UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                   FORM 10-KSB

(Mark One)

(X)  Annual report under section 13 or 15(d) of the Securities Exchange Act of
     1934.

     For the fiscal year ended October 31, 2003

( )  Transition report pursuant to section 13 or 15(d) of the Securities
     Exchange Act of 1934.

Commission file number: 0-17378

                             VITRO DIAGNOSTICS, INC.
                             -----------------------
             (Exact name of registrant as specified in its charter)

Nevada                                                        84-1012042
------                                                        ----------
(State or other jurisdiction of                      (I.R.S. Identification No.)
incorporation or organization)

12635 E. Montview Blvd., Aurora, Colorado                        80010
-----------------------------------------                        -----
(Address of principal executive offices)                       (Zip Code)

Registrant's telephone number, including area code:  (720) 859-4120
                                                     --------------

Securities registered pursuant to Section 12(b) of the Exchange Act:  None

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

                          Common Stock, $.001 par value
                          -----------------------------
                                (Title of Class)

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

Check if there is no disclosure of delinquent filers pursuant to Item 405 of
Regulation S-B is not contained herein, and will not 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. [X]

<PAGE>

The issuer had no revenue for its most recent fiscal year.

The aggregate market value of the 5,164,407 shares of voting stock held by
non-affiliates of the Company at December 31, 2003, calculated by taking the
last sales price of the Company's common stock ($.13 as quoted on December 31,
2003) was $671,373. The number of shares outstanding of the issuer's common
equity as of December 31, 2003 was 9,594,305.

                       Document incorporated by reference:

     None.

Transitional Small Business Disclosure Format:       [  ] Yes  [ X ] No

This report consists of 47 pages, including one page constituting the cover
page.

<PAGE>



                                TABLE OF CONTENTS



PART I.........................................................................1

   ITEM 1.  BUSINESS...........................................................1
   ITEM 2.  DESCRIPTION OF PROPERTY...........................................10
   ITEM 3.  LEGAL PROCEEDINGS.................................................10
   ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS...............10

PART II.......................................................................11

   ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS..........11
   ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
            AND RESULTS OF OPERATIONS.........................................12
   ITEM 7.  FINANCIAL STATEMENTS..............................................18
   ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS.....................18

PART III......................................................................19

   ITEM 9.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT................19
   ITEM 10. EXECUTIVE COMPENSATION............................................20
   ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT....22
   ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS....................24

PART IV.......................................................................25

   ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K..................................25

SIGNATURES....................................................................28


PART F/S.....................................................................F-1







                                        i
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                Special Note Regarding Forward Looking Statements

     Except for the historical information contained herein, this document
contains forward-looking statements relating to future financial results or
business expectations. These statements are identified by words such as
"expects," "anticipates" or "hopes." Investors should be aware that business
plans might change, as circumstances require. Actual results could differ
materially as a result of risk-related factors. Such factors include, but are
not limited to, those discussed in "Business" and "Management's Discussion and
Analysis or Plan of Operation." Investors should not put undue reliance on these
forward-looking statements. Except as otherwise required by rules of the
Securities and Exchange Commission, the Company disclaims any intent or
obligation to update publicly these forward-looking statements, whether as a
result of new information, future events or otherwise.

                          Reference to Other Documents

     The descriptions in this Report relating to the contents of any agreements
or other documents are qualified in their entirety by reference to those
documents, copies of which are filed with, or incorporated by reference into,
this Report.







                                       ii
<PAGE>

                                     PART I

ITEM 1. BUSINESS

History
-------

     Vitro Diagnostics, Inc. ("we" or the "Company") was incorporated under the
laws of the State of Nevada on March 31, 1986. From November of 1990 to July 31,
2000, the Company was engaged in the development, manufacture and distribution
of purified human antigens and the development of therapeutic products and
related technologies. In August 2000, the Company sold the assets used in the
manufacture and sale of purified antigens for diagnostic applications.

     Our common stock is currently traded over the counter and quoted on the OTC
Bulletin Board.

Narrative Description of Business
---------------------------------

     Since the sale of the diagnostic operations, we have focused on
commercializing products that incorporate technologies related to medical
therapeutic applications. These technologies include those originally developed
in the diagnostic business and others developed since then. The products and
product candidates include fertility drugs, cell lines and related products.
However, we have only recently successfully commercialized any products, and had
no revenue through the end of fiscal 2003, ending October 31, 2003. Our efforts
to commercialize these products and generate revenue have been hampered by our
limited personnel and working capital.

     The first products that we believe are commercially viable include cell
lines developed from our patented cell immortalization technology. The
technology was originally developed to aid in the production of a series of
fertility drugs, but we adapted the technology to new products in an effort to
generate immediate revenue and improve our financial condition. (See
"Management's Discussion and Analysis or Plan of Operations" for a more complete
description of our financial condition). We commenced marketing these products
at the end of calendar 2003, and it is too early to evaluate the effectiveness
of our efforts. However, we believe that given our current financial condition
and the concurrent limits on research, development and marketing, product
development will be limited in the near future.

     The following discussion highlights our efforts through the end of 2003.


A. Human Cell Lines and Related Products and Technology
-------------------------------------------------------

     1. Background

     The Company has developed a novel technology for the immortalization of
cells that our management believes has broad application to commercialization of
a series of products providing competitive advantages over existing products and
technologies. Cell immortalization represents a platform technology with
potential application to: a) production of cell products that are identical to
those of the human body, b) production of biotherapeutic products including
antibodies and vaccines, c) cell therapies for diseases such as Type I diabetes
and Alzheimer's and d) other applications in research, manufacturing and
veterinary medicine.

                                        1
<PAGE>

     A team of five Company scientists developed a proprietary and patented
process that uses controlled expression of specific genes to result in cellular
immortalization. Cell immortalization is a process to prolong the life of cells
grown outside of the body. Normally, these cells die relatively quickly. The
Company's technology extends cell lifetime for prolonged periods of time,
resulting in immortalization. Furthermore, cells immortalized by the Company's
method continue to divide for prolonged periods in cell culture while avoiding
malignant transformation. These cells thus maintain cellular properties of cells
of the body, which is a primary basis for the competitive advantage of products
derived from cell immortalization

     Through its research program, the Company has immortalized various cells of
animal and human origin providing proof of principle of its approach to cell
immortalization. This was an essential component of the issued and pending
patent applications owned by the Company (described below) and provides a basis
for commercialization of cell immortalization. Earlier research resulted in the
immortalization of animal and human pituitary cells that synthesize and release
various hormones of medical value, e.g., growth hormone and FSH. The hormones of
the pituitary gland control several bodily functions including growth,
reproduction and metabolism.

     These results have recently been extended to cells of the human pancreas
gland. As a result, an immortalized cell line of pancreatic fibroblast cells as
well as a non-immortalized fibroblast cell line has been established.
Fibroblasts are common to most tissues and primarily function to support and
bind tissues into organs. The Company has also immortalized other cells of the
human pancreas gland, including the type of cells that produce insulin.

     2. VITROCELL(TM) Product Line

     The Company launched its initial series of products that were derived from
its cell immortalization technology at the end of fiscal year 2003. The initial
VITROCELL(TM) product line consisted of 30 different items based on three human
cell lines developed by the Company. The cell lines were derived from either the
pituitary or pancreas gland and provide medical researchers with novel cell
lines for various research and development uses. For example, our products may
be used to facilitate basic research in diabetes, pancreatic cancer and
endocrinology of the pituitary gland. Also, cell lines are widely used in the
production of biotherapeutic products including proteins derived through
recombinant DNA methods and vaccines.

     Description of Products

LT1 Immortalized Human Pituitary Cell Line: This immortalized line was derived
from cells of the pituitary gland that are involved in the production of
pituitary protein hormones including FSH and LH and was produced according to
the Company's patented method. These cells may contain immortalized stem cells
that can be differentiated into hormone producing cells when exposed to certain
environmental conditions.

                                        2
<PAGE>

LT2 Immortalized Human Pancreatic Fibroblast Cell Line: This immortalized line
was derived from fibroblast cells of the pancreas that provide support to the
insulin-producing beta cells and glucagon-producing alpha cells. The cell line
was derived through use of the Company's patented method for immortalizing
cells.

VIT1 Non-immortalized Human Pancreatic Fibroblast Cell Line: This cell line is
similar to the LT2 line but without the immortalization process.

Optimized Cell Culture Media: The VITROCELL(TM) product line also includes two
different cell culture medias that are optimized to support growth of either the
LT1 or LT2/VIT1 cell lines, VitroPlus I and VitroPlus II, respectively. The
Company provides all components necessary for customers to prepare, store and
use its optimized media.

Other Products: The VITROCELL(TM) product line includes various forms of the
LT1, LT2 and VIT1 cell lines including cryopreserved cells in vials and
proliferating cells in specialized cell culture containers. Cryopreservation
media and instructions are provided together with various derivatives of its
cell lines (LT1, LT2 & VIT1) including cell culture media exposed to these
cells, purified RNA and DNA together with cells preserved in a specialized fluid
allowing customers to extract, purify and analyze RNA and DNA.

     In general, the business opportunities available to the Company by the
commercialization of the VITROCELL(TM) product line afford distinct advantages
compared to the development of new therapeutic drugs that require FDA approval
prior to sales. These advantages include: a) a shorter time to market, b)
broader market potential since the VITROCELL(TM) products have application to
the production of several different biotherapeutic products, and c) more rapid
establishment of revenue.

     Recombinant DNA technology resulting in the expression of the protein
product of a specific gene is the foundation of biotechnology and has been used
to produce numerous registered biopharmaceutical products, including various
hormones such as insulin for treatment of diabetes, cytokines such as
interferon-beta to treat multiple sclerosis, etc. Expression of a recombinant
protein is highly dependent upon the host organism used for expression and there
is considerable host cell variation in abilities to perform post-translational
modifications of proteins. Thus, while bacterial systems are incapable of
addition of sugar molecules through the process of glycosylation, proteins
requiring glycosylation for proper function are preferably produced in mammalian
cell hosts, e.g., Chinese hamster ovarian (CHO) cells. However, animal host
cells do not posses the same post-translational capabilities as the cells that
normally produce human-derived products. Hence, there are known differences that
exist between several recombinant proteins expressed in CHO cells and native
materials such as antibodies and glycoprotein hormones including FSH, LH, and
TSH. Therefore, one application of the VITROCELL(TM) product line is the
production of human glycoproteins that more closely resemble native
glycoproteins in structure and function.

                                       3
<PAGE>

     It is becoming increasingly clear that human cells are uniquely capable of
producing glycoproteins. As the biotechnology industry develops glycoprotein
therapeutic products, there is a need for human cells to produce products
identical to those of the human body to ensure product efficacy and safety.
Antibodies are glycoprotein immune molecules that recognize specific molecular
sites. Herceptin(R) is an example of an antibody-based biotherapeutic drug that
is used to treat certain types of breast cancer. The market for therapeutic
antibodies is projected to expand nearly ten-fold during the next ten years from
$2.5 billion presently to over $20 billion. The Company hopes to sell its
VITROCELL(TM) products to biotechnology firms involved in the development and
commercialization of humanized antibodies. Favorable evaluations of our products
may lead to exclusive license of the VITROCELL(TM) product line by a third party
for the specific application of the production of humanized antibodies for
therapeutic uses.

     Several vaccines rely on human cell lines for the propagation, attenuation
and production of viruses and are subsequently inactivated and purified by
various procedures to generate vacinations such as vaccines to Hepatitis A and
B, chicken pox, small pox and rabies. VITROCELL(TM) lines including the LT2 and
VIT1 cell lines that are derived from human fibroblast cells may have
application in the production of vaccines. The primary competitive advantage of
VITROCELL(TM) lines in vaccine production is that the cells are immortal and
therefore have prolonged growth capabilities while existing cell lines are
mortal with definite life spans.

     In the commercial production of biotherapeutic products, the VITROCELL(TM)
product line provides several competitive advantages, including: a) capacity for
human glycosylation profiles of glycoproteins, 2) prolonged proliferation due to
immortalization, 3) availability of optimized cell culture media and cell
culture procedures, 4) strong technical support from the manufacturer and
developer, and 5) potential for licensing of products for specific applications.

     3. Plan for the Marketing and Sales of the VITROCELL(TM) Product Line

     The initial target market that the Company intends to approach is other
firms engaged in the development, testing and commercialization of human
biotherapeutic glycoproteins and vaccines. We intend to advertise in trade
journals to generate awareness of our product offerings. Also, a key component
is to establish relevant contacts within key accounts and pursue direct
interactions designed to lead to evaluation and sales of our products. We may
also attend trade shows to increase the awareness of our product line and its
applications. We are interested in distribution arrangements and have some
initial discussions ongoing concerning this possibility. For example, we are
actively seeking European distribution as several biotechnology & pharmaceutical
firms that develop glycoprotein and vaccine biotherapeutics are located in
Europe.

     The Company ran an advertisement for its VITROCELL(TM) product line in the
trade journal, Genetic Engineering News. The response was encouraging, resulting
in increased traffic to its web site and several discussions that are ongoing
concerning various commercialization opportunities for the Company. However,
there can be no assurance that the various leads generated will result in
revenue to the Company.

     4. Expansion of the VITROCELL(TM) Product Line

     There is a considerable need for various human cell lines to support
research regarding the differentiation of stem cells into cells for use in
various applications of regenerative medicine. The Company is now focused on the
development of human beta cells of the pancreas gland for use in the development

                                       4
<PAGE>

of cell therapies to treat Type I diabetes. Transplantation therapy using beta
cells has been shown to be a viable treatment for Type I diabetes. In the late
1990's, Canadian scientists discovered that transplantation of purified beta
islet cells into diabetic patients resulted in insulin independence. The
so-called Edmonton protocol has been subject to several additional clinical
trials now including about 60 transplant recipients. Approximately 50% of the
transplant recipients were insulin independent one year following
transplantation. Insulin independence requires a minimum amount of donor islet
cells, usually 2 donors per recipient and life-long use of anti-rejection drugs
that are known to have side effects. However, islet transplantation is the only
known cure for Type I diabetes. These findings provide encouragement for finding
an effective treatment of Type I diabetes, a debilitating disease affecting
about 10 million people worldwide. While insulin therapy can regulate blood
glucose to normal levels, it is not a cure and many of the life threatening
consequences of Type I diabetes eventually strike Type I diabetics with enormous
medical costs, reducing quality of life and resulting in premature death. Costs
to the U.S. health care system for Type I & II diabetes are $105 billion per
year, representing the single most-costly chronic disease. Further development
of transplantation therapy depends on generation of unlimited quantities of
human beta cells and this is a major goal of diabetes research.

     The Company has been involved in the development of human pancreatic cell
lines since 2000 and is now targeting the insulin-producing beta cells. We hope
to generate various beta cell lines including both immortal and non-immortal
lines. We also intend to provide a cell culture medium optimized to support
growth and maintenance of these cell lines as we have done with our pancreatic
fibroblast cell lines, LT2 and VIT1 that are part of the VITROCELL(TM) product
line. Given successful development of these products, distribution would target
research groups working on methods to increase the supply of human beta cells
that are suitable for transplantation. We may also be able to establish
strategic alliances with pharmaceutical or biotechnology firms to develop cell
lines for use as transplants in the development of new cellular therapies to
treat Type I diabetes.

     5. Relevant Patents

     On October 1, 2002 the Company was granted United States patent number
6,458,593 B1 for a patent entitled "IMMORTALIZED CELL LINES AND METHODS OF
MAKING SAME." The issued patent provides the Company a proprietary position with
respect to use of specific immortalization methods and cell lines derived from
the pituitary gland, an organ located just below the brain that is responsible
for regulation of reproduction, growth, thyroid function and stress responses.

     The Company also has additional applications pending with the United States
Patent and Trademark Office (USPTO) and the European Patent Office, potentially
allowing broadened patent protection including immortalized human beta cells and
issued patents in several European countries. The Company also has pending
patent applications for its cell immortalization technology in Israel, Australia
and Canada. The examination of these applications could require several years
for completion. The Company's technology related to the production of cell
culture media is protected as trade secret.

                                       5
<PAGE>

B. Fertility Drugs
------------------

     The Company's previous operation in the manufacture and sale of purified
antigens for diagnostic purposes resulted in the discovery of several products
and technologies with potential application for therapeutic purposes. An initial
target was the pituitary hormone FSH and related products, since FSH has been
used as a drug to treat infertility for the past 30 years. The worldwide market
for FSH and related products is approximately $1.2 billion per year. Since the
sale of the diagnostic operation, management has continued efforts to develop
these discoveries into commercially valuable assets. Efforts are also underway
to convert some of the basic technology into a pipeline of products with
potentially wide-ranging applications in the treatment of human diseases, as
described above.

     The Company's present product candidates targeted to treat infertility
include purified urofollitropin ("VITROPIN(TM)") for injection. VITROPIN(TM) is
a highly purified urinary FSH preparation produced according to the Company's
patented purification process. Management believes that this product has
competitive advantages over products currently on the market, including higher
purity and reproducible, cost-efficient production. Another product designed to
treat infertility is VITROPIN-V(TM) (cell-derived FSH). VITROJECT(TM) is a novel
drug delivery device with perceived competitive advantages over the current
methods used to administer fertility drugs. None of these products has been
approved by the U.S. Food and Drug Administration ("FDA") for sale.

     1. Description of Products and Product Candidates

     VITROPIN(TM) is highly purified FSH derived from the urine of
post-menopausal women. It is produced through the Company's patented technology
that management believes represents a significant improvement over previous
methods used to produce this product. FSH has been used for over 30 years as a
drug to treat infertility by inducing follicle development in the ovary.

     VITROJECT(TM) is a novel delivery device for administration of VITROPIN(TM)
and other substances that provide an entire treatment regime within a single
device that is easy and economical to use. FSH currently must be given by either
intramuscular or subcutaneous injection at the same time in the evening, for 7
to 15 consecutive days. Most existing products are administered by
reconstitution of a single dose, loading into a syringe and injection, with
repetition of these steps in subsequent days. VITROJECT(TM) may allow patients
to self-inject fertility drugs by subcutaneous administration at home with fewer
drug manipulations and lower cost compared to existing methods.

     VITROPIN-V(TM) is envisioned to be the only product on the market identical
to native FSH. The Company plans to produce this product through use of its cell
immortalization technology. Management believes that the Company may come to
dominate the premium-priced fertility drug marketplace, which currently depends
upon artificially derived recombinant products. VITROPIN-V(TM) is still in an
early development stage and is projected to require substantial funding and
approximately four years additional development to be marketable.

                                       6
<PAGE>

     2. Relevant Patents

     The USPTO issued the Company's first patent on November 23, 1999 (US Patent
No. 5,990,288). This invention was entitled "Methods for Purifying FSH" and
details methods to manufacture highly purified FSH from various sources,
including human urine, recombinant FSH sources, human gonadotrope cells (cells
of the human pituitary gland that elaborate FSH & LH) and animal extracts of
pituitary glands. Management believes this invention represents a significant
advance in the methods previously used to purify FSH and to produce therapeutic
FSH.

     During 2002, two other patents were issued to the Company regarding its
technology to produce FSH. The USPTO granted patent number 6,414,123 B1 and the
New Zealand Patent Office granted patent number 501,212 to the Company for a
patent entitled "Method for Purifying FSH". The new patents provide additional
patent protection for the Company's previously patented FSH purification method
and additional protection for production of human FSH from different sources
including: urinary-derived, recombinant, cell-derived and genetically modified.
The newer patents also cover purified FSH derived from several different animal
species.

     The Company has additional pending applications in the United States,
Canada, Australia, New Zealand, United Kingdom and the European Patent Office.
Issuance of these pending applications would broaden and extend patent
protection to include other countries. There is presently no assurance that
these additional patents will be issued. Also, once issued, an individual patent
may be subject to litigation that may result in invalidation of all or part of
the patent. There is no assurance that any patent issued to the Company will not
be invalidated through legal challenge. See Item 6. - "Risk Factors."

     VITROJECT(TM) is subject to patent protection through pending applications
filed by the Company in the United States and foreign countries. This
application may result in issued patents within the United States and select
foreign countries.

     3. Regulatory Approval

     Drugs used to treat human infertility require registration with, and
approval from, appropriate government authorities prior to sale. In the United
States, the FDA oversees approval of such products. Due to the cost and time
required to complete tests for possible FDA approval, we do not anticipate
submitting any drugs for consideration in the immediate future, absent the
assistance of an industry partner, research collaboration or other capital
funding.

     4. Commercialization and Development Plan

     Further development of the Company's fertility drugs requires substantial
capital that is presently not available to the Company. Management has been and
continues to be engaged in confidential discussion with pharmaceutical firms

                                       7
<PAGE>

that have expressed interest in commercializing select fertility drugs owned by
the Company. In general, these firms presently produce and sell FDA-approved
products targeted to women's health care markets. The goal of these discussions
is to establish an arrangement whereby the Company would receive funding for the
sale or license of its technology or research collaboration designed to further
the commercialization of its technology. Management intends to continue these
efforts, as it believes such relationships would provide the most likely source
of funding for the Company to develop its fertility drugs. However, some
previous efforts to establish partnerships have been unsuccessful and there is
no assurance that future efforts will be successful.

     Within the past year there has been a shift in the level of interest by
potential partners away from urinary-derived FSH toward recombinant FSH and
equivalent products. This shift is probably due to various factors including
concerns by regulatory authorities regarding potential safety issues surrounding
urinary-derived materials. During 2003 there was a recall of purified urinary
FSH (Metrodin-HP(TM)) in the United Kingdom because of concerns about possible
transmission of Creutzkeldt-Jakob disease, a transmissible spongiform
encephalopathy related to mad-cow disease. The agent responsible for CJD can be
detected in the urine of CJD patients while there is controversy about whether
urine or urine-derived products are capable of transmitting diseases such as CJD
to humans. Also, it is difficult to assure adequate screening of the donors to
urine-based raw materials since there are usually large numbers of contributing
donors. On the other hand, recombinant FSH is derived from a single cell line
that is much easier to analyze for potential contamination. Management believes
that the concerns about safety are a principle factor in the decreased interest
by the part of potential partners in the commercialization of its purified
urinary FSH product, VITROPIN(TM). As noted elsewhere in this report, see
Management's Discussion and Analysis or Plan of Action, the Company wrote-down
costs associated with its FSH purification patent that would be used to
manufacture VITROPIN(TM).

     Recombinant human FSH presently dominates the fertility drug market and its
share of the total market is likely to continue to increase. The Company
presently has ongoing discussions with potential partners who are interested in
developing products such as VITROPIN-V(TM) that directly compete with presently
approved recombinant human FSH products. As noted below, see: "Other Recent
Developments", the addition of a new member to the Company's Board of Directors
since the end of fiscal year 2003 enhance opportunities available to the Company
for the commercialization of a new fertility drug to compete with presently
approved products.

C. Other Recent Developments
----------------------------

     James T. Posillico, Ph.D., Chief Scientific Officer of Cooper Surgical, Inc
(NYSE, COO) joined the Company's Board of Directors in November 2003. Dr.
Posillico has extensive experience in the development and commercialization of
women's health care products. He founded SAGE Biopharma in 1997 and developed an
innovative line of products including devices and supplies to support assisted
reproductive technologies. SAGE grew to over $4 million in sales in 2002, when
it was sold to Cooper Surgical, Inc. Prior to that, Dr. Posillico spent 10 years
with Serono, SA, a leading supplier of fertility drugs, where he held various
positions related to management, regulatory approvals and sales of a broad line
of fertility drugs and related products. The Company anticipates that Dr.
Posillico will provide assistance to ongoing efforts to commercialize its
fertility drugs and technology as well as general marketing & sales expertise of
relevance to the sales of its VITROCELL(TM) product line.

                                       8
<PAGE>

COMPETITION

     The Company faces competition from a number of larger, well-established
entities in the area of fertility treatment and research for other therapeutic
products. Ares-Serono Group, SA controls approximately 50% of the worldwide FSH
market. The Organon division of Akzo-Nobel, SA has the majority of the remaining
market, with a 30% market share. Ferring Pharmaceuticals has the remaining share
of the market, about 20%. Serono, Organon and Ferring have diversified product
lines including impure LH/FSH combination drugs and purified human or
recombinant FSH.

     The existing market participants represent substantial competition to any
entity hoping to introduce new products into the human fertility market,
including the Company. All of these entities have substantially greater
financial and personnel resources than the Company. Also, Serono is known to
vigorously protect its market position through various means, including
litigation. Organon and Ferring, while not known to engage in aggressive market
protection tactics, may well present substantial obstacles to the entry of any
of the Company's products to the market.

     Human cell lines are also produced and marketed by other companies with
substantially greater resources than the Company. Present suppliers of human
cells and related products include Crucell N.V., Cambrex Corporation and the
American Type Culture Collection. All of these firms have long standing history
and significant financial resources. The Company believes its products have
competitive advantages as noted elsewhere, see: Human Cell Lines and Related
Products and Technology, but there is significant competition for the markets
that the Company has chosen to approach.

TRADEMARKS

     The Company has established trademark claims to its products, VITROPIN(TM),
VITROJECT(TM), and VITROPIN-V(TM) informally by publication. These trademarks
are thus common law marks that may be challenged through similar, established
and registered marks that existed prior to initial publication by the Company.
The Company may elect to formally protect some or all of these marks through
registration with the United States Patent and Trademark Office in the future.
Registration of a trademark involves an initial investigation to determine if
there are prior claims to a particular mark. If no conflict is found, the
registration process includes an application to the Trademark office and payment
of filing fees. Within about one year of the filing, a decision is issued as to
whether or not registration is allowed. There is no assurance that the Company
will be able to successfully obtain any registered trademark. The Company has
registered the trademark Vitro Biopharma with the State of Colorado. This is
used as a "doing-business-as" name when approaching new contacts for potential
strategic alliance with the Company since the Company is no longer involved in
the manufacture of diagnostic products. Also, the Company has registered the
trademark, VITROCELL and the phrase: "Harnessing the Power of Cells" with the
State of Colorado.

                                       9
<PAGE>

EMPLOYEES

     The Company presently has one full time employee, James Musick, the
Company's President & CEO. Erik Van Horn, the Company's Vice President, provides
the Company with periodic consultation related to the achievement of its
business objectives. Mr. Musick is responsible for all day-to-day operations of
the Company, business development and other management functions.

     The Company also utilizes the services of consultants and independent
contractors to supplement the resources of its employee from time to time. These
consultants include scientific and laboratory personnel, accountants, attorneys
and an individual who has previous CFO experience in the biotechnology industry.
Some of these consulting positions may be converted to full time employment if
and when the Company's business requires and resources permit.

ITEM 2. DESCRIPTION OF PROPERTY

     The Company owns no real property. The Company leases its office and
laboratory space, consisting of 720 square feet, at 12635 East Montview
Boulevard, Suite 218, Aurora, CO 80010. The lease is a full service lease
allowing Company personnel access to common areas, conference rooms and use of
certain laboratory equipment. The space is being leased on a month-to-month
informal basis. Management believes that this space is adequate for the needs of
the Company for the foreseeable future.

ITEM 3. LEGAL PROCEEDINGS

     There are currently no legal matters or other regulatory procedures pending
or, to the knowledge of our management, threatened that involve the Company or
its property or any of the principal shareholders or officers or directors in
their capacities as such.

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

     There were no matters submitted to a vote of security holders during the
fourth quarter of the fiscal year covered by this Report.





                                       10
<PAGE>

                                     PART II

ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

     a) Market Information

     The following information sets forth the high and low bid price for the
Company's common stock for each quarter within the last two fiscal years. The
Company's common stock is traded over-the-counter and quoted on the electronic
Bulletin Board maintained by the National Association of Securities Dealers. The
following information was obtained from The Nasdaq Stock Market, Inc. The prices
set forth below do not include retail mark-ups, mark-downs or commissions, and
may not represent prices at which actual transactions occurred.

     Fiscal Quarter Ended           High             Low
     --------------------           ----             ---

     2002

     January 31                    $0.32             0.11
     April 30                       0.22             0.11
     July 31                        0.18             0.06
     October 31                     0.10             0.05

     2003

     January 31                    $0.05             0.03
     April 30                       0.04             0.04
     July 31                        0.045            0.03
     October 31                     0.2              0.03

     The Company's securities are presently classified as "Penny Stocks" as
defined by existing securities laws. This classification places significant
restrictions upon broker-dealers desiring to make a market in such securities.

     b) Holders

     As of December 31, 2003, the Company had approximately 1,955 shareholders
of record, not including persons who hold their shares in "street name".

     c) Dividends

     The Company has paid no dividends since inception and it is not anticipated
that any will be paid in the foreseeable future. The payment of dividends in the
future is dependent on the generation of revenue and profit, and the discretion
of the Board of Directors based upon such matters as the Company's capital needs
and costs of obtaining capital from outside sources.

                                       11
<PAGE>

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

     The following discussion and analysis covers our financial condition at
year end October 31, 2003, a comparison of our financial condition at that time
to year end 2002, our results of operation for the year ended October 31, 2003
and a comparison of those results to the year ended October 31, 2002. This
discussion and analysis should be read in conjunction with our financial
statements and notes appearing elsewhere in this report. The discussion should
also be read with the cautionary statements and risk factors appearing at the
end of this section.

Liquidity and Capital Resources

October 31, 2003
----------------

     The Company continues to have a shortage of working capital and liquidity
and reported a negative net worth at October 31, 2003. At fiscal year end
October 31, 2003, the Company had a working capital deficit of $179,154,
representing a decrease of $122,061 from fiscal year end October 31, 2002.
Current assets decreased $6,206 from year-end 2002 to 2003 while total assets
decreased $125,281 during that time, the former from cash spent on operations
while the latter was predominantly due to the write-down of impaired assets.
Current liabilities increased $115,855 from year-end 2002 to 2003 while total
liabilities increased $113,758, each predominantly from accrued debt and
deferred salary to the Company's president. This working capital has been
further reduced subsequent to year-end.

     During the fiscal year ended October 31, 2003, the Company's operations
used $7,503 of cash, while during 2002 the Company used $178,540 in cash. The
sharp decrease in cash usage reflects the minimal cash available to the Company.
The Company anticipates needing approximately equivalent capital to fund
operations at the present minimal levels during 2004. Operating expenses have
been minimized by deferral of salary and reduction of operating expenses to fund
only essential needs. The Company's present operations require approximately
$5,000/month in cash. All of our cash requirements during 2003 were funded or
guaranteed by our president, and there is no assurance that source of funding
will continue.

     The Company had $54,000 in available credit with $27,757 in unused credit
at fiscal year end 2003. Additional credit has been obtained and balances due
have increased since then. The Company must continue to service debt and the
President personally guarantees most of the Company debt. Given these
conditions, management believes that there is sufficient capital in the form of
debt to maintain operations through approximately the end of second quarter
2004. After that, and failing receipt of additional capital, the Company will be
forced to suspend operations.

                                       12
<PAGE>

     The Company remains dependent on receipt of additional cash to implement
its business plan and generate revenue in the future. The report of the
independent accountant that audited the Company's financial statements for the
year ended October 31, 2003 includes a qualification that the Company may not
continue as a going concern. In that event, the Company might be liquidated and
its assets sold to satisfy any claims of creditors. See note A to the financial
statements attached to this report for a more complete description of this
contingency.

     The Company continues to seek funding to maintain its operations and a
primary focus at the present time is the sale of VITROCELL(TM) products. These
products have now been launched and the Company's marketing and sales plan is
primarily focused on biotechnology and pharmaceutical firms that commercialize
human glycoproteins and vaccines (See Item I: Section A: Human Cell Lines and
Related Products and Technology). These products do not require FDA approval
prior to marketing. Continued development of products requiring FDA approval
prior to marketing such as VITROPIN-V(TM) requires substantially more financial
resources than are presently available to the Company. The Company is presently
engaged in discussions with pharmaceutical companies that have expressed
interest in the commercialization of the Company's fertility drugs. Management
is pursuing these and other opportunities with the objective of establishing
strategic alliances to fund further fertility drug development and
commercialization.

     Management has also reduced current spending levels by reducing
administrative expenses and expenditures related to research activities while
maintaining essential operational activities. The Company may consider other
alternatives to increase its capital resources such as merger with
revenue-generating private entities, sale of assets or other transactions that
may be appropriate.

October 31, 2002
----------------

     At fiscal year end October 31, 2002, the Company had working capital
deficit of $57,093, consisting of current assets of $11,247 and current
liabilities of $68,340. This represents a decrease in working capital of
$216,078 from October 31, 2001. The decrease in working capital resulted from
cash spent on operations.

     During fiscal 2002, the Company relied on funds from the sale of assets and
debt financing, to meet it working capital requirements.

     Total assets decreased from year-end 2001 to year-end 2002, primarily as a
result of the cash spent on operations. Total assets decreased by $173,996 from
$398,366 at October 31, 2001 to $224,370 at October 31, 2002. Shareholders'
equity decreased by a similar amount during this period.

                                       13
<PAGE>

Results of Operations

Year Ended October 31, 2003
---------------------------

     During the year ended October 31, 2003, the Company realized a net loss of
$262,278, or $.03 per share, with no revenue. These results are substantially
equivalent to fiscal 2002. A significant portion of the loss in 2003 was due to
a write-off for impairment of intangible assets, $111,104. The Company
determined that expenses related to FSH purification patents that were
previously capitalized (less depreciation) or deferred were unlikely to be
recovered in subsequent operations because of diminished marketability of
VITROPIN(TM), the Company's purified urinary FSH product. Accounting issues
related to this impairment are described in Note A to the financial statements
and factors affecting the marketability of urinary-derived FSH are discussed in
Item I, Section B, Commercialization and Development Plan. Without the
write-down of assets, the net loss would have been $151,174, which reflects the
actual result of operations.

     The loss from operations has diminished in the past three years from
$394,688 in 2001, $278,879 in 2002 to $154,775 in 2003 (without the asset
write-down) while the Company sustained an R&D program resulting in the launch
of the VITROCELL(TM) product line in 2003. The continual reduction in operating
losses is attributable to management's efforts to increase operational
efficiency in light of reduced available capital.

     Management does not anticipate that the Company should expect revenue from
its fertility drugs in the foreseeable future. Commercialization of these
products depends on significant funding, further product development including
clinical trials, FDA approval, and other conditions prior to commercial sale of
any product.

     Management does anticipate revenues from the sale of VITROCELL(TM) products
in 2004. It is clear that there is a current and growing market for human cell
lines for various medical applications as noted elsewhere in this report. There
is apparent interest in the VITROCELL(TM) product line as judged by the response
to the Company's initial advertising campaign. Early revenues from VITROCELL(TM)
products are likely to be influenced by several factors including acceptance by
customers, awareness of the product line, differentiation from competitive
products, pricing, service, etc. Management also believes that product line
expansion is an important component of revenue generation especially the
addition of human pancreatic beta cells, those cells that provide the body with
insulin.

     Total operating expenses decreased from fiscal 2002 to fiscal 2003, from
$278,879 to $265,879. Without the write-off of FSH patent expenses, operating
expenses decreased $121,104 in 2003 compared to 2002. Selling, general and
administrative expenses decreased $47,837 primarily as a result of downsizing
and the reduction of other expenses. Research and development expenses were also
decreased by $60,979.

     Other income decreased from fiscal 2002 to 2003, since the gain on the
Goodwin deposit occurred in 2002. Consulting fees of $10,000 were received from
a potential partner for commercialization of FSH during 2002.

                                       14
<PAGE>

Year Ended October 31, 2002.
----------------------------

     During the year ended October 31, 2002, the Company realized a net loss of
$252,397, or $.03 per share, on no revenue. Revenue for the year ended October
31, 2002 fell by $100,000 from the prior fiscal year, since the Company no
longer received grant funds from the NIH.

     Operating expenses dropped substantially from fiscal 2001 to fiscal 2002,
from $470,689 to $278,879, as a result of the downsizing of operations. Selling,
general and administrative expenses were also decreased by $23,504, primarily
due to downsizing. Research and development expenses were also decreased by
$155,136 due primarily to lack of NIH grant funding in 2002 and also as a result
of downsizing.

     Other income increased from fiscal 2001 to 2002, primarily due to the gain
on settlement of the Goodwin deposit of $28,000.

Recent Accounting Pronouncements

     In December 2002, the FASB issued Statement of Financial Accounting
Standards No. 148, "Accounting for Stock-Based Compensation - Transition and
Disclosure - An Amendment of FASB Statement 123" ("SFAS 123"). For entities that
change their accounting for stock-based compensation from the intrinsic method
to the fair value method under SFAS 123, the fair value method is to be applied
prospectively to those awards granted after the beginning of the period of
adoption ("prospective method"). The amendment permits two additional transition
methods for adoption of the fair value method. In addition to the prospective
method, the entity can choose to either (i) restate all periods presented
("retroactive restatement method") or (ii) recognize compensation cost from the
beginning of the fiscal year of adoption as if the fair value method had been
used to account for awards ("modified prospective method"). For fiscal years
beginning December 15, 2003, the prospective method will no longer be allowed.
We currently account for our stock-based compensation using the intrinsic value
method as proscribed by Accounting Principals Board Option No. 25, "Accounting
for Stock issued to Employees" and plan on continuing using this method to
account for stock options, therefore, we do not intend to adopt the transition
requirements as specified in SFAS 148. We have adopted the new SFAS 148
disclosure requirements.

     The FASB issued Interpretation ("FIN") No. 45, "Guarantor's Accounting and
Disclosure Requirements for Guarantees, Including Indirect Guarantees of
Indebtedness of Others", in November 2002 and FIN No. 46, "Consolidations of
Variable Interest Entities", in January 2003. FIN No. 45 is applicable on a
prospective basis for initial recognition and measurement provisions to
guarantees issued after December 2003; however, disclosure requirements are
effective immediately. FIN No. 45 requires a guarantor to recognize, at the
inception of a guarantee, a liability for the fair value of the obligations
undertaken in issuing the guarantee and expands the required disclosures to be
made by the guarantor about its obligation under certain guarantees that it has
issued. The adoption of FIN No. 45 did not have a material impact on our
financial position or results of operations. FIN No. 46 requires that a company
that controls another entity through interest other than voting interest should
consolidate such controlled entity in all cases for interim periods beginning
after June 15, 2003. The adoption of FIN No. 46 did not have a material impact
on our financial position or results of operations.

                                       15
<PAGE>

Critical Accounting Policies and Estimates

     The Company has identified the accounting policies described below as
critical to its business operations and the understanding of the Company's
results of operations. The impact and any associated risks related to these
policies on the Company's business operations is discussed throughout this
section where such policies affect the Company's reported and expected financial
results. The preparation of this Annual Report requires the Company to make
estimates and assumptions that affect the reported amount of assets and
liabilities of the Company, revenues and expenses of the Company during the
reporting period and contingent assets and liabilities as of the date of the
Company's financial statements. There can be no assurance that the actual
results will not differ from those estimates.

     Patents, Deferred Costs and Amortization

     Patents consist of costs incurred to acquire issued patents. Amortization
commences once a patent is granted. Costs incurred to acquire patents that have
not been issued are reported as deferred costs. If a patent application is
denied or expires, the costs incurred are charged to operations in the year the
application is denied or expires. The Company amortizes its patents over a
period of ten years. Amortization expense totaled $9,337 and $10,485 for the
years ended October 31, 2003 and 2002, respectively.

     Impairment and Disposal of Long-lived Assets

     The Company evaluates the carrying value of its long-lived assets under the
provisions of SFAS No. 144, "Accounting for the Impairment or Disposal of
Long-Lived Assets". Statement No. 144 requires impairment losses to be recorded
on long-lived assets used in operations when indicators of impairment are
present and the undiscounted future cash flows estimated to be generated by
those assets are less than the assets' carrying amount. If such assets are
impaired, the impairment to be recognized is measured by the amount by which the
carrying amount of the assets exceeds the fair value of the assets. Assets to be
disposed of are reported at the lower of the carrying value or fair value, less
cost to sell.

     During the year ended October 31, 2003, the Company completed a balance
sheet review that identified assets whose carrying amounts are not recoverable.
As a result of this review, the Company recorded asset impairment charges of
$111,104 for the write-off of patents and deferred intellectual property costs.

Recent Sales of Unregistered Securities

     During February 2003, the Company sold 222,222 shares of its common stock
to our President for $20,000, or $.09 per share, which equaled the market value
of the common stock on the transaction date. During the fourth quarter of our
fiscal year, we issued 250,000 options to our President as part of the
consideration for loans to the Company during 2003. The options were valued at
$0.04/share for purposes of this transaction.

                                       16
<PAGE>

     The Company issued these shares and options directly, and paid no
commission in connection with the issuance. The Company relied on the exemptions
from registration provided by Section 4(2) of the 1933 Act, as the individual
was afforded access to the type of information that would be contained in a
registration statement. This individual was aware of the risks of the
transaction, and the Company had a pre-existing relationship with this
individual.

RISK FACTORS

     This 10-KSB report, including Management's Discussion and Analysis or Plan
of Operation, contains forward-looking statements that may be materially
affected by several risk factors including those discussed below.

     1. Lack of operating experience. The Company, its officers and employees,
have no experience in the operation of a biotherapeutic operation. While the
Company has attempted to mitigate this deficiency by adding individuals
experienced in pharmaceutical operations to its Board of Directors, its
Scientific Advisory Board and as consultants to the Company, there is no
assurance that the Company will be able to achieve the proficiency needed to: a)
manufacture pharmaceutical products, b) perform necessary clinical trials
resulting in regulatory approval by the FDA and other regulatory authorities, c)
establish strategic alliances or other inter-corporate relationships necessary
to outsource specific aspects of the development of a pharmaceutical product, or
d) engage in appropriate marketing strategies to capture any share of the
markets targeted by the Company. The independent members of our Board of
Directors resigned their positions last year, leaving us only two members. While
we will continue our efforts to obtain additional Board representation in an
effort to supplement the experience and expertise of our officers, there is no
assurance that we will be successful in that endeavor.

     2. Dependence on key personnel. Achievement of the objectives described
herein also depends critically upon key personnel who have contributed
substantially to the development of the products and technology presently owned
by the Company. At present, the Company has no employment contracts with its
full-time employee, Dr. James Musick. Neither does the Company maintain "key
man" life insurance. Dr. Musick has contributed substantially to the development
of the products to treat infertility and cellular immortalization. Loss of his
services could adversely impact the successful commercialization of the
Company's products.

     3. Effects of potential litigation. The Company is subject to potential
litigation as by class action of its shareholders regarding reduction in the
market value of the Company's stock, hostile takeover efforts, product liability
claims and other claims of legal wrongdoing by the Company. During 2000, a major
shareholder attempted to exert control over the Company and threatened
litigation if its demands were not met. The Company successfully negotiated a
compromise with the shareholder resulting in the restructuring of the Company
and satisfaction of the shareholder demands. However, there are other potential
legal challenges that the Company may be subjected to and such actions could
divert resources from the pursuit of the business objectives of the Company and
compromise achievement of these goals.

                                       17
<PAGE>

     4. Dependence on third party manufacturers. The Company does not have the
resources necessary for manufacture of therapeutic products to required FDA
guidelines. As a result, the Company has decided to outsource such
manufacturing, called GMP manufacturing, to third parties who serve as contract
manufacturers. Thus, the Company is at risk as to the quality of manufacturing
by its chosen contractors. While the Company engages in careful scrutiny of its
potential manufacturers to ensure high quality and FDA compliance, there is no
assurance that the contractor will perform to FDA guidelines. Also, efficiency
is a central issue underlying the Company's profits and manufacturing efficiency
will not be entirely under the control of management of the Company when
contractors are used for GMP manufacture of the Company's products.

     5. Lack of liquidity in the Company's securities. There is presently
limited liquidity in the public stock of the Company as indicated by relatively
low price of the Company's stock and a relatively low volume of trading. This
limited liquidity is related in part to the fact that the Company's securities
are traded on the OTC bulletin board and are considered "penny stocks". Such
limited liquidity of the Company's securities may limit the funding abilities of
the Company that are related to equity transactions.

     6. Dependence on regulatory approvals. Prior to the marketing and sale of
the Company's fertility drug products, regulatory approval is essential. While
the Company maintains relationships with advisors who provide counsel to the
Company regarding its filings for registration by the FDA and other regulatory
authorities, there can be no assurance that the Company will receive the
requisite approvals to market its products. The absence of regulatory approval
essentially blocks the commercialization of the Company's products.

     7. Some R&D activities of the Company depend on fetal tissue research.
Research using fetal tissue is controversial. The Company faces risks because of
fetal tissue research, such as a potential federal ban of fetal tissue research
that would preclude federal funding of such research. The Company also faces
opposition to its research by anti-abortion groups.

ITEM 7. FINANCIAL STATEMENTS

     Reference is made to the Index of Financial Statements following Part IV of
this Report for a listing of the Company's financial statements and notes
thereto.

ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS

     There have been no changes in or disagreements with our independent
accountants during the last two fiscal years.

Item 8A. Controls and Procedures

     We maintain a system of controls and procedures designed to provide
reasonable assurance as to the reliability of the financial statements and other
disclosures included in this report. As of October 31, 2003, under the

                                       18
<PAGE>

supervision and with the participation of our Chief Executive Officer and Chief
Financial Officer, management has evaluated the effectiveness of the design and
operation of our disclosure controls and procedures. Based on that evaluation,
the Chief Executive Officer and the Chief Financial Officer concluded that our
disclosure controls and procedures were effective in timely alerting them to
required to be included in our periodic filing with the Securities and Exchange
Commission. No significant changes were made to internal controls or other
factors that could significantly affect those controls subsequent to the date of
their evaluation.


                                    PART III

ITEM 9. DIRECTORS AND EXECUTIVE OFFICERS

     The following individuals presently serve as officers and directors of the
Company:

     Name                       Age         Position
     ----                       ---         --------

     James R. Musick, Ph.D      57          President, Chief Executive Officer
                                            and Director

     Erik D. Van Horn           35          Vice President and Director

     James T. Posillico, Ph.D.  58          Director


     Directors of the Company serve until the next annual meeting of
shareholders and until their successors are elected and qualify. Officers serve
at the will of the Board of Directors. As shown above, our officers are also
presently directors of the Company.

     The Company currently has no audit or other committee of the Board of
Directors and no financial experts on its Board. The entire Board of Directors
performs the functions typically performed by an audit committee.

     The following represents a summary of the business history of each of the
foregoing individuals for the last five years:

     JAMES R. MUSICK, Ph.D. was appointed President and Chief Executive Officer
of the Company on August 7, 2000. From September 1, 1989 until August 7, 2000,
Dr. Musick served as Vice President, Secretary and Chief Operating Officer of
the Company. He has also served as a director of the Company since September 1,
1989. Dr. Musick received a Bachelor of Arts in Biological Sciences in 1968 and
a doctorate in Biological Sciences in 1975 from Northwestern University in
Evanston, Illinois.

                                       19
<PAGE>

     ERIK D. VAN HORN was appointed Vice President of the Company on August 7,
2000. He has also been Production Manager and a director of the Company since
March of 1993. He received his Bachelor of Science in Chemical Engineering from
the University of Colorado in 1990. Mr. Van Horn is presently employed by Amgen
as Supervisor of Manufacturing.

     JAMES T. POSILLICO, Ph.D. was appointed to the Board of Directors on
November 3, 2003. Dr. Posillico has over 20 years experience in the
commercialization of women's health care products including devices and drugs
for treatment of infertility. Dr. Posillico received his Ph.D. in endocrinology
from Duke University Medical Center in 1982 and performed post-doctoral training
at Harvard Medical School, where he also served as Assistant Professor in the
Departments of Medicine and Biochemistry from 1986 to 1991. Dr. Posillico is
presently the Chief Scientific Officer for Cooper Surgical, Inc., listed on the
New York Stock Exchange; a provider of medical devices and products located in
Trumbull, Connecticut, a position he has occupied since 2002. From 1997 to 2002,
Dr. Posillico founded and managed a medical product and device firm, SAGE
Biopharma that specialized in providing support to assisted reproductive
technologies including in-vitro fertilization.

     The Company has not established a code of ethics for its principal
executive officers due to the cost of such procedure, but may consider adopting
such code in the future as its resources permit.

Compliance with Section 16(a) of the Securities and Exchange Act of 1934
------------------------------------------------------------------------

     Based solely upon a review of Forms 3, 4 and 5 filed with the SEC, and
written representations regarding beneficial ownership reporting submitted to
the Company, since the filing of our last Form 10-KSB, none of our officers,
directors or the beneficial owner of ten percent or more of our outstanding
securities has failed to file any report required by Section 16 of the 1934 Act
on a timely basis.

ITEM 10. EXECUTIVE COMPENSATION

     The following table summarizes the total compensation of the chief
executive officer; any person who served as the chief executive officer during
the last fiscal year, and any other executive officers whose compensation from
the Company exceeded $100,000 during that period (the "Named Officers"):

                              SUMMARY COMPENSATION

                                                        Long Term Compensation
                                                        ----------------------
                                                               Securities
                            Year Ended   Annual Compensation   Underlying
Name                        October 31,        Salary           Options
----                        -----------        ------           -------

James R. Musick, President     2003           $57,708(1)           0
and Chief Executive Officer    2002           $57,708              0
                               2001           $57,708              0

----------
1    Excludes options to purchase 250,000 shares of the Company's common stock
     issued in connection with loans made by such individual to the Company.
     See, "-Option Grants" below.

                                       20
<PAGE>

Compensation of Directors
-------------------------

     During 2003, the sole member of the Board of Directors who was not a full
time employee of the Company was compensated at $200/hour for services as a
Director. Such services were exclusively for the attendance to Board of
Directors meetings related to conduct of the Company's business. The Board may
reevaluate this compensation in the future, especially as it relates to actions
taken by the Company's Board of Directors during fiscal year 2004. Each director
is also entitled to reimbursement for reasonable and necessary expenses incurred
on behalf of the Company.

     During 2003, the Board also cancelled a total of 165,000 stock options that
had been previously granted to three outside directors who served as Directors
of the Company from August 2000 through April 2002. Such options were issued
under the Company's 2000 Equity Incentive Plan that provides for the exercise of
effective options by grantees within three months of the termination of services
to the Company but not thereafter. The Company provided the previous outside
directors with sufficient time and notification to exercise these options.

Option Grants For 2003
----------------------

     On September 2, 2003, the Company granted its President options to purchase
250,000 shares of the Company's common stock with an exercise price equal to the
common stock market 1value on the date of grant, or $0.04 per share. The option
is exercisable until September 2013 and was issued as part consideration for
loans made to the Company by the President.

Year End Option Values
----------------------

     The following table sets forth the value of unexercised options held by the
Named Officers at October 31, 2003. The price of the Company's common stock on
October 31, 2003 was $.18 per share.
<TABLE>
<CAPTION>

                  Shares                       Number of             Value of unexercised
                  Acquired      Value          Unexercised Options   in-the-money options
Name              on Exercise   Realized ($)   at fiscal year end    at fiscal year end
-----------------------------------------------------------------------------------------
<S>               <C>           <C>            <C>                   <C>

James R. Musick   0             0              415,181               $34,875(1)

----------
1    Based upon the difference between the average exercise price of $.096 and
     the last reported sale price of the Company's common stock of $.18 per
     share on October 31, 2003.

                                       21
</TABLE>
<PAGE>

Stock Option Plan
-----------------

     The Company adopted a new Equity Incentive Plan on October 9, 2000 (the
"Plan") for the benefit of key personnel and others providing significant
services to the Company. The Plan replaces the 1992 Equity Incentive Plan (the
"1992 Plan"). The 1992 Plan will remain effective only so long as options remain
outstanding under the 1992 Plan. No new options will be granted under the 1992
Plan, and the only shares that will be issued under the 1992 Plan are those
shares underlying currently outstanding options.

     The Plan authorizes total stock awards of up to 1,000,000 shares of the
Company's common stock. Awards may take the form of incentive stock options,
non-qualified stock options, restricted stock awards, stock bonuses and other
stock grants. If a stock award made under the New Plan expires, terminates, is
canceled or settled in cash without the issuance of all shares of common stock
covered by the award, those shares will be available for future awards under the
Plan. Awards may not be transferred except by will or the laws of descent and
distribution. No awards may be granted under the Proposed Plan after September
30, 2010.

     The Plan is dministered by the Company's Board of Directors, which may
delegate its authority to a committee of the Board of Directors. The Board of
Directors has the authority to select individuals to receive awards, to
determine the time and type of awards, the number of shares covered by the
awards, and the terms and conditions of such awards in accordance with the terms
of the Plan. In making such determinations, the Board of Directors may take into
account the recipient's current and potential contributions and any other
factors the Board of Directors considers relevant. The recipient of an award has
no choice regarding the form of a stock award. The Board of Directors is
authorized to establish rules and regulations and make all other determinations
that may be necessary or advisable for the administration of the Plan.

     All options granted pursuant to the Plan shall be exercisable at a price
not less than the fair market value of the common stock on the date of grant.
Unless otherwise specified, the options expire ten years from the date of grant.

     During the year ended October 31, 2003, options to purchase 250,000 shares
of our common stock were issued under the Plan. At the fiscal year end, 954,197
options remained outstanding under the Plan and the 1992 Plan, with exercise
prices ranging from $.04 to $1.50 per share, or an average exercise price of
$.25 per share.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

Beneficial Ownership
--------------------

     The following table sets forth information, based solely on information
available to the Company, with respect to the ownership of the Company's common
stock by all officers and directors individually, all officers and directors as
a group, and all beneficial owners known to the Company to hold more than five
percent (5%) of the Company's common stock.

                                       22
<PAGE>

     The following shareholders have sole voting and investment power with
respect to the shares, unless it is indicated otherwise.

Name and Address of Beneficial Owner            Number of Shares           %
------------------------------------            ----------------         -----
  Officers and Directors
  ----------------------
    James R. Musick (1, 2)                          2,127,403            22.17%
    12635 E. Montview Blvd.
    Aurora, Colorado 80010

    Erik Van Horn (3)                                534,016              5.57%
    12635 E. Montview Blvd.
    Aurora, Colorado 80010

    James T. Posillico                                 -0-                 -0-
    5 Topping Way
    Chester, New Jersey 07930

    Officers and Directors as a group (1,2,3)       2,661,419            27.74%
     (2 individuals)

    Five Percent Shareholders
    Roger D. Hurst (4)                              1,135,482            11.83%
    8100 Southpark Way
    Unit B-1
    Littleton, CO 80120

    The James R. Musick Trust                       1,390,414            14.49%
    12635 E. Montview Blvd.
    Aurora, Colorado 80010

    Lloyd Hansen                                    1,140,000            11.88%
    2646 S.W. Mapp Rd
    STE #304
    Palm City, FL 34990

    Kristine Brubaker                                764,002              7.96%

----------
1    Includes 31,848 shares of common stock underlying an option exercisable at
     $.625 until June 6, 2009 and 250,000 shares of common stock underlying an
     option exercisable at $0.04 until September 2, 2013.

2    Includes 1,390,414 shares held by The James R. Musick Trust, of which Mr.
     Musick is a trustee and beneficiary.

                                       23
<PAGE>

3    Includes 330,516 shares of common stock underlying options exercisable at
     prices ranging from $.08 to $.625 and expiring through 2009.

4    Includes 10,386 shares owned by Compion and 3,000 owned by Compion
     Management Services, Inc., companies in which Mr. Hurst is the sole
     shareholder.


Changes in Control
------------------

     The Company knows of no arrangement, including the pledge by anyone of any
securities of the Company that may result in a change in control.


ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     During September 2003, the president loaned the Company $10,000 for working
capital. The note matures in August 2005 and carries a 10 percent interest rate.
Accrued interest payable on the loan totaled $167 at October 31, 2003. In
addition, in accordance with the terms of the note, the Company granted the
president options to purchase 125,000 shares of the Company's common stock with
an exercise price equal to the common stock market value on the date of grant,
or $.04 per share.

     During May 2003, the president loaned the Company $10,000 for working
capital. The note matures in May 2005 and carries a 10 percent interest rate.
Accrued interest payable on the loan totaled $458 at October 31, 2003. In
addition, in accordance with the terms of the note, the Company granted the
president options to purchase 125,000 shares of the Company's common stock with
an exercise price equal to the common stock market value on the date of grant,
or $.04 per share.

     During February 2003, the Company sold 222,222 shares of its common stock
to the president of the Company for $20,000, or $.09 per share, which equaled
the market value of the common stock on the transaction date.

     On August 23, 2002, the Company's president loaned the Company $20,000 for
working capital in exchange for a promissory note. The note carries an eight
percent interest rate and matured on August 23, 2003. The note is currently in
default. Principal unpaid as of August 23, 2003 accrues interest at ten percent.
Accrued interest totaled $1,900 at October 31, 2003. The note is collateralized
by a first lien on the Company's patents related to FSH purification. In
addition, in accordance with the terms of the note, the Company granted the
president options to purchase 133,333 shares of the Company's common stock with
an exercise price equal to the common stock market value on the date of grant,
or $.075 per share.

     During May 2002, the Company began accruing its president's salary due to a
lack of working capital. The president's unpaid salary totaled $86,562 as of
October 31, 2003 and is included in the accompanying condensed financial
statements as "accrued salaries".

     During May 2002, the Company's Board of Directors approved a $14,000 loan
to the vice president of the Company. The loan was used to exercise options to
purchase 200,000 shares of the Company's common stock. The loan carries a five
percent interest rate and matures on May 8, 2004. The Company is holding stock
certificates in the name of the officer, totaling 116,700 shares of common
stock, as collateral for the loan. During the period from May 1, 2002 through
October 31, 2003, the vice president earned $6,100 in compensation, which was
allocated against the balance due on the loan. At October 31, 2003, the
principal and related accrued interest owed on the loan totaled $7,900 and $751,
respectively.

                                       24
<PAGE>

     During February 2002, the Company sold 200,000 shares of its common stock
to the president of the Company for $36,000, or $.18 per share, which equaled
the market value of the common stock on the transaction date.


                                     PART IV

ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K

(a)  Exhibits

     The following is a list of exhibits filed or incorporated by reference into
this Report:

No.            Description
---            -----------

1              Not applicable.

2.1(1)         Purchase Agreement between Vitro Diagnostics, Inc., AspenBio,
               Inc. and others dated August 7, 2000, without Exhibits.

3.1.1(2)       Articles of Incorporation of the Company as filed March 31, 1986
               with the Nevada Secretary of State.

3.1.2(3)       Certificate of Merger of Domestic and Foreign Corporations as
               filed December 17, 1986 with the Nevada Secretary of State.

3.1.3(4)       Certificate of Amendment of Articles of Incorporation as filed
               February 6, 1987 with the Nevada Secretary of State.

3.1.4(3)       Certificate of Amendment of Articles of Incorporation as filed
               May 18, 1988 with the Nevada Secretary of State.

3.1.5(5)       Amended and Restated Articles of Incorporation of Vitro
               Diagnostics, Inc., as filed July 20, 2001 with the Nevada
               Secretary of State

3.2(4)         Bylaws of the Company.

4.1(4)         Specimen certificate for Common Shares, $.001 par value per
               share.

9              Not applicable.

                                       25
<PAGE>

10.1(1)        Settlement Agreement and Release dated August 7, 2000

10.2(6)        Equity Incentive Plan dated October 9, 2000

10.3(7)        Promissory note issued by Erik Van Horn to the Company dated May
               7, 2002.

10.4(7)        Promissory note issued by the Company to James R. Musick dated
               August 23, 2002.

10.5(7)        Agreement for Liquidation of Shares between the Co. and World
               Wide Capital Investors dated June 17, 2002.

11             Not applicable.

13             Not applicable.

16             Not applicable.

18             Not applicable.

21             Not applicable.

22             Not applicable

23             Not applicable.

24             Not applicable.

27             Not applicable.

31             Certifications pursuant to Rule 13a-14(a) or 15d-14(a) under the
               Securities Exchange Act of 1934, as amended.

32             Certifications pursuant to 18 U.S.C. Section 1350, as adopted
               pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

99             Not applicable.

----------
(1)  Filed as an Exhibit to Form 8-K dated August 7, 2000 and incorporated
     herein by reference.

(2)  Filed as an Exhibit to Form 10-KSB dated October 31, 2000.

(3)  Filed as an Exhibit to Form 10-KSB/A dated July 31, 2000.

                                       26
<PAGE>

(4)  Filed as an Exhibit to Registration Statement on Form SB-2, SEC File No.
     33-59230 and incorporated herein by reference.

(5)  Filed as an Exhibit to Form 10-KSB for the year ended October 31, 2001.

(6)  Filed as an Exhibit to the definitive Proxy Statement on Schedule 14/A as
     filed with the Commission on October 30, 2000 and incorporated herein by
     reference.

(7)  Filed as an Exhibit to Form 10-KSB for the year ended October 31, 2002.


(b)  Reports on Form 8-K.

     The Company filed no Reports on Form 8-K during the fourth quarter of the
fiscal year covered by this Report.

ITEM 15. PRINCIPAL ACCOUNTANT FEES AND SERVICES

     The Company currently has no audit committee of the Board of Directors, and
is not required to maintain such a committee since its stock is not quoted on
Nasdaq or traded on any national securities exchange. Accordingly, all material
decisions affecting the Company's audited financial statements, periodic
disclosure with the SEC and its relationship with its auditors are addressed by
the entire Board. The Board currently has no policies and procedures relating to
the pre-approval of audit and audit related services.

Audit Fees

     The Company paid or will pay Cordovano & Honeck, P.C. an aggregate of $
4,500 in fees for an audit of its 2003 financial statements.

Audit Related Fees

     The Company paid or will pay Cordovano & Honeck, P.C. an aggregate of $
2,670 in fees for review of its quarterly financial statements for the first
three quarters of the 2003 fiscal year.

All Other Fees

     The Company paid or will pay Cordovano & Honeck, P.C. an aggregate of $700
in fees in connection with the filing of corporate income tax returns for 2003.


                                       27
<PAGE>



                                   SIGNATURES


     Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has caused this Report to be signed on its
behalf by the undersigned thereunto duly authorized in Aurora, Colorado on the
4th day of February, 2004.

                                           VITRO DIAGNOSTICS, INC.


                                           By: /s/ James R. Musick
                                           -------------------------------------
                                           James R. Musick, President,
                                           Chief Executive Officer

     Pursuant to the requirements of the Security Exchange Act of 1934, as
amended, this Report has been signed by the following persons in the capacities
and on the dates indicated.

Signatures                       Title                          Date
----------                       -----                          ----


/s/ James R. Musick              President, Chief Executive     February 4, 2004
----------------------------     Officer and Director
James R. Musick



/s/ Erik D. Van Horn             Vice President and Director    February 4, 2004
----------------------------
Erik D. Van Horn



/s/ James T. Posillico           Director                       February 4, 2004
----------------------------
James T. Posillico




                                       28
<PAGE>



                             VITRO DIAGNOSTICS, INC.

                          Index to Financial Statements

                                                                            Page
                                                                            ----

Independent auditors' report................................................ F-2
Balance sheet at October 31, 2003........................................... F-3
Statements of operations for the years ended
     October 31, 2003 and 2002.............................................. F-4
Statement of changes in shareholders' deficit for
     the two years ended October 31, 2003 and 2002.......................... F-5
Statements of cash flows for the years ended
     October 31, 2003 and 2002.............................................. F-6
Notes to financial statements............................................... F-7
















                                      F-1
<PAGE>




                          INDEPENDENT AUDITORS' REPORT

To the Board of Directors and Shareholders
Vitro Diagnostics, Inc.:


We have audited the balance sheet of Vitro Diagnostics, Inc. as of October 31,
2003, and the related statements of operations, changes in shareholders'
deficit, and cash flows, for each of the years in the two-year period ended
October 31, 2003. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.

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

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Vitro Diagnostics, Inc. as of
October 31, 2003, and the results of its operations and its cash flows for each
of the two years in the period ended October 31, 2003 in conformity with
accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming the Company
will continue as a going concern. As discussed in Note A to the financial
statements, the Company has suffered significant operating losses since
inception and has a working capital deficit at October 31, 2003, which raises a
substantial doubt about its ability to continue as a going concern. Management's
plans in regard to these matters are also described in Note A. The financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.

As discussed in the Summary of Significant Accounting Policies, the Company
capitalized deferred costs totaling $61,230 for patent applications as of
October 31, 2003. Recovery of the deferred costs is dependent on the issuance of
those patents and the subsequent realization of income therefrom. The ultimate
outcome of this uncertainty cannot presently be determined. Accordingly, the
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.


/s/ Cordovano and Honeck, P.C.
------------------------------
Cordovano and Honeck, P.C.
Denver, Colorado
January 13, 2004

                                      F-2

<PAGE>
<TABLE>
<CAPTION>

                                      VITRO DIAGNOSTICS, INC.
                                           Balance Sheet
                                         October 31, 2003

<S>                                                                                    <C>
Assets
Current assets:
     Inventory .....................................................................   $     1,297
     Prepaid expenses ..............................................................         3,744
                                                                                       -----------
                                                                Total current assets         5,041

Equipment, net of accumulated depreciation of $2,283 ...............................         3,714
Equipment under capital lease, net of accumulated depreciation of $12,273 ..........         2,963
Patents, net of accumulated amortization of $3,176 (Note A) ........................        26,141
Deferred costs (Note A) ............................................................        61,230
                                                                                       -----------

                                                                        Total assets   $    99,089
                                                                                       ===========

Liabilities and Shareholders' Deficit
Current liabilities:
     Current maturities on note payable (Note E) ...................................   $     5,210
     Current maturities on capital lease obligation (Note E) .......................         3,180
     Bank overdraft ................................................................           822
     Accounts payable ..............................................................        35,112
     Note payable to officer (Note B) ..............................................        40,000
     Accrued interest payable to officer (Note B) ..................................         2,525
     Accrued salaries (Note B) .....................................................        86,562
     Line of credit (Note D) .......................................................         6,284
     Other accrued expenses ........................................................         4,500
                                                                                       -----------
                                                           Total current liabilities       184,195

Long-term debt (Note E):
     Note payable, less current maturities .........................................         1,084
     Capital lease obligation, less current maturities .............................         6,368
                                                                                       -----------
                                                                   Total liabilities       191,647
                                                                                       -----------


Shareholders' deficit (Note F):
     Preferred stock, $.001 par value; 5,000,000 shares authorized;
        -0- shares issued and outstanding ..........................................          --
     Common stock, $.001 par value; 50,000,000 shares authorized;
        9,460,972 shares issued and outstanding ....................................         9,461
     Additional paid-in capital ....................................................     4,372,138
     Officer loan to exercise options, including $751 of accrued interest (Note B) .        (8,651)
     Stock options - 954,197 outstanding ...........................................         8,003
     Accumulated deficit ...........................................................    (4,473,509)
                                                                                       -----------
                                                         Total shareholders' deficit       (92,558)
                                                                                       -----------
                                                                                       $    99,089
                                                                                       ===========

                          See accompanying notes to financial statements

                                               F-3
<PAGE>

                                        VITRO DIAGNOSTICS, INC.
                                       Statements of Operations

                                                                               For the Years Ended
                                                                                   October 31,
                                                                           --------------------------
                                                                               2003           2002
                                                                           -----------    -----------
Operating costs and expenses:
     Research and development ..........................................   $   108,825    $   169,804
     Selling, general and administrative ...............................        45,950         93,787
     Stock-based compensation (Note F):
        Stock-based compensation: legal fees ...........................          --            2,775
        Stock-based compensation: SAB director services ................          --            2,100
        Stock-based compensation: consulting services ..................          --            1,200
     Impairment of intangible assets (Note A) ..........................       111,104          9,213
                                                                           -----------    -----------
                                      Total operating costs and expenses       265,879        278,879
                                                                           -----------    -----------
                                                    Loss from operations      (265,879)      (278,879)

Other income (expense):
     Gain on settlement of Goodwin deposit (Note G) ....................          --           28,000
     Consulting fees ...................................................        10,000           --
     Interest income, officer loan (Note B) ............................           461            290
     Interest income ...................................................          --              930
     Interest expense ..................................................        (6,860)        (2,738)
                                                                           -----------    -----------
                                                Loss before income taxes      (262,278)      (252,397)

Provision for income taxes (Note C) ....................................          --             --
                                                                           -----------    -----------

                                                                Net loss   $  (262,278)   $  (252,397)
                                                                           ===========    ===========

Basic and diluted net loss per common share ............................   $     (0.03)   $     (0.03)
                                                                           ===========    ===========
Shares used in computing basic and diluted net loss per common share ...     9,366,955      8,989,519
                                                                           ===========    ===========





                            See accompanying notes to financial statements

                                                  F-4
<PAGE>

                                           VITRO DIAGNOSTICS, INC.
                                Statement of Changes in Shareholders' Deficit


                                                            Preferred Stock               Common Stock
                                                       -------------------------   -------------------------
                                                          Shares       Amount        Shares       Par Value
                                                       -----------   -----------   -----------   -----------
                           Balance, October 31, 2001          --     $      --       8,811,607   $     8,812

Common stock issued to a consultant for
   Security Advisory Board service (Note F) ........          --            --          10,000            10
Common stock options granted in exchange
   for services (Note F) ...........................          --            --            --            --
Common stock sold to an officer at
   $.18 per share (Note B) .........................          --            --         200,000           200
Common stock options exercised by an
   officer and paid for with a loan from the
   Company (Note F) ................................          --            --         200,000           200
Common stock issued to a consultant for
   market research services (Note F) ...............          --            --          17,143            17
Officer compensation charged against the
   loan to officer (Note B) ........................          --            --            --            --
Interest accrued on officer's equity loan (Note B) .          --            --            --            --
Net loss for the year ended October 31, 2002 .......          --            --            --            --
                                                       -----------   -----------   -----------   -----------
                           Balance, October 31, 2002          --            --       9,238,750         9,239

Common stock sold to an officer at
   $.09 per share (Note B) .........................          --            --         222,222           222
Officer compensation charged against the
   loan to officer (Note B) ........................          --            --            --            --
Interest accrued on officer's equity loan (Note B) .          --            --            --            --
Net loss for the year ended October 31, 2003 .......          --            --            --            --
                                                       -----------   -----------   -----------   -----------
                           Balance, October 31, 2003          --     $      --       9,460,972   $     9,461
                                                       ===========   ===========   ===========   ===========

Table continues on following page.

                                                     F-5
<PAGE>

                                                  VITRO DIAGNOSTICS, INC.
                                 Statement of Changes in Shareholders' Deficit (Continued)


                                                                       Loan to
                                                                       Officer
                                                       Additional    to Exercise
                                                         Paid-in        Stock          Stock      Accumulated
                                                         Capital       Options        Options       Deficit         Total
                                                       -----------   -----------    -----------   -----------    -----------
                           Balance, October 31, 2001   $ 4,299,487   $      --      $     5,228   $(3,958,834)   $   354,693

Common stock issued to a consultant for
   Security Advisory Board service (Note F) ........         2,090          --             --            --            2,100
Common stock options granted in exchange
   for services (Note F) ...........................          --            --            2,775          --            2,775
Common stock sold to an officer at
   $.18 per share (Note B) .........................        35,800          --             --            --           36,000
Common stock options exercised by an
   officer and paid for with a loan from the
   Company (Note F) ................................        13,800       (14,000)          --            --             --
Common stock issued to a consultant for
   market research services (Note F) ...............         1,183          --             --            --            1,200
Officer compensation charged against the
   loan to officer (Note B) ........................          --           2,400           --            --            2,400
Interest accrued on officer's equity loan (Note B) .          --            (290)          --            --             (290)
Net loss for the year ended October 31, 2002 .......          --            --             --        (252,397)      (252,397)
                                                       -----------   -----------    -----------   -----------    -----------
                           Balance, October 31, 2002     4,352,360       (11,890)         8,003    (4,211,231)       146,481

Common stock sold to an officer at
   $.09 per share (Note B) .........................        19,778          --             --            --           20,000
Officer compensation charged against the
   loan to officer (Note B) ........................          --           3,700           --            --            3,700
Interest accrued on officer's equity loan (Note B) .          --            (461)          --            --             (461)
Net loss for the year ended October 31, 2003 .......          --            --             --        (262,278)      (262,278)
                                                       -----------   -----------    -----------   -----------    -----------
                           Balance, October 31, 2003   $ 4,372,138   $    (8,651)   $     8,003   $(4,473,509)   $   (92,558)
                                                       ===========   ===========    ===========   ===========    ===========


                                      See accompanying notes to financial statements

                                                       F-5 (Continued)
<PAGE>

                                          VITRO DIAGNOSTICS, INC.
                                         Statements of Cash Flows

                                                                                    For the Years Ended
                                                                                         October 31,
                                                                                   ----------------------
                                                                                      2003         2002
                                                                                   ---------    ---------
Cash flows from operating activities:
     Net loss ..................................................................   $(262,278)   $(252,397)
     Adjustments to reconcile net loss to net cash used in
       operating activities:
        Depreciation and amortization ..........................................      15,456       16,587
        Stock-based compensation for common stock issued and
           stock options granted in exchange for services (Note F) .............        --          6,075
        Impairment of intangible assets (Note A) ...............................     111,104         --
        Interest income recognized on Officer's equity loan (Note B) ...........        (461)        (290)
        Services charged against Officer's equity loan (Note B) ................       3,700        2,400
     Changes in current assets and current liabilities:
        (Increase) decrease in accounts receivable, inventories,
           prepaid expenses and deposits .......................................      (1,297)         667
        Increase (decrease) in accounts payable, accrued expenses
           and payroll taxes payable ...........................................      93,177       15,190
                                                                                   ---------    ---------
Net cash used in operating activities ..........................................     (40,599)    (211,768)
                                                                                   ---------    ---------

Cash flows from investing activities:
     Purchases of property and equipment .......................................       (481)       (2,706)
     Payments for patents and deferred costs ...................................     (7,004)      (19,092)
                                                                                   ---------    ---------
Net cash used in investing activities ..........................................     (7,485)      (21,798)
                                                                                   ---------    ---------

Cash flows from financing activities:
     Proceeds from issuance of notes payable (Note B) ..........................      20,000       20,000
     Principal payments on notes payable .......................................      (1,802)        --
     Proceeds from line of credit ..............................................       9,400        1,400
     Principal payments on line of credit ......................................      (4,360)        (156)
     Principal payments on capital lease .......................................      (2,657)      (2,218)
     Sale of common stock ......................................................      20,000       36,000
                                                                                   ---------    ---------
Net cash provided by (used in) financing activities ............................      40,581       55,026
                                                                                   ---------    ---------

                                                              Net change in cash      (7,503)    (178,540)
Cash, beginning of year ........................................................       7,503      186,043
                                                                                   ---------    ---------
                                                               Cash, end of year   $    --      $   7,503
                                                                                   =========    =========

Supplemental disclosure of cash flow information:
     Cash paid during the year for:
        Interest ...............................................................   $   4,635    $   2,738
                                                                                   =========    =========
        Income taxes ...........................................................   $    --      $    --
                                                                                   =========    =========

     Non-cash investing and financing transactions:
        Promissory note issued in exchange for payables (Note E) ...............   $   8,096    $    --
                                                                                   =========    =========
        Officer loan to exercise stock options (Note B) ........................   $    --      $  14,000
                                                                                   =========    =========


                              See accompanying notes to financial statements

                                                    F-6
</TABLE>
<PAGE>

                             VITRO DIAGNOSTICS, INC.
                          Notes to Financial Statements


NOTE A: NATURE OF ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Organization

The Company was incorporated under the laws of Nevada on March 31, 1986. From
November of 1990 through July 31, 2000, the Company was engaged in the
development, manufacturing and marketing of purified human antigens
("Diagnostics") and the development of therapeutic products ("Therapeutics") and
related technologies. The Company's sales were solely attributable to the
manufacturing of the purified human antigens.

Following the transfer of its Diagnostics operations in August of 2000, the
Company began devoting all efforts to its therapeutic drug development and
related technologies. The Company's target area for its therapeutic products is
the treatment of human infertility. The Company has been granted three patents
for its process to manufacture VITROPIN(TM) VITROPIN(TM) is a highly purified
urinary follicle-stimulating hormone ("FSH") preparation produced according to
the Company's patented purification process. The Company is developing
additional FSH-related drugs including VITROPIN-V(TM), and has developed a
prototype syringe for administration of fertility drugs called VITROJECT(TM)

The Company has also been granted a patent for its proprietary technology
related to the immortalization of human cells. This technology is can be used in
a variety of commercial applications including the treatment of degenerative
diseases and drug discovery.

The accompanying financial statements have been prepared on a going concern
basis, which contemplates the realization of assets and satisfaction of
liabilities in the normal course of business. As shown in the accompanying
financial statements, the Company has suffered significant losses since
inception and has a working capital deficit at October 31, 2003. These factors,
among others, may indicate that the Company will be unable to continue as a
going concern for a reasonable time.

The financial statements do not include any adjustments relating to the
recoverability and classification of liabilities that might be necessary should
the Company be unable to continue as a going concern. The Company's continuation
as a going concern is dependent upon its ability to generate sufficient cash
flow to meet its obligations on a timely basis and ultimately to attain
profitability. During the years ended October 31, 2003 and 2002, the president
has loaned the Company funds for working capital on an "as needed" basis. There
is no assurance that these loans will continue in the future. The Company plans
to seek additional funding to maintain its operations through debt and equity
financing. The Company is presently engaged in discussions with companies that
have expressed interest in the commercialization of the Company's cell
immortalization technology and the Company's fertility drugs. Management will
pursue these and other opportunities with the objective of establishing
strategic alliances to fund further fertility drug development and
commercialization. Also, the Company recently launched a new product line,
VITROCELL(TM), consisting of novel human cell lines for research and
development. These products represent unique opportunities for researchers to
utilize proliferating human cell lines for a variety of research applications
including basic research in diabetes, pancreatic cancer and endocrinology of the
pituitary gland. Management intends to pursue revenue generation from this
product line and development of other related products to the fullest extent
possible given its resources. There is no assurance that any of these
initiatives will yield sufficient capital to maintain the Company's operations.
In such an event, management intends to pursue various alternatives such as sale
of its assets or merger with other entities.

                                      F-7
<PAGE>

                             VITRO DIAGNOSTICS, INC.
                          Notes to Financial Statements


Summary of Significant Accounting Policies

Use of estimates

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

Cash equivalents

For the purposes of the statement of cash flows, the Company considers all
highly liquid debt instruments purchased with an original maturity of three
months or less to be cash equivalents. The Company had no cash equivalents at
October 31, 2003.

Property, equipment and depreciation

Property and equipment are stated at cost and are depreciated over the assets'
estimated useful lives using the straight-line method. Depreciation expense
totaled $6,119 and $6,102 for the years ended October 31, 2003 and 2002,
respectively.

Upon retirement or disposition of equipment, the cost and accumulated
depreciation are removed from the accounts and any resulting gain or loss is
reflected in operations. Repairs and maintenance are charged to expense as
incurred and expenditures for additions and improvements are capitalized.

Patents, deferred costs and amortization

Patents consist of costs incurred to acquire issued patents. Amortization
commences once a patent is granted. Costs incurred to acquire patents that have
not been issued are reported as deferred costs. If a patent application is
denied or expires, the costs incurred are charged to operations in the year the
application is denied or expires. The Company amortizes its patents over a
period of ten years. Amortization expense totaled $9,337 and $10,485 for the
years ended October 31, 2003 and 2002, respectively. The Company's patents and
deferred costs consisted of the following at October 31, 2003:
<TABLE>
<CAPTION>
<S>                                                                          <C>
   Patent
   Method for purifying "FSH" (3 patents) ................................   $   --
         These patents detail methods to manufacture highly purified FSH
         from various sources including human cells and animal extracts
         of pituitary glands.
   Immortalized cell lines and methods of making the same (1 patent) .....     29,317
         This patent is for proprietary technology related to the
         immortalization of human cells, which could be used in the
         treatment of degenerative diseases and drug discovery.
   Less: accumulated amortization ........................................     (3,176)
                                                                             --------
                                                                             $ 26,141
                                                                             ========

                                       F-8
<PAGE>

                             VITRO DIAGNOSTICS, INC.
                          Notes to Financial Statements


   Deferred costs
   Method for purifying "FSH", continuation-
      in-part application ................................................   $   --
         This patent application is a continuation on the above patents
         previously obtained by the Company that seeks to expand
         protection of its issued patent.  The patent application was also
         filed in the United Kingdom, Canada, Australia, and in the
         European Patent office.
   Immortalization of human cell lines (VITROPIN-V(TM)) ..................     21,872
         This patent application is a continuation on the above patent
         previously obtained by the Company that seeks to expand
         protection of its issued patent.  The patent application was also
         filed in the United Kingdom, Canada, Australia, New Zealand,
         Israel, and in the European Patent office.
   Multi-dose syringe driver (VITROJECT(TM)) .............................     39,358
         Patent application for a device designed to administer injections
         more easily and economically.
                                                                             --------
                                                                             $ 61,230
                                                                             ========

Impairment and Disposal of Long-Lived Assets

The Company evaluates the carrying value of its long-lived assets under the
provisions of SFAS No. 144, "Accounting for the Impairment or Disposal of
Long-Lived Assets". Statement No. 144 requires impairment losses to be recorded
on long-lived assets used in operations when indicators of impairment are
present and the undiscounted future cash flows estimated to be generated by
those assets are less than the assets' carrying amount. If such assets are
impaired, the impairment to be recognized is measured by the amount by which the
carrying amount of the assets exceeds the fair value of the assets. Assets to be
disposed of are reported at the lower of the carrying value or fair value, less
costs to sell.

During the year ended October 31, 2003, the Company completed a balance sheet
review that identified assets whose carrying amounts are not recoverable. As a
result of this review, the Company recorded asset impairment charges of $111,104
for the write-off of patents and deferred intellectual property costs as
follows:

                                                       Accumulated
                                                       Amortization  Book Value             Book Value at
                                            Original     Through      Prior to      Asset     October 31,
               Description                    Cost    April 30, 2003 Impairment  Impairment      2003
-----------------------------------------   --------- -------------- ----------  ----------   ---------
Patents:
Method for purifying FSH (3 patents) ....   $ 128,089   $ (29,328)   $  98,761   $ (98,761)   $    --

Deferred Intellectual Property Costs:
Continuation-in-part application
   related to FSH patents ...............      10,339        --         10,339     (10,339)        --
Other patent application costs ..........       2,004        --          2,004      (2,004)        --
                                            ---------   ---------    ---------   ---------    ---------
                                   Totals   $ 140,432   $ (29,328)   $ 111,104   $(111,104)   $    --
                                            =========   =========    =========   =========    =========

                                      F-9
</TABLE>
<PAGE>

                             VITRO DIAGNOSTICS, INC.
                          Notes to Financial Statements


During the year ended October 31, 2002, the Company allowed 2 patent
applications to expire. The costs associated with those patent applications
totaled $9,213 and were expensed in the accompanying financial statements.

Income taxes

Income taxes are provided for the tax effects of transactions reported in the
financial statements and consist of taxes currently due plus deferred taxes
related primarily to differences between the recorded book basis and the tax
basis of assets and liabilities for financial and income tax reporting. The
deferred tax assets and liabilities represent the future tax return consequences
of those differences, which will either be taxable or deductible when the assets
and liabilities are recovered or settled. Deferred taxes are also recognized for
operating losses that are available to offset future taxable income and tax
credits that are available to offset future federal income taxes.

Revenue and cost recognition

The Company utilizes the accrual method of accounting whereby revenue is
recognized when earned and expenses are recognized when incurred.

Fair value of financial instruments

SFAS 107, "Disclosure About Fair Value of Financial Instruments," requires
certain disclosures regarding the fair value of financial instruments. The
carrying amounts of cash, accounts payable and other accrued liabilities
approximate fair value due to the short-term maturity of the instruments.

Net loss per share

The Company reports net loss per share using a dual presentation of basic and
diluted loss per share. Basic net loss per share excludes the impact of common
stock equivalents. Diluted net loss per share utilizes the average market price
per share when applying the treasury stock method in determining common stock
equivalents. Common stock options outstanding at October 31, 2003 were not
included in the diluted loss per share as all 954,197 options were
anti-dilutive. Therefore, basic and diluted losses per share at October 31, 2003
were equal.

Stock-based compensation

The Company accounts for stock-based employee compensation arrangements in
accordance with Accounting Principles Board ("APB") Opinion 25, "Accounting for
Stock Issued to Employees" and complies with the disclosure provisions of SFAS
No. 123, "Accounting for Stock-Based Compensation." Under APB No. 25,
compensation expense is based on the difference, if any, on the date of grant,
between the fair value of the Company's stock and the exercise price. The
Company accounts for stock issued to non-employees in accordance with the
provisions of SFAS No. 123. SFAS 123 requires the fair value based method of
accounting for stock issued to non-employees in exchange for services.

Companies that elect to use the method provided in APB 25 are required to
disclose pro forma net income and pro forma earnings per share information that
would have resulted from the use of the fair value based method. The Company has
elected to continue to determine the value of stock-based compensation
arrangements under the provisions of APB 25. Pro forma disclosures have been
included in Note D.

                                      F-10
<PAGE>

                             VITRO DIAGNOSTICS, INC.
                          Notes to Financial Statements


NOTE B: RELATED PARTY TRANSACTIONS

During September 2003, the president loaned the Company $10,000 for working
capital. The note matures in August 2005 and carries a 10 percent interest rate.
Accrued interest payable on the loan totaled $167 at October 31, 2003. In
addition, in accordance with the terms of the note, the Company granted the
president options to purchase 125,000 shares of the Company's common stock with
an exercise price equal to the common stock market value on the date of grant,
or $.04 per share.

During May 2003, the president loaned the Company $10,000 for working capital.
The note matures in May 2005 and carries a 10 percent interest rate. Accrued
interest payable on the loan totaled $458 at October 31, 2003. In addition, in
accordance with the terms of the note, the Company granted the president options
to purchase 125,000 shares of the Company's common stock with an exercise price
equal to the common stock market value on the date of grant, or $.04 per share.

During February 2003, the Company sold 222,222 shares of its common stock to the
president of the Company for $20,000, or $.09 per share, which equaled the
market value of the common stock on the transaction date.

On August 23, 2002, the Company's president loaned the Company $20,000 for
working capital in exchange for a promissory note. The note carries an eight
percent interest rate and matured on August 23, 2003. The note is currently in
default. Principal unpaid as of August 23, 2003 accrues interest at ten percent.
Accrued interest totaled $1,900 at October 31, 2003. The note is collateralized
by a first lien on the Company's patents related to FSH purification. In
addition, in accordance with the terms of the note, the Company granted the
president options to purchase 133,333 shares of the Company's common stock with
an exercise price equal to the common stock market value on the date of grant,
or $.075 per share.

During May 2002, the Company began accruing its president's salary due to a lack
of working capital. The president's unpaid salary totaled $86,562 as of October
31, 2003 and is included in the accompanying condensed financial statements as
"accrued salaries".

During May 2002, the Company's Board of Directors approved a $14,000 loan to the
vice president of the Company. The loan was used to exercise options to purchase
200,000 shares of the Company's common stock. The loan carries a five percent
interest rate and matures on May 8, 2004. The Company is holding stock
certificates in the name of the officer, totaling 116,700 shares of common
stock, as collateral for the loan. During the period from May 1, 2002 through
October 31, 2003, the vice president earned $6,100 in compensation, which was
allocated against the balance due on the loan. At October 31, 2003, the
principal and related accrued interest owed on the loan totaled $7,900 and $751,
respectively.

During February 2002, the Company sold 200,000 shares of its common stock to the
president of the Company for $36,000, or $.18 per share, which equaled the
market value of the common stock on the transaction date.

NOTE C: INCOME TAXES

A reconciliation of the U.S. statutory federal income tax rate to the effective
rate is as follows:

                                      F-11
<PAGE>

                             VITRO DIAGNOSTICS, INC.
                          Notes to Financial Statements


                                                                 October 31,
                                                             ------------------
                                                               2003       2002
                                                             -------    -------
U.S. federal statutory graduated rate ....................    32.30%     32.04%
State income tax rate, net of federal benefit ............     3.14%      3.15%
Net operating loss for which no tax benefit
   is currently available ................................   -35.44%    -35.19%
                                                             -------    -------
                                       Effective rate ....     0.00%      0.00%
                                                             =======    =======


At October 31, 2003, deferred taxes consisted of a net tax asset of $1,137,294,
due to operating loss carryforwards of $3,063,597, which was fully allowed for
in the valuation allowance of $1,137,294. The valuation allowance offsets the
net deferred tax asset for which there is no assurance of recovery. The deferred
tax assets for the years ended October 31, 2003 and 2002 were $92,946 and
$88,813, respectively. The change in the valuation allowance from October 31,
2002 through October 31, 2003 was $92,946. Net operating loss carryforwards will
expire through 2023.

The valuation allowance will be evaluated at the end of each year, considering
positive and negative evidence about whether the asset will be realized. At that
time, the allowance will either be increased or reduced; reduction could result
in the complete elimination of the allowance if positive evidence indicates that
the value of the deferred tax asset is no longer impaired and the allowance is
no longer required.

Should the Company undergo an ownership change as defined in Section 382 of the
Internal Revenue Code, the Company's tax net operating loss carryforwards
generated prior to the ownership change will be subject to an annual limitation,
which could reduce or defer the utilization of these losses.

NOTE D: LINE OF CREDIT

The Company has a $10,000 line of credit of which $3,716 was unused at October
31, 2003. The interest rate on the credit line was thirteen percent at October
31, 2003. Principal and interest payments are due monthly.

The Company also has three credit cards with a combined credit limit of $44,000,
of which $27,757 was unused at October 31, 2003. The interest rates on the
credit cards range from 2.9 percent to 19 percent as of October 31, 2003.

NOTE E: LONG-TERM DEBT

Note Payable

During August 2003, the Company converted liabilities owed to its attorney into
an $8,096 promissory note. The note carries a 10 percent interest rate and is
payable at the rate of $500 per month. The Company paid $1,802 against principal
and $198 toward interest expense through October 31, 2003. As of October 31,
2003, the Company owed $6,294 on the note. Future maturities of the note are as
follows:

                Year ended October 31,
                ----------------------
                        2004 ...................  $  5,210
                        2005 ...................     1,084
                                                  --------
                                                  $  6,294
                                                  ========

                                      F-12
<PAGE>

                             VITRO DIAGNOSTICS, INC.
                          Notes to Financial Statements


Capital Lease Obligation

On May 22, 2001, the Company entered into a capital lease agreement to acquire
computer and laboratory equipment. The Company is obligated to make 60 monthly
payments of $388 under the lease. Future maturities of the capital lease
obligation are as follows:

                   Year ended October 31,
                   ----------------------
                         2004 ..................   $  4,657
                         2005 ..................      4,657
                         2006 ..................      2,716
                                                   --------
                                                     12,030
                    Less: imputed interest .....     (2,482)
                                                   --------
                    Present value of net minimum
                       lease payments ..........   $  9,548
                                                   ========


The president of the Company has personally guaranteed the lease obligation.

NOTE F: SHAREHOLDERS' EQUITY

During October 2002, the Company issued 17,143 shares of its common stock to a
consultant in exchange for market research services. The transaction was valued
at the market price of the stock on the date of issuance, which was $.07 per
share. As a result, the Company recognized a stock-based compensation expense
totaling $1,200 based on the fair value of the common stock.

During December 2001, the Company issued 10,000 shares of its common stock to an
individual in exchange for services provided to the Company's Scientific
Advisory Board ("SAB")  The transaction was valued at the market price of the
stock on the date of issuance, which was $.21 per share. As a result, the
Company recognized a stock-based compensation expense totaling $2,100 based on
the fair value of the common stock.

Incentive plans

Effective December 2, 2000, the Company's Board of Directors adopted an Equity
Incentive Plan (the "Plan"), which replaced the Company's 1992 Stock Option
Plan. The purpose of the Plan is to attract and retain qualified personnel, to
provide additional incentives to employees, officers, consultants and directors,
and to promote the Company's business. The Plan authorizes total stock awards of
up to 1,000,000 shares of the Company's common stock. Awards may take the form
of incentive stock options, non-qualified stock options, restricted stock
awards, stock bonuses and other stock grants. If a stock award made under the
Plan expires, terminates, is canceled or settled in cash without the issuance of
all shares of common stock covered by the award, those shares will be available
for future awards under the Plan. Awards may not be transferred except by will
or the laws of descent and distribution. No awards may be granted under the Plan
after September 30, 2010.

                                      F-13
<PAGE>

                             VITRO DIAGNOSTICS, INC.
                          Notes to Financial Statements


The Plan is administered by the Company's Board of Directors, which may delegate
its authority to a committee of the Board of Directors. The Board of Directors
has the authority to select individuals to receive awards, to determine the time
and type of awards, the number of shares covered by the awards, and the terms
and conditions of such awards in accordance with the terms of the Plan. In
making such determinations, the Board of Directors may take into account the
recipient's current and potential contributions and any other factors the Board
of Directors considers relevant. The recipient of an award has no choice
regarding the form of a stock award. The Board of Directors is authorized to
establish rules and regulations and make all other determinations that may be
necessary or advisable for the administration of the Plan. All options granted
pursuant to the Plan shall be exercisable at a price not less than the fair
market value of the common stock on the date of grant. Unless otherwise
specified, the options expire ten years from the date of grant. The following
schedule summarizes the changes in the Company's stock option plan:

                           Options Outstanding and Exercisable  Weighted Average
                           -----------------------------------  ----------------
                                Number of   Exercise Price       Exercise Price
                                 Shares        Per Share            Per Share
                                ---------   ---------------      --------------
Balance at October 31, 2001 ...  800,364     $.07 to $1.50           $ 0.35
   Options granted ............  173,833     $.075 to $.21           $ 0.09
   Options exercised .......... (200,000)        $0.07               $ 0.07
   Options expired ............  (70,000)        $0.20               $ 0.20
                                --------                            --------

Balance at October 31, 2002 ...  704,197    $.075 to $1.50           $ 0.35
   Options granted ............  250,000         $0.04               $ 0.04
   Options exercised ..........     --           $0.00               $  --
   Options expired ............     --           $0.00               $  --
                                --------                            --------

Balance at October 31, 2003 ...  954,197     $.04 to $1.50           $ 0.25
                                ========


Stock options - employees

During the year ended October 31, 2003, the Company granted 250,000 options to
its president with exercise prices equal to the common stock market value on the
date of grant. The weighted average exercise price and weighted average fair
value of these options as of October 31, 2003 were $.04 and $.04, respectively.

During the year ended October 31, 2002, the Company granted 146,833 options to
officers and directors with exercise prices equal to the common stock market
value on the date of grant. The weighted average exercise price and weighted
average fair value of these options as of October 31, 2002 were $.08 and $.07,
respectively. Directors' options are considered employee options and are
accounted for under APB 25.

Pro forma information regarding net income and earnings per share is required by
SFAS 123 as if the Company had accounted for its granted stock options under the
fair value method of that Statement. The fair value for the options granted
during the fiscal year ended October 31, 2003 was estimated at the date of grant
using the Black-Scholes option-pricing model with the following assumptions:

       Risk-free interest rate..............................     2.00%
       Dividend yield.......................................     0.00%
       Volatility factor....................................   785.38%
       Weighted average expected life.......................  5 years


                                      F-14
<PAGE>

                             VITRO DIAGNOSTICS, INC.
                          Notes to Financial Statements


The Black-Scholes options valuation model was developed for use in estimating
the fair value of traded options, which have no vesting restrictions and are
fully transferable. In addition, option valuation models require the input of
highly subjective assumptions including the expected stock price volatility.
Because the Company's stock options have characteristics significantly different
from those of traded options, and because changes in the subjective input
assumptions can materially affect the fair value estimate, in management's
opinion, the existing models do not necessarily provide a reliable single
measure of the fair value of its stock options. However, the Company has
presented the pro forma net loss and pro forma basic and diluted loss per common
share using the assumptions noted above.

                                                 For the Years Ended
                                                     October 31,
                                                ---------------------
                                                  2003          2002
                                                ---------   ---------
        Net loss, as reported ...............   $(262,278)  $(252,397)
                                                =========   =========

        Pro forma net loss ..................   $(272,278)  $(262,708)
                                                =========   =========

        Basic and diluted net loss per common
           share, as reported ...............   $   (0.03)  $   (0.03)
                                                =========   =========

        Pro forma basic and diluted net loss
           per common share .................   $   (0.03)  $   (0.03)
                                                =========   =========

Stock options - non-employees

During the year ended October 31, 2002, the Company granted its SEC attorney
options to purchase 27,000 shares of the Company's common stock. The options'
exercise prices range from $.12 to $.21 and expire between December 11, 2011 and
May 7, 2012. The Company determined the fair value of the options in accordance
with SFAS 123 and recorded stock-based compensation expense of $2,775 in the
accompanying financial statements.

NOTE G: GOODWIN DEPOSIT

On June 18, 2001, the Company negotiated the repayment of a $24,000 deposit for
future services paid to Goodwin Biotechnology, Incorporated ("Goodwin")  Under
the repayment settlement, Goodwin agreed to repay the Company $25,000.

On October 22, 2001, the Company filed a complaint in Arapahoe County, Colorado
District Court against Goodwin for breach of contract. On January 10, 2002, the
Arapahoe County Court issued a judgment in the amount of $29,177 (including
interest and attorney fees)  The judgment also carries an annual interest rate
of 18 percent. The amount expected to be collected under the judgement could not
be estimated. The $24,000 deposit was written off as of October 31, 2001
resulting in a loss of $24,000, which is included in the accompanying financial
statements as "loss on write-off of Goodwin deposit".

                                      F-15
<PAGE>

                             VITRO DIAGNOSTICS, INC.
                          Notes to Financial Statements


During February 2002, the Company received $28,000 toward the payment of the
judgment filed on January 10, 2002 against Goodwin Biotechnology, Incorporated.
The Satisfaction of Judgment was filed in Arapahoe County, Colorado District
Court on March 5, 2002. The $28,000 is included in the accompanying financial
statements as "gain on settlement of Goodwin deposit".

NOTE H: SUBSEQUENT EVENT

On November 14, 2003, the Company's president paid $10,000 to exercise options
to purchase 133,333 shares of the Company's common stock. Following the
transaction, the Company had 820,864 options outstanding and exercisable.



















                                      F-16