SECURITIES AND EXCHANGE COMMISSION
                     Washington, D.C.  20549
                           FORM 10-KSB
(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, 2003
                       _________________

[ ]  TRANSITION  REPORT  PURSUANT  TO  SECTION  13  OR   15(d)  OF
     THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______________ to ________________

                  Commission file number 0-15888
                              _______


                      IGENE Biotechnology, Inc.
__________________________________________________________________
          (Name of Small Business Issuer in Its Charter)

                  Maryland                        52-1230461
_____________________________________________  ___________________
(State of other jurisdiction of incorporation  (IRS Employer
            or  organization)                  Identification No.)


  9110 Red Branch Road, Columbia, Maryland            21045
_______________________________________________   _______________
  (Address of principal executive offices)          (Zip Code)


                        (410) 997-2599
_________________________________________________________________
       (Issuer's telephone number, including area code)

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

Title of Each Class     Name of Each Exchange on Which Registered
___________________   ___________________________________________
       None                              None

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

               Common Stock (par value $.01 per share)
               _______________________________________
                          (Title of class)

     Check  whether the issuer (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Exchange Act during the
past  12  months (or for such shorter period that the  registrant
was  required to file such reports), and (2) has been subject  to
such filing requirements for the past 90 days.

     YES   X       NO
          ___          ___

     Check  if  there  is no disclosure of delinquent  filers  in
response  to Item 405 of Regulation S-B contained in  this  form,
and  no disclosure will be contained, to the best of registrant's
knowledge,   in   definitive  proxy  or  information   statements
incorporated by reference in Part III of this Form 10-KSB or  any
amendment to this Form 10-KSB.  [  ]

     State  issuer's  revenues for its most  recent  fiscal  year
$463,486

     State  the  aggregate market value of the  voting  and  non-
voting common equity held by non-affiliates computed by reference
to  the price at which the common equity was sold, or the average
bid and asked price of such common equity, as of a specified date
within the past 60 days.  $4,560,931 as of March 25, 2004
                          _______________________________

(Note:   The  officers and directors of the issuer are considered
affiliates for purposes of this calculation.)

     State  the  number  of shares outstanding  of  each  of  the
issuer's  classes of common equity, as of the latest  practicable
date.
As of March 25, 2004 there were 93,747,469 shares of the issuer's
_________________________________________________________________
common stock outstanding.
_________________________

<PAGE>

CAUTIONARY STATEMENT FOR PURPOSES OF "SAFE HARBOR PROVISIONS"  OF
THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995:

EXCEPT  FOR  HISTORICAL  FACTS, ALL  MATTERS  DISCUSSED  IN  THIS
REPORT, WHICH ARE FORWARD LOOKING, INVOLVE A HIGH DEGREE OF  RISK
AND  UNCERTAINTY.  CERTAIN STATEMENTS IN THIS  REPORT  SET  FORTH
MANAGEMENT'S   INTENTIONS,   PLANS,  BELIEFS,   EXPECTATIONS   OR
PREDICTIONS  OF THE FUTURE BASED ON CURRENT FACTS  AND  ANALYSES.
WHEN   WE   USE  THE  WORDS  "BELIEVE,"  "EXPECT,"  "ANTICIPATE,"
"ESTIMATE,"  "INTEND"  OR  SIMILAR  EXPRESSIONS,  WE  INTEND   TO
IDENTIFY FORWARD-LOOKING STATEMENTS.  YOU SHOULD NOT PLACE  UNDUE
RELIANCE ON THESE FORWARD-LOOKING STATEMENTS.  ACTUAL RESULTS MAY
DIFFER MATERIALLY FROM THOSE INDICATED IN SUCH STATEMENT, DUE  TO
A  VARIETY OF FACTORS, RISKS AND UNCERTAINTIES.  POTENTIAL  RISKS
AND  UNCERTAINTIES INCLUDE, BUT ARE NOT LIMITED  TO,  COMPETITIVE
PRESSURES  FROM OTHER COMPANIES AND WITHIN THE BIOTECH  INDUSTRY,
ECONOMIC  CONDITIONS IN THE COMPANY'S PRIMARY  MARKETS,  EXCHANGE
RATE FLUCTUATIONS, REDUCED PRODUCT DEMAND, INCREASED COMPETITION,
INABILITY   TO  PRODUCE  REQUIRED  CAPACITY,  UNAVAILABILITY   OF
FINANCING,  GOVERNMENT  ACTION,  WEATHER  CONDITIONS  AND   OTHER
UNCERTAINTIES,  INCLUDING THOSE DETAILED IN "RISK FACTORS"  BELOW
AND  FROM  TIME-TO-TIME IN THE COMPANY'S SECURITIES AND  EXCHANGE
COMMISSION FILINGS.

                             PART I

ITEM 1.   DESCRIPTION OF BUSINESS

General

     IGENE  Biotechnology,  Inc.  ("Igene")  is  engaged  in  the
business  of  developing, marketing, and manufacturing  specialty
ingredients for human and animal nutrition.   Igene was formed on
October  27,  1981  to  develop, produce and  market  value-added
specialty  biochemical products.  Igene is a supplier of  natural
astaxanthin, an essential nutrient in different feed applications
and  as  a  source of pigment for coloring farmed salmon species.
Igene   also   supplies   nutraceutical  ingredients,   including
astaxanthin.   Igene  is  focused  on  fermentation   technology,
nutrition   and   health  in  its  marketing  of   products   and
applications worldwide.

     Igene  has  devoted  its  resources to  the  development  of
proprietary  processes  to  convert  selected  agricultural   raw
materials  or  feedstocks  into  commercially  useful  and   cost
effective  products for the food, feed, flavor  and  agrochemical
industries.   In  developing these processes and products,  Igene
has relied on the expertise and skills of its in-house scientific
staff and, for special projects, various consultants.

     During   the   year  2000,  Igene  formed  a  wholly   owned
subsidiary,  Igene  Chile  Comercial,  Ltda.,  in   Chile.    The
subsidiary  has  a  sales and customer service office  in  Puerto
Varas, Chile, and a product warehouse in Puerto Montt, Chile.

     During  the  year  2001, Igene purchased  its  sales  agent,
ProBio Nutraceuticals AS ("ProBio"), a Norwegian company.  ProBio
specializes in sales and marketing to the pharmaceutical industry
and   feed   ingredients  markets.   In  addition   to   ProBio's
nutraceuticals business, it was hoped the purchase would  add  to
Igene's  management  structure  and  enhance  sales  development.
Following  the  acquisition, Stein Ulve and Per Benjaminsen,  the
managing   director   and  director  of  marketing   and   sales,
respectively,  of ProBio became our chief executive  officer  and
chief   marketing  officer,  respectively,  pursuant  to  written
employment  agreements.  This division was referred to  as  Igene
Norway AS.

     Igene Biotechnology Inc., in an effort to focus on and  grow
its  core  business, on February 5, 2003 disposed of its interest
in  its  former subsidiary, ProBio.  Fermtech AS, a  joint  stock
company  incorporated in the Kingdom of Norway and owned  equally
by  our former chief executive officer, Stein Ulve and our former
chief marketing officer, Per Benjaminsen, purchased the shares of
ProBio.  Mr. Ulve has resigned as CEO and director of Igene while
Mr.  Benjaminsen continues to serve the Company  as  Director  of
Sales and Marketing, effective as of December 31, 2002.

     Igene  currently  leases manufacturing  capacity  in  Mexico
City,  Mexico, through a contract manufacturer.  In an effort  to
develop  a  dependable source of production, on March  19,  2003,
Tate  &  Lyle PLC and Igene Biotechnology, Inc announced a  50:50
joint venture to produce AstaXin(R) for the aquaculture industry.
Production  will  utilize  Tate & Lyle's fermentation  capability
together with the unique technology developed by Igene.  Part  of
Tate  & Lyle's existing Selby, England, citric acid facility will
be  modified to include the production of 1,500 tons per annum of
this  product.  Tate & Lyle's investment of $25 million  includes
certain  of  its  facility assets currently used in  citric  acid
production.  Commercial production is expected to commence in the
second quarter of calendar year 2004.

Government Regulation

     The  manufacturing  and marketing of most  of  the  products
Igene  has developed are, and will likely continue to be, subject
to  regulation  by various governmental agencies  in  the  United
States,  including the Food and Drug Administration ("FDA"),  the
Department  of Agriculture ("USDA"), the Environmental Protection
Agency  ("EPA"),  and  comparable agencies  in  other  countries.
Igene,  as a matter of policy, requires that its products conform
to  current  Good  Manufacturing Practices ("GMPs")  (as  defined
under  the Federal Food, Drug and Cosmetic Act and the rules  and
regulations  there under) and Igene believes all of its  products
so  conform.   The extent of any adverse governmental  regulation
that  might  arise  from  future  administrative  or  legislative
action, including current rules and regulations pertaining to the
process  of  GRAS  (Generally Recognized as  Safe)  affirmations,
cannot be predicted.

     In  a notice published in the Federal Register July 6, 2000,
the FDA announced the amendment of its color additive regulations
to provide for the safe use of Phaffia yeast, such as that in the
Company's product, AstaXin(R), as a color additive in aquaculture
feeds.   This  ruling,  which became effective  August  8,  2000,
allows Igene to  market its product, AstaXin(R), for  aquaculture
feeds  and fish produced in, or imported into, the United States.
This  ruling is available to the public in the Federal  Register.
Igene  has  also previously obtained approval for AstaXin(R) from
the Canadian Food Inspection Agency (CFIA).   Additional  foreign
approval applications for AstaXin(R),  including  those  for  the
European  Union,  are in progress. Igene is required  to  perform
tests  and  prepare  documentation as  part  of  the  application
process.   It is hoped the application will be submitted  in  the
first half of 2004 and be approved in 2005.

     In  July 2000, Igene also obtained clearance from the FDA to
market its product, AstaXin(R), as a human dietary supplement  in
the  United States.  Scientific literature indicates that natural
astaxanthin,  such as  that in the Company's product, AstaXin(R),
may  offer  health  benefits for humans due to  its   antioxidant
properties.   The FDA notification and the Company's  submissions
are  available to the public from the FDA.   Comparable  agencies
in  the European Union and other foreign countries may have their
own    additional   registration   procedures.    No   additional
applications  for approval of AstaXin(R) as a  human  nutritional
supplement have yet been submitted.

     Igene  has not incurred and does not anticipate any material
environmental compliance costs.

Research and Development

     As  of  December 31, 2003, Igene had expended  approximately
$13,774,145  on research and development since its  inception  on
October  27,  1981  and has, as of December  31,  2003,  received
revenues  from  product  sales  and  royalties  of  approximately
$10,873,883  from the proprietary processes resulting  from  such
research  and development.  Igene will continue to incur research
and  development  costs in connection with  improvements  in  its
existing  processes  and  products, but it  does  not  anticipate
development of new processes and products in 2004.

      Research and development expenditures for each of the  last
two years are as follows:

     2003     $ 745,364
     2002     $ 609,781

     Igene's research and development activities have resulted in
the  development of processes to produce the products hereinafter
discussed.


Commercial Products

AstaXin(R)

    AstaXin(R)is Igene's registered trademark for its dried yeast
product  made  from  a proprietary strain of yeast  developed  by
Igene.  AstaXin(R) is a natural source of astaxanthin, a  pigment
which  imparts  the  characteristic red color  to  the  flesh  of
salmon,  trout,  prawns  and certain  other  types  of  fish  and
shellfish.   In  the  ocean, salmon and trout obtain  astaxanthin
from  krill  and other planktonic crustaceans in their  diet.   A
krill  and  crustacean diet would be prohibitively expensive  for
farm-raised salmonids.  Without the addition of astaxanthin,  the
flesh  of  such  fish is a pale, off-white color, which  is  less
appealing  to  consumers expecting "salmon-colored"  fish.   Fish
feeding trials in Europe, Asia, and North and South America  have
demonstrated  the efficacy of AstaXin(R) in pigmenting  fish.  An
estimated  1,000,000  metric  tons  of  farm-raised  salmon   are
produced  annually worldwide.  Igene derived revenue during  2003
and 2002 from sales of AstaXin(R).  Substantially all of  Igene's
AstaXin(R)  2003  and 2002 sales were to fish  producers  in  the
aquaculture  industry  in  Chile.   During  2003,  two  customers
located  in  Chile  represented over  83%  of  Igene's  sales  of
AstaXin(R).  As a result,  all of Igene Chile's  receivables  are
located   in   Chile.    All  of  Igene's  current  manufacturing
operations for AstaXin(R) are conducted in a single manufacturing
facility in Mexico City, Mexico.

     On May 20, 2000, Igene renewed its manufacturing arrangement
with Fermic, S.A. de C.V., of Mexico City, Mexico ("Fermic"), for
the production of its natural astaxanthin pigment, AstaXin(R), in
Fermic's  manufacturing facility in Mexico. Commercial production
began in January of 1998.

     The  Fermic contract executed in May 2000, provides that the
manufacturer has the right and license to produce  AstaXin(R) for
Igene,  is  paid a cash fee based on manufacturing capacity,  and
may receive up to 20,000,000 shares of Igene common stock in lieu
of additional cash based on quantity of product manufactured over
the  six  year  term. Of the 20,000,000 shares  available  to  be
earned,  11,089,222  have been earned to date.   Fermic  provides
equipment  and facilities necessary to manufacture and store  the
product  and is responsible for purchasing raw materials.   Igene
is  responsible for sales efforts and for ensuring the quality of
the  pigment.   Igene  also  has a  role  in  ensuring  that  the
manufacturing  process works effectively.  The  contract  expires
May 20, 2006, unless terminated earlier by either party. See Item
2. Description of Property, incorporated herein by reference.

     On  March 18, 2003, 2003, the Company entered into  a  Joint
Venture  Agreement  with Tate & Lyle Fermentation  Products  Ltd.
("Tate").  Pursuant to a Joint Venture Agreement, the Company and
Tate  agreed  to form a joint venture, Astaxanthin Partners,  LTD
(the "Joint Venture") to manufacture, market and sell Astaxanthin
and  derivative products throughout the world for all uses  other
than   as   a   Nutraceutical  or  otherwise  for  direct   human
consumption.  Tate contributed $24,600,000 in cash to  the  Joint
Venture, while the Company has agreed to contribute to the  Joint
Venture  its technology relating to the production of Astaxanthin
and assets related thereto. These assets will continue to be used
by  the Joint Venture in the same manner as historically used  by
the  Company.   The Company and Tate each have  a  50%  ownership
interest  in  the Joint Venture and equal representation  on  the
Board  of Directors of the Company.  Unamortized production costs
in  the  amount of $316,869 were contributed to the Joint Venture
reducing the adjustment to additional paid in capital.

     Production   will  utilize  Tate's  fermentation  capability
together with the unique technology developed by Igene.  Part  of
Tate's  existing  Selby, England, citric acid  facility  will  be
modified  to produce up to 1,500 tons per annum of this  product.
Tate  &  Lyle's investment of approximately $25 million  includes
certain  of  its  facility assets currently used in  citric  acid
production.  Commercial production is expected to commence in the
calendar year 2004.

     Based  on  estimates of worldwide production of farm  raised
salmon,  Igene  believes the market for astaxanthin  as  a  color
additive  in salmon feed exceeds $200,000,000 per year worldwide,
which   would   require   approximately  10,000  metric  tons  of
AstaXin(R) to  serve 100% of the market. A single competitor, who
produces  a  chemically  synthesized  product, presently controls
more  than  80%  of the world market for astaxanthin as a pigment
for aquaculture.  Igene's  production  for  the  year  2004  will
depend on the successful completion  of  the  new  joint  venture
production facility.  However, there can be no assurance that the
Company  and  venture  will  be  able to utilize these additional
sources of production capacity, or that, if it is able to utilize
the additional production capacity, that it will be able to do so
on terms favorable to Igene  or that any  level  of  demand  will
continue.

      Previously reported litigation (original lawsuit filed July
21,  1997,  in  the U.S. District Court, Baltimore,  MD)  between
Archer   Daniels  Midland,  Inc.  ("ADM")  and  Igene,  involving
allegations  of patent infringement and counterclaims  concerning
the  theft  of trade secrets was settled on September  29,  2003.
ADM  had  requested injunctive relief as well as  an  unspecified
amount   of   damages,  and  Igene  had  filed   a   $300,450,000
counterclaim  concerning the theft of trade secrets.   Resolution
of  the  dispute  between ADM and Igene  did  not  result  in  an
unfavorable  outcome  to Igene.   Accordingly,  no  liability  is
recorded  in  the  balance  sheet.   Under  the  terms   of   the
settlement, Igene is permitted to continue to make and  sell  its
product, AstaXin(R).  See Item 3. Legal Proceedings, incorporated
herein by reference.

     During   2001  Igene  began  investigating  other   possible
commercial  uses of astaxanthin, including its application  as  a
human  nutritional  supplement.   Igene  has  formulated  natural
astaxanthin as a  super-antioxidant, AstaXin(R),  for  the  North
American dietary supplement market.  Antioxidants are one of  the
largest product categories in the health and nutrition industry.

Patents and Trademarks

     It  is  Igene's policy to protect its intellectual  property
rights by a variety of means, including applying for patents  and
trademarks  in  the United States and in other countries.   Igene
also  relies  upon  trade  secrets and improvements,  un-patented
proprietary  know-how and continuing technological innovation  to
develop  and  maintain its competitive position. In this  regard,
Igene  places  restrictions in its agreements with third  parties
with  respect to the use and disclosure of any of its proprietary
technology.   Igene  also has internal nondisclosure  safeguards,
including   confidentiality   agreements   with   employees   and
consultants.

     All  patents and trademarks are carefully reviewed and those
with  no  foreseeable commercial value are abandoned to eliminate
costly  maintenance fees.  Patents, trademarks on technology  and
products  with  recognized commercial value, and which  Igene  is
currently maintaining, include those for  AstaXin(R),  which have
remaining lives ranging from 5 to 9 years.

Competition

     Competitors in the biotechnology field in the United  States
and   elsewhere   are  numerous  and  include   major   chemical,
pharmaceutical  and  food  companies,  as  well  as   specialized
biotechnology companies.  Competition can be expected to increase
as  small  biotechnology companies continue to  be  purchased  by
major  multinational  corporations  with  substantial  resources.
Competition is also expected to increase with the introduction of
more   diverse   products  developed  by   biotechnology   firms,
increasing  research cooperation among academic institutions  and
large  corporations, and continued government funding of research
and  development activities in the biotechnology field,  both  in
the   United   States  and  overseas.  Unlike  the  majority   of
biotechnology   companies,   which   are   developing    products
principally  for the pharmaceutical industry, Igene  has  focused
its own activities on the development of proprietary products for
use in aquaculture and nutritional supplement industries.  In the
future, however, competitors may offer products, that, by  reason
of   price,  or  efficacy,  or  more  substantial  resources  for
technology  advances,  may be superior  to  Igene's  existing  or
future products.

     A  single  large pharmaceutical company presently  dominates
the  market  for  astaxanthin  pigment  for  aquaculture in which
Igene's  product,  AstaXin(R),  is  presently  marketed and sold.
Igene  believes  that AstaXin(R), which is made from yeast,  will
compete  with  this  dominant producer, and other producers whose
products are chemically synthesized, based on its use of  natural
ingredients.   As  consumers and producers of  fish  become  more
aware of other alternatives, Igene believes that they will desire
natural ingredients, such as those in AstaXin(R).

     Several  companies  are  also known  to  be  developing  and
marketing  other  natural astaxanthin products.   Some  of  these
companies'  products are made from algae, while others  are  made
from  yeast.  Igene  believes  that  AstaXin(R) will compete with
other  companies' astaxanthin products which are made from algae,
due to  Igene's  higher production  capacity and lower production
costs, but can  provide  no  assurances in  that  regard.   Igene
also believes that AstaXin(R) will compete with other  companies'
astaxanthin products which are also made from yeast  due  to  our
proprietary  process  to  disrupt yeast  cell  walls,  which,  as
studies have shown, makes AstaXin(R) more readily absorbed by the
fish.


     Igene is also beginning  to  explore  the  possible  use  of
AstaXin(R) as a  human nutritional supplement.   This  market  is
attractive  because of potentially higher profit  margins.  Other
companies   are  known  to  also  be  developing  and   marketing
astaxanthin products for the human nutritional supplement market.
Igene  cannot  yet predict how competitive it would  be  in  this
market.

Sources and Availability of Raw Materials

     Raw materials used in the manufacture of AstaXin(R)  consist
principally of agricultural commodities widely available in world
markets  from  many suppliers, which may be used interchangeably.
We  do  not anticipate material price fluctuations or changes  in
availability in these raw materials in the near future.

Employees

     At December 31, 2003, Igene had 12 full time employees.  Six
full time employees are in administration and/or marketing, while
the  remainder  are engaged in research, process development  and
support  of  manufacturing activities.  The full  time  marketing
employees include Igene's two sales and technical representatives
in  Chile and one representative in Norway.  The remainder of the
employees  are  based  in the U.S.  Igene also  utilizes  various
consultants on an as-needed or short-term basis.

     None  of Igene's employees are represented by a labor  union
and  Igene has experienced no work stoppages.  Igene believes its
relations with its employees are satisfactory.


ITEM 2.  DESCRIPTION OF PROPERTY

     Igene leases approximately 8,500 square feet of space in the
Oakland  Ridge Industrial Park located at 9110 Red  Branch  Road,
Columbia,  Maryland.   Igene occupies the  space  under  a  lease
extension  expiring on January 31, 2011.  The approximate  rental
expense is $93,600 per year for the coming two years, $95,900 for
the  third  year, and $408,200 combined for the last four  years.
Approximately  2,000  square feet  of  this  space  is  used  for
executive and administrative offices and approximately 2,500 feet
is  used  for research and development activities. The  remaining
4,000 square feet of space is used for Igene's intermediate-stage
or scale-up pilot plant facility.

     Igene  also  leases,  under a contract  expiring  May  2006,
manufacturing capacity at Fermic S.A. de C.V. (Fermic) in  Mexico
City,  Mexico and leases warehouse space for product  storage  in
Mexico  City.  The lease for warehouse space is on an  as  needed
basis, and Igene is under no obligation to lease space.

     Igene began a one year lease in December 2001, which renewed
in  December  2003, of approximately 220 square  feet  of  office
space,  in  Chile,  to  conduct marketing and  technical  support
activities  by  its  full-time technical representatives.   Igene
also  leases warehouse space on a month-to-month basis as  needed
for product storage in Chile.

     Igene  currently  owns  or leases sufficient  equipment  and
facilities for its research operations and all of this  equipment
is  in  satisfactory condition and is adequately insured.   There
are  no  current  plans for improvement of  this  property.    If
demand for Igene's product continues to increase, Igene plans  to
lease additional warehouse space as needed in Chile.


ITEM 3.  LEGAL PROCEEDINGS

     Previously reported, litigation (original lawsuit filed July
21,  1997,  in  the U.S. District Court, Baltimore,  MD)  between
Archer   Daniels  Midland,  Inc.  ("ADM")  and  Igene,  involving
allegations  of patent infringement and counterclaims  concerning
the  theft  of trade secrets was settled on September  29,  2003.
ADM  had  requested injunctive relief as well as  an  unspecified
amount   of   damages,  and  Igene  had  filed   a   $300,450,000
counterclaim  concerning the theft of trade secrets.   Resolution
of  the  dispute  between ADM and Igene  did  not  result  in  an
unfavorable  outcome to Igene.   Accordingly,  no  liability  was
recorded  in  the  balance  sheet.   Under  the  terms   of   the
settlement, Igene is permitted to continue to make and  sell  its
product, AstaXin(R).  Igene had expenses of $131,464 and  $47,159
in  2003  and  2002 respectively, associated with  this  on-going
litigation.


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

     None.

                             PART II

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

Common Stock

     Commencing  on or about June 12, 1989, Igene's common  stock
began  trading on the over-the-counter market on a limited  basis
and  is  quoted on the National Quotation Bureau's OTC  "bulletin
board".   The  following  table shows, by calendar  quarter,  the
range  of representative bid prices for Igene's common stock  for
2003 and 2002.

          Calendar Quarter                   High        Low

   2003:  First Quarter                   $  .1000    $  .0070
          Second Quarter                  $  .0800    $  .0400
          Third Quarter                   $  .0700    $  .0200
          Fourth Quarter                  $  .2100    $  .0600

   2002:  First Quarter                   $  .0800    $  .0400
          Second  Quarter                 $  .0575    $  .0230
          Third  Quarter                  $  .0400    $  .0200
          Fourth  Quarter                 $  .0270    $  .0070


     Igene  obtained the above information through  Pink  Sheets,
LLC,  a  national quotation bureau.  Such quotations  are  inter-
dealer   quotations  without  retail  mark-up,   mark-downs,   or
commissions,  and  may  not represent actual  transactions.   The
above quotations do not reflect the "asking price" quotations  of
the stock.

     The  approximate number of record holders of Igene's  common
stock  as  of March 25, 2004 was 250.  As of March 25, 2004,  the
high  bid and low offer prices for the common stock, as shown  on
the  "over-the-counter  bulletin board"  were  $0.15  and  $0.17,
respectively.

Dividend Policy

     When  and  if  funds are legally available for such  payment
under  statutory  restrictions, Igene may pay  annual  cumulative
dividends on the preferred stock of $.64 per share on a quarterly
basis.   During 1988 Igene declared and paid a cash  dividend  of
$.16  per share of its preferred stock.  In December 1988,  Igene
suspended payment of the quarterly dividend of $.16 per share  of
preferred  stock.  No dividends have been declared or paid  since
1988.   Any  resumption of dividend payments on  preferred  stock
would  require  significant improvement in cash flow.   Preferred
stock  dividends  are  payable when and if  declared  by  Igene's
board.   Unpaid  dividends  accumulate  for  future  payment   or
addition  to the liquidation preference and redemption  price  of
the preferred stock.  As of December 31, 2003, total dividends in
arrears  on Igene's preferred stock equal $249,905 (or $9.76  per
share)  on  Igene's Series A and $150,000 (or $.80 per share)  on
Igene's  Series  B  are  included in the carrying  value  of  the
redeemable preferred stock.

     Dividends  on common stock are currently prohibited  because
of  the preferential rights of holders of preferred stock.  Igene
has  paid  no cash dividends on its common stock in the past  and
does  not  intend to declare or pay any dividends on  its  common
stock in the foreseeable future.

Sales of Unregistered Securities

     On  April  3,  2003,  the  Board of Directors,  in  lieu  of
additional compensation, authorized the payment of shares to  Dr.
Stephen  Hiu  and Mr. Patrick Monahan.  Each of them was  awarded
83,333  shares  of  Igene common stock.   The  aggregate  166,666
shares was issued and expensed based on market value at the  time
of  award,  $.060 per share, or $10,000 of combined compensation.
Igene  relied on Section 4(2) of the Securities Act of  1933,  as
amended,  to issue the shares to the holder of the variable  rate
subordinated debenture without registration under the  Securities
Act of 1933, as amended.

     During  the  course  of 2003, Fermic, Igene's  manufacturing
agent,  earned 2,785,957 shares of common stock as  part  of  the
manufacturing  agreement.  Fermic earns 2,250  shares  of  common
stock  for  each kilogram pure astaxanthin produced and delivered
as  part  of  the agreement. The average price is  based  on  the
market  value of the shares at the time the product was produced.
Fermic  can  earn  up  to 20,000,000 shares in  total  under  the
contract.   The 2,785,957 shares were earned at an average  price
of   $.05  per  share  for  2003.   Through  December  31,  2003,
11,089,222 shares have been earned.  Any future shares earned  by
Fermic  will  be  issued on a quarterly basis.  Igene  relied  on
Section 4(2) of the Securities Act of 1933, as amended, to  issue
the  shares to Fermic without registration under that act.  Igene
relied  on the representations and warranties of Fermic  made  in
the   manufacturing  agreement  in  claiming  the  aforementioned
exemption.

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

     Certain  statements  in this report set  forth  management's
intentions,  plans, beliefs, expectations or predictions  of  the
future  based on current facts and analyses.  Actual results  may
differ materially from those indicated in such statements, due to
a  variety of factors including competitive pressures from  other
companies and within the biotech industry, economic conditions in
Igene's  primary  markets,  exchange rate  fluctuations,  reduced
product   demand,   increased  competition,   unavailability   of
production  capacity,  unavailability  of  financing,  government
action,  weather  conditions and other  uncertainties,  including
those  detailed in "Risk Factors" below and from time-to-time  in
Igene's Securities and Exchange Commission filings.

Results of Operations

     On  March 18, 2003, the Company entered into a Joint Venture
Agreement  with Tate & Lyle Fermentation Products Ltd.  ("Tate").
Pursuant  to  a  Joint Venture Agreement, the  Company  and  Tate
agreed  to  form  a  joint  venture  (the  "Joint  Venture")   to
manufacture, market and sell Astaxanthin and derivative  products
throughout  the world for all uses other than as a  Nutraceutical
or  otherwise  for  direct human consumption.   Tate  contributed
$24,600,000  in cash to the Joint Venture, while the Company  has
agreed to contribute to the Joint Venture its technology relating
to  the  production  of Astaxanthin and assets  related  thereto.
These assets will continue to be used by the Joint Venture in the
same manner as historically used by the Company.  The Company and
Tate each have a 50% ownership interest in the Joint Venture  and
equal  representation on the Board of Directors of  the  Company.
Unamortized  production  costs in the  amount  of  $316,869  were
contributed  to  the  Joint Venture reducing  the  adjustment  to
additional paid in capital.

     Production   will  utilize  Tate's  fermentation  capability
together with the unique technology developed by Igene.  Part  of
Tate's  existing  Selby, England, citric acid  facility  will  be
modified  to produce up to 1,500 tons per annum of this  product.
Tate's  investment of approximately $25 million includes  certain
of  its facility assets currently used in citric acid production.
Commercial  production is expected to commence  in  the  calendar
year 2004.  Sales and cost of sales activity are now recorded  as
part of the earnings of unconsolidated subsidiary.

Sales and other revenue

     As part of the Joint Venture agreement, all further sales of
AstaXin(R) are recognized through the venture company. Therefore,
Igene  recorded no sales during the last half of 2003.  For  2003
and  2002,  sales  were $463,486 and $3,491,765,  respectively--a
decrease of $3,028,279 or 86.7%.  Sales had been limited  in  the
past  quarters due to insufficient production quantity.  However,
the  primary  cause  for  the decreased sales  for  the  year  as
compared with the prior year is that, as of June, 2003, Igene had
sold its remaining inventory to the Joint Venture in anticipation
of  the  consummation of the Joint Venture Agreement.  Management
anticipates that the joint venture with Tate will provide a  more
dependable  product flow.  However, there can be no assurance  of
the  dependability  of  production,  or  that  any  increases  in
production or sales will occur, or that if they occur, they  will
be material.

Cost of sales and gross profit

     As with  sales revenue, from June 30, 2003 forward  cost  of
sales  and gross profit were recognized and will continue  to  be
recognized  through the Joint Venture.  Igene reported  no  gross
profit on sales of AstaXin(R) for the last half of  2003.   Gross
profit on sales  of AstaXin(R) was $17,342 for 2003  which  is  a
decrease  of  $306,789  from  the $324,131  for  the  year  ended
December 31, 2002.  Gross profit fell from 9% of sales for  2002,
to  4% for 2003.  The Company attributes the fall in gross profit
to   a  combination  of  pricing  pressure  in  the  market   and
inefficiencies  in  production.  Demand is expected  to  increase
both due to seasonal increases in customer usage and increases in
our  market  share.   Management expects  that  sales  and  gross
profits  may be limited by the quantities of AstaXin the  Company
is  able  to  have produced by its current contract manufacturer,
while  the  Joint Venture prepares for production.   The  Company
believes   that  the  lack  of  production  capacity  should   be
alleviated as the Joint Venture plant begins production in  2004.
Unless  augmented by increases in production resulting  from  the
Joint Venture and increased production efficiency resulting  from
process  research and development, sales and gross profit  growth
may  be  limited by production restrictions.  Management  expects
the  level  of  gross  profit  to improve  in  the  future  as  a
percentage  of  sales,  with expected   increases  in  production
efficiency  received from the Joint Venture with Tate  offsetting
pricing competition, but can provide no assurances in that regard
to future increased production or future increased margin.

     Cost of  sales  for the 2003 were $446,144 as compared  with
cost of sales of $3,167,634, for 2002.

Marketing and selling expenses

     Marketing  and  selling expenses for 2003  were  $328,393, a
decrease  of  $225,831, or 40.7% from the marketing  and  selling
expenses  of  $554,224  for  2002.  A portion  of  this  decrease
results  from a decrease in sales force costs resulting from  the
disposition  of  ProBio.  In addition, the reduction  of  salable
product   currently   available  to  Igene   from   its   current
manufacturer  has caused a corresponding reduction  in  marketing
and selling expense.  As a result of the Joint Venture with Tate,
Igene  is  expecting  an  increase  in  salable  product  with  a
corresponding  increase  in sales costs  at  the  point  the  new
facility is in production.  However no assurances can be made  in
regards  to  increased production from the new facility  nor  the
corresponding  increase in selling costs.   Of the marketing  and
selling  expenses  incurred by Igene approximately  $181,000  was
reimbursed by the Joint Venture during 2003.

Research, development and pilot plant expenses

     Research, development and pilot plant expenses for  2003 and
2002  were  $745,364  and $609,781, respectively,  reflecting  an
increase  of  $135,583 or 22.2%.  Costs increased in  support  of
increasing  the  efficiency of the manufacturing process  through
experimentation  in the Company's pilot plant, undertaken  in  an
attempt  to  develop higher yielding strains of yeast  and  other
improvements in the  Company's AstaXin(R) technology.   Igene  is
hoping  this  will lead to an increase in salable  product  at  a
reduced  cost  to  Igene  and  the  Joint  Venture.   However  no
assurances can be made in that regard.  These costs are currently
funded  through  reimbursement from the  Joint  Venture.   During
2003,  the Joint Venture reimbursed Igene approximately  $638,000
for the costs.

General and administrative expenses

     General and administrative expenses for 2003 and  2002  were
$687,427  and $963,907, respectively, a decrease of $276,480,  or
28.7%.   This decrease is primarily due to a one time  charge  of
$125,000  incurred during the third quarter of  2002  for  shares
issued  as  compensation.   The Board of  Directors,  in  further
attempts   to  ascertain  a  manufacturing  partner,   authorized
retention  of  the services of Mr. Martin Gerson.   The  expected
term  of the service is two (2) years.  In compensation for  this
service, Mr. Gerson was awarded 12,000,000 shares of Igene common
stock.  As there is only an expectation for term of service,  but
not  a   requirement, the total amount of $125,000  was  expensed
during  the third quarter of 2002.  The value of the services  to
be  performed  by Mr. Gerson was $125,000, as determined  by  the
Board  of Directors.  In determining the number of shares  issued
for the services to be performed, consideration was given to such
factors  as blockage discounts and the restricted status  of  the
common  stock  issued.  In addition, general  and  administrative
expenses  decreased  as  a result of the  disposition  of  ProBio
Nutraceuticals  and  the reduced management compensation  expense
and  overhead  relieved  associated with  ProBio  Nutraceuticals.
General and administrative expenses are expected to remain at the
current  level.   These expenses are expected  to  be  funded  by
additional  funding  from stockholders, and by  cash  flows  from
operations, to the extent available for such purposes.   However,
we can provide no assurances that such additional funding or cash
flows  from  operations,  will  become  available  or  that  such
funding,  if any, will be available upon terms favorable  to  us.
Of  the general and administrative expenses incurred during 2003,
approximately $398,000 were reimbursed by the Joint Venture.

Litigation expenses

     Previously reported litigation (original lawsuit filed  July
21,  1997,  U.S.  District Court, Baltimore,  MD  between  Archer
Daniels Midland, Inc. ("ADM") and Igene, involving allegations of
patent  infringement and counterclaims concerning  the  theft  of
trade secrets, was resolved on September 29, 2003.  Resolution of
the  dispute  between   ADM  and  Igene  did  not  result  in  an
unfavorable  outcome to Igene.  Igene will continue to  make  and
sell  its product, AstaXin(R).  The Company incurred $133,464  of
litigation expenses for 2003 and $47,159 for 2002.

Expenses reimbursement by Joint Venture

     As  part  of the Joint Venture agreement, costs incurred  by
Igene related to production, research and development, as well as
those  related  to  the marketing of AstaXin(R),  are  considered
costs  of the Joint Venture and therefore are reimbursed  by  the
Joint  Venture.   For  the year ended December  31,  2003,  costs
reimbursed  by  the  Joint Venture totaled  $1,252,565.   Of  the
reimbursement  received  approximately  $638,000  was  to   cover
research  and development costs, $181,000 was to cover  marketing
and  selling  expenses  and $398,000 was  to  cover  general  and
administrative costs.

Interest expense (net of interest income)

     Interest expense (net of interest income) for 2003 and  2002
was  $897,543 and $901,989 respectively, a decrease of $4,446  or
1%.   This  interest expense (net of interest income) was  almost
entirely composed of interest on Igene's long term financing from
its  directors  and  other stockholders and interest  on  Igene's
subordinated  and  convertible debentures,  and  is  expected  to
remain at the current level.

Equity in earnings of unconsolidated subsidiary

     As  a result of the Joint Venture, the production, sales and
marketing  of  Astaxanthin now take place in  the  unconsolidated
Joint Venture subsidiary.  For 2003, Igene's portion of the Joint
Venture  loss  was  $914,494.  The loss was a  result  of  a  50%
interest  in  the following:  Gross profit for  the  year  was  a
negative $17,600 on sales of $1,133,675, less manufacturing  cost
of  $1,151,275.  Selling, general and administrative expenses for
the  period were $1,827,703 and interest income was $16,315.  The
resulting loss before tax was $1,828,988.  For 2003, Igene's  50%
portion of the Joint Venture loss was $914,494.

Disposition  of ProBio Subsidiary and net loss from  discontinued
operations

     As  reported on Form 8-K on February 20, 2003, Igene, in  an
effort  to focus on and grow its core business, disposed  of  all
10,000  of the issued and outstanding shares of capital stock  of
ProBio.  Fermtech AS, a joint stock company incorporated  in  the
Kingdom of Norway and owned equally by our former chief executive
officer,  Stein Ulve and our former chief marketing officer,  Per
Benjaminsen,  purchased  the shares  of  ProBio.   Mr.  Ulve  has
resigned  as  CEO  and  director of Igene while  Mr.  Benjaminsen
continues  to  serve  the  Company as in independent  consultant,
effective as of December 31, 2002.

     Igene  sold ProBio to Fermtech AS in exchange for  aggregate
consideration  valued  at approximately $343,000,  consisting  of
7,000,000  shares  of Igene common stock that Fermtech  initially
received  in consideration for the purchase of ProBio in December
2001  (of  these  shares, 2,000,000 shares may  be  re-earned  by
Fermtech  as  described below), valued for the  purposes  of  the
acquisition  at $.03 per share, plus forgiveness of approximately
$168,000  of  debt  that  Igene owed to ProBio  at  the  time  of
purchase  in  2001.  Mr. Benjaminsen remained employed  by  Igene
through  February 2004, and 1,000,000 of the escrowed  shares  of
common  stock  were  delivered to Fermtech.  If  Mr.  Benjaminsen
remains  employed by Igene through February 2005,  the  remaining
1,000,000  escrowed  shares  will be  released  from  escrow  and
delivered to Fermtech.  The remaining 5,000,000 shares of  common
stock of Igene were retired effective February 5, 2003.

     The  amount  of consideration paid for ProBio was determined
through  arms-length  negotiations between Igene  management,  on
behalf  of  Igene, and Mr. Ulve, on behalf of Fermtech.   Factors
considered  in determining the amount paid for the ProBio  shares
involved  analysis of ProBio's cash flow, cash position,  revenue
and revenue prospects.

     The  equipment and other physical property disposed of  that
was owned by ProBio includes inventory, personal computers, a web
site  and  trademark, other office equipment and  furniture,  and
accounts   receivables   and   accounts   payable   related    to
nutraceutical transactions.  The 2002 net operating loss  of  the
division being sold as ProBio is $437,051 ($0.01 loss per  common
share)  on  sales  of $2,306,193 and are reflected  on  the  2002
consolidated  statement of operations as loss  from  discontinued
operations.

Gain on disposition

     Igene  sold ProBio to Fermtech AS in exchange for  aggregate
consideration  valued  at approximately $343,000,  consisting  of
7,000,000 shares of Igene common stock that was owned by Fermtech
(of  these shares, 2,000,000 shares may be re-earned by  Fermtech
as   described   below),  valued  for   the   purposes   of   the
2001acquisition  of  ProBio by Igene  at  $.03  per  share,  plus
forgiveness of approximately $168,000 of debt that Igene owed  to
ProBio  at the time of purchase in 2001. Provided Mr. Benjaminsen
remains employed by Igene through February 2004, 1,000,000 of the
escrowed shares of common stock will be delivered to Fermtech. If
Mr.  Benjaminsen remains employed by Igene through February 2005,
the  remaining  1,000,000 escrowed shares will be  released  from
escrow  and  delivered to Fermtech. Gain on disposal  during  the
first  quarter  of 2003 was $237,637.  This gain was  a  one-time
occurrence  as  a  result of the disposition of  the  assets  and
liabilities associated with ProBio.

Net loss and basic and diluted net loss per common share

     As  a  result  of the foregoing result of operations,  Igene
reported  net  losses of $2,199,141 and $3,189,980 for  2003  and
2002, respectively, a decreased loss of $990,839 or 31.1%, a loss
of  $.02 and $.04 per basic and diluted common share in 2003  and
2002,  respectively.  The weighted average number  of  shares  of
common  stock outstanding of 90,438,251 and 81,544,079  for  2003
and  2002,  respectively, an increase of 8,894,172  shares.   The
increase in outstanding shares resulted from the weighted average
adjustment of the issuance of 3,750,000 shares in the exercise of
warrants, the issuance of 166,666 shares of common stock in  lieu
of salary increases to certain officers of Igene, the issuance of
2,785,957  shares to Igene's manufacturer under the manufacturing
agreement with Fermic, 100,000 shares in issuance for exercise of
employee  stock incentive plan, 1,100 in conversion of redeemable
preferred   stock,  less  the  retirement  of  7,000,000   shares
reacquired as part of the disposition of ProBio.

Financial Position

     During  2003  and 2002, the following also affected  Igene's
financial position:

     -   Igene sold to third parties or sold to the Joint Venture
         its  entire  inventory  during 2003.   The result was an
         increase to cash of $374,709.

     -   In addition, accounts receivable and prepaid assets were
         sold  to  the  Joint  Venture  which  increased  cash by
         $38,886  from  the  reduction in accounts receivable and
         $378,864 from the reduction in prepaid assets.

     -   Increase  in cash flow has allowed for the reduction  in
         accounts payable of $409,784, of which $250,000 was used
         for the repayment of borrowings.

     -   Igene  issued  40,000 shares in 2002 on a variable  rate
         subordinated  debenture  with  a  principal  balance  of
         $1,500,000, recording  interest  expense  and increasing
         common stock and paid-in capital by $90,000 in 2002.  On
         October  1,  2002,  Igene exercised its right to satisfy
         this  debt  by  paying  the  holder of the variable rate
         subordinated  debenture  187,500  shares  of Series B 8%
         Cumulative  Convertible Preferred Stock, valued pursuant
         to the  terms  of  the  debenture at a rate of $8.00 per
         share.   The carrying amount of the redeemable preferred
         stock  was  increased and  paid-in  capital available to
         common shareholders  was   decreased by $90,000 in 2003,
         reflecting  cumulative  unpaid  dividends  on redeemable
         preferred stock.

     -   The  carrying value of redeemable preferred stock Series
         A, was increased and paid-in capital available to common
         shareholders  was  decreased  by  $16,387 and $16,900 in
         both  2003 and  2002, respectively reflecting cumulative
         unpaid dividends on redeemable preferred stock.

     -   Holders of Series A preferred stock converted 550 shares
         of  preferred  stock in 2003 into 1,100 shares of common
         stock,  reducing  the  liquidation  value  of redeemable
         preferred stock by $9,416.

     -   During the year ended December 31, 2002 and 2001,  Igene
         purchased  equipment  in  the  amount  of  $113,025  and
         $211,380, respectively,  to be used by its manufacturing
         agent  related  to  an  investment  agreement  of  up to
         $500,000  to  be spent by  the   manufacturing agent for
         improvements.  These  funds  will  be  credited to Igene
         production  costs  over   the   remaining  term  of  the
         manufacturing agreement.

     -   During  the  year  ended  December  31,  2003  and 2002,
         3,750,000  and  194,400  warrants,  respectively,   were
         exercised using $200,892 and $14,300 of 8% notes payable
         in  a  cashless  exercise.  3,750,000  and  194,400  new
         shares  of  common  stock  were issued pursuant to these
         exercises  of  warrants  and  $200,892 and $14,300 of 8%
         notes were cancelled.

     In  December 1988, as part of an overall effort  to  contain
costs  and  conserve working capital, Igene suspended payment  of
the quarterly dividend on its preferred stock.  Resumption of the
dividend  will  require significant improvements  in  cash  flow.
Unpaid  dividends cumulate for future payment or addition to  the
liquidation  preference  or redemption  value  of  the  preferred
stock.   As  of December 31, 2003, total dividends in arrears  on
Igene's  preferred stock equal $249,905 (or $9.76 per  share)  on
Igene's  Series  A  and $150,000 (or $.80 per share)  on  Igene's
Series  B  are  included in the carrying value of the  redeemable
preferred stock.

Liquidity and Capital Resources

     Historically, Igene  has  been funded  primarily  by  equity
contributions  and loans from stockholders. As  of  December  31,
2003,  Igene had working capital of $571,031, and cash  and  cash
equivalents of $63,075.

     Cash used by operating activities in 2003 and 2002  amounted
to $173,616 and $1,312,880, respectively, a decrease in cash used
of $1,139,264.

     Cash used by investing activities in 2003 and 2002  amounted
to  $10,223, and $136,958, respectively, a decrease in cash  used
of $126,735.

     During 2002  cash  provided  by  financing  activities   was
$1,553,062,  it included $1,550,000 from issuances of  debentures
to  directors,  and  the  remainder was net  proceeds  of  a  new
equipment  lease.  During 2003 cash used by financing  activities
was  $250,797, it was comprised primarily of a $250,000 repayment
of  notes  received from directors during 2002.  The  balance  is
comprised  of equipment lease payments and purchases through  the
employee stock incentive program.

     Over the  next twelve months, Igene believes  it  will  need
additional  working  capital.  This funding  is  expected  to  be
received from sales  of  AstaXin(R) through  the  Joint  Venture.
However,  there  can be no assurance that projected  profits,  if
any,  from  sales, or additional funding from the  Joint  Venture
will be sufficient for Igene to fund its continued operations.

     Approximately $6,300,000 in long-term debt was scheduled  to
become  payable  in  March 2003, and has been extended  to  March
2006.  We do not have the ability to repay such debt at this time
and  management feels any attempts to satisfy the  debt  at  this
time  would have adverse effects on the Company.  Management  has
negotiated  with  the holders of the debt to  extend  the  debt's
maturity to a time when the Company is better able to satisfy its
obligation.

     Igene does  not  believe that inflation  had  a  significant
impact on its operations during 2003 and 2002.
Critical Accounting Policies

     The  preparation  of our financial statements in  conformity
with   accounting  principles  generally  accepted  in  the  U.S.
requires  management to make judgments, assumptions and estimates
that affect the amounts reported in our financial statements  and
accompanying notes.  Actual results could differ materially  from
those  estimates.  The following are critical accounting policies
important to our financial condition and the results presented in
our   financial  statements  that  require  management  to   make
judgments and estimates that are inherently uncertain:

     Our  inventories  are stated at the lower of cost or market.
Cost  is  determined  using  a weighted-average  approach,  which
approximates the first-in first-out method.  If the cost  of  the
inventories  exceeds their expected market value, provisions  are
recorded  for  the  difference between the cost  and  the  market
value.   Inventories consist of our currently  marketed  product,
AstaXin(R).

     The Joint Venture recognizes revenue from product sales when
there is persuasive evidence that an arrangement exists, delivery
has   occurred,   the  price  is  fixed  and  determinable,   and
collectibility is reasonably assured.  Allowances are established
for   estimated  uncollectible  amounts,  product   returns   and
discounts.

      The  investment in the Joint Venture is accounted for under
the  equity method whereby the Company's 50% ownership percentage
in  the  Joint Venture's equity is reflected as an asset and  the
changes  in  the  Joint  Venture's equity  as  a  result  of  its
operations  is reflected in the Company's consolidated  statement
of operations.  The excess of value of the Company's ownership in
the  Joint Venture over the consideration paid for such ownership
is reflected as an adjustment to additional paid-in capital.  The
Company  evaluates  its  investment  in  the  Joint  Venture  for
impairment,  as  it  does for all other assets.   The  accounting
policies  followed  by the Joint Venture are in  conformity  with
accounting principals generally accepted in the United States  of
America.


ITEM 7.   CONSOLIDATED FINANCIAL STATEMENTS

     The consolidated financial statements appear after Part  III
of this Report and are incorporated herein by reference.


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

     None.


ITEM 8A.  CONTROLS AND PROCEDURES

     Based  on  their  most  recent review, which  was  completed
within  90  days  of  the balance sheet date,  Igene's  principal
executive  officer and principal financial officer have concluded
that Igene's disclosure controls and procedures are effective  to
ensure that information required to be disclosed by Igene in  the
reports  that  it files or submits under the Securities  Exchange
Act  of  1934,  as  amended, is accumulated and  communicated  to
Igene's management, including its principal executive officer and
principal  financial  officer, as  appropriate  to  allow  timely
decisions  regarding  required disclosure and  are  effective  to
ensure  that such information is recorded, processed,  summarized
and reported within the time periods specified in the SEC's rules
and  forms. There were no significant changes in Igene's internal
controls  or  in  other  factors that could significantly  affect
those controls subsequent to the date of their evaluation.


                            PART III


ITEM 9.   DIRECTORS,  EXECUTIVE  OFFICERS,   PROMOTERS,   CONTROL
          PERSONS, AND KEY EMPLOYEES


     Igene's directors  are  elected annually by the stockholders
of Igene.  The directors, executive officers and key employees of
Igene as of December 31, 2003 are as follows:


<TABLE>
<CAPTION>

Name                          Age   Position with Igene
___________________________  _____  _____________________________
<S>                           <C>   <C>
Michael G. Kimelman           65    Chairman of the Board of
                                    Directors, member of audit
                                    committee

Thomas L. Kempner             76    Vice Chairman of the Board
                                    of Directors, member of
                                    finance committee

Stephen F. Hiu                47    Director, President, Chief
                                    Technical Officer, and
                                    Director of Research and
                                    Development

Patrick F. Monahan            53    Director, Vice-President,
                                    Secretary, and Director
                                    of Manufacturing

Sidney R. Knafel              73    Director, member of finance
                                    committee

Edward J. Weisberger          39    Chief Financial Officer

Per A. Benjaminsen            35    Director of Sales and
                                    Marketing
</TABLE>

Each of our directors was elected for a one-year term at our most
recent  annual meeting, held in May of 2003.  Our officers  serve
at  the  pleasure  of  the  Board of Directors  and  until  their
respective successors are elected and qualified.

MICHAEL  G.  KIMELMAN  has served as a Director  of  Igene  since
February  1991  and as Chairman of the Board of  Directors  since
March 1991.  He is a founder and member of Kimelman & Baird, LLC,
as  well  as  Chairman of the Board of Directors  of  Astaxanthin
Partners  Ltd.   He  also serves on the Board and  the  Executive
Committee of the Hambletonian Society.

THOMAS L. KEMPNER is Vice Chairman of the Board of Directors  and
has been a Director of Igene since its inception in October 1981.
He  is and has been Chairman and Chief Executive Officer of  Loeb
Partners  Corporation,  investment bankers,  New  York,  and  its
predecessors since February 1978.  He is currently a Director  of
CCC  Information  Services Group, Inc., Dyax, Fuel  Cell  Energy,
Inc.,   Insight  Communications  Co.,  Inc.,  and  Intermagnetics
General  Corp.  He is a Director Emeritus of Northwest  Airlines,
Inc.

STEPHEN F. HIU was appointed Chief Technical Officer in 2002, and
has  served  as  President and Treasurer since  March  1991,  and
elected  a  Director  in August 1990.  He has  been  Director  of
Research  and Development since January 1989 and, prior  thereto,
was  Senior Scientist since December 1985, when he joined  Igene.
He  was  a  post-doctoral  Research  Associate  at  the  Virginia
Polytechnic Institute and State University, Blacksburg, Virginia,
from  January  1984 until December 1985.  Dr. Hiu holds  a  Ph.D.
degree  in microbiology from Oregon State University and  a  B.S.
degree  in biological sciences from the University of California,
Irvine.

PATRICK F. MONAHAN has served as  Vice-President since 2002,  and
as  Director  of Manufacturing and as a Director of  Igene  since
April 1991.  He has served as Secretary since September 1998.  He
has  managed  Igene's fermentation pilot plant since 1982.  Prior
thereto, he was a technical specialist in the fermentation  pilot
plant  of  W.R. Grace and Co. from 1975 to 1982. He  received  an
Associate  of  Arts  degree in biology from  Allegheny  Community
College  and  a B.S. degree in biology with a minor in  Chemistry
from Frostburg State College, Frostburg, Maryland.

SIDNEY  R. KNAFEL, has served as a Director of Igene since  1982,
has  also  been  Managing Partner of SRK  Management  Company,  a
private investment concern located in New York City, since  1981.
He  has also served  as Chairman of Insight Communications,  Inc.
since  1985.  He is also currently a Director of General American
Investors Company, Inc. as well as a number of private companies.

EDWARD  J.  WEISBERGER was appointed Chief Financial  Officer  of
Igene  in  December  2001.  He is a CPA with  multiple  years  of
financial experience in the public and private sectors with  both
smaller and fortune 100 companies.

PER  A.  BENJAMINSEN served as Chief Marketing Officer  of  Igene
from December 2001 through December 2002.  He received his degree
in  fisheries science at the University of Tromso, Norway. He was
the  founder and entrepreneur of a specialty refining company  of
essential fatty acids in Norway.

Section 16(a) Beneficial Ownership Reporting Compliance

     Igene  believes  that  during 2003 and through March of 2004
all  of  its  officers  and  directors  of more than 10%  of  its
common stock,  have  filed  all  past  due  reports and come into
compliance with Section 16(a) reporting requirements with respect
to  acquisitions  and  dispositions  of Igene's  securities, with
the  exception  of  the  11,000,000  warrants  issued  to Michael
Kimelman  in  2003.  This is being corrected in April of 2004. In
making this disclosure, Igene has  relied   solely   on   written
representations  of its directors, officers  and  more  than  10%
holders  and  on copies furnished to Igene of reports  that  have
been filed with the Securities and Exchange Commission.

ITEM 10.    EXECUTIVE COMPENSATION

     The  following  tables show the compensation paid or accrued
by  Igene  to the Chief Executive Officer, and each of  the  four
most  highly  compensated officers other than  the  CEO.   During
2002,  no Directors were compensated for their Board or Committee
activities.   Other  than  the 1986  and  1997,  and  2001  Stock
Incentive  Plan  and the Simple Retirement Plan described  below,
Igene has no profit sharing or incentive compensation plans.

<TABLE>
                            SUMMARY COMPENSATION TABLE
<CAPTION>
                                                Salary                        Salary
                                             Compensation                  Compensation
Name and Principal Position      Year             $              Year            $
___________________________     ______      ______________      ______     _____________
<S>                             <C>         <C>                 <C>        <C>
Stein Ulve                       2002          $100,000          2003          $000
Chief Executive Officer

Stephen Hiu                      2002          $114,200          2003          $113,400
President

Patrick Monahan                  2002          $106,840          2003          $103,506
Director

Per Bejaminsen                   2002          $100,000          2003          $100,000
Chief Marketing Officer

Edward Weisberger                2002          $103,340          2003          $103,906
Chief Financial Officer

</TABLE>

     Through  December 2001, Stephen Hiu served as the  principal
executive officer his cash compensation was $94,000 in 2001.

Simple Retirement Plan

     Effective February 1, 1997 Igene adopted a Simple Retirement
Plan  under Internal Revenue Code Section 408(p).  The plan is  a
defined  contribution  plan, which covers  all  of  Igene's  U.S.
employees  who  receive at least $5,000 of compensation  for  the
preceding    year.    The   plan   permits   elective    employee
contributions.  For the years ended December 31, 2002  and  2001,
Igene  made  an  elective contribution of  2%  of  each  eligible
employee's  compensation  for each year.   Effective  January  1,
2003,  Igene made an elective contribution of 3% of each eligible
employee's compensation for each year.  Igene's contributions  to
the  plan  for 2002 were $11,201, which is expensed in  the  2002
statement of operations.  Igene's contributions to the  plan  for
2003  were  $17,631  which is expensed in the 2003  statement  of
operations.

Stock Option Plans

     Igene  currently   maintains  two  stock  incentive   plans.
Igene's  2001 Stock Incentive Plan (the "2001 Plan"),  which  was
approved  by  Igene's stockholders on June 12,  2001,  authorized
55,000,000  options and shares of restricted stock  for  issuance
under  that  plan.   Igene's 1997 Stock Option  Plan  (the  "1997
Plan"),  which was approved by Igene's stockholders  on  November
17,  1997, authorized 20,000,000 options for issuance under  that
plan.  A  committee  of  the Board of Directors  administers  the
Plans.

     The purpose  of  the  Plans  is  to  further  the  long-term
stability  and  financial  success of  Igene  by  attracting  and
retaining  employees and consultants through the  use  of  stock-
based  incentives,  and to provide non-employee  members  of  the
Board  of  Directors with an additional incentive to promote  the
success of Igene.  It is believed that ownership of Igene  common
stock  will stimulate the efforts of those employees, consultants
and  non-employee  directors upon whose  judgment  and  interests
Igene is and will be largely dependent for the successful conduct
of  its  business.   It  is also believed that  incentive  awards
granted  to  employees  under these plans will  strengthen  their
desire  to  remain  employed  with Igene  and  will  further  the
identification of employees' interests with those of Igene.

     Options are exercisable at such rates and times  as  may  be
fixed by the committee.  Options also become exercisable in  full
upon  (i)  the holder's retirement on or after his 65th birthday,
(ii)  the disability or death of the holder, or (iii) under other
circumstances as determined by the Committee.  Options  generally
terminate  on  the  tenth  business day  following  cessation  of
service  as  an  employee,  director, consultant  or  independent
contractor.

     Options may  be exercised by payment in full of  the  option
price in cash or check, or by delivery of previously-owned shares
of  common stock having a total fair market value on the date  of
exercise  equal to the option price, or by such other methods  as
permitted by the Committee.

     The Plans contain anti-dilution provisions in the  event  of
certain corporate transactions.

     The Board  of  Directors may at any time withdraw  from,  or
amend,   the  Plans  and  any  options  not  heretofore  granted.
Stockholder  approval is required to (i) increase the  number  of
shares  issuable  under the Plans, (ii) increase  the  number  of
options  which  may be granted to any individual during  a  year,
(iii)  or  change  the class of persons to whom  options  may  be
granted.   No options shall be granted under the 2001 Plan  after
April  30, 2011 and under the 1997 Plan after September 19, 2007.
Igene  previously  maintained its 1986  Stock  Option  Plan,  but
additional options may no longer be granted under that plan.

     Options to  acquire 35,983,750 shares of common  stock  have
been  granted under the three Stock Option Plans and   35,488,250
options are still outstanding under the Plans as of December  31,
2003.   No  options  were  granted during  2003,  and  18,200,000
options were granted during 2002.

Compensation of Directors

     During 2003  Michael  G.  Kimelman  was  granted  11,000,000
warrants as compensation for his services as Igene's Chairman  of
the Board of Directors.


ITEM 11.  SECURITY  OWNERSHIP  OF  CERTAIN  BENEFICIAL OWNERS AND
          MANAGEMENT AND RELATED STOCKHOLDER MATTERS

     The following  table sets forth information as  of  February
24,  2004  with  respect  to beneficial ownership  of  shares  of
Igene's outstanding common stock and preferred stock by (i)  each
person  known to Igene to own or beneficially own more than  five
percent  of  its  common  stock or  preferred  stock,  (ii)  each
Director,   and   (iii)  each  officer  named  in   the   Summary
Compensation  Table provided in Part II Item 10 above,  and  (iv)
all Directors and executive officers  as a group.

<TABLE>
<CAPTION>
                                            Common Stock                     Preferred Stock
                                  ______________________________     _____________________________
                                     Number of                         Number of
Name and Address                      Shares          Percent *         Shares          Percent
                                  ______________   _____________     _____________   _____________
<S>                               <C>              <C>               <C>             <C>
Directors and officers

Joseph C. Abeles                   16,273,483(1)       15.29               7,375         28.80
  220 E. 42nd Street
  New York, NY 10017

Stephen  F. Hiu                    10,948,633(2)       10.71                 ---           ---
  9110 Red Branch Road
  Columbia, MD 21045

Thomas L. Kempner                 143,139,072(3)       65.87                 ---           ---
  61 Broadway
  New York, NY 10006

Michael G. Kimelman                33,590,138(4)       26.96                 ---           ---
  100 Park Avenue
  New York, NY  10017

Sidney R. Knafel                  141,326,146(5)       65.62                 ---           ---
  810 Seventh Avenue
  New York, NY 10019

Patrick F. Monahan                  6,947,533(6)        7.08                 ---           ---
  9110 Red Branch Road
  Columbia, MD 21045

Per A. Benjaminsen                  7,166,666(7)        7.25                 ---           ---
  9110 Red Branch Road
  Columbia, MD 21045

Edward J. Weisberger                2,570,000(8)        2.71                 ---           ---
  9110 Red Branch Road
  Columbia, MD 21045

All Directors and Officers        350,148,442(9)       87.31               7,375         28.80
  as a Group (8 persons)

Others
______

Fraydun Manocherian                 7,905,135(10)       8.52                 ---           ---
  3 New York Plaza
  New York, NY 10004

Fermic                             11,089,222          12.02                 ---           ---

</TABLE>

*  Under the rules of the Securities and Exchange Commission, the
calculation of the percentage assumes for each person  that  only
that  person's rights, warrants, options or convertible notes  or
preferred  stock are exercised or converted, and  that  no  other
person   exercises  or  converts  outstanding  rights,  warrants,
options or convertible notes or preferred stock.

1.   Includes  the  following: 2,113,544 shares held directly  or
     indirectly by Mr. Abeles, 14,750 shares  issuable  upon  the
     conversion  of  7,375  shares  of preferred stock, 5,042,777
     shares issuable upon the conversion of $311,663 of long-term
     notes  issued  by  Igene, and 9,102,412 shares issuable upon
     exercise of warrants held by Mr. Abeles.

2.   Includes   the  following: 948,633 shares held  directly  or
     indirectly  by  Mr.  Hiu  and  10,000,000  shares   issuable
     pursuant  to  options  held  by  Dr. Hiu  that are currently
     exercisable.

3.   Includes  386,972  shares and 536,920 shares  issuable  upon
     exercise of warrants held by Mr. Kempner that are  currently
     exercisable. Also includes 8,661,245 shares held directly by
     Mr. Kempner,  18,761,668 shares issuable upon conversion  of
     notes  issued  by  Igene  and  held  by  Mr.  Kempner,   and
     41,582,728  shares  issuable  upon exercise of warrants held
     by a trust under  which Mr.  Kempner  is one of two trustees
     and  the sole  beneficiary, which are currently exercisable.
     Also includes 8,621,247 shares held directly by Mr. Kempner,
     18,761,669  shares  issuable  upon  the  conversion of notes
     issued  by  Igene  and  held  by  Mr. Kempner and 41,561,125
     shares issuable upon exercise of warrants held a trust under
     which  Mr.  Kempner  is  one of two trustees and one of  his
     brothers is  the  sole  beneficiary,  which  are   currently
     exercisable.   Also  includes 1,530,222 shares issuable upon
     the  conversion of $79,200 of notes issued by Igene and held
     by  Mr. Kempner  and 2,079,411 shares issuable upon exercise
     of warrants held by trusts under which Mr. Kempner is one of
     two  trustees  and  is  a  one-third  beneficiary  that  are
     currently exercisable.  Also includes  243,  360  shares and
     131,414  shares  issuable  upon exercise of warrants held by
     trusts  under  which  Mr.  Kempner  is   executer   and   is
     a one-third beneficiary that are currently exercisable. Also
     includes  182,526  shares  and  98,565  warrants held by Mr.
     Kempner's wife.

4.   Includes 1,264,360 shares held directly or indirectly by Mr.
     Kimelman,  14,000,000  shares  issuable  upon  exercise   of
     options currently  exercisable,  1,072,756  shares  issuable
     upon the  conversion of $63,070 of notes issued by Igene and
     held by Mr. Kimelman,  and 17,253,022  shares issuable  upon
     exercise  of  warrants  held  directly  or indirectly by Mr.
     Kimelman.

5.   Includes  18,190,551 shares, 38,168,101 shares issuable upon
     the  conversion  of  notes  issued  by Igene and held by Mr.
     Knafel and  84,967,495 shares issuable upon the exercise  of
     warrants owned or  beneficially owned by Mr. Knafel that are
     currently exercisable.

6.   Includes 1,047,533 shares held directly or indirectly by Mr.
     Monahan  and  5,900,000 shares issuable  upon  the  exercise
     of   options   held   by  Mr.  Monahan  that  are  currently
     exercisable.

7.   Includes 500,000 shares of common stock and 6,666,666 shares
     issuable  upon  exercise of options  held by Mr. Benjaminsen
     that are currently exercisable.

8.   Includes  70,000 shares held directly by Mr. Weisberger  and
     2,500,000 shares issuable upon exercise of options that  are
     currently exercisable.

9.   Includes  41,376,099  shares of common stock, 14,750  shares
     issuable   upon   the   conversion   of   7,375   shares  of
     preferred stock; 29,867,250 shares issuable upon exercise of
     options that are  currently  exercisable,  82,680,765 shares
     issuable upon the conversion  of  notes  issued by Igene and
     196,209,578 shares issuable  upon  the  exercise of warrants
     that are currently exercisable.

10.  Includes  7,375,935 shares of common stock owned directly or
     indirectly  by  Mr.  Manocherian and 529,200 shares issuable
     upon  the  exercise of warrants owned directly or indirectly
     by Mr. Manocherian that are currently exercisable.

<TABLE>
              Equity Compensation Plan Information as of December 31, 2003

<CAPTION>
                                                                             Number of securities
                                                                             remaining available for
                                                                             future issuance under
                        Number of securities to     Weighted-average         equity compensation
                        be issued upon exercise     exercise price of        plans (excluding
                        of outstanding options      outstanding options,     securities reflected in
Plan category           warrants and rights         warrants and rights      column
________________        _______________________     ____________________     ________________________
<S>                     <C>                         <C>                      <C>
  Equity compensation   35.5 million(1)             $0.04.7(2)               39.016 million(3)
  plans approved by
  security holders

  Equity compensation   $ 0                         $0                        8.911 million(5)
  plans not approved
  by security holders
                        _______________________     _____________________     _______________________

  Total                 35.5 million                $0.047                    47.927 million
                        =======================     =====================     =======================

</TABLE>

  (1)  Total shares issued under employee stock option plan.
  (2)  Exercise price of outstanding options under compensation
       plans.
  (3)  All shares remaining issuable under employee option plan.
  (4)  All   shares   remaining   earnable   under   the   Fermic
       manufacturing agreement.


Fermic, Igene's manufacturing agent, earns shares of common stock
as  part  of  the  manufacturing agreement.  Fermic  earns  2,250
shares  of  common  stock for each kilogram of  pure  astaxanthin
produced  and  delivered  as part of the agreement.  The  average
price is based on the market value of the shares at the time  the
product  was produced.   Fermic can earn up to 20,000,000  shares
in  total under the contract.  3,260,246 shares were earned at an
average  price  of $.03 per share for 2002, and 2,785,957  shares
were earned at an average price of $.05 per share for 2003.


ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

     On  April  3,  2003,  the  Board of Directors,  in  lieu  of
additional compensation, authorized the payment of shares to  Mr.
Stephen  Hiu  and Mr. Patrick Monahan.  In compensation  each  of
them  was  awarded  83,333  shares of Igene  common  stock.   The
aggregate 166,666 shares was issued and expensed based on  market
value  at  the  time  of award, $.060 per share,  or  $10,000  of
combined compensation.

     On  August  13,  2002, the Board of Directors,  in  lieu  of
additional compensation, authorized the payment of shares to  Mr.
Stephen  Hiu  and Mr. Patrick Monahan.  In compensation  each  of
them  was  awarded  800,000 shares of Igene  common  stock.   The
aggregate  1,600,000 shares was issued on December 26,  2002  and
expensed in the fourth quarter based on market value at the  time
of award, $.025 per share, or $40,000 as compensation.

     On  February  22, 2002, Igene issued and sold $1,000,000  in
aggregate principal amount of 8% convertible debentures,  to  Mr.
Kempner,  a director of Igene, and to Mr. Knafel, also a director
of  Igene,  in equal amounts of $500,000 each.  These  debentures
are  convertible into shares of Igene's common stock at $.04  per
share based on the market price of Igene's shares at the time the
purchase  of  the debentures was agreed to.  In consideration  of
the commitment to purchase the 8% convertible debenture, each  of
these  directors  also received 12,500,000 warrants  to  purchase
common  stock  at  $.04  per  share.  These  debentures,  if  not
converted earlier, become due on February 22, 2012.

     On  July  17,  2002,  Igene  issued  and  sold  $300,000  in
aggregate principal amount of 8% convertible debentures,  to  Mr.
Kempner,  a director of Igene, and to Mr. Knafel, also a director
of  Igene,  in equal amounts of $150,000 each.  These  debentures
are  convertible into shares of Igene's common stock at $.03  per
share based on the market price of Igene's shares at the time the
purchase  of  the debentures was agreed to.  In consideration  of
the commitment to purchase the 8% convertible debenture, each  of
these  directors  also  received 5,000,000 warrants  to  purchase
common  stock  at  $.03  per  share.  These  debentures,  if  not
converted earlier, become due on July 17, 2012.

     In  August 2002, Igene issued 7,000,000 warrants to purchase
Igene  common  stock at $.025 per share to its  Chairman  of  the
Board,  Mr.  Kimelman  as  part of  the  stock  option  plan,  as
compensation for his services as Chairman of the Board.

     On  December  21,  2002, Igene issued and sold  $250,000  in
aggregate  principal  amount  of  8%  demand  notes  to   certain
directors  of  Igene.   These  notes  were  repaid  with  accrued
interest during 2003.

     As  reported on Form 8-K filed February 20, 2003, Igene,  in
an effort to focus on and grow its core business, sold all 10,000
of  the  issued and outstanding shares of capital stock of ProBio
that  it  owned as of February 4, 2003 to Fermtech  AS,  a  joint
stock  company  incorporated in the Kingdom of Norway  and  owned
equally by our former chief executive officer, Stein Ulve, and by
Per  Benjaminsen, our Chief Marketing Officer.  Mr. Ulve resigned
as  CEO and director of Igene and Mr. Benjaminsen resigned as our
chief  marketing  officer,  effective  December  31,  2002.   Mr.
Benjaminsen has agreed to continue to provide sales and marketing
services to Igene as an independent contractor.

     Igene  sold  ProBio to Fermtech AS in exchange for aggregate
consideration valued at approximately $343,000, a portion of  the
consideration received by Igene consisted of 7,000,000 shares  of
common  stock of Igene that Fermtech owned as a result of Igene's
purchase  of ProBio in January 2001, (of these shares,  2,000,000
shares  may be re-earned by Fermtech as described below),  valued
for  the  purposes  of the acquisition at $.03  per  share,  plus
forgiveness of approximately $168,000 of debt that Igene owed  to
ProBio at the time of purchase in 2001.  Mr. Benjaminsen remained
employed  by  Igene  through  February  2004,  1,000,000  of  the
escrowed  shares of common stock were delivered to  Fermtech.  If
Mr.  Benjaminsen remains employed by Igene through February 2005,
the  remaining  1,000,000 escrowed shares will be  released  from
escrow and delivered to Fermtech.  The remaining shares of  Igene
Common stock were retired on February 5, 2003.



ITEM 13.  EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES, AND  REPORTS
          ON FORM 8-K

(a)(1)    The following financial statements relating to 2003 and
          2002 are filed as a part of this Report:

          Independent Auditors' Report.

          Consolidated Balance Sheet as of December 31, 2003.

          Consolidated  Statements of  Operations for  the  years
          ended December 31, 2003 and December 31, 2002.

          Consolidated  Statements  of  Stockholders' Deficit for
          the years ended December 31, 2003 and December 31, 2002.

          Consolidated  Statements  of Cash Flows for  the  years
          ended December 31, 2003 and December 31, 2002.

          Notes to Consolidated Financial Statements.

(a)(2)    Exhibits filed  herewith or incorporated  by  reference
          herein are set  forth in the following  table  prepared
          in accordance with Item 601 of Regulations S-K.

     3.1  Articles of Incorporation of the Registrant  as amended
          to  date,  constituting  Exhibit  3.1  to  Registration
          Statement  No. 333-41581  on  Form  SB-1   are   hereby
          incorporated herein by reference.

     3.2  By-Laws,  constituting Exhibit 3.2 to the  Registrant's
          Registration  Statement  No.  33-5441  on Form S-1, are
          hereby incorporated herein by reference.

     4.1  Form   of   Variable   Rate  Convertible   Subordinated
          Debenture Due 2002 (Class A), constituting Exhibit  4.4
          to Registration Statement No. 33-5441 on Form  S-1,  is
          hereby incorporated herein by reference.

     10.1 Form of Conversion and Exchange Agreement used  in  May
          1988 in connection with the conversion and exchange  by
          certain holders of shares of preferred stock for common
          stock  and  Warrants,  constituting  Exhibit  10.19  to
          Registration Statement  No. 33-5441  on  Form  S-1,  is
          hereby incorporated herein by reference.

     10.2 Exchange Agreement made as of July 1, 1988  between the
          Registrant and now Dow Chemical Company,  Inc.  (f.k.a.
          Essex Industrial Chemicals, Inc.),. with respect to the
          exchange of 187,500  shares of preferred  stock  for  a
          Debenture, constituting Exhibit 10.21  to  Registration
          Statement  No.  33-5441  on   Form   S-1,   is   hereby
          incorporated herein by reference.

     10.3 Preferred Stockholders' Waiver Agreement  dated  May 5,
          1988, incorporated   herein   by   reference   to   the
          identically numbered exhibit in Form  S-1  Registration
          Statement No. 33-23266.

     10.4 Form of Agreement  between the Registrant  and  Certain
          Investors in Preferred Stock dated September 30,  1987,
          incorporated herein by  reference  to  the  identically
          numbered  exhibit in  Amendment  No.  1  to  Form   S-1
          Registration Statement No. 33-23266.

     10.5 Letter  Agreement executed May 11, 1995 between  Archer
          Daniels  Midland,  Inc.  and IGENE Biotechnology, Inc.,
          along  with  November  11, 1995 Amendment, constituting
          Exhibit 10.11 to the Registrant's Report on Form 10-KSB
          for the year ended December 31,  1995  is  incorporated
          herein by reference.

     10.6 Agreement  of Lease effected December 15, 1995  between
          Columbia   Warehouse  Limited  Partnership  and   IGENE
          Biotechnology, Inc.  constituting  Exhibit 10.13 to the
          registrant's report  on  Form 10-KSB for the year ended
          December 31, 1995 is incorporated herein by reference.

     10.7 Toll  manufacturing  agreement  effective as of May 20,
          2000 between Igene Biotechnology, Inc. and  Fermic S.A.
          de  C.V. constituting  exhibit  10.7  to Igene's annual
          report  on  Form  10-KSB  filed  on  April  2, 2001, is
          incorporated  herein  by  reference.  Portions  of this
          exhibit  have  been  omitted  pursuant to a request for
          confidential treatment.

     10.8 First  amendment  to  lease  made  September  13,  2000
          between  Igene  Biotechnology,  Inc.  and  Red   Branch
          Center, LLC constituting Exhibit 10.8 to Igene's annual
          report  on  Form  10-KSB  filed  on  April  2, 2001, is
          incorporated herein by reference.

     10.9 Consulting Agreement between Igene and Martin L. Gerson,
          Exhibit  10.9  to  Igene's annual report on Form 10-KSB
          filed  on  March  28,  2003,  is incorporated herein by
          reference.

    10.10 Stock  Purchase and Severance Agreement dated as of the
          4th  day  of  February  2003  among Igene, Fermtech AS,
          Stein  Ulve  and  Per Benjaminsen, constituting Exhibit
          10.10 to Igene's  annual report on Form 10-KSB filed on
          March 28, 2003, is incorporated herein by reference.

     21.  Subsidiaries

          Igene Chile Comercial, Ltda.

          Igene  Norway  AS  (divested pursuant to Stock Purchase
          and Severance Agreement dated February 4, 2003 attached
          hereto as Exhibit 10.10)

    23.a. Consent of Stegman & Company

          31.1 Rule  13a-14(a) or 15d-14(a) Certification of  the
               Company's   principal   executive   officer  filed
               herewith.

          31.2 Rule  13a-14(a) or 15d-14(a) Certification of  the
               Company's   principal   financial   officer  filed
               herewith.

          32.1 Rule  13a-14(b) or 15d-14(b) Certification of  the
               Company's   principal  executive officer  pursuant
               to 18  U.S.C.  Section 1350 as adopted pursuant to
               Rule  906  of the Sarbanes-Oxley Act of 2002 filed
               herewith.

          32.2 Rule  13a-14(b) or 15d-14(b) Certification of  the
               Company's principal financial officer  pursuant to
               18 U.S.C. Section 1350 as adopted pursuant to Rule
               906  of  the  Sarbanes-Oxley  Act  of  2002  filed
               herewith.

(b)  On February 5, 2003, Igene filed a current report on Form 8-
     K disclosing   the  disposition  of  its  subsidiary  ProBio
     Nutraceuticals.


ITEM 14. PRINCIPAL ACCOUNTANTS FEES AND SERVICES

                      INDEPENDENT AUDITORS

     The  accounting  firm of Stegman & Company, Certified Public
Accountants,  has been engaged to audit the books and accounts of
the Company for the next fiscal year.  Stegman & Company serviced
as the Company's independent auditor in 2003.   Stegman & Company
has advised the Company that neither the accounting firm nor  any
of its members of associates has any direct financial interest in
or  any  connection  with  the Company other than as iendependent
public auditors.

                     AUDIT FEES AND SERVICES

     The  following table shows the fees paid or accrued  by  the
Company  for the audit and other services provided by  Stegmen  &
Company for fiscal years 2003 and 2002:

<TABLE>
<CAPTION>
                               FY 2003           FY 2002
                            ____________      ____________

            <S>             <C>               <C>
            Audit Fees      $  25,750.00      $  23,096.25
            Tax Fees            3,000.00          2,500.00
            All Other Fees          0.00              0.00
                            ____________      ____________

              TOTAL         $  28,750.00      $  25,596.25
                            ============      ============

</TABLE>

     Audit  services  of Stegman & Company for fiscal years  2003
and  2002  consisted  of  the  examination  of  the  consolidated
financial  statements  of the Company and  quarterly  reviews  of
financial statements.  "Tax Fees" in fiscal years 2003  and  2002
include  charges primarily related to tax return preparation  and
tax  consulting  services.   In 2003,  the  SEC  adopted  a  rule
pursuant  to the Federal Sarbanes-Oxley Act of 2002 that,  except
with  respect  to  certain de minimis services  discussed  below,
requires  Audit  Committee pre-approval of  audit  and  non-audit
services provided by the Company's independent auditors.  All  of
the  2003 services described above were pre-approved by the Audit
Committee pursuant to this SEC rule to the extent that  rule  was
applicable during fiscal year 2003.

     The Audit Committee's policy is to pre-approve all audit and
permitted  non-audit services, except that de  minimis  non-audit
services,  as  defined in Section 10A(i)(1) of the Exchange  Act,
may  be  approved  prior  to the completion  of  the  independent
auditor's  audit.  The Audit Committee has reviewed summaries  of
the  services  provided and the related fees and  has  determined
that  the  provision  of non-audit services  is  compatible  with
maintaining the independence of Stegman & Company.



                     INDEPENDENT AUDITORS' REPORT






To the Audit Committee and Stockholders
IGENE Biotechnology, Inc.

We  have  audited the accompanying consolidated balance sheet  of
IGENE Biotechnology, Inc. and subsidiary as of December 31, 2003,
and   the   related   consolidated  statements   of   operations,
stockholders' deficit and cash flows for each of the two year  in
the period ended December 31, 2003.  These consolidated financial
statements  are  the responsibility of the Company's  management.
Our responsibility is to express an opinion on these consolidated
financial statements based on our audits.

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

In our opinion, the consolidated financial statements referred to
above  present  fairly, in all material respects,  the  financial
position  of  IGENE  Biotechnology, Inc.  and  subsidiary  as  of
December 31, 2003, and the results of their operations and  their
cash  flows for each of the two year in the period ended December
31,  2003,  in  conformity with accounting  principles  generally
accepted in the United States of America.

The accompanying financial statements have been prepared assuming
that  the Company will continue as a going concern.  As discussed
in   Note  16  to  the  consolidated  financial  statements,  the
Company's  recurring losses, production limitations  and  limited
capitalization  raise  substantial doubt  about  its  ability  to
continue as a going concern.  Management's plans regarding  those
matters  also are described in Note 16.  The financial statements
do not include any adjustments that might result from the outcome
of this uncertainty.


                                /s/ STEGMAN & COMPANY
                                _________________________
                                    STEGMAN & COMPANY

Baltimore, Maryland
March 25, 2004

<TABLE>

                            IGENE Biotechnology, Inc. and Subsidiary
                                   Consolidated Balance Sheet
                                       December 31, 2003

<CAPTION>

ASSETS
______
<S>                                                              <C>
CURRENT ASSETS
  Cash and cash equivalents                                      $     63,075
  Accounts receivable                                                 156,458
  Due from Joint Venture                                              495,183
  Prepaid expenses and other current assets                            43,675
                                                                 _____________

     TOTAL CURRENT ASSETS                                             758,391

OTHER ASSETS
  Property and equipment, net                                         148,931
  Loan receivable from manufacturing agent                            122,964
  Investment in unconsolidated Joint Venture                       11,391,506
  Other assets                                                          4,886
                                                                 _____________

      TOTAL ASSETS                                               $ 12,426,678
                                                                 =============
LIABILITIES, REDEEMABLE PREFERRED STOCK
AND STOCKHOLDERS' DEFICIT
_______________________________________

CURRENT LIABILITIES
  Accounts payable and accrued expenses                          $    185,862
  Equipment lease payable - current portion                             1,498
                                                                 _____________

     TOTAL CURRENT LIABILITIES                                        187,360

LONG-TERM DEBT
  Notes payable                                                     5,842,767
  Convertible Debentures                                            4,814,212
  Accrued interest                                                  3,398,272

REDEEMABLE PREFERRED STOCK
  Carrying amount of redeemable preferred stock, 8% cumulative,
  convertible, voting, series A, $.01 par value per share.
  Stated value $17.76 per share.   Authorized 1,312,500 shares;
  issued and outstanding 25,605 shares. Redemption amount
  $454,745.                                                           454,745

  Carrying amount of redeemable preferred stock, 8% cumulative,
  convertible, voting, series B, $.01 par value per share.
  Stated value $8.80 per share.   Authorized, issued and
  outstanding 187,500 shares. Redemption amount $1,650,000.         1,650,000
                                                                 _____________

     TOTAL LIABILITIES                                             16,347,356
                                                                 _____________

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' DEFICIT
  Common stock -- $.01 par value per share.  Authorized
    750,000,000 shares; issued and outstanding 92,747,469
    shares                                                            927,475
Additional paid-in capital                                         34,471,490
  Accumulated Deficit                                             (39,319,643)
                                                                 _____________

     TOTAL STOCKHOLDERS' DEFICIT                                   (3,920,678)
                                                                 _____________

     TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT                 $ 12,426,678
                                                                 =============
</TABLE>

The accompanying notes are an integral part of the consolidated
financial statements.

<TABLE>
                            IGENE Biotechnology, Inc. and Subsidiary
                             Consolidated Statements of Operations

<CAPTION>

                                                            Years ended December 31,
                                                                2003             2002
                                                         ____________     ____________
<S>                                                      <C>              <C>
REVENUE
_______

  Sales                                                  $   463,486      $ 3,491,765
  Cost of sales                                              446,144        3,167,634
                                                         ____________     ____________

  GROSS PROFIT                                                17,342          324,131

OPERATING EXPENSES
__________________

  Marketing and selling                                      328,393          554,224
  Research, development and pilot plant                      745,364          609,781
  General and administrative                                 687,427          963,907
  Litigation expenses                                        133,464           47,159
  Less expenses reimbursed by Joint Venture               (1,252,565)             ---
                                                         ____________     ____________

  TOTAL OPERATING EXPENSES                                   642,083        2,175,071
                                                         ____________     ____________

  OPERATING LOSS                                            (624,741)      (1,850,940)

EQUITY IN LOSS OF JOINT VENTURE                             (914,494)             ---
INTEREST EXPENSE                                            (897,543)        (901,989)
                                                         ____________     ____________

  NET LOSS FROM CONTINUING OPERATIONS                     (2,436,778)      (2,752,929)
                                                         ____________     ____________

DISCONTINUED OPERATIONS
_______________________

Net Loss from discontinued operations                            ---         (437,051)
Gain on disposal of discontinued operations                  237,637              ---
                                                         ____________     ____________

  NET INCOME (LOSS) FROM DISCONTINUED OPERATIONS             237,637         (437,051)
                                                         ____________     ____________

  NET LOSS                                               $(2,199,141)     $(3,189,980)
                                                         ============     ============

  BASIC AND DILUTED NET LOSS PER COMMON SHARE            $     (0.02)     $     (0.03)
  FROM CONTINUING OPERATIONS

  BASIC AND DILUTED NET LOSS PER COMMON SHARE                   0.00            (0.01)
  FROM DISCONTINUED OPERATIONS
                                                         ____________     ____________

  BASIC AND DILUTED NET LOSS PER COMMON SHARE            $     (0.02)     $     (0.04)
                                                         ============     ============
 </TABLE>










The accompanying notes are an integral part of the consolidated
financial statements.

<TABLE>
                                IGENE Biotechnology, Inc. and Subsidiary
                             Consolidated Statements of Stockholders' Deficit
                             For The years ended December 31, 2003 and 2002

<CAPTION>
                                                                        Additional                        Total
                                                 Common Stock            Paid-in        Accumulated    Stockholders'
                                             # Shares      Amount        Capital          Deficit         Deficit
                                            ____________ ____________  _____________   _____________   _____________
<S>                                         <C>          <C>           <C>             <C>             <C>
BALANCE AT JANUARY 1, 2002                   75,848,600  $   758,486   $ 22,188,837    $(33,930,522)   $(10,983,199)

Issuance of common stock in lieu
  of cash in payment of interest on
  subordinated debenture                         40,000          400         89,600             ---          90,000

Cumulative undeclared dividends
  on redeemable preferred stock                     ---          ---        (16,900)            ---         (16,900)

Conversion of redeemable
  preferred stock into common stock                 500            5          4,275             ---           4,280

Exercise of warrants                            194,400        1,944         12,356             ---          14,300

Shares issued to S. Hiu and P. Monahan
  in lieu of compensation                     1,600,000       16,000         24,000             ---          40,000

Shares issued to M. Gerson for
  consulting agreement                       12,000,000      120,000          5,000             ---         125,000

Shares issued for manufacturing
  agreement                                   3,260,246       32,602         80,436             ---         113,038

Net loss for 2002                                   ---          ---            ---      (3,189,980)     (3,189,980)
                                            ____________ ____________  _____________   _____________   _____________

BALANCE AT DECEMBER 31, 2002                 92,943,746  $   929,437   $ 22,387,604    $(37,120,502)   $(13,803,461)


Retirement of common stock
  related to sale of ProBio                  (7,000,000)     (70,000)      (140,000)            ---        (210,000)

Cumulative undeclared dividends
  on redeemable preferred stock                     ---          ---       (166,387)            ---        (166,387)

Conversion of redeemable
  preferred stock into common stock               1,100           11          9,405             ---           9,416

Exercise of warrants                          3,750,000       37,500        243,750             ---         281,250

Shares issued to S. Hiu and P. Monahan
  in lieu of compensation                       166,666        1,667          8,333             ---          10,000

Shares issued for employee stock
  incentive program                             100,000        1,000          1,500             ---           2,500

Investment in unconsolidated
  Joint Venture                                     ---          ---     11,983,131             ---      11,983,131

Shares issued for manufacturing
  agreement                                   2,785,957       27,860        144,154             ---         172,014

Net loss for 2003                                   ---          ---            ---      (2,199,141)     (2,199,141)
                                            ____________ ____________  _____________   _____________   _____________

BALANCE AT DECEMBER 31, 2003                 92,747,469  $   927,475   $ 34,471,490    $(39,319,643)   $ (3,920,678)
                                            ============ ============  =============   =============   =============
</TABLE>








The accompanying notes are an integral part of the consolidated
financial statements.

<TABLE>
                                       IGENE Biotechnology, Inc. and Subsidiary
                                        Consolidated Statements of Cash Flows


<CAPTION>
                                                                     Years ended December 31,
                                                                        2003           2002
                                                                    ____________   ____________
CASH FLOWS FROM OPERATING ACTIVITIES
____________________________________
<S>                                                                 <C>            <C>
     Net loss                                                       $(2,199,141)   $(3,189,980)
     Adjustments to reconcile net loss to net
     cash used by operating activities:
         Depreciation                                                    29,057         60,914
         Amortization of deferred costs                                  54,729        116,514
         Gain disposal of discontinued operations                      (237,637)           ---
         Compensation paid in shares of common stock                     10,000         40,000
         Consulting cost paid in shares of common stock                     ---        125,000
         Manufacturing cost paid in shares of common stock              172,014        113,037
         Equity in loss of unconsolidated joint venture                 914,494            ---
         Interest on debenture paid in shares of common stock               ---         90,000
         Decrease (increase) in:
             Accounts receivable                                        359,059        (30,917)
             Due from Joint Venture                                    (495,183)           ---
             Inventory                                                  374,709        352,367
             Prepaid expenses and other assets                        1,254,067         44,620
         Increase (decrease) in:
             Accounts payable and other accrued expenses               (409,784)       965,565
                                                                    ____________   ____________

             NET CASH USED IN OPERATING ACTIVITIES                     (173,616)    (1,312,880)
                                                                    ____________   ____________

CASH FLOWS FROM INVESTING ACTIVITIES
____________________________________

      Capital expenditures                                                  ---       (100,159)
      Deposits on manufacturing equipment                                   ---       (113,025)
      Cash retained from asset held for disposition                         ---         76,226
      Cash transferred to Joint Venture                                  (4,223)           ---
      Investment in Joint Venture Capital Stock                          (6,000)           ---
                                                                    ____________   ____________

            NET CASH USED IN INVESTING ACTIVITIES                       (10,223)      (136,958)
                                                                    ____________   ____________

CASH FLOWS FROM FINANCING ACTIVITIES
____________________________________

      Proceeds from issuance of convertible debentures                      ---      1,300,000
      Net (repayment) borrowing of equipment lease payable               (3,297)         3,062
      Proceeds from exercise of employee stock options                    2,500            ---
      Proceeds from (repayment of) issuance of note payable            (250,000)       250,000
                                                                    ____________   ____________

            NET CASH (USED) PROVIDED BY FINANCING ACTIVITIES           (250,797)     1,553,062
                                                                    ____________   ____________

NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS                   (434,636)       103,224

CASH AND CASH EQUIVALENTS - BEGINNING OF THE YEAR                       497,711        394,487
                                                                    ____________   ____________

CASH AND CASH EQUIVALENTS - END OF THE YEAR                         $    63,075    $   497,711
                                                                    ============   ============

SUPPLEMENTARY DISCLOSURE AND CASH FLOW INFORMATION
__________________________________________________

  Cash paid during the year for interest                            $    61,171    $    42,409
  Cash paid during the year for income taxes                                ---            ---

</TABLE>
See Note 2 for non-cash investing and financing activities.

















The accompanying notes are an integral part of the consolidated
financial statements.

            IGENE Biotechnology, Inc. and Subsidiary
           Notes to Consolidated Financial Statements
         For the years ended December 31, 2003 and 2002



(1) Summary of Significant Accounting Policies
    __________________________________________

    Nature of Operations
    ____________________

    Igene  Biotechnology, Inc. ("Igene") was  incorporated  under
    the  laws  of  the State of Maryland on October 27,  1981  as
    "Industrial Genetics, Inc."  Igene changed its name  to  "IGI
    Biotechnology,  Inc."  on  August  17,  1983  and  to  "Igene
    Biotechnology, Inc." on April 14, 1986.  Igene is located  in
    Columbia,  Maryland  and  is  engaged  in  the  business   of
    industrial  microbiology and related biotechnologies.   As  a
    result  of the stock purchase, ProBio became our wholly-owned
    subsidiary.   Igene  has an operational subsidiary  in  Chile
    and  through February 2003 had a subsidiary in Norway.  IGENE
    Biotechnology, Inc. ("Igene") is engaged in the  business  of
    developing,    marketing,    and   manufacturing    specialty
    ingredients  for  human  and animal  nutrition.    Igene  was
    formed  to  develop, produce and market value-added specialty
    biochemical  products.   Igene  is  a  supplier  of   natural
    astaxanthin,   an  essential  nutrient  in   different   feed
    applications  and as a source of pigment for coloring  farmed
    salmon    species.    Igene   also   supplies   nutraceutical
    ingredients,   as   well  as  consumer  ready   health   food
    supplements,  including astaxanthin.   Igene  is  focused  on
    fermentation technology, pharmacology, nutrition  and  health
    in its marketing of products and applications worldwide.

    Igene  has  devoted  its  resources  to  the  development  of
    proprietary  processes to convert selected  agricultural  raw
    materials  or  feedstocks into commercially useful  and  cost
    effective   products   for  the  food,   feed,   flavor   and
    agrochemical  industries.  In developing these processes  and
    products,  Igene has relied on the expertise  and  skills  of
    its  in-house  scientific staff and,  for  special  projects,
    various consultants.

    In  an  effort to develop a dependable source of  production,
    March  18,  2003,  Tate  and Igene announced  a  50:50  joint
    venture  to produce AstaXin(R) for the aquaculture  industry.
    Production   will   utilize  Tate   &   Lyle's   fermentation
    capability  together with the unique technology developed  by
    Igene.  Part of Tate & Lyle's existing Selby, England, citric
    acid  facility will be modified to include the production  of
    1,500  tons  per  annum  of  this  product.   Tate  &  Lyle's
    investment  of $25 million includes certain of  its  facility
    assets  currently used in citric acid production.  Commercial
    production  is  expected to commence  in  the  calendar  year
    2004.

    Principles of Consolidation
    ___________________________

    In  December  2001  Igene purchased its  sales  agent  ProBio
    Nutraceuticals,  AS,  A  Norwegian  corporation   ("ProBio").
    During 2003, Igene executed a formal agreement to dispose  of
    ProBio.   For  these consolidated financial  statements,  the
    earnings   and  losses  have  been  treated  as   loss   from
    discontinued operations.   The accounts of our other  wholly-
    owned   subsidiary,  Igene  Chile  are   included   for   the
    consolidation    of   these   financial   statements.     All
    significant intercompany accounts and transactions have  been
    eliminated in consolidation.

    Cash and cash equivalents
    _________________________

    Igene  considers  cash equivalents to be  short-term,  highly
    liquid  investments  that have maturities  of  less  than  90
    days.  These include interest bearing money market accounts.

    Accounts Receivable
    ___________________

    Accounts  receivable  are  stated at  the  amount  management
    expects   to   collect   from   the   outstanding   balances.
    Management   provides  for  probable  uncollectible   amounts
    through  a  charge to earnings and a credit  to  a  valuation
    allowance   based  upon  its  assessment   of   the   current
    collection   status   of  individual  accounts.     Deliquent


           IGENE Biotechnology, Inc. and Subsidiary
           Notes to Consolidated Financial Statements
         For the years ended December 31, 2003 and 2002


    amounts  that are outstanding after management has  conducted
    reasonable  collection  efforts, are written  off  through  a
    charge  to  the valuation allowance and a credit to  accounts
    receivable.   The valuation allowance did not change  in  the
    current period.

    Equity in unconsolidated joint venture
    ______________________________________

    The  investment in the Joint Venture is accounted  for  under
    the   equity  method  whereby  the  Company's  50%  ownership
    percentage in the Joint Venture's equity is reflected  as  an
    asset  in  the consolidated balance sheet and the changes  in
    the  Joint Venture's equity as a result of its operations  is
    reflected   in   the  Company's  consolidated  statement   of
    operations.   The excess of value of the Company's  ownership
    in  the  Joint Venture over the consideration paid  for  such
    ownership  is reflected as an adjustment to additional  paid-
    in  capital.   The  Company evaluates its investment  in  the
    Joint  Venture  for  impairment, as it  does  for  all  other
    assets.   The  accounting  policies  followed  by  the  Joint
    Venture   are   in  conformity  with  accounting   principals
    generally accepted in the United States of America.

    Due from Joint Venture
    ______________________

    As    discussed   previously,    Igene   receives   a    cash
    reimbursement  from  the  Joint Venture  related  to  certain
    expenses  incurred for research production and  sales.   This
    amount   represents  the  costs  incurred  by  Igene  pending
    reimbursement.   In  addition the assets remaining  in  Chile
    that  were transferred to the Joint Venture at June 30,  2003
    are   included   in  this  figure.   These   assets   include
    approximately   $4,000  in  cash,  $12,500  in   receivables,
    $62,000  in prepaid assets, and $18,000 in equipment.   These
    amounts are to be reimbursed by the Joint Venture.

    Research and development costs
    ______________________________

    For  financial reporting purposes, research, development  and
    pilot  plant  scale-up  costs are  charged  to  expense  when
    incurred.

    Property and Equipment
    ______________________

    Property  and  equipment are stated at cost less  accumulated
    depreciation  and amortization computed using  the  straight-
    line  method.   Premises and equipment are  depreciated  over
    the  useful  lives of the assets, which generally range  from
    three  to  ten  years for furniture, fixtures and  equipment,
    three  to five years for computer software and hardware,  and
    ten  to  forty  years for building and building improvements.
    Leasehold  improvements are amortized over the terms  of  the
    respective  leases  or  the estimated  useful  lives  of  the
    improvements,  whichever  is  shorter.   The  cost  of  major
    renewals and betterments are capitalized, while the costs  of
    ordinary maintenance and repairs are expensed as incurred.

    Estimates
    _________

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


	   IGENE Biotechnology, Inc. and Subsidiary
           Notes to Consolidated Financial Statements
         For the years ended December 31, 2003 and 2002


    Foreign Currency Translation and Transactions
    _____________________________________________

    Since   the   day-to-day  operations   of   Igene's   foreign
    subsidiary   in   Chile  are  dependent   on   the   economic
    environment of the parent's currency, the financial  position
    and  results of operations of Igene's foreign subsidiary  are
    determined  using Igene's reporting currency (US dollars)  as
    the  functional currency.  All exchange gains and losses from
    remeasurement  of  monetary assets and liabilities  that  are
    not  denominated  in US dollars are recognized  currently  in
    income.  The  gains  are  due to large  fluctuations  in  the
    Chilean  Peso.   A gain of $7,000 and $1,000,  were  reported
    for   the   years   ended  December  31,   2003   and   2002,
    respectively.

    Fair value of financial instruments
    ___________________________________

    The  carrying amounts of cash and cash equivalents,  accounts
    receivable,    accounts   payable,   and   short-term    debt
    approximate  fair  value  because  of  the  relatively  short
    maturity  of  these  instruments.   Management  believes  the
    carrying  amount  of long-term debt approximates  fair  value
    because of similar current rates at which Igene could  borrow
    funds with consistent remaining maturities.

    Sales Returns
    _____________

    Igene  recorded  sales returns in the  period  in  which  the
    product  is  returned, rather than estimating future  returns
    of  current  sales, since they are expected to be  immaterial
    in amount.

    Interest on Variable Rate Subordinated Debenture
    ________________________________________________

    Igene  recorded  interest on its variable  rate  subordinated
    debenture  (see also note 7) at a level rate  of  8%  through
    October  1,  1996 and at 12% thereafter; rather than  at  the
    fair-market  value of shares which have been issued  in  lieu
    of  cash payments of interest.  This was an estimated average
    rate  based  on  Igene's plan to continue (as  it  has  since
    October  1, 1989) to pay interest on the debenture by issuing
    shares  of common stock at the higher of $2.25 per  share  or
    the  current market value of Igene's shares, as allowed under
    the  terms of the debenture.  As the market value of  Igene's
    stock remained below $2.25 per share (during the period  from
    October  1989  through December 1999 its  highest  price  was
    $1.25),  Igene  continued to issue  stock  in  lieu  of  cash
    payments at $2.25 per share.

    Accounting for stock based compensation
    _______________________________________

    The  Company  has adopted the disclosure-only  provisions  of
    Statement   of  Financial  Accounting  Standards   No.   123,
    "Accounting  for  Stock-Based Compensation" (SFAS  No.  123),
    and  SFAS  No. 148, "Accounting for Stock-Based Compensation-
    Transition    and   Disclosure",   but   applies   Accounting
    Principals  Board Opinion No. 25 and related  interpretations
    in  accounting  for its stock option plans.  No  compensation
    expense  related  to the Company's stock  option  plans  were
    recorded during two years ended December 31, 2003.

    The  Company  accounts for those plans under the  recognition
    and   measurement   principles  of  APB   Opinion   No.   25,
    "Accounting  for  Stock  Issued to  Employees",  and  related
    interpretations.     No   stock   option    based    employee
    compensation  cost is reflected in net loss, as  all  options
    granted  under the plan had an exercise price  equal  to  the
    market  value of the underlying common stock on the  date  of
    grant.   The  following table illustrates the effect  on  net
    loss  and  earnings per share if the Company had applied  the
    fair   value   recognition  provisions  of  SFAS   No.   123,
    "Accounting  for  Stock-Based  Compensation"  and  disclosure
    provisions  of  SFAS  No.  148  "Accounting  for  Stock-Based
    Compensation-Transition  and  Disclosure",   to   stock-based
    employee compensation for the two years ended December 31:


                    IGENE Biotechnology, Inc. and Subsidiary
                   Notes to Consolidated Financial Statements
                 For the years ended December 31, 2003 and 2002
<TABLE>
<CAPTION>

                                                            2003             2002
                                                        ____________     ____________
<S>                                                     <C>              <C>
    Net loss, as reported                               $(2,199,141)     $(3,189,980)

    Less pro forma stock-based employee compensation
      expense determined under fair value based method
      net of related tax effects                           (529,000)        (685,000)
                                                        ____________     ____________

    Pro forma net loss                                  $(2,728,141)     $(3,874,981)
                                                        ============     ============
    Net loss per Share:
      Basic - as reported                               $     (0.02)     $     (0.04)
      Basic - pro forma                                 $     (0.03)     $     (0.05)

      Diluted - as reported                             $     (0.02)     $     (0.04)
      Diluted - pro forma                               $     (0.03)     $     (0.05)

</TABLE>

    New accounting pronouncements
    _____________________________

    In  April  2003,  the  Financial Accounting  Standards  Board
    ("FASB")  issued Statement of Financial Accounting  Standards
    ("SFAS")  No. 149, "Amendment of Statement 133 on  Derivative
    Instruments  and Hedging Activities".  SFAS  No.  149  amends
    and   clarifies   financial  accounting  and  reporting   for
    derivative    instruments,   including   certain   derivative
    instruments  embedded  in other contracts,  and  for  hedging
    activities  under  SFAS No. 133, "Accounting  for  Derivative
    Instruments  and  Hedging  Activities".   The  Statement   is
    effective  for contracts entered into or modified after  June
    30,  2003 and for hedging relationships designated after June
    30,  2003.   There  was no material impact on  the  Company's
    financial  condition or results of operations  upon  adoption
    of this Statement.

    In  May  2003, the FASB issued SFAS No. 150, "Accounting  for
    Certain  Financial Instruments with Characteristics  of  both
    Liabilities  and Equity". SFAS No. 150 establishes  standards
    for  how  an issuer classifies and measures certain financial
    instruments  with  characteristics of both  a  liability  and
    equity.    It  requires  that  an  issuer  classify   certain
    financial  instruments as a liability, although the financial
    instrument  may  previously have been classified  as  equity.
    This   Statement  is  effective  for  financial   instruments
    entered into or modified after May 31, 2003 and otherwise  is
    effective  at  the  beginning of  the  first  interim  period
    beginning  after June 15, 2003.  The effect of adopting  this
    pronouncement required the reclassification of $2.04  million
    of redeemable preferred stock as a liability.

    In  January  2003,  the  FASB issued Interpretation  No.  46,
    "Consolidation  of  Variable Interest Entities"  ("FIN  46"),
    which  explains identification of variable interest  entities
    and  the assessment of whether to consolidate these entities.
    FIN  46  requires  existing unconsolidated variable  interest
    entities  to  be consolidated by their primary  beneficiaries
    if  the entities do not effectively disperse risks among  the
    involved  parties.  The provisions of FIN  46  are  effective
    for  all  financial statements issued after January 1,  2003.
    The  Company  has  no significant variable interests  in  any
    entities  which  would require disclosure  or  consolidation.
    The  Company's investment in the Joint Venture does not  meet
    the criteria of a variable interest entity under FIN 46.



	   IGENE Biotechnology, Inc. and Subsidiary
           Notes to Consolidated Financial Statements
         For the years ended December 31, 2003 and 2002

(2) Non-cash investing and financing activities:
    ___________________________________________

    On March 18, 2003, the Company entered into a Joint   Venture
    Agreement  with  Tate & Lyle  Fermentation  Products     Ltd.
    ("Tate").   Pursuant  to  a  Joint  Venture  Agreement,   the
    Company  and Tate agreed to form a joint venture (the  "Joint
    Venture")  to  manufacture, market and sell  Astaxanthin  and
    derivative  products throughout the world for all uses  other
    than  as  a  Nutraceutical  or  otherwise  for  direct  human
    consumption.   Tate contributed $24,600,000 in  cash  to  the
    Joint Venture, while the Company has agreed to contribute  to
    the  Joint  Venture its technology relating to the production
    of  Astaxanthin and assets related thereto. These assets will
    continue  to be used by the Joint Venture in the same  manner
    as  historically used by the Company.  The Company  and  Tate
    each  have a 50% ownership interest in the Joint Venture  and
    equal  representation  on  the  Board  of  Directors  of  the
    Company.   Unamortized  production costs  in  the  amount  of
    $316,869  were contributed to the Joint Venture reducing  the
    adjustment to additional paid in capital.

    On  April  3,  2003,  the  Board of  Directors,  in  lieu  of
    additional compensation, authorized the payment of shares  to
    Mr.  Stephen  Hiu  and Mr. Patrick Monahan.  In  compensation
    each  of  them  was  awarded 83,333 shares  of  Igene  common
    stock.   The aggregate 166,666 shares was issued and expensed
    based  on market value at the time of award, $.060 per share,
    or $10,000 of combined compensation.

    On  August  13,  2002,  the Board of Directors,  in  lieu  of
    additional compensation, authorized the payment of shares  to
    Mr.  Stephen  Hiu  and Mr. Patrick Monahan.  In  compensation
    each  of  them  was awarded 800,000 shares  of  Igene  common
    stock.    The  aggregate  1,600,000  shares  was  issued   on
    December  26,  2002 and expensed in the fourth quarter  based
    on  market  value at the time of award, $.025 per  share,  or
    $40,000 as compensation.

    During   the  course  of  2003  and  2002,  Fermic,   Igene's
    manufacturing  agent, earned 2,785,957 and 3,260,246  shares,
    respectively,  of  common stock as part of the  manufacturing
    agreement.   Fermic earns 2,250 shares of  common  stock  for
    each  kilogram  pure astaxanthin produced  and  delivered  as
    part  of  the  agreement. The average price is based  on  the
    market  value  of  the  shares at the time  the  product  was
    produced.   Fermic can earn up to 20,000,000 shares in  total
    under  the contract.  The 2,785,957 shares were earned at  an
    average  price  of  $.05 per share for  2003,  and  3,260,246
    shares were earned at an average price of $.03 per share  for
    2002.   Through  December  31, 2003, 11,089,222  shares  have
    been  earned.   Any future shares earned by  Fermic  will  be
    issued on a quarterly basis. Igene relied on Section 4(2)  of
    the  Securities Act of 1933, as amended, to issue the  shares
    Fermic without registration under that act.  Igene relied  on
    the  representations and warranties of  Fermic  made  in  the
    manufacturing   agreement  in  claiming  the   aforementioned
    exemption.

    On  February  4,  2003, Igene sold its subsidiary  ProBio  to
    Fermtech  AS  in exchange for aggregate consideration  valued
    at  approximately $343,000, consisting of 7,000,000 shares of
    Igene  common  stock  that  ProBio owned  (of  these  shares,
    2,000,000  shares may be re-earned by Fermtech  as  described
    below),  valued for the purposes of the acquisition  at  $.03
    per  share,  plus  forgiveness of approximately  $168,000  of
    debt  that  Igene owed to ProBio at the time of  purchase  in
    2001.   Mr.  Benjaminsen remained employed by  Igene  through
    February  2004,  1,000,000 of the escrowed shares  of  common
    stock  were delivered to Fermtech. If Mr. Benjaminsen remains
    employed  by  Igene  through  February  2005,  the  remaining
    1,000,000  escrowed shares will be released from  escrow  and
    delivered to Fermtech.

    During the 2003, the Company extended scheduled repayment  on
    demand  notes of $6,043,659 and related accrued  interest  of
    $2,865,810 until March 31, 2006.


	   IGENE Biotechnology, Inc. and Subsidiary
           Notes to Consolidated Financial Statements
         For the years ended December 31, 2003 and 2002


    During  2002  Igene issued 40,000 shares of common  stock  in
    payment   of   interest  on  a  variable  rate   subordinated
    debenture.   If  paid in cash, the interest would  have  been
    payable at 12%, or $90,000.  Shares may be issued in lieu  of
    cash  under  the debenture agreement at the higher  of  $2.25
    per  share  or market price per share.  The stock was  issued
    and  related interest was paid at $2.25 per  share  (see also
    note 7).

    In  addition, Igene exercised it's right to satisfy this debt
    on  the  variable rate subordinate debenture  on  October  1,
    2002.   Igene  gave notice to the holder of   the  $1,500,000
    variable  rate subordinated debenture, that pursuant  to  the
    debenture  agreement, "Payment of Principal  upon  Maturity",
    Igene is exercising our right to discharge the principal  due
    by   converting   the  Debenture  into  187,500   Shares   of
    Cumulative  Convertible Preferred stock at $8.00  per   share
    (see also note 7).

    On  February  22, 2002, Igene issued and sold  $1,000,000  in
    aggregate principal amount of 8% convertible debentures,  50%
    each to certain directors of Igene.   These  debentures   are
    convertible into shares of Igene's common stock at  $.04  per
    share  based  on the market price of Igene's  shares  at  the
    time the debentures were agreed to.  In consideration of  the
    commitment  to  purchase the 8% convertible debenture,  these
    directors  also received an aggregate of 25,000,000  warrants
    to   purchase   common  stock  at  $.04  per  share.    These
    debentures, if not converted earlier, become due on  February
    22,  2012.  Igene believes that the issuance and sale of  the
    convertible  debenture  is  exempt  from  registration  under
    Section  4(2)  of  the Securities Act of  1933,  as  amended,
    based  on,  among other things, the fact that the  purchasers
    of  the securities were directors of the company at the  time
    of purchase.

    On   July  17,  2002,  Igene  issued  and  sold  $300,000  in
    aggregate principal amount of 8% convertible debentures,  50%
    each to certain directors of Igene.   These  debentures   are
    convertible into shares of Igene's common stock at  $.03  per
    share  based  on the market price of Igene's  shares  at  the
    time the debentures were agreed to.  In consideration of  the
    commitment  to  purchase the 8% convertible debenture,  these
    directors  also received an aggregate of 10,000,000  warrants
    to   purchase   common  stock  at  $.03  per  share.    These
    debentures, if not converted earlier, become due on July  17,
    2012.   Igene  believes that the issuance  and  sale  of  the
    convertible  debenture  is  exempt  from  registration  under
    Section  4(2)  of  the Securities Act of  1933,  as  amended,
    based  on,  among other things, the fact that the  purchasers
    of  the securities were directors of the company at the  time
    of purchase.

    On  August  13,  2002,  the Board of  Directors,  in  further
    attempts  to  ascertain a manufacturing  partner,  authorized
    retention  of  the  services  of  Mr.  Martin  Gerson.    His
    responsibility would be to locate and  negotiate a deal  with
    a  manufacturing partner and act as liaison for the  expected
    term  of  the  service, two (2) years.  In  compensation  for
    this  service,  Mr. Gerson was awarded 12,000,000  shares  of
    Igene  common  stock.  The 12,000,000 shares  was  issued  on
    September 3, 2002 and expensed in the third quarter  at  fair
    value  of  approximately,  $.01 per  share,  or  $125,000  as
    compensation  at  the time of the award.  The  value  of  the
    services  to  be  performed by Mr. Gerson  was  $125,000,  as
    determined  by  the Board of Directors.  In  determining  the
    number  of  shares issued for the services to  be  performed,
    consideration   was  given  to  such  factors   as   blockage
    discounts   and   that  the  shares  of  common   stock   are
    restricted.  The total was expensed immediately as  there  is
    no service requirement for Mr. Gerson.

    During  2002  the  Company capitalized  leased  equipment  by
    recording  lease obligations payable of $6,537 under  capital
    lease.

    During  2003, 550 shares of redeemable preferred  stock  were
    exercised  and  retired in exchange for 1,100 new  shares  of
    common stock which were issued pursuant to the conversion.


	   IGENE Biotechnology, Inc. and Subsidiary
           Notes to Consolidated Financial Statements
         For the years ended December 31, 2003 and 2002


    During   2003,   3,750,000  warrants  were  exercised   using
    $200,892  of 8% notes payable and $80,358 of accrued interest
    in  a  cashless  exercise.  3,750,000 new  shares  of  common
    stock were issued pursuant to these exercises of options  and
    $200,892 of 8% notes were cancelled.

    During 2003 and 2002, Igene recorded dividends in arrears  on
    8%  redeemable preferred stock at $.64 per share  aggregating
    $16,387  and  $16,900  respectively, on  Series  A  preferred
    stock  and  $.48 per share aggregating $90,000  on  Series  B
    preferred stock, which has been removed from paid-in  capital
    and   included  in  the  carrying  value  of  the  redeemable
    preferred stock. (see also note 10)

(3) Concentration of Credit Risk
    ____________________________

    The Joint Venture is potentially subject to the effects of  a
    concentration   of   credit  risk  in  accounts   receivable.
    Accounts  receivable is substantially composed of receivables
    from  customers  in Chile, which is an important  market  for
    Igene's product, AstaXin(R).  Chile has  from  time  to  time
    experienced   political  unrest  and  currency   instability.
    Because  of  the volume of business transacted  by  Igene  in
    Chile,  recurrence  of  such  unrest  or  instability   could
    adversely affect the businesses of its customers in Chile  or
    Igene's  ability  to  collect  its  receivables  from   these
    customers.   In  order to minimize risk,  the  Joint  Venture
    strictly  evaluates the companies to which it extends  credit
    and  all  prices are denominated in US dollars as to minimize
    currency  fluctuation risk.  Losses due to  credit  risks  in
    accounts receivable are expected to be immaterial.

(4) Property and Equipment
    ______________________

    Property  and equipment are stated at cost and are summarized
    as follows:

    Laboratory equipment and fixtures             $     181,043
    Pilot plant equipment and fixtures                   91,503
    Idle equipment                                       56,150
    Office furniture and fixtures                        36,990
                                                  ______________

                                                        365,685
    Less accumulated depreciation                      (216,754)
                                                  ______________

                                                  $     148,931
                                                  ==============


    Idle  equipment represents manufacturing equipment, which  is
    not  presently  needed  for  production  of AstaXin(R). Igene
    plans  to  retain  the  equipment for use when  needed due to
    increased   production  volume  or failure of presently  used
    equipment. This equipment  is not currently being depreciated
    and its net carrying amount approximates its fair value.

(5) Investment in Joint Venture
    ___________________________

    Investment  in  Joint Venture is based on the  following.  On
    March  18,  2003, the Company entered into a Joint    Venture
    Agreement  with  Tate.    Pursuant  to   a   Joint    Venture
    Agreement,  the  Company and Tate agreed to  form  the  Joint
    Venture  to  manufacture,  market and  sell  Astaxanthin  and
    derivative  products throughout the world for all uses  other
    than  as  a  Nutraceutical  or  otherwise  for  direct  human
    consumption.   Tate contributed $24,600,000 in  cash  to  the
    Joint Venture, while the Company has agreed to contribute  to
    the  Joint  Venture its technology relating to the production
    of  Astaxanthin and assets related thereto. These assets will
    continue  to be used by the Joint Venture in the same  manner
    as  historically used by the Company.  The Company  and  Tate
    each  have a 50% ownership interest in the Joint Venture  and
    equal  representation  on  the  Board  of  Directors  of  the
    Company.   Unamortized  production costs  in  the  amount  of


	   IGENE Biotechnology, Inc. and Subsidiary
           Notes to Consolidated Financial Statements
         For the years ended December 31, 2003 and 2002


    $316,869  were  contributed to the Joint Venture  making  the
    adjustment to additional paid in capital $11,989,131.   Added
    to  this was a purchase of common stock in the new venture of
    $6,000.

    As  a result of the Joint Venture, the production, sales  and
    marketing   of   Astaxanthin   now   takes   place   in   the
    unconsolidated Joint Venture subsidiary.  For  2003,  Igene's
    portion  of  the Joint Venture's net loss was $914,494.   The
    loss  was a result of a 50% interest in the following:  Gross
    profit  for  the  year  was a negative $17,600  on  sales  of
    $1,133,675,  less manufacturing cost of $1,151,275.   Selling
    and  general and administrative expenses for the period  were
    $1,827,703  and interest income was $16,315.   The  resulting
    loss  before  tax  was  $1,828,988.  For  2003,  Igene's  50%
    portion of the Joint Venture loss was $914,494.

    The  initial investment of $12,306,000 was reduced by Igene's
    share  of  the  loss during 2003 of $914,494 resulting  in  a
    $11,391,506  investment in unconsolidated  Joint  Venture  at
    December 31, 2003.

    As  of December 31, 2003 the joint venture balance sheet  was
    as follows:

          Cash                              $    838,509
          Accounts receivable                    646,143
          Inventory                              976,906
          Fermentation plant - in process     21,614,000
                                            _____________

          Total Assets                      $ 24,075,558


          Working capital loan payable      $    533,000
          Accounts payable                       751,546
                                            _____________

          Total Liabilities                    1,284,546

          Capital                             24,620,000
          Deficit                             (1,828,988)
                                            _____________

          Total Liabilities and Capital     $ 24,075,558
                                            =============

(6) Accounts Payable and Accrued Expenses
    _____________________________________

    Accounts  payable  and  accrued  expenses  consist   of   the
    following:

          Accounts payable, trade           $     82,994
          Other accrued expenses                 102,868
                                            _____________

                                            $    185,862
                                            =============

(7) Variable Rate Subordinated Debenture
    ____________________________________

    Igene  exercised  its  right  to satisfy  the  variable  rate
    subordinate  debenture on October 1, 2002 by  converting  the
    principal  due under the variable rate subordinated debenture
    into  187,500  Shares of 8% Cumulative Convertible  Preferred
    stock, Series B at $8.00 per share.

    The  debenture  bore  interest at a  rate  of  8%  per  annum
    through  September 30, 1996 and thereafter at a rate  of  12%
    per  annum.  Interest was payable in cash through October  1,
    1989.   Thereafter, the debenture agreement provided that  at
    the  option and at the discretion of Igene, interest  may  be
    paid  in  shares  of Igene's common stock at the  greater  of
    $2.25  per  share  or  the average market  value  per  share.


	   IGENE Biotechnology, Inc. and Subsidiary
           Notes to Consolidated Financial Statements
         For the years ended December 31, 2003 and 2002


    During  2002  Igene issued 40,000 shares of its common  stock
    as  payment  of interest on the debenture. The debenture  was
    convertible  into common stock of Igene at any  time  at  the
    option  of the holder at an initial rate of $4 per  share  of
    common stock.  The debenture was redeemable at the option  of
    Igene  at any interest payment date at par value plus accrued
    interest.

(8) Convertible Debentures
    ______________________

    In   2002,  Igene  issued  and  sold  $250,000  in  aggregate
    principal  amount of 8% demand notes to certain directors  of
    Igene.   During  2003 Igene repaid these notes  plus  accrued
    interest in satisfaction of the debt.

    On  July 17 2002, Igene issued and sold $300,000 in aggregate
    principal amount of 8% convertible debentures,  50% each   to
    certain   directors   of   Igene.    These   debentures   are
    convertible into shares of Igene's common stock at  $.03  per
    share  based  on the market price of Igene's  shares  at  the
    time the debentures were agreed to.  In consideration of  the
    commitment  to  purchase the 8% convertible debenture,  these
    directors  also received an aggregate of 10,000,000  warrants
    to   purchase   common  stock  at  $.03  per  share.    These
    debentures, if not converted earlier, become due on  July  17
    2012.   Igene  believes that the issuance  and  sale  of  the
    convertible  debenture  is  exempt  from  registration  under
    Section  4(2)  of  the Securities Act of  1933,  as  amended,
    based  on,  among other things, the fact that the  purchasers
    of  the securities were directors of the company at the  time
    of purchase.

    On  February  22  2002, Igene issued and sold  $1,000,000  in
    aggregate principal amount of 8% convertible debentures,  50%
    each to certain directors of Igene.   These  debentures   are
    convertible into shares of Igene's common stock at  $.04  per
    share  based  on the market price of Igene's  shares  at  the
    time the debentures were agreed to.  In consideration of  the
    commitment  to  purchase the 8% convertible debenture,  these
    directors  also received an aggregate of 25,000,000  warrants
    to   purchase   common  stock  at  $.04  per  share.    These
    debentures, if not converted earlier, become due on  February
    22  2012.  Igene believes that the issuance and sale  of  the
    convertible  debenture  is  exempt  from  registration  under
    Section  4(2)  of  the Securities Act of  1933,  as  amended,
    based  on,  among other things, the fact that the  purchasers
    of  the securities were directors of the company at the  time
    of purchase.

    Convertible  debentures  are  summarized  as  follows  as  of
    December 31, 2003:

<TABLE>
<CAPTION>
                                                                         Accrued
                                                         Principal       Interest
                                                        ___________     ___________
    <S>                                                 <C>             <C>
    8%, 10-year, convertible debenture issued 7/17/02   $  300,000      $   34,652
    8%, 10-year, convertible debenture issued 2/22/02    1,000,000         144,658
    8%, 10-year, convertible debenture issued 3/1/01     1,014,212         229,503
    8%, 10-year, convertible debenture issued 3/27/01    1,500,000         293,852
    6%, 3-year, convertible debenture issued 11/30/01    1,000,000           5,000
                                                        ___________     ___________

                                                        $4,814,212      $  707,665
                                                        ===========     ===========
</TABLE>

(9) Notes Payable
    _____________

    This  long  term  debt,  approximately $6,300,000  which  was
    scheduled to become payable in March 2003, has been  extended
    and  is now due March 2006.  Management felt any attempts  to
    satisfy  the debt at this time would have materially  adverse
    effects  on  the  Company.  Management  negotiated  with  the
    holders of the debt to extend the debt's maturity to  a  time
    when  the  Company is better able to satisfy its  obligation.
    However   the  company  can  not  guarantee  that   it   will
    successfully be able to repay the debt at that time.


	   IGENE Biotechnology, Inc. and Subsidiary
           Notes to Consolidated Financial Statements
         For the years ended December 31, 2003 and 2002


    As  a  part  of the terms of the debt the exercise prices  of
    the  warrants  and any conversion features was discounted  by
    25% thus a  $.10 warrant is now convertible at $.075 cents.

    Beginning  November 16, 1995 and continuing  through  May  8,
    1997, Igene issued promissory notes to certain directors  for
    aggregate  consideration of $1,082,500.  These notes  specify
    that  at any time prior to repayment the holder has the right
    to  convert  the  notes to common stock of  Igene  at  prices
    ranging  from $0.05 per share to $0.135 per share,  based  on
    the  market  price  of common shares at the respective  issue
    dates.   The  notes were convertible in total  to  13,174,478
    shares  of  common stock.  As a result of the extension  they
    are  now  convertible in 17,565,970 shares of  common  stock.
    Concurrently,  with  each  of the  $1,082,500  of  promissory
    notes,  the holders also received 13,174,478 warrants for  an
    equivalent  number  of  shares at the  equivalent  price  per
    share.  The warrants expire ten years from the issue  of  the
    notes.   As  a  result of the extension of debt  the  warrant
    exercise  prices  were  reduced by  25%.   These  notes  were
    modified in conjunction with the 1998 rights offering  to  be
    due  on  March 31, 2003, and have been extended to March  31,
    2006  as  part of the extension.  The notes bear interest  at
    the prime rate.

    In  conjunction with the rights offering in March 1998, Igene
    issued  $5,000,000  of  8%  Notes  due  March  31,  2003  and
    50,000,000 warrants to purchase one share of common stock  at
    an  exercise  price  of $0.10 per share  expiring  March  31,
    2008.   As a result of the extension these notes are now  due
    March  31,  2006  and the exercise price  is  now  $.075  per
    share.

    Notes Payable are summarized as follows as of December 31,
    2003:

<TABLE>
<CAPTION>
                                                                         Accrued
                                                         Principal       Interest
                                                        ___________     ___________
  <S>                                                   <C>             <C>
    Long-term notes payable, bearing interest
        at prime, scheduled to maturing
        March 31, 2003, extended to March 31,
        2006, convertible into common stock             $1,082,500      $  499,579
    Long-term notes payable, bearing interest
        at 8%, scheduled to maturing
        March 31, 2003, extended to March 31,
        2006                                             4,760,267       2,191,028
                                                        ___________     ___________

                                                        $5,842,767      $2,690,607
                                                        ===========     ===========
</TABLE>

    Combined  aggregate amounts of maturities for all convertible
    debentures and notes payable are as follows:

                 Year                   Amount
                ______               ___________

                 2004                $ 1,000,000
                 2005                        ---
                 2006                  5,842,767
                 2007                        ---
                 Thereafter          $ 3,814,212


  	    IGENE Biotechnology, Inc. and Subsidiary
           Notes to Consolidated Financial Statements
         For the years ended December 31, 2003 and 2002


(10) Redeemable Preferred Stock
     __________________________

    Each  share of redeemable preferred stock is entitled to vote
    on  all  matters requiring shareholder approval as one  class
    with  holders  of  common stock, except that  each  share  of
    redeemable preferred stock is entitled to two votes and  each
    share of common stock is entitled to one vote.

    Redeemable  preferred stock is convertible at the  option  of
    the  holder  at  any time, unless previously  redeemed,  into
    shares  of Igene's common stock at the rate of two shares  of
    common  stock  for each share of preferred stock  (equivalent
    to  a conversion price of $4.00 per common share), subject to
    adjustment under certain conditions.

    Shares of redeemable preferred stock are redeemable for  cash
    in  whole  or in part at the option of Igene at any  time  at
    the  stated  value plus accrued and unpaid dividends  to  the
    redemption  date.   Dividends  are  cumulative  and   payable
    quarterly on January 1, April 1, July 1 and October 1,  since
    January  1,  1988   (See note 7 relating to the  exchange  of
    certain redeemable preferred stock for a debenture).

    Igene   exercised  it's  right  to  satisfy  the   $1,500,000
    principal  amount  of debt outstanding on its  variable  rate
    subordinate  debenture on October 1, 2002.  Igene  discharged
    the  principal due by converting the debenture  into  187,500
    Shares  of 8% Cumulative Convertible Preferred stock,  Series
    B  at  a rate of $8.00 per share (See note 7 relating to  the
    exchange  of  certain  redeemable  preferred  stock   for   a
    debenture).

    Mandatory  redemption  of Preferred stock  Series  A  was  by
    agreement  due  by  Igene  in  October  2002.   As  Igene  is
    operating  at  a  negative cash flow and  negative  earnings,
    Maryland  law  does  not allow for the  redemption  of  these
    shares.   As  such they will remain outstanding and  continue
    to  accrue  interest  until such time as  Igene  is  able  to
    undertake  redemption, though there can be no assurance  this
    will develop.

    In  December  1988, as part of an overall effort  to  contain
    costs  and conserve working capital, Igene suspended  payment
    of   the   quarterly   dividend  on  its   preferred   stock.
    Resumption   of   the   dividend  will  require   significant
    improvements  in  cash flow.  Unpaid dividends  cumulate  for
    future  payment or addition to the liquidation preference  or
    redemption value of the preferred stock.  As of December  31,
    2003,  total dividends in arrears on Igene's preferred  stock
    equal  $249,905 (or $9.76 per share) on Igene's Series A  and
    $150,000  (or  $.80 per share) on Igene's Series  B  and  are
    included  in  the carrying value of the redeemable  preferred
    stock.

(11)Stockholders' Equity
    ____________________

    Options
    _______

    In  June  of  2001, the stockholders approved the 2001  Stock
    Option Plan (the "2001 Plan"), which succeeds the 1997  Stock
    Option  Plan (the "1997 Plan"), which succeeded Igene's  1986
    Stock  Option  Plan  (the  "1986  Plan"),  as  amended.   All
    outstanding, unexercised options granted under the  1997  and
    1986  Plans  remain  outstanding with unchanged  terms.   The
    number of shares authorized for issuance under the 2001  Plan
    is  55,000,000.  This is in addition to the 20,000,000 shares
    authorized  for  issuance  under  the  1997  Plan,  and   the
    2,000,000  shares  authorized for  issuance  under  the  1986
    Plan.


            IGENE Biotechnology, Inc. and Subsidiary
           Notes to Consolidated Financial Statements
         For the years ended December 31, 2003 and 2002


    The   following   is  a  summary  of  options   granted   and
    outstanding  under  the  plans as of December  31,  2003  and
    2002:
<TABLE>
<CAPTION>
                                      2003                           2002
                            ________________________       ________________________
    <S>                     <C>            <C>             <C>            <C>
                                           Weighted                       Weighted
                                            Average                        Average
                                           Exercise                       Exercise
                              Number          Price          Number          Price
                            ___________  ___________       ___________  ___________
    Options outstanding
    and exercisable,
    beginning of year       35,588,250        $.047        19,037,584        $.064
    Options granted                ---          ---        18,200,000        $.025

    Options  exercised        (100,000)       $.025               ---          ---
    Options forfeited,
    or withdrawn with
    consent of holders             ---          ---        (1,649,334)       $.038
    Options expired                ---          ---               ---          ---
                            ___________  ___________       ___________  ___________
    Options outstanding
    and exercisable,
    end of year             35,488,250        $.047        35,588,250        $.047
                            ===========  ===========       ===========  ===========
</TABLE>

<TABLE>
                  Options Outstanding
<CAPTION>
                                    Weighted Average
      Exercise Price     Shares     Remaining Life (Years)
      ______________   __________   ______________________
      <S>              <C>          <C>
      $.025            17,100,000            8.6
      $.050             9,342,666            5.9
      $.053                97,719            3.0
      $.060               162,865            3.0
      $.065                45,000            5.5
      $.080             5,500,000            7.8
      $.100             3,240,000            4.3
                       __________

      $.047            35,488,250
                       ==========
</TABLE>

    In  addition  to  the  options listed  above,  the  following
    additional  unregistered options were issued outside  of  the
    2001,  1997 and 1986 plans.  Per Benjaminsen and Stein  Ulve,
    were  each granted 10,000,000 options, as part of their Igene
    employment  agreement  signed concurrently  with  the  ProBio
    purchase.   The options vest over a three year  period.   Mr.
    Ulve  had  vested in the first third of his options and  with
    his  resignation  from Igene forfeited the balance.   He  has
    until  January  21,  2004 to exercise the  options  that  had
    vested.   Mr. Benjaminsen has vested in the first two  thirds
    of  his  options  and will vest in the remaining  portion  on
    December  31,  2004.  These options expire October  9,  2011.
    All 20,000,000 options are exercisable at $0.08 per share.


   	    IGENE Biotechnology, Inc. and Subsidiary
           Notes to Consolidated Financial Statements
         For the years ended December 31, 2003 and 2002


    The  fair value of each option grant is estimated on the date
    of  grant  using the Black-Scholes option-pricing model  with
    the  following weighted average assumptions used  for  grants
    during the two years ended December 31:

<TABLE>
<CAPTION>
                                          2002             2003
                                        _______          _______
     <S>                                <C>              <C>
     Dividend yield                        ---              ---
     Expected volatility                437.67%           51.79%
     Risk-free interest rate              4.47%            4.21%
     Expected lives in years                10               10
     Fair value of options granted       $0.04            $0.04

</TABLE>


    Warrants
    ________

    In  consideration for his work on the Board of Directors  Mr.
    Kimelman  was awarded on May 13, 2003 11,000,000 warrants  to
    purchase  Igene common stock at $.06 per share.  The warrants
    shall expire March 26, 2013.

    On  February  22  2002, Igene issued and sold  $1,000,000  in
    aggregate principal amount of 8% convertible debentures,  50%
    each to certain directors  of  Igene.   These debentures  are
    convertible into shares of Igene's common stock at  $.04  per
    share  based  on the market price of Igene's  shares  at  the
    time the debentures were agreed to.  In consideration of  the
    commitment  to  purchase the 8% convertible debenture,  these
    directors  also received an aggregate of 25,000,000  warrants
    to   purchase   common  stock  at  $.04  per  share.    These
    debentures, if not converted earlier, become due on  February
    22  2012.  Igene believes that the issuance and sale  of  the
    convertible  debenture  is  exempt  from  registration  under
    Section  4(2)  of  the Securities Act of  1933,  as  amended,
    based  on,  among other things, the fact that the  purchasers
    of  the securities were directors of the company at the  time
    of purchase.

    On  July 17 2002, Igene issued and sold $300,000 in aggregate
    principal amount of 8% convertible  debentures,  50% each  to
    certain   directors   of   Igene.    These   debentures   are
    convertible into shares of Igene's common stock at  $.03  per
    share  based  on the market price of Igene's  shares  at  the
    time the debentures were agreed to.  In consideration of  the
    commitment  to  purchase the 8% convertible debenture,  these
    directors  also received an aggregate of 10,000,000  warrants
    to   purchase   common  stock  at  $.03  per  share.    These
    debentures, if not converted earlier, become due on  July  17
    2012.   Igene  believes that the issuance  and  sale  of  the
    convertible  debenture  is  exempt  from  registration  under
    Section  4(2)  of  the Securities Act of  1933,  as  amended,
    based  on,  among other things, the fact that the  purchasers
    of  the securities were directors of the company at the  time
    of purchase.

    The  following table summarizes warrants issued,  outstanding
    and exercisable:


                                      As of December 31,
                                ______________________________

                                   2003               2002
                                ___________        ___________

    Issued                      205,266,073        198,016,073
    Outstanding                 205,266,073        198,016,073
    Exercisable                 205,266,073        198,016,073


	    IGENE Biotechnology, Inc. and Subsidiary
           Notes to Consolidated Financial Statements
         For the years ended December 31, 2003 and 2002


    Common Stock
    ____________

    At  December  31, 2003, 205,266,073 shares of authorized  but
    unissued   common  stock  were  reserved  for   exercise   of
    outstanding  warrants, 35,488,250 shares  of  authorized  but
    unissued common stock were reserved for exercise pursuant  to
    the  1986, 1997 and 2001 Stock Option Plans, 9,999,999 shares
    were   reserved  for  exercise  of  options   held   by   Mr.
    Benjaminsen  and  Mr. Ulve, 51,210 shares of  authorized  but
    unissued  common  stock  were  reserved  for  issuance   upon
    conversion  of  Igene's outstanding preferred stock,  375,000
    shares  of authorized but unissued common stock were reserved
    for issuance upon conversion of the Preferred Stock series  B
    issued  in  conversion  of   the variable  rate  subordinated
    debenture,  8,910,778  shares  were  reserved  for  issue  in
    accordance  with Igene's manufacturing agreement with  Fermic
    (see  note  13)  and  93,993,621  shares  of  authorized  but
    unissued stock were reserved for issuance upon conversion  of
    outstanding convertible notes.

    Preferred Stock
    _______________

    Igene  exercised  its  right  to satisfy  the  variable  rate
    subordinate  debenture on October 1, 2002 by  converting  the
    principal  due under the variable rate subordinated debenture
    into  187,500  Shares of 8% Cumulative Convertible  Preferred
    stock, Series B at $8.00 per share.

    The  debenture  bore  interest at a  rate  of  8%  per  annum
    through  September 30, 1996 and thereafter at a rate  of  12%
    per  annum.  Interest was payable in cash through October  1,
    1989.   Thereafter, the debenture agreement provided that  at
    the  option and at the discretion of Igene, interest  may  be
    paid  in  shares  of Igene's common stock at the  greater  of
    $2.25  per  share  or  the average market  value  per  share.
    During  2002  Igene issued 40,000 shares of its common  stock
    as payment of interest on the debenture

    The  debenture was convertible into common stock of Igene  at
    any  time at the option of the holder at an initial  rate  of
    $4  per  share of common stock.  The debenture was redeemable
    at  the  option of Igene at any interest payment date at  par
    value  plus  accrued interest.  (See note 7 relating  to  the
    exchange  of  certain  redeemable  preferred  stock   for   a
    debenture).

    As  of  December  31,  2003, total dividends  in  arrears  on
    Igene's  preferred stock equal $249,905 (or $9.76 per  share)
    on  Igene's  Series  A and $90,000 (or  $.48  per  share)  on
    Igene's  Series B and are included in the carrying  value  of
    the redeemable preferred stock.

(12) Net Loss Per Common Share
     _________________________

    Net  loss  per  common share for 2003 and 2002  is  based  on
    90,438,251   and   81,544,079   weighted   average    shares,
    respectively.  For purposes of computing net loss per  common
    share,  the  amount  of  net  loss  has  been  increased   by
    dividends  declared  and cumulative undeclared  dividends  in
    arrears on preferred stock.

    Common   stock  equivalents,  including:  options,  warrants,
    convertible   debt,   convertible   preferred   stock,    and
    exercisable  rights have not been included in the computation
    of  earnings  per  share in 2003 and 2002 because  to  do  so
    would  have been anti-dilutive.  However, these common  stock
    equivalents  could have potentially dilutive effects  in  the
    future (see also notes 7, 8, 10 and 11).

(13) Commitments
     ___________

    Igene  is obligated for office and laboratory facilities  and
    other  rentals under operating lease agreements, which expire
    in  2011.  The  basic  annual  rentals  are  expected  to  be
    approximately $93,600 under such leases. Annual rent  expense


            IGENE Biotechnology, Inc. and Subsidiary
           Notes to Consolidated Financial Statements
         For the years ended December 31, 2003 and 2002



    relating to the leases for the years ended December 31,  2003
    and 2002 approximated $93,600 and $90,000, respectively.

    Future  minimum  rental payments, in the  aggregate  and  for
    each of the next five years are as follows:

                Year             Amount
               ______          __________
                2004            $110,294
                2005             110,294
                2006             112,318
                2007             114,710
                2008             117,162

     Effective   May   20,  2000,  Igene  signed   an   exclusive
     manufacturing   agreement  with   Fermic,   S.A.   de   C.V.
     ("Fermic"),  of Mexico City, Mexico, for the  production  of
     AstaXin(R).    The  Fermic   contract   provides   that  the
     manufacturer  has  a  limited  exclusive  right  to  produce
     AstaXin(R) and is paid a monthly fee in cash, which is based
     on manufacturing capacity, plus shares of Igene common stock
     based  on  production quantities.  Fermic provides equipment
     and  facilities  necessary  to  manufacture  and  store  the
     product  and  is  responsible for purchasing raw  materials.
     Igene is responsible for sales efforts and for ensuring  the
     quality  of the pigment.  Igene also has a role in  ensuring
     that  the manufacturing process works effectively.  The term
     of the contract is 6 years.

     Based on  production of AstaXin(R), Igene  has  committed to
     issue  to  Fermic  up to a maximum of 20,000,000  shares  of
     Igene common stock during a six year period expiring May 20,
     2006  in  accordance  with the new manufacturing  agreement.
     Based on quantities of AstaXin(R) produced 11,089,222 shares
     of Igene common stock has been issued to Fermic.  This stock
     has been recorded as a manufacturing expense and also as  an
     increase  in common stock and additional paid in capital  of
     $574,905.  This amount has been computed based on  the  fair
     value of the stock as of the period in which the shares were
     earned.

(14) Contingencies
     ______________

     Previously reported litigation (original lawsuit filed  July
     21, 1997, U.S. District Court, Baltimore, MD) between Archer
     Daniels   Midland,   Inc.  ("ADM")  and   Igene,   involving
     allegations   of   patent  infringement  and   counterclaims
     concerning  the  theft  of trade secrets,  was  resolved  on
     September 29, 2003.  Resolution of the dispute between   ADM
     and   Igene  did  not  result in an unfavorable  outcome  to
     Igene.   Igene  will continue to make and sell its  product,
     AstaXin(R).   The  Company incurred $133,464  of  litigation
     expenses for 2003 and $47,159 for 2003.

(15) Income Taxes
     ____________

     No  income tax benefit or deferred tax asset is reflected in
     the   financial   statements.   Deferred  tax   assets   are
     recognized  for  future deductible temporary difference  and
     tax loss carry forwards if their realization is "more likely
     than not".

     At  December  31,  2003,  Igene has federal  and  state  net
     operating loss carry-forwards of approximately   $23,400,000
     that  expire at various dates from 2003 through  2023.   The
     recorded  deferred  tax  asset,  representing  the  expected
     benefit  from  the future realization of the  net  operating
     losses, net of the valuation allowance,  was   $-0- for 2003
     and 2002.


            IGENE Biotechnology, Inc. and Subsidiary
           Notes to Consolidated Financial Statements
         For the years ended December 31, 2003 and 2002


       The sources of the deferred tax asset are approximately as
       follows:

         Net operating loss carry-forward benefit    $ 9,037,000
         Valuation allowance                          (9,037,000)
                                                     ____________

         Deferred tax asset, net                     $       ---
                                                     ============

(16) Uncertainty
     ___________

    Igene  has incurred net losses in each year of its existence,
    aggregating  approximately  $39,000,000  from  inception   to
    December   31,  2003  and  its  liabilities  and   redeemable
    preferred   stock   exceeded  its  assets  by   approximately
    $3,861,000  at that date.  These factors indicate that  Igene
    will  not be able to continue in existence unless it is  able
    to   raise   additional   capital   and   attain   profitable
    operations.

    The  continuing  successful  marketing  of  Igene's  product,
    AstaXin(R),  may  permit  Igene to attract additional capital
    and enable it to continue.

    Igene began manufacturing and selling AstaXin(R) during  1998
    and  has  continued to do so to date, attempting to  increase
    sales   and   manufacturing  levels.   Igene  believes   this
    technology to be highly marketable.  Igene hopes to  continue
    increasing sales of  AstaXin(R), eventually  achieving  gross
    profits  and,  subsequently, profitable  operations.   Though
    the achievement of these can not be assured.

    During  2002  Igene continued to fund its operations  through
    the  issuance of warrants and convertible debentures  through
    direct  purchases and loans by directors and other accredited
    investors.  This provided additional capital of $1,550,000.

(17) Nature of Risks and Concentrations
     __________________________________

    Igene derived revenue during 2003 and 2002 from sales of  the
    product, AstaXin(R).  Substantially all of  Igene's  2003 and
    2002   sales  were  to  fish  producers  in  the  aquaculture
    industry  in  Chile.  During 2002, three customers,  who  are
    located in Chile, represented over 10% of sales each,  for  a
    total  of  83%  in the aggregate, accordingly, all  of  Igene
    Chile's   receivables   are  located   in   Chile.     Though
    development  of the Joint Venture facility is  underway,  all
    of  Igene or the Joint Venture's manufacturing operations for
    AstaXin(R) are currently conducted in a single  manufacturing
    facility in Mexico City, Mexico.

    All  of the preceding concentrations subject Igene to certain
    risks.  For  example,  it is considered at  least  reasonably
    possible  that any particular customer, distributor,  product
    line, or provider of services or facilities could be lost  in
    the  near  term.   It is also considered at least  reasonably
    possible  that  operations located outside the United  States
    could  be disrupted in the near term.  However, Igene has  at
    present no information that would lead it to believe that  it
    will lose its principal product, principal customers, or  its
    contracted  manufacturer; or that its  operations  in  Mexico
    City  or Chile will be disrupted, though this belief can  not
    be assured.

(18) Simple Retirement Plan
     ______________________

   Effective  January 1, 1997, Igene adopted a Simple  Retirement
   Plan  under Internal Revenue Code Section 408(p). The Plan  is
   a  defined contribution plan, which covers all of Igene's U.S.
   employees who receive at least $5,000 of compensation for  the
   preceding   year.   The   Plan   permits   elective   employee
   contributions.  Igene made nonelective contributions of 2%  of
   each  eligible employee's compensation for each year  for  the


           IGENE Biotechnology, Inc. and Subsidiary
           Notes to Consolidated Financial Statements
         For the years ended December 31, 2003 and 2002


   period  January  1,  1997  through until  December  31,  2001.
   Effective   January   1,   2003,  Igene   made   an   elective
   contribution  of  3% of each eligible employee's  compensation
   for  each  year.  Igene's contributions to the plan  for  2002
   were  $11,201,  which  is expensed in the  2002  statement  of
   operations.  Igene's contributions to the plan for  2003  were
   $17,631   which   is  expensed  in  the  2003   statement   of
   operations.

                           SIGNATURES


In accordance with Section 13 or 15(d) of the Securities Exchange
Act, the registrant caused this report to be signed on its behalf
by  the undersigned, thereunto duly authorized, in Howard County,
Maryland on March 26, 2004.


                       IGENE Biotechnology, Inc.

                       ________________________________________
                       (Registrant)


                       By /s/STEPHEN F. HIU
                          _____________________________________

                             STEPHEN F. HIU
                             President, Chief Technical Officer
                             and Treasurer

                       Date  March 26, 2004

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

<TABLE>
<CAPTION>

Signature                  Title                      Date
_________                  _____                      _____
<S>                        <C>                        <C>

/s/ STEPHEN F. HIU         Director, President,       March 26, 2004
    ____________________   Chief Technical Officer,
    STEPHEN F. HIU         Treasurer

/s/ EDWARD J. WEISBERGER   Chief Financial Officer    March 26, 2004
    ____________________   (principal financial and
    EDWARD J. WEISBERGER    accounting officer)

/s/ THOMAS L. KEMPNER      Vice Chairman of Board     March 26, 2004
    ____________________   of Directors
    THOMAS L. KEMPNER

/s/ MICHAEL G. KIMELMAN    Chairman of the Board      March 26, 2004
    ____________________   of Directors
    MICHAEL G. KIMELMAN

/s/ SIDNEY R. KNAFEL       Director                   March 26, 2004
    ____________________
    SIDNEY R. KNAFEL

/s/ PATRICK F. MONAHAN     Director, Vice President   March 26, 2004
    ____________________   Secretary and
    PATRICK F. MONAHAN     Director of Manufacturing

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