)
Warrants                                                              1,000,000


NOTE 5 - Amounts due to Related Parties

As of September 30, 2005 the company had an amount of $160,000 outstanding to
Sterling FCS Ltd under an annual contract for the provision of corporate and
financial services at a cost of $10,000 per month.


                                        8

<PAGE>

NOTE 6 - Notes due to Related Parties

On July 22, 2004, the Company entered into a secured credit facility for $5.0
million with Bioaccelerate Inc, which bears interest at the Applicable Federal
Rate as defined in Section 1274(d) of the Internal Revenue Code of 1986. The
interest rate as of September 30, 2005 was 4.13%. The Company intends to use
these funds to develop its lead products. The facility is secured by all
tangible and intangible assets. As an inducement to Bioaccelerate Inc. to
provide the credit facility, the Company issued warrants to purchase 1,000,000
shares of its common stock at an exercise price of $1.00 per share expiring on
July 22, 2009. No value was assigned to these warrants. Cumulative accrued
interest as of September 30, 2005 amounts to $86,900. Total due at the end of
the quarter was $4,212,624, excluding interest the Company has drawn down
$4,125,724 of the facility.


NOTE 7 - Commitments and Contingencies

On March 16, 2005, Bioaccelerate assigned the rights to six clinical and up to
four pre-clinical compounds from Bioaccelerate's drug portfolio. The assignments
are generally subject to written consent by the other party to the license
agreement, which consent can not be unreasonably withheld, and in one case
payment by Bioaccelerate of some additional consideration to the other party to
the license agreement. In addition, Innovate is already a party to certain
licensing agreements. Our management estimates these Agreements require a
Company investment of approximately $700 thousand in the current year. Until
Innovate secures additional equity capital or other financing the Company is
entirely dependent upon financial support from its major shareholder,
Bioaccelerate, to satisfy these commitments and the Company's other capital
requirements. One of the compounds, which comprised part of the Innovate
portfolio has been assigned to Bioaccelerate Inc. This assignment has resulted
in reduction of $1.4m in the future commitments of the Company. Innovate is
currently considering a number alternative compounds included within
Bioaccelerate's portfolio in order to select a suitable replacement. If, at any
time, Innovate should have insufficient capital to satisfy the expenditure
requirements under the licensing agreements or its other capital requirements,
the Company's business and prospects could be materially adversely affected and
its rights to develop the compounds covered by the license agreements could be
lost or adversely affected.

The Company leases 200 square feet in each of its office facilities in New York
and London from Bioaccelerate on a month-to-month basis for aggregate monthly
rents of approximately $9,000.

NOTE 8 - Subsequent Events

Common Stock

On October 19, 2005 the company issued 225,000 shares of common stock for
consultancy services at a market price of $3.25 per share.


                                        9
<PAGE>

ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.

FORWARD LOOKING STATEMENTS: NO ASSURANCES INTENDED

This Form 10-QSB contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. This filing includes statements regarding our plans,
goals, strategies, intent, beliefs or current expectations. These statements are
expressed in good faith and based upon a reasonable basis when made, but there
can be no assurance that these expectations will be achieved or accomplished.
Sentences in this document containing verbs such as "believe," "plan," "intend,"
"anticipate," "target," "estimate," "expect," and the like, and/or future-tense
or conditional constructions ("will," "may," "could," "should," etc.) constitute
forward-looking statements that involve risks and uncertainties. Items
contemplating, or making assumptions about, actual or potential future sales,
market size, collaborations, trends or operating results also constitute such
forward-looking statements.

Although forward-looking statements in this Report on Form 10-QSB reflect the
good faith judgment of management, such statements can only be based on facts
and factors currently known by management. Consequently, forward-looking
statements are inherently subject to risks and uncertainties, and actual results
and outcomes may differ materially from the results and outcomes discussed in,
or anticipated by, the forward-looking statements. Factors that could cause or
contribute to such differences in results and outcomes, include without
limitation, those discussed in our Annual Report on Form 10-KSB for the period
ended December 31, 2004. Readers are urged not to place undue reliance on these
forward-looking statements, which speak only as of the date of this Report. We
undertake no obligation to revise or update any forward-looking statements in
order to reflect any event or circumstance that may arise after the date of this
Report. Readers are urged to carefully review and consider the various
disclosures made by us in our Annual Report on Form 10-KSB for the period ended
December 31, 2004, which attempt to advise interested parties of the risks and
factors that may affect our business, financial condition, results of operation
and cash flows.

The following discussion should be read along with the Consolidated Financial
Statements and Notes to our audited financial statements for the fiscal period
ended December 31, 2004, as well as the other interim unaudited financial
information for the current fiscal year.

Critical Accounting Policies and Estimates

The preparation of the Company's financial statements requires management to
make certain critical accounting estimates that impact the stated amount of
assets and liabilities at a financial statement date and the reported amount of
income and expenses during a reporting period. These accounting estimates are
based on management's judgment and are considered to be critical because of
their significance to the financial statements and the possibility that future
events may differ from current judgments, or that the use of different
assumptions could result in materially different estimates. The critical
accounting policies and estimates have not changed from and should be read in
conjunction with the Company's Annual Report filed on Form 10-K for the period
ended December 31, 2004.
The Company's estimates are reviewed continuously to ensure reasonableness.
However, the amounts the Company may ultimately realize could differ from such
estimated amounts.


                                       10

<PAGE>

Overview

Innovate Oncology, Inc. (the "Company" or "Innovate") acquires, develops and
seeks to commercialize novel compounds to treat various types of cancer. Our
drug pipeline consists of seven drug products, five clinical candidates and two
in pre-clinical development and focuses on multiple forms of cancer, including
three of the most prevalent: breast, prostate and colon cancer.
Bioaccelerate Holdings, Inc. ("Bioaccelerate") owns 88.6% of the Company's
common stock. Bioaccelerate is a pharmaceutical development company incorporated
in Nevada and traded on the Over-the-Counter Bulletin Board ("OTCBB") under the
symbol OTCBB: BACL. Like the Company, Bioaccelerate enters into co-development
and licensing agreements with leading medical research, academic and private
pharmaceutical companies. On July 21, 2004, Bioaccelerate sold its UK
subsidiary, Innovative Oncology Limited, ("Innovative") to Innovate Oncology,
Inc. ("Innovate Oncology"), a Delaware corporation, in exchange for 100% of the
outstanding common stock of Innovate Oncology. As part of that transaction,
Bioaccelerate agreed to assign the licenses, rights and obligations for six
clinical and up to four pre-clinical drug compounds from its portfolio of drug
candidates in development to Innovate Oncology.

On August 23, 2004, Innovate Oncology entered into an agreement with Hampton
Berkshire Insurance & Financial, Inc. ("Hampton") in which Hampton agreed to
acquire 100% of the outstanding common stock of Innovate Oncology. As part of
the transaction, Hampton, a Nevada corporation, canceled 5,026,590 shares of its
common stock, effected a 3.8-for-1 reverse stock split, which reduced its
pre-acquisition outstanding common stock to 1,453,242, and issued 16,500,000
shares of its common stock to Innovate Oncology's shareholders. Contemporaneous
with the close of the acquisition, the Company changed its corporate name from
Hampton to Innovate Oncology, Inc., moved its corporate office to New York, and
replaced all management, corporate officers and directors. At the close of the
acquisition on October 1, 2004, the Company had 17,953,242 shares of common
stock issued and outstanding.

To enhance the growth prospects of the Company it has appointed Mr Sujay Kango
as Chief Executive Officer and Mr Paul Hopper as Chairman of the Board of
Directors. Mr Hopper was formerly the CEO of Australian Cancer Technology
Limited, now known as Avantogen Limited, Innovate's joint venture partner in
North America for the development of RP-101. Mr Kango has 14 years of successful
pharmaceutical experience including marketing, management and sales. Prior to
joining Innovate, Mr Kango was at Tibotec Therapeutics, a division of Ortho
Biotech where most recently he was the Director of Oncology Marketing.

Business Strategy

Large pharmaceutical companies need additional drugs of substantial market
potential to fill depleted development pipelines, particularly since many of
their products will soon be losing patent protection and internal development
may fail to keep up with commercial demand for innovation. Increasingly those
companies seek to fill that gap by in-licensing drugs at the middle to late
stages of development rather than acquiring compounds at an earlier stage.
In-licensed Phase III products accounted for more 30% of the in-licensing
agreements made by large pharmaceutical companies in 2002, according to Reuters
Business Insight.

Innovate uses a broad network of relationships it has forged in academia,
medical research centers and industry to in-license or acquire promising
early-stage compounds and existing compounds that can be reformulated, used for
new indications or used with new dosing regimens. We rely upon these
relationships and a product development network to accelerate the time it takes
for new compounds to reach the critical Phase III clinical trial level when a
drug is most attractive to large pharmaceutical companies.


                                       11

<PAGE>

We enter into development, marketing and partnership agreements with contract
research laboratories, industry experts and pharmaceutical companies to develop,
test and seek regulatory approval for our drug candidates. By relying primarily
upon contracts with third parties for research, clinical development and project
management rather than doing that work in-house, we are able to maintain a
limited and less costly infrastructure, particularly as compared with large
pharmaceutical companies. Our management believes that this streamlined
operating strategy has created an efficient and cost-effective route from
early-stage clinical development to a commercial product.
Product Development

A major element of our product development strategy is the use of third-parties
or Contract Research Organizations ("CRO") for drug development at all stages
along the path to market. CROs conduct safety and efficacy tests and clinical
studies and assist us in guiding products through the Food and Drug
Administration ("FDA") and the European Medicines Agency ("EMEA") regulatory
review and approval processes. The Company also uses the contract manufacturing,
formulation and chemistry skills of external providers.

We believe the use of third-parties to develop and manufacture our products has
several advantages over building a comprehensive infrastructure to handle all
such functions in-house. This approach generally gives us more choice and
greater selectivity in the dedicated resources we will concentrate on a
developing product than if those functions were performed by internal personnel
who were required to support the full range of our product development
activities. We believe that maintaining a limited infrastructure, particularly
focused upon early-stage processes in the drug development path will enable us
to develop products efficiently and cost effectively. Although this approach
will allow us to avoid the expense associated with developing a large internal
infrastructure to support our product development efforts, it also means that we
will continue to be dependent on the ability of outside parties to perform
critical functions for us.

The contract approach to product development requires project management by
professionals with substantial industry experience. We plan to evaluate
prospective additions to our in-house expertise as well as opportunities for
contract and advisory services in areas of critical importance to all of our
proposed products, including the management of current pipeline development
teams. The product development process is designed to identify problems
associated with a proposed product's safety and effectiveness. We also attempt
to reduce the risk that a proposed product will not be accepted in the
marketplace by conducting market research and defining a commercial strategy for
each product candidate. A drug development portfolio cannot be completely
insulated from potential clinical and market failures. It is likely that some
proposed products we select for development will not produce the clinical or
revenue results expected.

Additionally, we may choose to license at an early stage or divest product
candidates from our portfolio if they produce clinical results outside our
target sector and/or require financial, development and management resources
better met by larger or more specialized pharmaceutical or biopharmaceutical
companies.


                                       12

<PAGE>

Research and Development

Our primary research and development efforts have focused on identifying
promising compounds and developing them into products to treat various types of
cancer. We engage in research, pre-clinical studies and clinical development
with third-party laboratories, including Supratek Pharma, Inc Baylor School of
Medicine and Northwestern University for pre-clinical development; Klinikum
Chemnitz gGmbH and Technical University Munich, both in Germany, for clinical
trials; Hesperion Ltd. in Switzerland for clinical CROs; and Nycomed in Denmark
and PMRS, Inc. for drug substance and product manufacturing. Our research and
development structure is designed to enable us to evaluate and make the best
choices for where and how projects are run and resourced. Each is managed as a
discrete project with its own budget and project management. When it's practical
and desirable, different projects will use common resources and contracted
facilities.

Our budget projections for research and development are based primarily upon
those established and set out in or pursuant to our agreements with research and
co-development partners. Projects may meet development and regulatory barriers,
however that require additional work or a change in approach which can lead to
changes in both timing and budget requirements to maintain a product's path to
market. When this situation arises we tend to be in a more flexible position to
meet such demands than a fully internally resourced pharmaceutical company that
relies on existing internal capabilities to progress.

Innovate Oncology's Product Portfolio

One in three Americans will be diagnosed with cancer, and two out of three
diagnosed with the disease will die from it, according to Reuters Business
Insight. Our objective is to provide cancer patients with effective and safe
therapeutics that save or prolong their lives. We are developing a diversified
product portfolio targeting multiple forms of cancer, including three of the
most prevalent: breast, prostate and colon cancer. Our pipeline of seven drugs
consists of five drug candidates in or beginning clinical trials and two in
pre-clinical stages of development. The clinical candidates can be divided into
the following categories: New Chemical Entities ("NCE"), therapeutic switches of
existing drug in the market that are not indicated currently to treat cancer,
and reformulations of drugs in the market indicated to treat cancer.

The portfolio of clinical candidates includes two NCEs, which may have the
greatest commercial potential, but also carry the highest risk precisely because
of their novelty. The portfolio's therapeutic switch offers the advantages of
being a proven drug that we believe may have medical and market value that isn't
realized fully by its current use. Like a therapeutic switch, reformulating an
existing, FDA-approved compound offers lower risk to the Company because it's a
validated therapy and potentially less expensive to develop. We believe this
diversified approach balances the risks and rewards inherent in each drug
candidate and its particular development program.

Our portfolio is characterized by compounds that have multiple mechanisms of
action, which, we believe might substantially increase a compound's clinical
efficacy. Also, several of these products are lead compounds derived from novel
technologies with the potential for follow-on compounds to be developed into
separate products for related indications.

One of the compounds, which comprised part of the Innovate portfolio has been
assigned to Bioaccelerate Inc. This assignment has resulted in reduction of
$1.4m in the future commitments of the Company. Innovate is currently
considering a number alternative compounds included within Bioaccelerate's
portfolio in order to select a suitable replacement.

                                       13

<PAGE>

Innovate Oncology's Product Pipeline

The table below summarizes the status of our development programs.

<TABLE>
<CAPTION>
                                                                     Phase of Development
Product                                             -------------------------------------------------------
Candidate                  Indication                Pre-Clinical    Phase I     Phase II     Phase III
-----------------------------------------------------------------------------------------------------------
<S>           <C>                                          <C>          <C>         <C>
INOC-001      Chemo-Resistance Inhibitor                   X            X           X

INOC-002      Chemotherapy Potentiator                     X            X           X

INOC-005      Capridine Beta                               X            X

INOC-009      Oral Paclitaxal Formulation                  X            X

INOC-010      Polymer-Formulated Camptothecin              X            X

INOC-016      HER2 Oncogene Inhibitor                      X

INOC-019      Prostate Tumor Suppressor                    X
</TABLE>

"Pre-Clinical" refers to the series of tests in the laboratory and those
performed on animals after a lead molecule has been identified. Basic
pharmacology is completed in this phase as well as the toxicology required for
human testing, which may be ongoing. Primary and secondary manufacturing of the
active compound and the method of drug delivery (intravenous or tablet, for
example) will be established during this time. Testing in humans is expected to
begin within 18 and 24 months. Pre-clinical tests must be completed before an
Investigational New Drug application ("IND") can be submitted to the FDA.

"IND" refers to the preparation of an Investigational New Drug application, the
process by which a drug is submitted to the FDA to receive approval for human
testing.

"Phase I" refers to the stage in which compounds are tested for safety, maximal
tolerated dose and pharmacokinetics in volunteers without the disease.

"Phase II" refers to the initial stages of compound testing in patients with the
disease (a particular indication) or symptoms of interest for ultimate New Drug
Application ("NDA") approval and labeling. This stage first demonstrates the
compound's efficacy and dosing range, and expands the safety profile.

"Phase III" refers to the rigorously controlled test of a new drug in a large
population of patients with the disease. After the successful conclusion of
Phase III clinical trials, an NDA is filed with the FDA for approval to market
the drug.


                                       14
<PAGE>

INNOVATE PRODUCTS IN DEVELOPMENT: CLINICAL CANDIDATES

INOC-001 Chemo-resistance Inhibitor

Description. INOC-001 is the lead drug candidate in our portfolio. Our
management believes that the compound offers a novel approach to overcoming
resistance to chemotherapy that many patients develop over the course of
treatment. The compound, which is marketed as an anti-viral drug in Germany and
other European countries, is being tested to treat metastatic pancreatic cancer.
In pre-clinical studies, INOC-001 demonstrated an ability to reduce toxic side
effects, slow disease progression and increase survival rates when used in
conjunction with some chemotherapeutic drugs. Pre-clinical experiments have
shown evidence of INOC-00l inhibiting several genes responsible for
chemo-resistance as well as using multiple mechanisms of action. We have
completed a Phase I trial with various types of solid tumors and chemotherapy
regimens and have documented early efficacy in patients with pancreatic cancer.

Market Opportunity. The American Cancer Society estimates that in 2005, 32,180
people in the U.S. will be diagnosed with pancreatic cancer and 31,800 patients
will die from the disease. The five-year survival rate is only 4.4%, making it
one of the most lethal forms of cancer. Fewer than 10% of patients respond to
treatment.

Partnerships. Cynat Oncology a wholly owned subsidiary of Bioaccelerate, is a
joint venture partner in Resistys, Inc. with Avantogen formerly known as
Australian Cancer Technology ("ACT"). As part of Bioaccelerate's obligation to
provide six clinical products to Innovate, Bioaccelerate transferred 100% of the
capital stock of Cynat Oncology to Innovate on March 16, 2005 following an
announcement on February 14, 2005, that Bioaccelerate would assign its rights to
develop and commercialize INOC-001 to Innovate. The Company is sharing the
development costs equally with its partner as well as an exclusive license to
market the product in the U.S. and Canada.

Status. On December 15, 2004, Bioaccelerate announced it had initiated a Phase
I/II clinical trial for the treatment of metastatic pancreatic cancer with its
co-development partner ACT. The eight-month study will include 22 patients with
metastatic pancreatic cancer and will be conducted at three leading centers in
Germany: Chemnitz Clinics in collaboration with the Technical University
Dresden; Munich University of Technology's Kilinikum rects der Isar; and
University of Munich Hospital's Klilnikum Gro(beta)hadern. The trial is being
managed by Swiss CRO Hesperion. INOC-001 tablets are administered in conjunction
with conventional chemotherapy agents and will be evaluated in this study with
Gemcitabine. Eighteen patients have been enrolled and dosed.

Patents. A U.S. patent, number US 6,589,941 was granted for the compound in 2003
and another U.S. patent is pending. A patent was issued under the terms of the
Patent Cooperative Treaty ("PCT"), which is adhered to by more than 100
countries.

INOC-002 Chemotherapy Potentiator

Description. INOC-002 is an enhancement and a new dosing regimen of an
intravenous drug approved to treat colon cancer. The Company intends to test a
novel dosing regimen, administering the drug simultaneously with capecitabine, a
commonly used chemotherapeutic agent. Administering the drugs simultaneously
could make capecitabine more effective, and therefore may permit a lower dose,
which in turn would reduce toxic side effects. The Company believes that current
dosing regimens based on its labeled use as an anti-worming agent have not
optimized the potential synergistic effect of INOC-002 that could be achieved by
combined dosing. The lead indication of INOC-002 is a post-operative adjuvant
therapeutic agent.


                                       15

<PAGE>

Market Opportunity. Colorectal cancer is the third most prevalent form of cancer
globally, according to Reuters Business Insight. Its annual mortality rate is
almost as high as the mortality rates for breast and prostate cancer patients
combined even though the patient population for those two types of cancer is
more than four times the size of the colorectal patient population. In 2003,
approximately 889,000 patients were being treated for the disease and 428,000
new patients were diagnosed.

Partnerships. On August 6, 2004, Bioaccelerate entered into an agreement with
Targent, Inc. to acquire eight patents and certain confidential information
related to INOC-002. Bioaccelerate assigned this agreement to Innovate on March
16, 2005 subject to consent by Targent. The agreement between Bioaccelerate and
Targent requires consent by the other party to any assignment which consent may
not be unreasonably withheld or delayed. Bioaccelerate has sought consent from
Targent to the assignment and is awaiting confirmation by Targent. The Company
is responsible for the drug development costs as well any maintenance fees on
patents and patent applications.

Status. Pre-clinical trials confirmed the additive effect of INOC-002. The
Company plans to initiate its clinical program within a year. .

Patents. Eight patent applications were filed between December 1, 2000 and March
15, 2005 for patents in the U.S., Canada, Europe, Australia, Japan, Hong Kong
and an international patent.


INOC-005 Capridine Beta

Description. INOC-005 is an NCE to treat prostate cancer. The compound renders
aggressive hormone-independent prostate cells hormone-sensitive and therefore
may be effective in treating both hormone-sensitive and hormone-insensitive
tumors in combination with anti-androgen therapy. In pre-clinical development,
INOC-005 also showed activity against leukemia, melanoma, lung, colon, ovarian,
renal and bladder cancer. Toxicology studies indicate that this compound may
have lower bone marrow toxicity.

Market Opportunity. In 2003, approximately 300,000 men in the seven major market
countries (U.S., France, Germany, Italy, Spain, Japan and the UK) were diagnosed
with prostate cancer; the total patient population was 1,774,000, according to
Reuters Business Insight. Those patients had a 99.7% one-year survival rate and
a 96.8% five-year survival rate. Treatment for prostate cancer is one of the
success stories in oncology research. Nonetheless there's room for improvement
given the prevalence of the disease.

Partnerships. On March 31, 2005, the Company entered into an agreement with
Prostagenics, LLC pursuant to which, Innovate obtained the global patent rights
to develop and commercialize INOC-005.

Status. Pre-clinical development has been completed. The Company expects to file
an IND application by mid 2006 to conduct Phase I clinical trials for advanced
prostate cancer.

Patents. A U.S. patent, number US 6,589,961 was granted to this product
candidate in 2003. Seven other patent applications have been filed for this
compound in the U.S., Canada, Mexico, Europe and Israel.


                                       16

<PAGE>

INOC-009 Oral Paclitaxal

Description. INOC-009 is a reformulation of a commonly used intravenous
chemotherapeutic agent that treats several types of cancer, including breast,
ovarian and AIDS-related Kaposi's sarcoma. This new, oral formulation improves
the drug's solubility and therefore facilitates absorption into the bloodstream.
The formulation also prevents efflux of the drug from the intestine.

Market Opportunity. Breast cancer is the second most common form of cancer
worldwide, according to the World Health Organization's World Cancer Report. An
existing intravenous paclitaxal product (Taxol(R)) was one of the top 10 selling
cancer drugs in 2004 with sales of more than $1.2 billion.

Partnerships. On July 15, 2004, Bioaccelerate entered into a license and
co-marketing agreement with Supratek, Pharma, Inc. to develop INOC 009 to treat
cancer in humans. Innovate is already a licensee under the terms of the
agreement but Bioaccelerate has also assigned its rights under this agreement to
Innovate on March 16, 2005, subject to receipt of Supratek's written consent,
which can not be unreasonably witheld. Bioaccelerate has sought that consent and
is awaiting confirmation by Supratek.

Status. Pre-clinical testing has been completed. The Company expects to file an
IND application with the FDAmid 2006.

Patents. Supratek owns a total of four "composition of matter" patents numbers
US 5,817,321, 6,060,518, 6,277,410 and 6,387,406 in the U.S. related to its
proprietary technology and is responsible for maintenance and upkeep of its
patents


INOC-010 Polymer-Formulated Camptothecin

Description. INOC-010 is a reformulation that uses an innovative, proprietary
carrier technology to treat drug-resistant tumors. This technology has
demonstrated improved efficacy compared with the previous formulation because it
increases the amount of the drug taken up by tumor cells and inhibits drug
efflux associated with tumor resistance. This intravenous reformulation of
topotecan showed no apparent change in toxicity during pre-clinical tests to
treat melanoma, breast and lung cancer.

Market Opportunity. Topotecan is currently indicated to treat ovarian cancer and
small cell lung cancer.

Partnerships. On November 10, 2004, Bioaccelerate entered into a licensing and
co-marketing agreement with Supratek Pharma, Inc. to develop, seek regulatory
approval and, in major markets, commercialize INOC-010. Supratek granted
Bioaccelerate an exclusive global license to its intellectual property related
to INOC-010. Innovate is also a licensee under the terms of the agreement but
Bioaccelerate has also assigned its rights under this agreement to Innovate on
March 16, 2005, subject to receipt of Supratek's written consent, which consent
can not be unreasonably withheld. Bioaccelerate has sought that consent and is
awaiting confirmation from Supratek.

Status. Pre-clinical testing is complete. The Company expects to file an IND
application with the FDA in 2006.

Patents. Supratek owns a total four "composition of matter" patents in the U.S.
related to its proprietary technology and is responsible for maintenance and
upkeep of its patents.


                                       17

<PAGE>

                              PRE-CLINICAL PROJECTS

INOC-016 HER2 Oncogene Inhibitor

Description. INOC-016 is a small molecule that has been shown to inhibit
expression of the HER2 gene that is over expressed in 30% of all breast cancer
tumors and is associated with a poor outcome. Herceptin(R) is a monoclonal
antibody that binds to HER2 on tumor cells. It is currently marketed and
approved for use with chemotherapy to treat advanced breast cancer.

The Company believes that INOC-016, by preventing the expression of the gene,
may lead to a more complete eradication of the HER2 protein and therefore be
more efficacious in the management of breast cancer.

Status. In pre-clinical testing of this drug, INCO-016 has been shown to stop
the growth of breast cancer tumors in animal models.

Partnerships. On January 4, 2005, Bioaccelerate entered into an exclusive
license agreement with Baylor College of Medicine granting Bioaccelerate
worldwide exclusive rights to patents and other intellectual property rights
associated with INOC-016 to develop and commercialize the compound.
Bioaccelerate conditionally assigned this agreement to Innovate on March 16,
2005.

Patents. A U.S. patent application was filed in 2003 and a joint PCT/U.S. patent
application was filed in 2003. Baylor is responsible for filing, prosecuting and
maintaining all patents. The Company will pay all legal costs associated with
these patents.

INOC-019 Prostate Tumor Suppressor

Description. A peptide derived from a novel, proprietary tumor suppressor
protein designed to induce the death of prostate cancer cells in vitro and in
animal models.

Partnerships. On March 15, 2005, Bioaccelerate entered into a license agreement
with Northwestern University. The agreement granted Bioaccelerate an exclusive
global license to the patent rights to develop and commercialize INOC-019.
Bioaccelerate assigned this agreement to Innovate on March 16, 2005.

Patents. A U.S. patent, number US 6,780,984 was granted for this compound in
2004.


COMPANY STATUS

The Company continues to make significant progress in developing its product
portfolio, and has multiple products in clinical trials with other compounds
following on in development. We have continued to incur losses as expected
during this emerging stage. We anticipate that the success of our immediate
product development strategy will permit us to further develop our other
products and potential products currently in our portfolio.

A major element of the Company's product development strategy has been the use
of third-party or contract research organizations ("CROs") to assist in the
conduct of safety and efficacy testing and clinical studies, to assist the
Company in guiding products through the FDA and EMEA regulatory review and
approval processes, and to manufacture and distribute any FDA and EMEA approved
products. The Company believes that maintaining a limited infrastructure will
enable it to develop products efficiently and cost effectively. However
consideration will be given to opportunities to strengthen the resources and
portfolio in certain areas that may prove viable commercially and add value to
the overall business in the future.


                                       18

<PAGE>

The reader should consider the likelihood of our future success to be highly
speculative in light of our limited operating history, as well as the limited
resources, problems, expenses, risks and complications frequently encountered by
similarly situated companies. To address these risks, we must, among other
things:

o     advance our lead product candidates and technology platforms;

o     obtain required government and other public and private approvals on a
      timely basis;

o     enter into corporate partnerships;

o     license additional technology;

o     maintain a proprietary position in our technologies and products; and

o     attract and retain key personnel.

The Company may not be successful in addressing these risks. If we are unable to
do so, our business prospects, financial condition and results of operations
would be materially adversely affected. The likelihood of our success must be
considered in light of the development cycles of pharmaceutical and
biopharmaceutical products and technologies and the competitive and regulatory
environment in which we operate.

Results of Operations - Comparison of quarter ended September 30, 2005 and 2004
During the quarter ended September 30, 2005, work continued on the product
development programs as planned and the individual expense items are detailed
below.

General and administrative expenses amounted to $230,430 for the quarter ended
September 30, 2005 compared with $310,079 for the quarter ended September 30,
2004. The higher costs in 2004 were primarily due to consulting fees relating to
the setting up of new research projects. During 2005 management expense
increased significantly over the previous year however this has been offset by a
reduction in consultancy fees.

Research and development expenses for the quarter ended September 30, 2005 were
$494,820 compared with $0 during the quarter ended September 30, 2004.

Net loss for the quarter ended September 30, 2005 was $755,250 compared with
$310,079 for the quarter ended September 30, 2004. This increase was due to the
research and development activities that are now taking place.

Results of Operations - Comparison of nine months ended September 30, 2005 and
2004 General and administrative expenses amounted to $842,337 for the nine
months ended September 30, 2005 compared with $310,079 for the nine months ended
September 30, 2004. The increase was due to the fact that the activities in 2004
did not start until July of that year. During 2005 management expense increased
significantly over the previous year however this has been offset by a reduction
in consultancy fees.

Research and development expenses for the nine months ended September 30, 2005
were $2,550,534 compared with $0 during the nine months ended September 30,
2004. Research and development work in 2004 did not start until the last quarter
of the year.

Net loss for the nine months ended September 30, 2005 was $3,472,071 compared
with $310,079 for the nine months ended September 30, 2004. This increase was
due to the research and development activities that are now taking place.

The Company has incurred a net loss of $4,592,108 since inception.


                                       19

<PAGE>

Liquidity and Capital Resources

A $5million credit facility was agreed with Bioaccelerate on July 22, 2004. The
Company is using these funds to develop its lead products. This investment has
enabled the Company to progress its milestones for its lead development
programs. We believe this facility will be sufficient to support our business
plan until longer term financing can be arranged.

Should encounter any unforeseen problems, the Company will review its budget and
adjust the scheduling and costs of the development programs accordingly to allow
the Company to operate until sufficient long term funding is achieved. However,
a key element of our business strategy is to continue to acquire, obtain
licenses for, and develop, new technologies and products that we believe offer
unique market opportunities and/or complement our existing product lines.

ITEM 3 - CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

As of the end of the period covered by this report, the Company carried out an
evaluation, under the supervision and with the participation of the Company's
management, including the Company's President and the Company's Chief Financial
Officer, of the effectiveness of the design and operation of the Company's
disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)
under the Securities Exchange Act of 1934, as amended). Based on this
evaluation, the Company's President and Chief Financial Officer concluded that
the Company's disclosure controls and procedures were effective in timely
ensuring that (i) information required to be disclosed in the reports that the
Company files or submits under the Securities Exchange Act of 1934, as amended,
is recorded, processed, summarized and reported, within the time periods
specified in the rules and forms of the Securities and Exchange Commission and
(ii) information required to be disclosed in the reports that the Company files
or submits under the Securities Exchange Act of 1934, as amended, is accumulated
and communicated to management, including the Company's President and Chief
Financial Officer, or persons performing similar functions, as appropriate to
allow timely decisions regarding required disclosure. It should be noted that,
in designing and evaluating the disclosure controls and procedures, management
recognizes that any controls and procedures, no matter how well designed and
operated, can provide only reasonable assurance of achieving the desired control
objectives, and management necessarily will apply its judgment in evaluating the
cost-benefit relationship of possible controls and procedures.

Changes in Internal Controls for Financial Reporting

There have been no significant changes in the Company's internal controls over
financial reporting that occurred during the quarter ended September 30, 2005,
that have materially affected, or are reasonably likely to materially affect our
internal control over financial reporting.


                                       20

<PAGE>

                           PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

From time to time, we may be involved in litigation relating to claims arising
out of our operations in the normal course of business. We currently are not a
party to any legal proceedings, the adverse outcome of which, in management's
opinion, individually or in the aggregate, would have a material adverse effect
on our results of operations or financial position.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.


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

None


ITEM 5. OTHER INFORMATION

None

ITEM 6. EXHIBITS AND REPORTS ON FORM 8

(a) Exhibits. The following exhibits are filed with this report.

31. Written Statement of President and Chief Financial Officer with respect to
compliance with Section 13(a) or 15 (d) of the Securities Exchange Act of 1934
and Section 302 of the Sarbanes-Oxley Act of 2002.

32. Written Statement of President and Chief Financial Officer with respect to
compliance with Section 13(a) or 15(d) of the Securities Exchange Act of 1934
and pursuant to 18 U.S.C. 1350, as adopted pursuant to ss. 906 of the
Sarbanes-Oxley Act of 2002.

(b) Reports on Form 8-K. The following reports have been filed on Form 8-K
during the last fiscal quarter:

None


                                       21

<PAGE>

                                   SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned authorized officers.

Dated: December 15, 2005

Innovate Oncology, Inc.


                                        By: /s/ Nigel Rulewski
                                        ------------------------------------
                                        Nigel Rulewski
                                        President & Director
                                        (Principal Executive Officer)


                                        By: /s/ Alan Bowen
                                        ------------------------------------
                                        Alan Bowen
                                        CFO, Treasurer & Director
                                        (Principal Financial Officer)

                                        By: /s/Linden Boyne
                                        ----------------------------------
                                        Secretary, Director


                                       22