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| (Mark      One)                                                                                                                |                                                                                                                   |
|--------------------------------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------------------------|
| x                                                                                                                              | ANNUAL      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES      EXCHANGE ACT OF 1934     |
| For      the fiscal year ended December 31, 2009                                                                          |
| or                                                                                                                             |
| o                                                                                                                              | TRANSITION      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES      EXCHANGE ACT OF 1934 |
| For      the transition period      from              to |

| Delaware(State      or Other Jurisdiction ofIncorporation      or Organization)                                    | 83-0221517(I.R.S.      EmployerIdentification      No.) |
|-------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------|
| 2600 Stemmons Freeway, Suite 176, Dallas,      TX(Address      of registrant’s principal executive offices)  | 75207(Zip      Code)                                    |
| Registrant’s      telephone number, including area code: (214) 905-5100                                 |
| Securities      registered pursuant to Section 12(b) of the      Act:  None                              |

| Common      Stock, $0.01 par value  |
|------------------------------------------|
| Title of Each      Class                 |

| Large      accelerated filer o | Accelerated      filer o | Non-accelerated      filer o(Do      not check if a smaller reporting company) | Smaller      reporting company x |
|-------------------------------------|-------------------------------|-------------------------------------------------------------------------------------|---------------------------------------|

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|       |  TABLE      OF CONTENTS |                                                                                           |
|------------|------------------------------|------------------------------------------------------------------------------------------------|
|       |                         |                                                                                           |
| Part I     |                         |   Page                                                                               |
|       | Item      1.                 | Business                                                                                       | 2 |
|       | Item      1A.                | Risk      Factors                                                                              | 16 |
|       | Item      2.                 | Properties                                                                                     | 24 |
|       | Item      3.                 | Legal      Proceedings                                                                         | 24 |
|       | Item      4.                 | Reserved                                                                                       | 24 |
|       |                         |                                                                                           |   |
| Part II    |                         |                                                                                           |
|       | Item      5.                 | Market      for Registrant’s Common Equity, Related Stockholder Matters      and         |   |
|       |                         | Issuer      Purchases of Equity Securities                                                     | 26 |
|       | Item      7.                 | Management’s      Discussion and Analysis of Financial Condition and                     |   |
|       |                         | Results      of Operations                                                                     | 28 |
|       | Item      8.                 | Financial      Statements and Supplementary Data                                               | 33 |
|       | Item      9.                 | Changes      In and Disagreements With Accountants on Accounting and Financial      Disclosure | 33 |
|       | Item      9A(T).             | Controls      and Procedures                                                                   | 33 |
|       | Item      9B.                | Other      Information                                                                         | 34 |
|       |                         |                                                                                           |   |
| Part III   |                         |                                                                                           |
|       | Item      10.                | Directors,      Executive Officers and Corporate Governance                                    | 35 |
|       | Item      11.                | Executive      Compensation                                                                    | 35 |
|       | Item      12.                | Security      Ownership of Certain Beneficial Owners and Management and Related      36        |   |
|       |                         | Stockholder      Matters                                                                       | 35 |
|       | Item      13.                | Certain      Relationships and Related Transactions and Director      Independence             | 35 |
|       | Item      14.                | Principal      Accountant Fees and Services                                                    | 35 |
|       | Item      15.                | Exhibits                                                                                       | 36 |
|       |                         |                                                                                           |   |
| Signatures |                         | 39                                                                                             |

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| ·   | MuGard™      is our approved product for the management of oral mucositis, a frequent      side-effect of cancer therapy for which there is no established treatment.      The market for mucositis treatment is estimated to be in excess of $1      billion world-wide. MuGard, a proprietary nanopolymer formulation, has      received marketing allowance in the U.S. from the Food & Drug      Administration (FDA). MuGard has been launched in Germany, Italy, UK,      Greece and the Nordic countries by our European commercial partner,      SpePharm. Our manufacturing of MuGard is underway as we expect to launch      MuGard in North America during the second quarter of 2010. We are working      with our partners in Korea and China for  marketing. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Our      lead development candidate for the treatment of cancer is ProLindac™, a      nanopolymer DACH-platinum prodrug. We recently completed a Phase 2      clinical trial on ProLindac in the EU in patients with recurrent ovarian      cancer. The clinical study had positive safety and efficacy results. On      January 7, 2010, we announced that we are initiating a study of ProLindac      combined with Paclitaxel in second line treatment of platinum pretreated      advanced ovarian cancer patients. This multi-center study of up to 25      evaluable patients will be conducted in Europe. We are also currently      planning a number of combination trials, looking at combining ProLindac      with other cancer agents in solid tumor indications including colorectal      and ovarian cancer. The DACH-platinum incorporated in ProLindac is the      same active moiety as that in oxaliplatin (Eloxatin; Sanofi-Aventis),      which has sales in excess of $2.0billion. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| ·   | Thiarabine,      or 4-thio Ara-C, is a next generation nucleoside analog licensed from      Southern Research Institute. Previously named SR9025 and OSI-7836, the      compound has been in two Phase 1/2 solid tumor human clinical trials and      was shown to have anti-tumor activity. We are working with leukemia and      lymphoma specialists at MD Anderson Cancer Center in Houston and intend to      initiate additional Phase 2 clinical trials in adult AML, ALL and other      indications. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Cobalamin™      is our proprietary preclinical nanopolymer oral drug delivery technology      based on the natural vitamin B12 oral uptake mechanism. We are currently      developing a product for the oral delivery of insulin, and have conducted      sponsored development of a product for oral delivery of human growth      hormone. We are in discussion with several companies regarding the      sponsored development of Cobalamin oral drug delivery formulations of      proprietary and non-proprietaryactives. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Cobalamin-mediated      cancer targeted delivery is a preclinical technology which makes use of      the fact that cell surface receptors for vitamins such as B12 are often      overexpressed by cancer cells. This technology uses nanopolymer constructs      to deliver more anti-cancer drug to tumors while protecting normal      tissues. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Compound                                                                                |   | Originator                            |   |  Technology   |   | Indication |   | ClinicalStage (1)                              |
|-----------------------------------------------------------------------------------------|--------|---------------------------------------|--------|--------------------|--------|------------|--------|------------------------------------------------|
|                                                                                    |   |                                  |   |               |   |       |   |                                           |
| MuGard™                                                                           |   | Access                                |   | Mucoadhesiveliquid |   | Mucositis  |   | (510k)      Marketing clearance received  |
| ProLindacTM      (Polymer   Platinate,      AP5346)  (2)  |   | Access      /Univ      ofLondon  |   | Syntheticpolymer   |   | Cancer     |   | Phase      2                                   |
| Thiarabine      (4-thio Ara-C) (3)                                                      |   | SouthernResearchInstitute        |   | Smallmolecule      |   | Cancer     |   | Phase      1/2                                 |
| Oral      Insulin                                                                  |   | Access                                |   | Cobalamin          |   | Diabetes   |   | Pre-clinical                                   |
| Oral      Delivery System                                                          |   | Access                                |   | Cobalamin          |   | Various    |   | Pre-clinical                                   |
| Cobalamin™-Targeted      Therapeutics                                             |   | Access                                |   | Cobalamin          |   | Anti-tumor |   | Pre-clinical                                   |

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| (1)   | For      more information, see “Government Regulation” for description of clinical      stages. |
|-----------------|-------------------------------------------------------------------------------------------------------------|

| (2)   | Licensed      from the School of Pharmacy, The University of  London. |
|-----------------|-----------------------------------------------------------------------|

| (3)   | Licensed      from Southern Research Institute of Birmingham,  Alabama. |
|-----------------|-------------------------------------------------------------------------|

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| ·   | Synthetic      Polymer Targeted Drug DeliveryTechnology; |
|--------------------|----------------------------------------------------------|

| ·   | Cobalamin™-Mediated      Oral Delivery Technology; and |
|--------------------|--------------------------------------------------------------|

| ·   | Cobalamin™-Mediated      Targeted Delivery Technology. |
|--------------------|--------------------------------------------------------------|

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|        ● | passive      tumor targeting involves transporting anti-cancer agents through the      bloodstream to tumor cells using a “carrier” molecule. Many different      carrier molecules, which can take a variety of forms (micelles,      nanoparticles, liposomes and polymers), are being investigated as each      provides advantages such as specificity and protection of the anti-cancer      drug from degradation due to their structure, size (molecular weights) and      particular interactions with tumor cells. Our ProLindac program uses a      passive tumor targeting technology. |
|---------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|        ● | active      tumor targeting involves attaching an additional fragment to the      anticancer drug and the carrier molecule to create a new “targeted” agent      that will actively seek a complementary surface receptor to which it binds      (preferentially located on the exterior of the tumor cells). The theory is      that the targeting of the anti-cancer agent through active binding to the      affected cells should allow more of the anti-cancer drug to enter the      tumor cell, thus amplifying the response to the treatment and reducing the      toxic effect on bystander, normaltissue. |
|---------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| -   | the      use of vitamin B12 to target the transcobalamin II receptor which is      upregulated in numerous diseases including cancer, rheumatoid arthritis,      certain neurological and autoimmune disorders with two U.S. patents and      three U.S. and four European patent applications;  and |
|---------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| -   | oral      delivery of a wide variety of molecules which cannot otherwise be orally      administered, utilizing the active transport mechanism which transports      vitamin B12 into the systemic circulation with six U.S. patents and two      European patents and one U.S. and one European patent      application. |
|---------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Mucoadhesive      technology in 2021, |
|--------------------|---------------------------------------|

| ·   | ProLindac™      in 2021, |
|--------------------|--------------------------------|

| ·   | Thiarabine      in 2018, and |
|--------------------|------------------------------|

| ·   | Cobalamin      mediated technology between 2010 and2019 |
|--------------------|---------------------------------------------------------|

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| •           Cisplatin, marketed by Bristol-Myers Squibb, the originator of the drug,      and several generic manufacturers; |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------|

| •           Carboplatin, marketed by Bristol-Myers Squibb in the US; and several      generic manufacturers, and |
|-------------------------------------------------------------------------------------------------------------------------------------------------|

| •           Oxaliplatin, marketed exclusively by  Sanofi-Aventis. |
|--------------------------------------------------------------------------------------------------|

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| • | American      Pharmaceutical Partners, Cell Therapeutics, Daiichi, SynDevRx, and Enzon      are developing alternate drugs in combination with polymers and other drug      delivery systems. |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| ·   | some      or all of our drug candidates may be found to be unsafe or ineffective or      otherwise fail to meet applicable regulatory standards or receive      necessary regulatory clearances; |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | our      drug candidates, if safe and effective, may be too difficult to develop      into commercially viable drugs; |
|--------------------|-----------------------------------------------------------------------------------------------------------------------|

| ·   | it      may be difficult to manufacture or market our drug candidates on a large      scale; |
|--------------------|----------------------------------------------------------------------------------------------|

| ·   | proprietary      rights of third parties may preclude us from marketing our drug      candidates; and |
|--------------------|-------------------------------------------------------------------------------------------------------|

| ·   | third      parties may market superior or equivalentdrugs. |
|--------------------|------------------------------------------------------------|

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|   | •           Cisplatin, marketed by Bristol-Myers Squibb, the originator of the drug,      and several generic manufacturers; |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | •           Carboplatin, marketed by Bristol-Myers Squibb in the US;    and |
|--------|------------------------------------------------------------------------------------------------------------|

|   | •           Oxaliplatin, marketed exclusively by  Sanofi-Aventis. |
|--------|--------------------------------------------------------------------------------------------------|

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| •     American      Pharmaceutical Partners, Cell Therapeutics, Daiichi, and Enzon are      developing alternate drugs in combination with polymers and other drug      delivery systems. |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |  • | License      Agreement, dated as of August 8, 2007, by and between Virium      Pharmaceuticals, Inc.(a predecessor in interest to Access) and Southern      Research Institute; and  |
|--------|---------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | •       | Exclusive      Patent and Know-how Sub-license Agreement between Somanta and      Immunodex, Inc. dated August 18, 2005, as  amended.                                           |

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| ·   | third-party      payers' increasing challenges to the prices charged for medical products      and services; |
|--------------------|--------------------------------------------------------------------------------------------------------------|

| ·   | the      trend toward managed health care in the United States and the concurrent      growth of HMOs and similar organizations that can control or significantly      influence the purchase of healthcare services and products;      and |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | legislative      proposals to reform healthcare or reduce government insurance      programs. |
|--------------------|-----------------------------------------------------------------------------------------------|

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|                                     |   | Common      Stock |   |
|------------------------------------------|--------|-------------------|--------|
|                                     |   | High              |   |   | Low |   |
| Fiscal Year Ended December 31,      2009 |   |              |   |   |   |   |
| First      quarter                       |   | $                 | 1.85   |   |   | $ | 0.77 |   |
| Second      quarter                      |   |              | 2.25   |   |   |   | 1.25 |   |
| Third      quarter                       |   |              | 4.70   |   |   |   | 1.84 |   |
| Fourth      quarter                      |   |              | 3.50   |   |   |   | 2.80 |   |
|                                     |   |              |   |   |   |   |   |   |
| Fiscal Year Ended December 31,      2008 |   |              |   |   |   |   |   |   |
| First      quarter                       |   | $                 | 3.50   |   |   | $ | 1.35 |   |
| Second      quarter                      |   |              | 3.30   |   |   |   | 1.40 |   |
| Third      quarter                       |   |              | 3.49   |   |   |   | 2.50 |   |
| Fourth      quarter                      |   |              | 2.75   |   |   |   | 0.80 |   |
|                                     |   |              |   |   |   |   |   |   |

----

|                                                        |   |                         |      |   |                     |   |   | Number      of securities     |   |
|-------------------------------------------------------------|--------|------------------------------|-----------|--------|--------------------------|--------|--------|-------------------------------|--------|
|                                                        |   |                         |      |   |                     |   |   | remaining      available      |   |
|                                                        |   |                         |      |   |                     |   |   | for      future issuance      |   |
|                                                        |   | Number      of securities to |      |   | Weighted-average         |   |   | under      equity             |   |
|                                                        |   | be      issued upon exercise |      |   | exercise      price of   |   |   | compensation      plans       |   |
|                                                        |   | of      outstanding options  |      |   | outstanding      options |   |   | (excluding      securities    |   |
| Plan Category                                               |   | warrants      and rights     |      |   | warrants      and rights |   |   | reflected      in column (a)) |   |
|                                                        |   | (a)                          |      |   | (b)                      |   |   | (c)                           |   |
|                                                        |   |                         |      |   |                     |   |   |                          |   |
| Equity      compensation plans                              |   |                         |      |   |                     |   |   |                          |   |
| approved      by security                                   |   |                         |      |   |                     |   |   |                          |   |
|   holders:                                        |   |                         |      |   |                     |   |   |                          |   |
|     2005      Equity Incentive Plan     |   |                         | 1,435,237 |   |                     | $      | 1.99   |                          |   |   | 1,408,851 |   |
|     1995      Stock Awards Plan         |   |                         | 103,000   |   |                     |   | 15.89  |                          |   |   | - |   |
|     2001      Restricted Stock Plan     |   |                         | -         |   |                     |   | -      |                          |   |   | 52,818 |   |
|                                                        |   |                         |      |   |                     |   |   |                          |   |   |   |   |
| Equity      compensation plans                              |   |                         |      |   |                     |   |   |                          |   |   |   |   |
|   not      approved by security                   |   |                         |      |   |                     |   |   |                          |   |   |   |   |
|   holders:                                        |   |                         |      |   |                     |   |   |                          |   |   |   |   |
|     2007      Special Stock Option Plan |   |                         | 100,000   |   |                     |   | 2.9    |                          |   |   | 350,000 |   |
| Total                                                       |   |                         | 1,638,237 |   |                     | $      | 2.92   |                          |   |   | 1,811,669 |   |

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| ITEM      7. | MANAGEMENT'S      DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION  AND |
|--------------|-----------------------------------------------------------------------|

|   |   RESULTS      OF OPERATIONS |
|--------|----------------------------------------|

| ·   | the      Somanta acquisition resulted in a one-time non-cash in-process research      and development expense in the first quarter of 2008      ($8,879,000); |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | MacroChem’s      acquisition of Virium on April 18, 2008 which resulted in a one-time      non-cash in-process research and development expense      ($9,657,000); |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | research      and development expenses incurred by MacroChem for the year ended December      31,  2008, which are no longer ongoing    ($953,000); |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | lower      costs for product manufacturing due to the start of a new ProLindac      clinical trial ($753,000); |
|--------------------|----------------------------------------------------------------------------------------------------------------|

| ·   | lower      salary and related expenses($392,000); |
|--------------------|---------------------------------------------------|

| ·   | lower      scientific consulting expenses($266,000); |
|--------------------|------------------------------------------------------|

| ·   | other      net decreases in research spending($84,000); |
|--------------------|---------------------------------------------------------|

| ·   | offset      by higher expenses due to option grants ($303,000);  and |
|--------------------|----------------------------------------------------------------------|

| ·   | offset      by higher clinical costs due to the planned start of a new clinical trial      in 2010 ($103,000). |
|--------------------|----------------------------------------------------------------------------------------------------------------|

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| ·   | lower      general and administrative expenses incurred by MacroChem for the year      ended December 31,  2008 that are no longer ongoing      ($2,943,000); |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | lower      accrual for liquidated damages($493,000); |
|--------------------|------------------------------------------------------|

| ·   | lower      director and officer insurance and lower director fees ($166,000) due to      lower insurance costs and directors taking options instead of fees in      2009; |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | lower      patent expenses ($117,000); |
|--------------------|----------------------------------------|

| ·   | lower      legal and accounting expenses ($86,000);and |
|--------------------|--------------------------------------------------------|

| ·   | other      net decreases in general and administrative expenses      ($110,000); |
|--------------------|----------------------------------------------------------------------------------|

| ·   | offset      by higher shareholder consultant expenses ($2,348,000) to inform investors      about Access and to expand our shareholderbase; |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | higher      business professional expenses ($1,094,000);and |
|--------------------|-------------------------------------------------------------|

| ·   | higher      expenses due to the cost of option grants  ($122,000). |
|--------------------|--------------------------------------------------------------------|

----

| ·   | the      successful development and commercialization of ProLindac™, MuGard™ and      our other product candidates; |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------|

| ·   | the      ability to convert, repay or restructure our outstanding convertible note      and debentures; |
|--------------------|---------------------------------------------------------------------------------------------------------|

| ·   | the      ability to establish and maintain collaborative arrangements with      corporate partners for the research, development and commercialization of      products; |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | continued      scientific progress in our research and development    programs; |
|--------------------|---------------------------------------------------------------------------------|

| ·   | the      magnitude, scope and results of preclinical testing and clinical      trials; |
|--------------------|----------------------------------------------------------------------------------------|

| ·   | the      costs involved in filing, prosecuting and enforcing patent      claims; |
|--------------------|----------------------------------------------------------------------------------|

| ·   | the      costs involved in conducting clinicaltrials; |
|--------------------|-------------------------------------------------------|

| ·   | competing      technological developments; |
|--------------------|--------------------------------------------|

| ·   | the      cost of manufacturing and scale-up; |
|--------------------|----------------------------------------------|

----

| ·   | the      ability to establish and maintain effective commercialization arrangements      and activities; and |
|--------------------|--------------------------------------------------------------------------------------------------------------|

| ·   | successful      regulatory filings. |
|--------------------|-------------------------------------|

| (in      thousands)                                       |   | Twelve      Months endedDecember 31, |   |   | Inception      ToDate (1) |   |
|-----------------------------------------------------------|--------|--------------------------------------|--------|--------|---------------------------|--------|
| Project                                                   |   | 2009                                 |   |   | 2008                      |   |   |   |   |
| Polymer      Platinate (ProLindac™)            |   | $                                    | 2,507  |   |                      | $      | 3,402 |   |   | $ | 28,126 |   |
| Mucoadhesive      Liquid  Technology      (MLT) |   |                                 | 107    |   |                      |   | - |   |   |   | 1,618 |   |
| Others      (2)                                           |   |                                 | 43     |   |                      |   | 332 |   |   |   | 5,437 |   |
| Total                                                     |   | $                                    | 2,657  |   |                      | $      | 3,734 |   |   | $ | 35,181 |   |
|                                                      |   |                                 |   |   |                      |   |   |   |   |   |   |   |

| (1)   | Cumulative      spending from inception of the Company or project through December 31,      2009. |
|-----------------|---------------------------------------------------------------------------------------------------|

| (2)   | Includes:  Vitamin      Mediated Targeted Delivery, carbohydrate targeting and other      projects. |
|-----------------|---------------------------------------------------------------------------------------------------------------|

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| a.   | Financial      Statements.  The following financial statements are      submitted as part of this report: |
|----------------|---------------------------------------------------------------------------------------------------------------------|

| Report of Registered      Independent Public Accounting      Firm..............................................................................................................................................................................              | F-1 |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----|
| Consolidated Balance Sheets at      December 31, 2009 and      2008...........................................................................................................................................................................               | F-2 |
| Consolidated Statements of      Operations for 2009 and      2008................................................................................................................................................................................            | F-3 |
| Consolidated Statements of      Stockholders’ Equity (Deficit) for 2009 and      2008...............................................................................................................................................                   | F-4 |
| Consolidated Statements of      Cash Flows for 2009 and      2008...............................................................................................................................................................................             | F-5 |
| Notes to Consolidated      Financial      Statements........................................................................................................................................................................................................ | F-6 |

| 2.1 | Amended      and Restated Agreement of Merger and Plan of Reorganization between the      Registrant and Chemex Pharmaceuticals, Inc., dated as of October 31, 1995      (Incorporated by reference to Exhibit A of  our Registration      Statement on Form S-4 dated December 20, 1995, Commission File No.      33-64031) |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2.2 | Agreement      and Plan of Merger, by and among the Registrant, Somanta Acquisition      Corporation, Somanta Pharmaceuticals, Inc., Somanta Incorporated and      Somanta Limited, dated April 19, 2007 (Incorporated by reference to      Exhibit 2.1 to our Form 8-K dated April 18,  2007) |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 2.3 | Agreement and Plan of Merger, by and among the      Registrant, MACM Acquisition Corporation and MacroChem Corporation, dated      July 9, 2008 (Incorporated by reference to Exhibit 2.3 of our Form      10-Q for the quarter ended June 30,2008) |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.1 | Certificate      of Incorporation (Incorporated by reference to Exhibit 3(a) of our Form      8-K dated July 12, 1989, Commission File Number  9-9134) |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.2 | Certificate      of Amendment of Certificate of Incorporation filed August 13, 1992      (Incorporated by reference to Exhibit 3.3 of our Form 10-K for year ended      December 31, 1995) |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.3 | Certificate      of Merger filed January 25, 1996 (Incorporated by reference to Exhibit E      of our Registration Statement on Form S-4 dated December 20, 1995,      Commission File No. 33-64031) |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.4 | Certificate      of Amendment of Certificate of Incorporation filed January 25, 1996      (Incorporated by reference to Exhibit E of our Registration Statement on      Form S-4 dated December 20, 1995, Commission File No.      33-64031) |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.5 | Certificate      of Amendment of Certificate of Incorporation filed July 18, 1996      (Incorporated by reference to Exhibit 3.7 of our Form 10-K for the year      ended December 31, 1996) |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.6 | Certificate      of Amendment of Certificate of Incorporation filed June 18, 1998.      (Incorporated by reference to Exhibit 3.8 of our Form 10-Q for the quarter      ended June 30, 1998) |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.7 | Certificate      of Amendment of Certificate of Incorporation filed July 31, 2000      (Incorporated by reference to Exhibit 3.8 of our Form 10-Q for the quarter      ended March 31, 2001) |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.8 | Certificate      of Designations of Series A Junior Participating Preferred Stock filed      November 7, 2001 (Incorporated by reference to Exhibit 4.1.H of our      Registration Statement on Form S-8 dated December 14, 2001, Commission      File No. 333-75136) |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.9 | Amended      and Restated Bylaws (Incorporated by reference to Exhibit 2.1 of our Form      10-Q for the quarter ended June 30,1996) |
|-----|--------------------------------------------------------------------------------------------------------------------------------------|

| 3.10 | Certificate      of Designation, Rights and Preferences of Series A Cumulative Convertible      Preferred Stock filed November 9, 2007 (Incorporated by reference to      Exhibit 3.10 to our Form SB-2 filed on December 10,  2007. |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.11 | Certificate      of Amendment to Certificate of Designations, Rights and Preferences of      Series A Cumulative Convertible Preferred Stock filed June 11, 2008      (Incorporated by reference to Exhibit 3.11 of our Form 10-Q for the      quarter ended June 30, 2008) |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| 10.1* | 1995      Stock Option Plan (Incorporated by reference to Exhibit F of our      Registration Statement on Form S-4 dated December 20, 1995, Commission      File No. 33-64031) |
|-------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2* | Amendment      to 1995 Stock Option Plan (Incorporated by reference to Exhibit 10.25 of      our Form 10-K for the year ended December 31,  2001) |
|-------|---------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.3 | Lease      Agreement between Pollock Realty Corporation and the Registrant dated July      25, 1996 (Incorporated by reference to Exhibit 10.19 of our Form 10-Q for      the quarter ended September 30,1996) |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.4 | Platinate      HPMA Copolymer Royalty Agreement between The School of Pharmacy,      University of London and the Registrant dated November 19, 1996      (Incorporated by reference to Exhibit 10.9 of our Form 10-K for the year      ended December 31, 1996) |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.5* | 401(k)      Plan (Incorporated by reference to Exhibit 10.20 of our Form 10-K for the      year ended December 31, 1999) |
|-------|--------------------------------------------------------------------------------------------------------------------------|

| 10.6 | Form      of Convertible Note (Incorporated by reference to Exhibit 25 of our Form      10-Q for the quarter ended September 30,2000) |
|------|---------------------------------------------------------------------------------------------------------------------------------------|

| 10.7 | Rights      Agreement dated as of October 31, 2001 between the Registrant and American      Stock Transfer & Trust Company, as Rights Agent (Incorporated by      reference to Exhibit 99.1 of our Current Report on Form 8-K dated November      7, 2001) |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.8 | Amendment      to Rights Agreement dated as of February 16, 2006 between the Registrant      and American Stock Transfer & Trust Company, as Rights Agent      (Incorporated by reference to Exhibit 10.33 of our Form 10-Q for the      quarter ended March 31, 2006) |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.9 | Amendment      to Rights Agreement dated as of November 9, 2007 between the Registrant      and American Stock Transfer & Trust Company as Rights      Agent |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.10* | 2001      Restricted Stock Plan (Incorporated by reference to Exhibit 1 of our Proxy      Statement filed on April 16, 2001) |
|--------|------------------------------------------------------------------------------------------------------------------------------|

| 10.11* | 2005      Equity Incentive Plan (Incorporated by reference to Exhibit 1 of our Proxy      Statement filed on April 18, 2005) |
|--------|------------------------------------------------------------------------------------------------------------------------------|

| 10.12 | Asset      Sale Agreement dated as of October 12, 2005, between the Registrant and      Uluru, Inc. (Incorporated by reference to Exhibit 10.25 of our 10-K for      the year ended December 31, 2005) |
|-------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.13 | Amendment      to Asset Sale Agreement dated as of December 8, 2006, between the      Registrant and Uluru, Inc. (Incorporated by reference to Exhibit 10.16 of      our Form 10-KSB filed on April 2,2007) |
|-------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.14 | License      Agreement dated as of October 12, 2005, between the Registrant and Uluru,      Inc. (Incorporated by reference to Exhibit 10.26 of our 10-K for the year      ended December 31, 2005) |
|-------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.15 | Form      of Warrant dated February 16, 2006, issued by the Registrant to certain      Purchasers (Incorporated by reference to Exhibit 10.31 of our Form 10-Q      for the quarter ended March 31,2006) |
|-------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.16 | Form      of Warrant dated October 24, 2006, issued by the Registrant to certain      Purchasers (Incorporated by reference to Exhibit 10.27 of our Form 10-KSB      filed on April 2, 2007) |
|-------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.17 | Form      of Warrant December 6, 2006, issued by the Registrant to certain      Purchasers (Incorporated by reference to Exhibit 10.32 of our Form 10-KSB      filed on April 2, 2007) |
|-------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.18* | 2007      Special Stock Option Plan and Agreement dated January 4, 2007, by and      between the Registrant and Stephen R. Seiler, President and Chief      Executive Officer (Incorporated by reference to Exhibit 10.35 of our Form      10-QSB filed on May 15, 2007) |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.19 | Note      Purchase Agreement dated April 26, 2007, between the Registrant and      Somanta Pharmaceuticals, Inc. (Incorporated by reference to Exhibit 10.42      of our Form 10-Q filed on August 14,2007) |
|-------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.20 | Preferred      Stock and Warrant Purchase Agreement, dated November 7, 2007, between the      Registrant and certain Purchasers (Incorporated by reference to Exhibit      10.23 of our Form S-1 filed on March 11,2008) |
|-------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.21 | Investor      Rights Agreement dated November 10, 2007, between the Registrant and      certain Purchasers (Incorporated by reference to Exhibit 10.24 of our Form      S-1 filed on March 11, 2008) |
|-------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.22 | Form      of Warrant Agreement dated November 10, 2007, between the Registrant and      certain Purchasers (Incorporated by reference to Exhibit 10.25 of our Form      S-1 filed on March 11, 2008) |
|-------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.23 | Board      Designation Agreement dated November 15, 2007, between the Registrant and      SCO Capital Partners LLC (Incorporated by reference to Exhibit 10.26 of      our Form S-1 filed on March 11,2008) |
|-------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.24 | Amendment      and Restated Purchase Agreement, dated February 4, 2008 between the      Registrant and certain Purchasers (Incorporated by reference to Exhibit      10.27 of our Form S-1 filed on March 11,2008) |
|-------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.25 | Amended      and Restated Investor Rights Agreement, dated February 4, 2008, between      the Registrant and certain Purchasers (Incorporated by reference to      Exhibit 10.28 of our Form S-1 filed on March 11,  2008) |
|-------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.26* | Employment      Agreement dated January 4, 2008, between the Registrant and Jeffrey B.      Davis (Incorporated by reference to Exhibit 10.29 of our Form S-1 filed on      March 11, 2008) |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| 10.27 | Form      of Securities Purchase Agreement (Incorporated by reference to Exhibit      10.29 of our Form S-1 filed on January 15,2010) |
|-------|---------------------------------------------------------------------------------------------------------------------------------------|

| 10.28 | Form      of Warrant (Incorporated by reference to Exhibit 10.30 of our Form S-1      filed on January 15, 2010) |
|-------|------------------------------------------------------------------------------------------------------------------|

| 10.29* | Employment      Agreement of David P. Nowotnik, PhD (Incorporated by reference to Exhibit      10.31 of our Form 8-K February 8,2010) |
|--------|---------------------------------------------------------------------------------------------------------------------------------------|

| 21 | Subsidiaries      of the Registrant |
|----|-------------------------------------|

| 31.1 | Chief      Executive Officer Certification Pursuant to 18 U.S.C. Section 1350, as      Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of      2002 |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 31.2 | Chief      Financial Officer Certification Pursuant to 18 U.S.C. Section 1350, as      Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of      2002 |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 32 | Chief      Executive Officer Certification and Chief Financial Officer Certification      Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of      the Sarbanes-Oxley Act of 2002 |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Management      contract or compensatory plan required to be filed as an Exhibit to this      Form pursuant to Item 15© of thereport. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------|

----

----

----

|                           ASSETS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |  December 31, 2009                                                                                |   |  December 31, 2008                                                                                                                                                                                                                           |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                        |   |  (See      Note 12)                                                                                                                                                                                                                               |
| Current      assetsCash and cash      equivalents      ReceivablesPrepaid expenses and other      current assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  $             607,00036,00042,000    |   |  $          2,677,000             147,000             175,000 |
|                 Total      current assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | 685,000                                                                                                     |   | 2,999,000                                                                                                                                                                                                                                              |
|  Property      and equipment, net                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |  50,000                                                                                                |   |  95,000                                                                                                                                                                                                                                           |
|  Patents,      net                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  787,000                                                                                               |   |  999,000                                                                                                                                                                                                                                          |
|  Other      assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  61,000                                                                                                |   |  78,000                                                                                                                                                                                                                                           |
|             Total      assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | $          1,583,000                                      |   | $          4,171,000                                                                                                                                                                                 |
|         LIABILITIES      AND STOCKHOLDERS' EQUITY (DEFICIT)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                        |   |                                                                                                                                                                                                                                                   |
| Current      liabilities  Accounts      payable  Accrued      expenses  Dividends      payable  Accrued      interest payable  Notes      payable  Current      portion of deferred revenue                                                                                                                                                                                                                                                                                                                                                                                                                       |  $          4,094,000857,0002,773,000563,000-347,000 |   |  $          3,287,0001,295,0001,896,000145,000825,000164,000                                                                                                                                    |
|                          Total current liabilities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | 8,634,000                                                                                                   |   | 7,612,000                                                                                                                                                                                                                                              |
| Derivative      liabilityLong-term      deferred revenueLong-term      convertible debt                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 9,708,0004,730,0005,500,000                                                                                 |   | -2,245,0005,500,000                                                                                                                                                                                                                                    |
|  Total      liabilities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 28,572,000                                                                                                  |   | 15,357,000                                                                                                                                                                                                                                             |
|  Commitments      and contingencies                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                        |   |                                                                                                                                                                                                                                                   |
|  Stockholders'      deficit  Convertible      preferred stock - $.01 par value; authorized 2,000,000shares;     2,992.3617      issued at December 31, 2009; 3,242.8617 issued at     December      31, 2008  Common      stock - $.01 par value; authorized 100,000,000 shares;     issued,      13,171,545 at December 31, 2009; issued 9,467,474      at      December 31, 2008  Additional      paid-in capital  Notes      receivable from stockholders  Treasury      stock, at cost – 163 shares |     -  132,000215,735,000(1,045,000)(4,000)                                   |   |     -  95,000225,753,000(1,045,000)(4,000)                                                                                                                                                                               |
|            Accumulated deficit                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | (241,807,000)                                                                                               |   | (235,985,000)                                                                                                                                                                                                                                          |
|                      Total stockholders' deficit                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | (26,989,000)                                                                                                |   | (11,186,000)                                                                                                                                                                                                                                           |
|             Total      liabilities and stockholders' deficit                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | $          1,583,000                                      |   | $          4,171,000                                                                                                                                                                                 |

----

|                                                                                     |   | December      31, |        |
|------------------------------------------------------------------------------------------|--------|-------------------|-------------|
|                                                                                     |   | 2009              |        |   | 2008 |   |
|                                                                                     |   |              |        |   | (See      Note 12) |   |
| Revenues                                                                                 |   |              |        |   |   |   |
| Licenserevenues                                                                          |   | $                 | 315,000     |   |   | $ | 118,000 |   |
| Royalties                                                                                |   |              | 37,000      |   |   |   | - |   |
| Sponsored research and      development                                                  |   |              | -           |   |   |   | 173,000 |   |
| Total revenues                                                                           |   |              | 352,000     |   |   |   | 291,000 |   |
|                                                                                     |   |              |        |   |   |   |   |   |
| Expenses                                                                                 |   |              |        |   |   |   |   |   |
| Research and      development                                                            |   |              | 2,657,000   |   |   |   | 23,235,000 |   |
| General and      administrative                                                          |   |              | 7,112,000   |   |   |   | 7,463,000 |   |
| Depreciation and      amortization                                                       |   |              | 259,000     |   |   |   | 324,000 |   |
| Total expenses                                                                           |   |              | 10,028,000  |   |   |   | 31,022,000 |   |
|                                                                                     |   |              |        |   |   |   |   |   |
| Loss      from operations                                                                |   |              | (9,676,000  | ) |   |   | (30,731,000 | ) |
|                                                                                     |   |              |        |   |   |   |   |   |
| Interest      and miscellaneous income                                                   |   |              | 29,000      |   |   |   | 211,000 |   |
| Interest      and other expense                                                          |   |              | (539,000    | ) |   |   | (911,000 | ) |
| Loss      on change in fair value of derivative                                          |   |              | (7,154,000  | ) |   |   | - |   |
|                                                                                     |   |              | (7,664,000  | ) |   |   | (700,000 | ) |
| Net      loss                                                                            |   |              | (17,340,000 | ) |   |   | (31,431,000 | ) |
|                                                                                     |   |              |        |   |   |   |   |   |
| Less      preferred stock dividends                                                      |   |              | (1,886,000  | ) |   |   | (3,358,000 | ) |
| Net      loss allocable to common stockholders                                           |   | $                 | (19,226,000 | ) |   | $ | (34,789,000 | ) |
|                                                                                     |   |              |        |   |   |   |   |   |
|                                                                                     |   |              |        |   |   |   |   |   |
| Basic      and diluted loss per common share                                             |   |              |        |   |   |   |   |   |
|     Net      loss allocable to common stockholders                   |   | $                 | (1.63       | ) |   | $ | (4.16 | ) |
|                                                                                     |   |              |        |   |   |   |   |   |
| Weighted      average basic and diluted common shares    outstanding |   |              | 11,818,530  |   |   |   | 8,354,031 |   |
|                                                                                     |   |              |        |   |   |   |   |   |

----

|                                                                                                      |   |   |             |   |   |   |               |   |   |   |               |   |   |   |  Notes        |   |   |   |             |   |   |   |                             |   |
|-----------------------------------------------------------------------------------------------------------|--------|--------|------------------|--------|--------|--------|--------------------|--------|--------|--------|--------------------|--------|--------|--------|--------------------|--------|--------|--------|------------------|--------|--------|--------|----------------------------------|--------|
|                                                                                                      |   |   |             |   |   |   |               |   |   |   |               |   |   |   |               |   |   |   | Additional  |   |   |   | receivable      from   |   |   |   |   |   |   |   |   |   |
|                                                                                                      |   |   | Shares      |   |   |   | Amount   |   |   |   | Shares   |   |   |   | Amount   |   |   |   | paid-in          |   |   |   | stockholders                |   |   |   | Treasury   |   |   |   | Accumulated   |   |
|                                                                                                      |   |   |             |   |   |   |               |   |   |   |               |   |   |   |               |   |   |   | capital          |   |   |   |                             |   |   |   | stock  |   |   |   |   |   |
| Access-MacroChem      as if   combined      at January   1,      2008  |   |   |   6,085,000 |   |   | $      | 61,000             |   |   |   |   3,227.3617  |   |   | $      |  -            |   |   | $      | 213,782,000      |   |   | $      | (1,045,000                       | )      |   | $ | (4,000 | ) |   | $ | (199,892,000 | ) |
| Common      stock issued for   services                                                    |   |   | 10,000           |   |   |   | -                  |   |   |   | -                  |   |   |   | -                  |   |   |   | 27,000           |   |   |   | -                                |   |   |   | - |   |   |   | - |   |
| Warrants      issued for   services                                                        |   |   | -                |   |   |   | -                  |   |   |   | -                  |   |   |   | -                  |   |   |   | 350,000          |   |   |   | -                                |   |   |   | - |   |   |   | - |   |
| Common      stock   issued      for cash exercise   of      options         |   |   |   25,000    |   |   |   |   -           |   |   |   |   -           |   |   |   |   -           |   |   |   |   15,000    |   |   |   |   -                         |   |   |   |   - |   |   |   |   - |   |
| Stock      option   compensation      expense                                              |   |   | -                |   |   |   | -                  |   |   |   | -                  |   |   |   | -                  |   |   |   | 922,000          |   |   |   | -                                |   |   |   | - |   |   |   | - |   |
| Preferred      stock issuances                                                                            |   |   | -                |   |   |   | -                  |   |   |   | 272.5000           |   |   |   | -                  |   |   |   | 1,687,000        |   |   |   | -                                |   |   |   | - |   |   |   | - |   |
| Warrants      issued with    preferred      stock                                     |   |   | -                |   |   |   | -                  |   |   |   | -                  |   |   |   | -                  |   |   |   | 1,142,000        |   |   |   | -                                |   |   |   | - |   |   |   | - |   |
| Costs      of stock issuances                                                                             |   |   | -                |   |   |   | -                  |   |   |   | -                  |   |   |   | -                  |   |   |   | (385,000         | )      |   |   | -                                |   |   |   | - |   |   |   | - |   |
| Preferred      stock dividend   beneficial      conversion   feature        |   |   |   -         |   |   |   |   -           |   |   |   |   -           |   |   |   |   -           |   |   |   |   1,308,000 |   |   |   |   -                         |   |   |   |   - |   |   |   | (1,308,000 | ) |
| Common      stock and   warrants      issued to   Somanta      shareholders |   |   |   1,500,000 |   |   |   |   15,000      |   |   |   |   -           |   |   |   |   -           |   |   |   |   4,916,000 |   |   |   |   -                         |   |   |   |   - |   |   |   |   - |   |
| Common      stock and   warrants      issued to   Somanta      creditors    |   |   |   538,000   |   |   |   |   5,000       |   |   |   |   -           |   |   |   |   -           |   |   |   |   1,571,000 |   |   |   |   -                         |   |   |   |   - |   |   |   |   - |   |
| Preferred      stock converted   into      common stock                                    |   |   | 857,000          |   |   |   | 9,000              |   |   |   | (257.0000          | )      |   |   | -                  |   |   |   | (9,000           | )      |   |   | -                                |   |   |   | - |   |   |   | - |   |
| Common      stock issued for   preferred      dividends                                    |   |   | 452,000          |   |   |   | 5,000              |   |   |   | -                  |   |   |   | -                  |   |   |   | 427,000          |   |   |   | -                                |   |   |   | - |   |   |   | - |   |
| Preferred      dividends                                                                                  |   |   | -                |   |   |   | -                  |   |   |   | -                  |   |   |   | -                  |   |   |   | -                |   |   |   | -                                |   |   |   | - |   |   |   | (3,358,000 | ) |
| Net      loss                                                                                             |   |   | -                |   |   |   | -                  |   |   |   | -                  |   |   |   | -                  |   |   |   | -                |   |   |   | -                                |   |   |   | - |   |   |   | (31,427,000 | ) |

| Balance,      December 31,   2008                                                                            |   |   | 9,467,000             |   |   |   | 95,000              |   |   |   | 3,242.8617      |   |   |   | -               |   |   |   |  225,753,000     |   |   |   | (1,045,000      | )      |   |   | (4,000          | )      |   |   | (235,985,000      | )      |
|-----------------------------------------------------------------------------------------------------------------------------|--------|--------|-----------------------|--------|--------|--------|---------------------|--------|--------|--------|-----------------|--------|--------|--------|-----------------|--------|--------|--------|-----------------------|--------|--------|--------|-----------------|--------|--------|--------|-----------------|--------|--------|--------|-------------------|--------|
|                                                                                                                        |   |   |                  |   |   |   |                |   |   |   |            |   |   |   |            |   |   |   |                  |   |   |   |            |   |   |   |            |   |   |   |              |   |
| Cumulative      effect of a  change      in accounting  principle      (See Note 9)                     |   |   |   -              |   |   |   |   -            |   |   |   |   -        |   |   |   |   -        |   |   |   | (15,957,000           | )      |   |   |   -        |   |   |   |   -        |   |   |   |   13,404,000 |   |
| Restricted      common stock   issued      for services                                                      |   |   | 687,000               |   |   |   | 8,000               |   |   |   | -               |   |   |   | -               |   |   |   | 2,199,000             |   |   |   | -               |   |   |   | -               |   |   |   | -                 |   |
| Warrants      issued for   services                                                                          |   |   | -                     |   |   |   | -                   |   |   |   | -               |   |   |   | -               |   |   |   | 796,000               |   |   |   | -               |   |   |   | -               |   |   |   | -                 |   |
| Common      stock issued   for      cash exercise   of      options                           |   |   |   250,000        |   |   |   |   2,000        |   |   |   |   -        |   |   |   |   -        |   |   |   |   177,000        |   |   |   |   -        |   |   |   |   -        |   |   |   |   -          |   |
| Common      stock issued   for      cashless warrant   exercises                              |   |   |   33,000         |   |   |   |   -            |   |   |   |   -        |   |   |   |   -        |   |   |   |   -              |   |   |   |   -        |   |   |   |   -        |   |   |   |   -          |   |
| Preferred      stock converted   into      common stock                                                      |   |   | 836,000               |   |   |   | 9,000               |   |   |   | (250.5000       | )      |   |   | -               |   |   |   | (9,000                | )      |   |   | -               |   |   |   | -               |   |   |   | -                 |   |
| Common      stock issued   for      preferred dividends                                                      |   |   | 915,000               |   |   |   | 9,000               |   |   |   | -               |   |   |   | -               |   |   |   | 918,000               |   |   |   | -               |   |   |   | -               |   |   |   | -                 |   |
| Stock      option   compensation      expense                                                                |   |   | -                     |   |   |   | -                   |   |   |   | -               |   |   |   | -               |   |   |   | 811,000               |   |   |   | -               |   |   |   | -               |   |   |   | -                 |   |
| Common      stock issued to  MacroChem      noteholders  for      notes and accrued  interest |   |   |     859,000 |   |   |   |     8,000 |   |   |   |     - |   |   |   |     - |   |   |   |     851,000 |   |   |   |     - |   |   |   |     - |   |   |   |     -   |   |
| Common      stock issued to  former      MacroChem  executives                                          |   |   |   125,000        |   |   |   |   1,000        |   |   |   |   -        |   |   |   |   -        |   |   |   |   196,000        |   |   |   |   -        |   |   |   |   -        |   |   |   |   -          |   |
| Preferred      dividends                                                                                                    |   |   | -                     |   |   |   | -                   |   |   |   | -               |   |   |   | -               |   |   |   | -                     |   |   |   | -               |   |   |   | -               |   |   |   | (1,886,000        | )      |
| Net      loss                                                                                                               |   |   | -                     |   |   |   | -                   |   |   |   | -               |   |   |   | -               |   |   |   | -                     |   |   |   | -               |   |   |   | -               |   |   |   | (17,340,000       | )      |

----

| Balance,      December 31,   2009 |   |   | 13,172,000 |   |   | $ | 132,000 |   |   |   | 2,992.3617 |   |   | $ | - |   |   | $ | 215,735,000 |   |   | $ | (1,045,000 | ) |   | $ | (4,000 | ) |   | $ | (241,807,000 | ) |
|--------------------------------------------------|--------|--------|------------|--------|--------|---|---------|--------|--------|--------|------------|--------|--------|---|---|--------|--------|---|-------------|--------|--------|---|------------|---|--------|---|--------|---|--------|---|--------------|---|

----

|                                                                 |   | Year      ended December 31, |        |
|----------------------------------------------------------------------|--------|------------------------------|-------------|
|                                                                 |   | 2009                         |        |   | 2008 |   |
|                                                                 |   |                         |        |   | (See      Note 12) |   |
| Cash      flows from operating activities:                           |   |                         |        |   |   |   |
| Net      loss                                                        |   |  $                      | (17,340,000 | ) |   |  $ | (31,431,000 | ) |
| Adjustments      to reconcile net loss to net cash used              |   |                         |        |   |   |   |   |   |
| in      operating activities:                                        |   |                         |        |   |   |   |   |   |
| Stock      option compensation expense                               |   |                         | 811,000     |   |   |   | 922,000 |   |
| Stock      and warrants issued for services                          |   |                         | 3,200,000   |   |   |   | 533,000 |   |
| Acquired      in-process research & development                  |   |                         | -           |   |   |   | 18,540,000 |   |
| Amortization      of debt discount and beneficial conversion feature |   |                         | -           |   |   |   | 263,000 |   |
| Loss      on change in fair value of derivative                      |   |                         | 7,154,000   |   |   |   | - |   |
| Depreciation      and amortization                                   |   |                         | 259,000     |   |   |   | 317,000 |   |
| Change      in operating assets and liabilities:                     |   |                         |        |   |   |   |   |   |
| Receivables                                                          |   |                         | 111,000     |   |   |   | (112,000 | ) |
| Prepaid      expenses and other current assets                       |   |                         | 133,000     |   |   |   | (19,000 | ) |
| Other      assets                                                    |   |                         | 17,000      |   |   |   | (66,000 | ) |
| Accounts      payable and accrued expenses                           |   |                         | 369,000     |   |   |   | 260,000 |   |
| Dividends      payable                                               |   |                         | (82,000     | ) |   |   | 19,000 |   |
| Accrued      interest payable                                        |   |                         | 452,000     |   |   |   | 15,000 |   |
| Deferred      revenue                                                |   |                         | 2,668,000   |   |   |   | 1,435,000 |   |
| Net      cash used in operating activities                           |   |                         | (2,248,000  | ) |   |   | (9,324,000 | ) |
|                                                                 |   |                         |        |   |   |   |   |   |
| Cash      flows from investing activities:                           |   |                         |        |   |   |   |   |   |
| Capital      expenditures                                            |   |                         | (2,000      | ) |   |   | (31,000 | ) |
| Proceeds      from sale of asset                                     |   |                         | 1,000       |   |   |   | 13,000 |   |
| Redemption      of short-term investments and certificate            |   |                         |        |   |   |   |   |   |
| of      deposits                                                     |   |                         | -           |   |   |   | 759,000 |   |
| Virium      acquisition by MacroChem, net of cash acquired           |   |                         | -           |   |   |   | (240,000 | ) |
| Somanta      acquisition, net of cash acquired                       |   |                         | -           |   |   |   | (65,000 | ) |
| Net      cash provided by (used in) investing activities             |   |                         | (1,000      | ) |   |   | 436,000 |   |
|                                                                 |   |                         |        |   |   |   |   |   |
| Cash      flows from financing activities:                           |   |                         |        |   |   |   |   |   |
| Proceeds      from debt issuance                                     |   |                         | -           |   |   |   | 400,000 |   |
| Payments      of notes payable                                       |   |                         | -           |   |   |   | (639,000 | ) |
| Proceeds      from exercise of stock options                         |   |                         | 179,000     |   |   |   | 15,000 |   |
| Proceeds      from preferred stock issuances, net of costs           |   |                         | -           |   |   |   | 2,444,000 |   |
| Net      cash provided by financing activities                       |   |                         | 179,000     |   |   |   | 2,220,000 |   |
|                                                                 |   |                         |        |   |   |   |   |   |
| Net      decrease in cash and cash equivalents                       |   |                         | (2,070,000  | ) |   |   | (6,668,000 | ) |
| Cash      and cash equivalents at beginning of year                  |   |                         | 2,677,000   |   |   |   | 9,345,000 |   |
| Cash      and cash equivalents at end of year                        |   |  $                      | 607,000     |   |   |  $ | 2,677,000 |   |
|                                                                 |   |                         |        |   |   |   |   |   |
| Supplemental      cash flow information:                             |   |                         |        |   |   |   |   |   |
| Cash      paid for interest                                          |   |  $                      | 1,000       |   |   |  $ | 568,000 |   |
|                                                                 |   |                         |        |   |   |   |   |   |
| Supplemental      disclosure of noncash transactions                 |   |                         |        |   |   |   |   |   |
| Shares      issued for payables, notes payable and accrued interest  |   |                         | 859,000     |   |   |   | 1,576,000 |   |
| Shares      issued for dividends on preferred stock                  |   |                         | 927,000     |   |   |   | 432,000 |   |
| Warrants      issued for placement agent fees                        |   |                         | -           |   |   |   | 104,000 |   |
| Preferred      stock dividends in dividends payable                  |   |                         | 1,886,000   |   |   |   | 3,358,000 |   |
| Beneficial      conversion feature -                                 |   |                         |        |   |   |   |   |   |
| February      2008 preferred stock dividends                         |   |                         | -           |   |   |   | 857,000 |   |
| November      2007 preferred stock dividends                         |   |                         | -           |   |   |   | 451,000 |   |
| Preferred      stock issuance costs paid in cash                     |   |                         | -           |   |   |   | 281,000 |   |
| Debt      discount related to MacroChem convertible debt issuance    |   |                         | -           |   |   |   | 93,000 |   |

----

| NOTE      1 -  NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING      POLICIES |
|----------------------------------------------------------------------------------------------|

----

----

|   | Intangible      assets consist of the following (inthousands): |
|--------|----------------------------------------------------------------|

|                                              |   | December 31, 2009  |        |   | December 31, 2008       |   |
|---------------------------------------------------|--------|--------------------|-------------|--------|-------------------------|--------|
|                                              |   | Grosscarryingvalue |        |   | Accumulatedamortization |   |   | Grosscarryingvalue |   |   | Accumulatedamortization |   |
| Amortizable      intangible assets      - Patents |   | $                  |  2,624 |   |                    | $      |  1,837 |   |   | $ |  2,624 |   |   | $ |  1,625 |   |

| 2010       |   | $      | 212 |   |
|------------|--------|--------|-----|--------|
| 2011       |   |   | 212 |   |
| 2012       |   |   | 82  |   |
| 2013       |   |   | 44  |   |
| 2014       |   |   | 44  |   |
| Thereafter |   |   | 193 |   |
| Total      |   | $      | 787 |   |

----

|                                                                                                                                                                                                              |   | 2009                 |   | 2008                 |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------|--------|----------------------|
| Expected      volatility assumption was based upon a combination of historical stock      price volatility measured on a weekly basis and is considered a reasonable      indicator of expected volatility.  |   |  115%           |   |  133%           |
| Risk-free      interest rate assumption is based upon U.S. Treasury bond interest rates      appropriate for the term of the our employee stock options.                                                     |   |  2.37%          |   |  2.97%          |
| Dividend      yield assumption is based on our history and expectation of dividend      payments.                                                                                                            |   |  None           |   |  None           |
| Estimated      expected term (average of number years) is based on the simplified method      as prescribed by SAB 107/110 as we do not have sufficient information to      calculate an expected term.           |   |  5.5      years |   |  6.2      years |

|                                                                                             |   | Year      endedDecember 31, 2009 |   |   | Year      endedDecember 31, 2008 |   |
|--------------------------------------------------------------------------------------------------|--------|----------------------------------|--------|--------|----------------------------------|--------|
| Research      and development                                                                    |   | $                                | 381    |   |                             | $      | 108 |   |
| General      and administrative                                                                  |   |                             | 430    |   |                             |   | 814 |   |
|     Stock-based      compensation expense included in operating      expense |   |                             | 811    |   |                             |   | 922 |   |
|                                                                                             |   |                             |   |   |                             |   |   |   |
| Total      stock-based compensation expense                                                      |   |                             | 811    |   |                             |   | 922 |   |
| Tax      benefit                                                                                 |   |                             | -      |   |                             |   | - |   |
|     Stock-based      compensation expense, net of tax                        |   | $                                | 811    |   |                             | $      | 922 |   |
|                                                                                             |   |                             |   |   |                             |   |   |   |

----

----

|   |   |       |    |   |     |   |   |          |   |   | Fair      Value     |   |
|--------|--------|------------|---------|--------|----------|--------|--------|---------------|--------|--------|---------------------|--------|
|   |   |       |    |   |     |   |   |          |   |   | of      exercisable |   |
|   |   | Consulting |    |   | Office   |   |   | Expense       |   |   | Options      /      |   |
| Year   |   | Fees       |    |   | Expenses |   |   | Reimbursement |   |   | Warrants            |   |
| 2009   |   | $          | 132,000 |   |     | $      | 18,000 |          |   | $      | 10,000              |   |   | $ | 86,000 |   |
| 2008   |   | $          | 320,000 |   |     | $      | 30,000 |          |   | $      | 71,000              |   |   | $ | 164,000 |   |

|   |   | Consulting |   |   | Expense       |   |
|--------|--------|------------|--------|--------|---------------|--------|
| Year   |   | Fees       |   |   | Reimbursement |   |
| 2008   |   | $          | 31,000 |   |          | $      | 3,000 |   |

| Property      and equipment consists of the following: |   | December      31, |          |
|--------------------------------------------------------|--------|-------------------|---------------|
|                                                   |   | 2009              |          |   | 2008 |   |
| Laboratory      equipment                              |   | $                 | 786,000       |   |   | $ | 831,000 |   |
| Laboratory      and building improvements              |   |              | 58,000        |   |   |   | 58,000 |   |
| Furniture      and equipment                           |   |              |  567,000 |   |   |   | 568,000 |   |
|                                                   |   |              | 1,411,000     |   |   |   | 1,457,000 |   |
| Less      accumulated depreciation and amortization    |   |              | 1,361,000     |   |   |   | 1,362,000 |   |
| Net      property and equipment                        |   | $                 | 50,000        |   |   | $ | 95,000 |   |

----

| Future     |   |      |
|------------|--------|-----------|
| Maturities |   | Debt      |
| 2011       |   | 5,500,000 |

| ·   | Level      1 – Quoted prices in active markets for identical assets or      liabilities. |
|--------------------|------------------------------------------------------------------------------------------------|

| ·   | Level      2 – Observable inputs other than quoted prices included in Level 1, such      as quoted prices for similar assets and liabilities in active markets;      quoted prices for identical or similar assets and liabilities in markets      that are not active; or other inputs that are observable or can be      corroborated by observable marketdata. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Level      3 – Unobservable inputs that are supported by little or no market activity      and that are significant to the fair value of the assets and liabilities.      This includes certain pricing models, discounted cash flow methodologies      and similar valuation techniques that use significant unobservable      inputs. |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (in      thousands)             |   | December      31, 2009 |   |   | December      31, 2008 |   |
|---------------------------------|--------|------------------------|--------|--------|------------------------|--------|
|                            |   | Level      1           |   |   | Level      2           |   |   | Total |   |   | Level      1 |   |   | Level      2 |   |   | Total |   |
| Assets:                         |   |                   |   |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|  Cash                      |   | $                      | 607    |   |                   | $      | - |   |   | $ | 607 |   |   | $ | 2,677 |   |   | $ | - |   |   | $ | 2,677 |   |
|                            |   |                   |   |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Liabilities:                    |   |                   |   |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|  Derivative      liability |   | $                      | -      |   |                   | $      | 9,708 |   |   | $ | 9,708 |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |

----

----

----

|                          |   | January 1, 2009 |   |   | December 31, 2009 |   |
|-------------------------------|--------|-----------------|--------|--------|-------------------|--------|
| Risk-free      interest rate  |   |            | 1.55   | %      |              |   | 2.69 | % |
| Expected      volatility      |   |            | 116.31 | %      |              |   | 117.43 | % |
| Expected      life (in years) |   |            | 4.88   |   |              |   | 3.88 |   |
| Dividend      yield           |   |            | 0.00   | %      |              |   | 0.00 | % |
|                          |   |            |   |   |              |   |   |   |

----

|                                                                     |   | Warrants    |      |   | Exercise |   | Expiration  |
|--------------------------------------------------------------------------|--------|-------------|-----------|--------|----------|--------|-------------|
|         Summary      of Warrants |   | Outstanding |      |   | Price    |   | Date        |
| 2009      investor relations advisor (a)                                 |   |        | 30,000    |   |     | $      | 3.45        |   | 9/15/12 |
| 2009      business consultant (b)                                        |   |        | 150,000   |   |     |   | 2.07        |   | 7/23/14 |
| 2009      investor relations advisor (c)                                 |   |        | 50,000    |   |     |   | 6.00        |   | 8/27/12 |
| 2009      investor relations advisor (d)                                 |   |        | 60,000    |   |     |   | 1.85        |   | 7/14/12 |
| 2008      preferred stock offering (e)                                   |   |        | 499,584   |   |     |   | 3.50        |   | 2/24/14 |
| 2008      Somanta accounts payable (f)                                   |   |        | 246,753   |   |     |   | 3.50        |   | 1/04/14 |
| 2008      warrants assumed on acquisition (g)                            |   |        | 191,991   |   |     |   | 18.55-69.57 |   | 6/9/10-1/31/12 |
| 2008      investor relations advisor (h)                                 |   |        | 50,000    |   |     |   | 3.15        |   | 1/3/13 |
| 2008      investor relations advisor (i)                                 |   |        | 40,000    |   |     |   | 3.00        |   | 9/1/13 |
| 2008      scientific consultant (j)                                      |   |        | 200,000   |   |     |   | 3.15        |   | 1/4/12 |
| 2007      preferred stock offering (k)                                   |   |        | 3,649,880 |   |     |   | 3.50        |   | 11/10/13 |
| 2006      convertible note (l)                                           |   |        | 3,853,634 |   |     |   | 1.32        |   | 2/16/12 |
| 2006      convertible note (l)                                           |   |        | 386,364   |   |     |   | 1.32        |   | 10/24/12 |
| 2006      convertible note (l)                                           |   |        | 377,273   |   |     |   | 1.32        |   | 12/06/12 |
| 2006      investor relations advisor (m)                                 |   |        | 50,000    |   |     |   | 2.70        |   | 12/27/11 |
| Total                                                                    |   |        | 9,835,479 |   |     |   |        |   |   |

| a)   | During      2009, an investor relations advisor received warrants to purchase 30,000      shares of common stock at an exercise price of $3.45 per share at any time      until September 15, 2012, for investor relations consulting services      rendered from October 2009 through March 2010. 15,000 of the warrants were      exercisable on December 31, 2009 and 15,000 of the warrants will be      exercisable – 5,000 on January 31, 2010, 5,000 on February 28, 2010 and      5,000 on March 31, 2010. The fair value of the warrants was $1.55 per      share on the date of the grant using the Black-Scholes pricing model with      the following assumptions: expected dividend yield 0.0%, risk-free      interest rate 1.43%, expected volatility 0.87% and a term of 3 years. The      expense recorded for the year ended December 31, 2009 was      $24,000. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| b)   | During      2009, a business consultant received warrants to purchase 150,000 shares      of common stock at an exercise price of $2.07 per share at any time until      July 23, 2014, for business consulting services rendered in 2009. 60,000      of the warrants were exercisable on December 31, 2009. The remaining      90,000 warrants may vest in 30,000 share increments with our stock price      reaching specified trading prices. The remaining warrants will expire July      23, 2010 if our stock does not reach these specified trading prices. The      expense recorded for the year ended December 31, 2009 was      $238,000. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| c)   | During      2009, an investor relations advisor received warrants to purchase 50,000      shares of common stock at an exercise price of $6.00 per share at any time      until August 27, 2012, for investor relations consulting services rendered      in 2009. All 50,000 of the warrants were exercisable at December 31, 2009.      The fair value of the warrants was $2.04 per share on the date of the      grant using the Black-Scholes pricing model with the following      assumptions: expected dividend yield 0.0%, risk-free interest rate 1.58%,      expected volatility 119% and a term of 3 years. The expense recorded for      the year ended December 31, 2009 was$102,000. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| d)   | During      2009, an investor relations advisor received warrants to purchase 60,000      shares of common stock at an exercise price of $1.85 per share at any time      until July 14, 2012, for investor relations consulting services rendered      in 2009. All 60,000 of the warrants were exercisable on December 31, 2009.      The expense recorded for the year ended December 31, 2009 was      $233,000. |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| e)   | In      connection with the preferred stock offering in February 2008, warrants to      purchase a total of 499,584 shares of common stock were issued. All of the      warrants are exercisable immediately and expire six years from date of      issue. The fair value of the warrants was $2.29 per share on the date of      the grant using the Black-Scholes pricing model with the following      assumptions: expected dividend yield 0.0%, risk-free interest rate 2.75%,      expected volatility 110% and a term of 6years. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| f)   | In      connection with our acquisition of Somanta Pharmaceuticals, Inc. (Somanta)      we exchanged for $1,576,000 due to Somanta vendors, 538,508 shares of our      common stock and warrants to purchase 246,753 shares of common stock at      $3.50. The warrants expire January 4,2014. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| g)   | We      assumed three warrants in the Somanta  acquisition: |
|----------------|-------------------------------------------------------------|

|   | -Warrant      #2 – 31,943 shares of our common stock at $18.55 per share and expires      January 31, 2012. |
|--------|-------------------------------------------------------------------------------------------------------------------|

|   | -Warrant      #3 – 159,725 shares of our common stock at $23.19 per share and expires      January 31, 2012. |
|--------|--------------------------------------------------------------------------------------------------------------------|

| h)   | During      2008, an investor relations advisor received warrants to purchase 50,000      shares of common stock at an exercise price of $3.15 per share at any time      until January 3, 2013, for investor relations consulting services rendered      in 2008. 25,000 of the warrants were exercisable on July 3, 2008 and      25,000 of the warrants will be exercisable January 3, 2009. The fair value      of the warrants was $2.24 per share on the date of the grant using the      Black-Scholes pricing model with the following assumptions: expected      dividend yield 0.0%, risk-free interest rate 3.13%, expected volatility      127% and a term of 5 years. |
|----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| i)   | During      2008, an investor relations advisor received warrants to purchase 40,000      shares of common stock at an exercise price of $3.00 per share at any time      until September 1, 2013, for investor relations consulting services. All      of the warrants are exercisable. The fair value of the warrants was $2.61      per share on the date of the grant using the Black-Scholes pricing model      with the following assumptions: expected dividend yield 0.0%, risk-free      interest rate 2.37%, expected volatility 132% and a term of 5      years. |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| j)   | During      2008, a director who is also a scientific advisor received warrants to      purchase 200,000 shares of common stock at an exercise price of $3.15 per      share at any time until January 4, 2012, for scientific consulting      services rendered in 2008. The warrants vest over two years in 50,000      share blocks with vesting on July 4, 2008, January 4, 2009, July 4, 2009      and the remaining shares on January 4, 2010. The fair value of the      warrants was $1.78 per share on the date of the grant using the      Black-Scholes pricing model with the following assumptions: expected      dividend yield 0.0%, risk-free interest rate 2.01%, expected volatility      92% and a term of 4 years. |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| k)   | In      connection with the preferred stock offering in November 2007, warrants to      purchase a total of 3,649,880 shares of common stock were issued. All of      the warrants are exercisable immediately and expire six years from date of      issue. The fair value of the warrants was $2.50 per share on the date of      the grant using the Black-Scholes pricing model with the following      assumptions: expected dividend yield 0.0%, risk-free interest rate 3.84%,      expected volatility 114% and a term of 6years. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| l)   | In      connection with the convertible note offerings in 2006, warrants to      purchase a total of 4,617,271 shares of common stock were issued. All of      the warrants are exercisable immediately and expire six years from date of      issue. |
|----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| m)   | During      2006, an investor relations advisor received warrants to purchase 50,000      shares of common stock at an exercise price of $2.70 per share at any time      from December 27, 2006 until December 27, 2011, for investor relations      consulting services rendered in 2007. All of the warrants are      exercisable. |
|----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                                                                                      |   |            |    | Weighted-                                 |
|---------------------------------------------------------------------------------------------------------------------------|--------|-----------------|---------|-------------------------------------------|
|                                                                                                                      |   |            |    | average                         |
|                                                                                                                      |   |            |    | exercise                             |
|                                                                                                                      |   | Options         |    |    price    |
| Outstanding      options at January 1, 2008                                                                               |   | 926,386         | $  | 1.59                                      |
| Granted,      fair value of $ 2.73 per share                                                                              |   | 305,000         |    | 3.00                                      |
| Exercised                                                                                                                 |   | (25,250)        |    | 0.63                                      |
| Expired                                                                                                                   |   | (69,316)        |    | 3.17                                      |
| Outstanding      options at December 31, 2008                                                                             |   | 1,136,820       |    | 1.90                                      |
|                                                                                                                      |   |            |    |                                      |
| Granted,      fair value of $ 1.38 per share                                                                              |   | 565,000         |    | 1.38                                      |
| Exercised                                                                                                                 |   | (249,916)       |    | 0.73                                      |
| Expired                                                                                                                   |   | (16,667)        |    | 3.00                                      |
| Outstanding      options at December 31, 2009                                                                             |   | 1,435,237       |    | 1.99                                      |
|                                                                                                                      |   |            |    |                                      |
|          Exercisable at December 31,      2009           |   | 1,215,238  |    |  1.80                           |

----

|                          |     Number      of | Weighted      average | Number      of |     Weighted-average |
|-------------------------------|----------------------------------------|-----------------------|----------------|------------------------------------------|
|                          | options                                | Remaining             | Exercise       | options                                  |   Remaining | Exercise |
| Range      of exercise prices |    outstanding          |  life in years   | price          | exercisable                              |  life in years | price |
|                          |                                   |                  |           |                                     |   |   |
| $0.63      - 0.85             | 412,500                                | 7.0                   | $0.64          | 412,500                                  | 7.0 | $0.64 |
| $1.38                         | 460,000                                | 10.0                  | $1.38          | 460,000                                  | 10.0 | $1.38 |
| $2.90      - 7.23             | 562,737                                | 8.7                   | $3.47          | 342,738                                  | 8.2 | $3.75 |
|                          | 1,435,237                              |                  |           | 1,215,238                                |   |   |

|                                          |   |    |    |   | Weighted- |   |
|-----------------------------------------------|--------|---------|---------|--------|-----------|--------|
|                                          |   |    |    |   | average   |   |
|                                          |   |    |    |   | exercise  |   |
|                                          |   | Options |    |   | price     |   |
| Outstanding      options at January 1, 2008   |   |    | 162,417 |   |      | $      | 15.53 |   |
| Expired                                       |   |    | (44,417 | )      |      |   | 16.57 |   |
| Outstanding      options at December 31, 2008 |   |    | 118,000 |   |      |   | 15.14 |   |
|                                          |   |    |    |   |      |   |   |   |
| Expired                                       |   |    | (15,000 | )      |      |   | 10.00 |   |
| Outstanding      options at December 31, 2009 |   |    | 103,000 |   |      |   | 15.89 |   |
|                                          |   |    |    |   |      |   |   |   |
| Exercisable      at December 31, 2009         |   |    | 103,000 |   |      |   | 15.89 |   |

----

|                          |     Number      of | Weighted      average | Number      of |     Weighted-average |
|-------------------------------|----------------------------------------|-----------------------|----------------|------------------------------------------|
|                          | options                                | Remaining             | Exercise       | options                                  |  Remaining | Exercise |
| Range      of exercise prices |    outstanding          |  life in years   | price          | exercisable                              |  life in years | price |
|                          |                                   |                  |           |                                     |   |   |
| $10.10      - 12.50           | 60,640                                 | 3.8                   | $11.74         | 60,640                                   | 3.8 | $11.74 |
| $14.05      - 18.65           | 22,800                                 | 2.8                   | $16.82         | 22,800                                   | 2.8 | $16.82 |
| $20.25      – 29.25     | 19,560                                 | 4.1                   | $26.58         | 19,560                                   | 4.1 | $26.58 |
|                          | 103,000                                |                  |           | 103,000                                  |   |   |

----

|                             |   |                        |       |
|----------------------------------|--------|-----------------------------|------------|
|                             |   | Access      Pharmaceuticals |       |   | MacroChem      Corporation |   |   | Combined |   |
| Current      assets              |   | $                           | 3,550,000  |   |   | $ | 84,000 |   |   | $ | 2,999,000 |   |
| Total      assets                |   |                        | 4,257,000  |   |   |   | 549,000 |   |   |   | 4,171,000 |   |
| Current      liabilities         |   |                        | 4,906,000  |   |   |   | 3,346,000 |   |   |   | 7,612,000 |   |
| Long-term      deferred revenue  |   |                        | 2,245,000  |   |   |   | 24,000 |   |   |   | 2,245,000 |   |
| Long-term      debt              |   |                        | 5,500,000  |   |   |   | - |   |   |   | 5,500,000 |   |
| Stockholders’      deficit |   |                        | (8,394,000 | ) |   |   | (2,925,000 | ) |   |   | (11,186,000 | ) |

|                                                                                                                                              |   | For the year ended December 31,      2009 |        |   | For the year ended December 31,      2008 |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------|-------------|--------|-------------------------------------------|--------|
|                                                                                                                                              |   | Access      Pharmaceuticals               |        |   | MacroChem      Corporation                |   |   | Combined |   |   | Access      Pharmaceuticals |   |   | MacroChem      Corporation |   |   | Combined |   |
| Total      revenues                                                                                                                               |   | $                                         | 352,000     |   |                                      | $      | - |   |   | $ | 352,000 |   |   | $ | 291,000 |   |   | $ | - |   |   | $ | 291,000 |   |
|                                                                                                                                              |   |                                      |        |   |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Expenses                                                                                                                                          |   |                                      |        |   |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Research      and development                                                                                                                     |   |                                      | 2,645,000   |   |                                      |   | 12,000 |   |   |   | 2,657,000 |   |   |   | 12,613,000 |   |   |   | 10,622,000 |   |   |   | 23,235,000 |   |
| General      and administrative                                                                                                                   |   |                                      | 6,932,000   |   |                                      |   | 180,000 |   |   |   | 7,112,000 |   |   |   | 4,340,000 |   |   |   | 3,123,000 |   |   |   | 7,463,000 |   |
| Depreciation      and   amortization                                                                                               |   |                                      | 207,000     |   |                                      |   | 52,000 |   |   |   | 259,000 |   |   |   | 253,000 |   |   |   | 71,000 |   |   |   | 324,000 |   |
|       Total      expenses                                                                                           |   |                                      | 9,784,000   |   |                                      |   | 244,000 |   |   |   | 10,028,000 |   |   |   | 17,206,000 |   |   |   | 13,816,000 |   |   |   | 31,022,000 |   |
|                                                                                                                                              |   |                                      |        |   |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loss      from operations                                                                                                                         |   |                                      | (9,432,000  | )      |                                      |   | (244,000 | ) |   |   | (9,676,000 | ) |   |   | (16,915,000 | ) |   |   | (13,816,000 | ) |   |   | (30,731,000 | ) |
|                                                                                                                                              |   |                                      |        |   |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest      and miscellaneous   Income                                                                                           |   |                                      | 29,000      |   |                                      |   | - |   |   |   | 29,000 |   |   |   | 178,000 |   |   |   | 33,000 |   |   |   | 211,000 |   |
|    Interest      and other expense                                                                                                 |   |                                      | (513,000    | )      |                                      |   | (26,000 | ) |   |   | (539,000 | ) |   |   |   |   |   |   |   |   |   |   |   |   |
|    Change      in fair value of      derivative                                                      |   |                                      | (7,154,000  | )      |                                      |   | - |   |   |   | (7,154,000 | ) |   |   | (478,000 | ) |   |   | (433,000 | ) |   |   | (911,000 | ) |
|                                                                                                                                              |   |                                      | (7,638,000  | )      |                                      |   | (26,000 | ) |   |   | (7,664,000 | ) |   |   | (300,000 | ) |   |   | (400,000 | ) |   |   | (700,000 | ) |
| Loss      from operations                                                                                                                         |   |                                      | (17,070,000 | )      |                                      |   | (270,000 | ) |   |   | (17,340,000 | ) |   |   | (17,215,000 | ) |   |   | (14,216,000 | ) |   |   | (31,431,000 | ) |
| Less      preferred stock   Dividends                                                                                              |   |                                      | (1,886,000  | )      |                                      |   | - |   |   |   | (1,886,000 | ) |   |   | (3,358,000 | ) |   |   | - |   |   |   | (3,358,000 | ) |
| Net      loss allocable to   common      stockholders                                                                              |   | $                                         | (18,956,000 | )      |                                      | $      | (270,000 | ) |   | $ | (19,226,000 | ) |   | $ | (20,573,000 | ) |   | $ | (14,216,000 | ) |   | $ | (34,789,000 | ) |
|                                                                                                                                              |   |                                      |        |   |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic      and diluted loss per   common      share                                                                                |   |                                      |        |   |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Net      loss allocable to     common      stockholders                                                |   |                                      | -           |   |                                      |   | - |   |   | $ | (1.63 | ) |   |   | - |   |   |   | - |   |   | $ | (4.16 | ) |
|   Weighted      average basic     and      diluted common     shares      outstanding |   |                                      | -           |   |                                      |   | - |   |   |   | 11,818,530 |   |   |   | - |   |   |   | - |   |   |   | 8,354,031 |   |

| ·   | Approximately      1.5 million shares of Access common stock were issued to the common and      preferred shareholders of Somanta as consideration having a value of      approximately $4,650,000 (the value was calculated using Access’ stock      price on January 4, 2008, times the number of shares    issued); |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| ·   | exchange      of all outstanding warrants for Somanta common stock for warrants to      purchase 191,991 shares of Access common stock at exercise prices ranging      between $18.55 and $69.57 per share. The warrants were valued at      approximately $281,000. All of the warrants are exercisable immediately      and expire approximately four years from date of issue. The weighted      average fair value of the warrants was $1.46 per share on the date of the      grant using the Black-Scholes pricing model with the following      assumptions: expected dividend yield 0.0%, risk-free interest rate 3.26%,      expected volatility 114% and an expected term of approximately 4      years; |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | paid      an aggregate of $475,000 in direct transaction costs;  and |
|--------------------|----------------------------------------------------------------------|

| ·   | cancelled      receivable from Somanta of$931,000. |
|--------------------|----------------------------------------------------|

| Cash                                       |   | $      | 1      |   |
|--------------------------------------------|--------|--------|--------|--------|
| Prepaid      expenses                      |   |   | 25     |   |
| Office      equipment                      |   |   | 14     |   |
| Accounts      payable                      |   |   | (2,582 | )      |
| In-process      research & development |   |   | 8,879  |   |
|                                       |   | $      | 6,337  |   |

|                                                                                       |   | Twelve      months endedDecember      31, 2008 |    |
|--------------------------------------------------------------------------------------------|--------|------------------------------------------------|---------|
| Net      loss allocable to common stockholders                                             |   | $                                              | (20,573 | ) |
|                                                                                       |   |                                           |    |   |
| Net      loss per common shares (basic and diluted)                                        |   | $                                              | (3.51   | ) |
|                                                                                       |   |                                           |    |   |
| Weighted      average common shares outstanding         (basic and diluted) |   |                                           | 5,854   |   |

----

----

| Common      stock issued              |   | 6,870,000 |   |
|---------------------------------------|--------|-----------|--------|
| Liabilities      assumed              |   | 2,404,000 |   |
| Warrants      related to debt assumed |   | 147,000   |   |
| Transaction      costs                |   | 240,000   |   |
| Total      purchase price             |   | 9,661,000 |   |

|                                                                |   | 2008                |
|---------------------------------------------------------------------|--------|--------------------------|
|                                                                |   | (unaudited)              |
| Net      income (loss)                                              |   | (10,564,000)   |
|                                                                |   |                     |
| Net      income (loss) per common share (basic and diluted)         |   | (0.23)                   |
| Weighted      average common shares outstanding (basic and diluted) |   | 45,754,492               |

|                                                                         |   | 2009    |       |   | 2008   |    |
|------------------------------------------------------------------------------|--------|---------|------------|--------|--------|---------|
|                                                                         |   |    |       |   |   |    |
| Income      taxes at U.S. statutory rate                                     |   |  $ | (6,537,000 | )      |   |  $ | (10,477,000 | ) |
| Change      in valuation allowance                                           |   |    | 5,182,000  |   |   |    | 6,987,000 |   |
| Benefit      of foreign losses not recognized                                |   |    | 57,000     |   |   |    | 59,000 |   |
| Expenses      not deductible                                                 |   |    | 623,000    |   |   |    | 2,874,000 |   |
| Expiration      of net operating loss and general                            |   |    |       |   |   |    |   |   |
|     business      credit carryforwards, net of revisions |   |    | 675,000    |   |   |    | 557,000 |   |
|                                                                         |   |    |       |   |   |    |   |   |
| Total      tax expense                                                       |   | $       | -          |   |   | $       | - |   |

----

|                                                          |   |              |        |   |   |   |
|---------------------------------------------------------------|--------|-------------------|-------------|--------|--------|--------|
|                                                          |   | December      31, |        |
|                                                          |   | 2009              |        |   | 2008   |   |
| Deferred      tax assets                                      |   |              |        |   |   |   |
| Net      operating loss carryforwards                         |   | $                 | 62,358,000  |   |   | $      | 59,939,000 |   |
| General      business credit carryforwards                    |   |              | 2,371,000   |   |   |   | 2,472,000 |   |
|              State credits |   |              | 3,126,000   |   |   |   | 3,138,000 |   |
| Property,      equipment and goodwill                         |   |              | 51,000      |   |   |   |         54,000 |   |
|        Stock      options  |   |              | 773,000     |   |   |   | 497,000 |   |
|             Derivatives         |   |              | 2,432,000   |   |   |   |  - |   |
| Deferred      revenue                                         |   |              | 748,000     |   |   |   | 324,000 |   |
|             Intangible assets   |   |              | 383,000     |   |   |   | 383,000 |   |
|             Accrued interest    |   |              | -           |   |   |   |  253,000 |   |
| Other                                                         |   |              | 270,000     |   |   |   | 270,000 |   |
|                                                          |   |              |        |   |   |   |   |   |
| Gross      deferred tax assets                                |   |              | 72,512,000  |   |   |   | 67,330,000 |   |
| Valuation      allowance                                      |   |              | (72,512,000 | )      |   |   | (67,330,000 | ) |
|                                                          |   |              |        |   |   |   |   |   |
| Net      deferred taxes                                       |   | $                 | -           |   |   | $      | - |   |
|                                                          |   |              |        |   |   |   |   |   |
|                                                          |   |              |        |   |   |   |   |   |

|       |   | Net      operating      |        |   | General      business     |   |
|------------|--------|-------------------------|-------------|--------|---------------------------|--------|
|       |   | loss      carryforwards |        |   | credit      carryforwards |   |
| 2010       |   | $                       | 2,171,000   |   |                      | $      | 140,000 |   |
| 2011       |   |                    | 4,488,000   |   |                      |   | 13,000 |   |
| 2012       |   |                    | 4,212,000   |   |                      |   | 77,000 |   |
| 2013       |   |                    | 3,324,000   |   |                      |   | 112,000 |   |
| 2014       |   |                    | 3,306,000   |   |                      |   | 95,000 |   |
| Thereafter |   |                    | 165,903,000 |   |                      |   | 1,934,000 |   |
|       |   | $                       | 183,404,000 |   |                      | $      | 2,371,000 |   |

----