UNITED
      STATES


SECURITIES
      AND EXCHANGE COMMISSION


WASHINGTON,
      D.C. 20549





**FORM
      10-KSB**





[X]
            ANNUAL
                REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
                1934For
                the fiscal year ended**August
                31, 2007**[  ]
            TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                ACTFor
                the transition period from _________ to ________Commission
                file number**333-138189**





**Atheron,
                Inc.**(Name
                of small business issuer in its
                charter)




**Nevada**
            **N/A**(State
                or other jurisdiction of incorporation or organization)
            (I.R.S.
                Employer Identification No.)**3598
                Durango St. Palanan, Makati City, Philippines
                1235**
            _________(Address
                of principal executive offices)
            (Zip
                Code)Issuer’s
              telephone number:**(632)
              728 1626**




Securities
                registered under Section 12(b) of the Exchange Act:Title
                of each class
            Name
                of each exchange on which registered**None**
            **Not
                Applicable**Securities
                registered under Section 12(g) of the Exchange Act:**None**(Title
                of class)





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





Check
      if
      disclosure of delinquent filers in response to Item 405 of Regulation S-B is
      not
      contained in this form, and no disclosure will be contained, to the best of
      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 **[
      ]**





Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act). **Yes
      [X] No [ ]**





State
      issuer’s revenue for its most recent fiscal year. **$0**





State
      the
      aggregate market value of the voting and non-voting common equity held by
      non-affiliates computed by reference to the average bid and asked price of
      such
      common equity, as of a specified date within the past 60 days. **Not
      Available**





State
      the
      number of shares outstanding of each of the issuer’s classes of common equity,
      as of the latest practicable date. **2,150,000
      Common Shares as of August 31, 2007**





Transitional
      Small Business Disclosure Format (Check One): **Yes:
      __; No X**




Table
          of Contents





**TABLE
      OF CONTENTS**





PagePART
                IItem
                1.
            Description
                of Business
            3Item
                2.
            Description
                of Property
            12Item
                3.
            Legal
                Proceedings
            12Item
                4.
            Submission
                of Matters to a Vote of Security
                Holders
            12PART
                IIItem
                5.
            Market
                for Common Equity and Related Stockholder Matters
            13Item
                6.
            Management’s
                Discussion and Analysis or Plan of
                Operation
            15Item
                7.
            Financial
                Statements
            19Item
                8.
            Changes
                In and Disagreements With Accountants on Accounting and
                Financial Disclosure
            20Item
                8A.
            Controls
                and Procedures
            20Item
                8B.
            Other
                Information
            21PART
                IIIItem
                9.
            Directors,
                Executive Officers, Promoters and Control Persons;
                Compliance With Section 16(a) of the Exchange Act
            21Item
                10.
            Executive
                Compensation
            23Item
                11.
            Security
                Ownership of Certain Beneficial Owners and Management
                and Related Stockholder Matters
            25Item
                12.
            Certain
                Relationships and Related
                Transactions
            26Item
                13.
            Exhibits
            26Item
                14.
            Principal
                Accountant Fees and Services
            26


2
 Table
          of Contents


**PART
      I**




**Item1.
      Description of Business**




**Overview**




We
      were
      formed as a Nevada corporation on May 8, 2006. Our principal executive offices
      are located at 3598 Durango St. Palanan, Makati City 1235, Philippines. Our
      telephone number is (632)
      728-1626 .




We
      are in
      the business of developing a technology for ethanol-methanol gasoline which
      is
      prepared from light oil, naphtha, straight-run gasoline and key additives.
      Our
      mixed gasoline formula is not yet completed and will require further research
      and development before it is ready for commercial use. Once developed, we intend
      to license our formula initially in the Philippines, and if demand warrants,
      into China and other countries in Asia.





We
      believe our mixed gasoline formula will offer a number of advantages over
      existing gasoline products. Our formula should provide better miscibility than
      traditional gasoline. Miscibility refers to the property of various substances,
      liquids in particular, to be mixed together and form a homogenous material.
      The
      better the miscibility available in gasoline, the cleaner it will burn,
      resulting in better overall engine performance and cleaner pistons, rings,
      plugs
      and exhaust ports. In addition, we believe our formula will have a lower
      evaporation rate. A main ingredient in gasoline is ethanol, which evaporates
      easily. An excessive amount of unburned evaporated fuel tends to result in
      higher quantities of smog in the atmosphere. Our formula is designed to prevent
      an excessive amount of evaporation.





We
      also
      believe our product will prevent premature detonation (or “knocking”) in the
      engine. Lead was previously used as an effective anti-knocking agent by
      increasing the fuel’s octane rating. Our formula uses anti-knocking additives
      that similarly increase the octane rating for greater efficiency and power.
      Our
      formula is expected to have higher stability. When gasoline is stagnant for
      a
      certain period of time, gums and varnishes tend to build up and precipitate
      in
      the gasoline, causing what is known as“stale fuel.” This results in build up in
      the cylinders and fuel lines, complicating engine start-up. A stabilizer, which
      will be used in our formula, is expected to help prevent build up and extend
      the
      life of the engine.





Finally,
      we believe our mixed gasoline formula will cost less to consumers than
      traditional gasoline. We believe that our mixed gasoline formula will help
      alleviate the burden on the consuming public. We plan to license our formula
      initially in the Philippines, and then branch off to other nations if demand
      grows. The regular gas price at the pump in the Philippines is about $3 per
      gallon similar to that in United States, only the GDP per capita in the
      Philippines is only 3% of that in the United States, so an increase in gas
      prices has a more drastic impact in the Philippines than in the United States.
      President Macapagal-Arroyo warned that rising oil prices threatens the country’s
      foreign exchange reserves as well as its energy supply. With these repercussions
      in place, we are hopeful that our low-cost mixed gasoline formula will have
      a
      positive impact in the Filipino market.





We
      are a
      development stage company and have not generated any sales to date. We are
      in
      the initial stages of developing our formula, have very limited cash resources
      and are in need of


3
 Table
          of Contents


substantial
      additional capital to execute our business plan. For these and other reasons,
      our independent auditors have raised substantial doubt about our ability to
      continue as a going concern.




**Demand
      for Crude Oil**




As
      explained in the  International
      Energy Outlook 2007 (IEO2007) ,
      world
      oil demand is expected to grow from 83 million barrels per day in 2004 to 97
      million barrels per day in 2015 and 118 million barrels per day in 2030.
      ( http://www.eia.doe.gov/oiaf/ieo/world.html ).
      Much
      of the growth in oil consumption is projected for the nations of non-OECD Asia,
      where strong economic growth is expected. Non-OECD Asia (including China and
      India) is projected to grow at an average rate of 3.2 percent per year, more
      than doubling over the 2004 to 2030 period and accounting for more than 65
      percent of the increase in energy use for the non-OECD region as a whole. While
      the country of the Philippines was not specifically mentioned in the IEO2007
      projections, we believe that it falls within the category of projections noted
      for Non-OECD Asia and will experience much growth in oil consumption as
      well.




Much
      of
      the world’s incremental oil demand is projected for use in the transportation
      sector, where there are few competitive alternatives to petroleum; however,
      several of the technologies associated with unconventional liquids
      (gas-to-liquids, coal-to-liquids, and ethanol and biodiesel produced from energy
      crops) are expected to meet a growing share of demand for petroleum liquids
      during the projection period. On a global basis, the transportation sector
      accounts for 68 percent of the total projected increase in liquids use between
      2004 and 2030, followed by the industrial sector, which accounts for another
      27
      percent of the increment in world liquids demand.




With
      the
      projected growth in oil for both the transportation and industrial sectors,
      we
      believe that our mixed gasoline formula will be met with strong demand in
      Non-OECD Asia countries such as the Philippines.




**How
      Gasoline is Made**




Gasoline
      is a mixture of hydrocarbons blended with a few additives to meet the
      performance needs of automobile engines. The major raw material for gasoline
      is
      crude oil, which contains numerous compounds ranging from methane to those
      having 85 carbon atoms. Gasoline can be produced by “distilling” crude oil or by
      maintaining the oil at high temperatures until the different oil components,
      or
“fractions” as they are called, reach boiling point and vaporize. Some of the
      major crude oil fractions obtained upon initial distillation are “light ends,”
such as propane and butane; “straight run” gasoline, the higher boiling part of
      which is sometimes called naphtha; kerosene; diesel fuel; heating oil; and
      lubricating oils.





Several
      refinery processes have developed to produce the blending factions used to
      make
      gasoline. Simple distillation converts approximately 10 percent of a barrel
      of
      crude oil to gasoline. A process known as “cracking,” a breaking down of heavy
      oil fractions under high temperatures and pressures, produces about 25 percent
      of a barrel of crude oil to gasoline. In catalytic cracking, a process where
      oil
      is fed into a reaction vessel containing a catalyst, even higher percentages
      of
      gasoline are produced from crude oil. In “reforming,” the gasoline fraction


4
 Table
          of Contents


is
      mixed
      with hydrogen and heated with a catalyst, causing a rearrangement of its
      molecular structure.





Gasoline
      in is usually blended from straight run gasoline, reformate, alkylate, and
      some
      butane. A number of additives are blended into gasoline. Some are used to reduce
      oxidation and tarnish formation. Alcohols are used to reduce icing and corrosion
      processes from occurring. Finally, detergents are used to remove deposits
      resulting from combustion from the engine and fuel injectors.





**Important
      Measures for Gasoline**





Two
      important measures for gasoline are the Reid vapor pressure (RVP) and the octane
      number. Gasoline has to be volatile enough to vaporize and mix with air to
      burn,
      but one problem is that the vapor pressure can go up or down with a change
      in
      temperature or with altitude. Summer months require a lower RVP so that gasoline
      does not evaporate before it combusts in a gasoline engine. Winter months
      require a higher RVP so that gasoline does not vapor lock before combusts.
      One
      way to control vapor pressure is by adding more or less butane.





The
      octane number of gasoline tells you how much the fuel can be compressed before
      it spontaneously ignites. Lower octane fuels can handle less compression before
      igniting. Octanes are therefore an important component of gasoline because
      they
      help provide smoother combustion in the car’s cylinders and prevent knocking.
      Knocking-- the pinging noise sometimes heard from an engine--is caused by
      irregular pressure waves inside a cylinder that arise from nonuniform
      combustion. Unchecked, knocking can crack the cylinder heads or pistons and
      destroy an engine.





**Our
      Mixed Gasoline Formula**





Our
      core
      technology is a formula of ethanol-methanol gasoline which is prepared from
      light oil, naphtha, straight-run gasoline and key additives. As opposed to
      traditional gasoline, its advantages are better miscibility, proper evaporation
      nature, high antiknock characteristics and anticorrosion nature, high stability
      and lower cost to consumers.





Our
      mixed
      gasoline formula consists mainly of the following ingredients:





§
            Light
                oil, naphtha, straight-run gasoline:
                70-80%


§
            Ethanol:
                8-20%


§
            Methyl
                alcohol: 2-10%


§
            Isobutyl
                alcohol: 1-6%


§
            Carbon
                nine solvent naphtha: 3-8%


§
            Methylnaphthalene:
                0.2-1%


§
            Dimethyl
                ether: 1-5%


§
            Nitrobenzene:
                0.5-3.4%


§
            Mixed
                benzene: 1-2%


§
            Dispersing
                agent: 0.3-0.8%


§
            Antiseptic:
                0.2-0.8%


5
 Table
          of Contents





§
            Lauryl
                benzene sulfonic acid: 0.02-0.03%


§
            Anti-knocking
                compound: 0.03-0.06%


§
            C5
                Petroleum Resins: 2-8%





***Straight-Run-Gasoline***





Gasoline
      produced by the direct distillation of crude oil is known as straight-run
      gasoline. It is usually distilled continuously, which separates the gasoline
      from the other fractions of the oil having higher boiling points, such as
      kerosene and heating oil. The range of temperatures in which gasoline boils
      and
      is distilled off is roughly between 38° and 205° C (100° and 400° F). The yield
      of gasoline from this process varies from about 1 percent to about 50 percent,
      depending on the crude oil and the process used.





***Naphtha***





Naphtha
      is a group of various volatile flammable liquid hydrocarbon mixtures used
      primarily as either feedstock for petrochemical cracking or gasoline reforming
      and blending. Naptha is a highly volatile product, manufactured from crude
      oil
      by distillation and by catalytic cracking of heavy residues. Naphtha is obtained
      from petroleum refineries as a small percentage (around 4%) of the distillation
      of crude oil. It is an intermediate between the lighter gasoline and the heavier
      fractions.





***Methyl
      Alcohol***





Methyl
      alcohol is commonly called Methanol or wood alcohol. Methanol is used in the
      production of a variety of chemical derivatives and in the production of methyl
      tertiary butyl ether (MTBE), an oxygenate and an octane enhancer for gasoline.
      In the United States, MTBE has been substantially removed from gasoline for
      environmental reasons. MTBE is currently more economic than many other
      components of gasoline and this has caused strong demand for MTBE, outside
      of
      the United States. To date, the net loss of methanol demand as a result of
      the
      changes occurring to gasoline formulations in the United States has had a
      relatively minor impact on the global methanol market.





***Ethanol***





Ethanol
      is a chemical produced by the fermentation of sugars found in grains and other
      biomass. Ethanol can be produced from a number of different types of grains,
      such as wheat and sorghum, as well as from agricultural waste products such
      as
      sugar, rice hulls, cheese whey, potato waste, brewery and beverage wastes and
      forestry and paper wastes.





Ethanol
      has many industrial uses. Pertinent to our business, ethanol can be used as
      a
      fuel component that serves as an octane enhancer in fuels, an oxygenated fuel
      additive that can reduce carbon monoxide vehicle emissions, and a
      non-petroleum-based gasoline extender.


6
 Table
          of Contents


***C9
      Solvent Naphtha***





This
      ingredient consists mainly of aromatic hydrocarbons, including benzene and
      the
      alkyl derivatives of benzene. Hydrocarbons are molecules consisting of atoms
      of
      carbon and hydrogen. Benzene has the elemental composition C 6 H 6 and is a
      flat, six-membered ring with three carbon-carbon double bonds. Aromatic
      hydrocarbons are important components of petroleum and its refined products.
      The
      name “aromatic” for these hydrocarbons comes from the fact that many have a
      strong, pungent aroma. Among the most important aromatic petroleum hydrocarbons
      in our formula are benzene and its derivatives (alkylbenzenes) toluene
      (methylbenzene) and xylenes (dimethylbenzenes).





***C5
      Petroleum Resins***





Petroleum
      resin is a kind of thermal plasticizing resin produced in the refining process.
      Petroleum resins are mainly used for adhesives, marking paints, synthetic
      rubbers, but are also used in gasoline blending process.





***Isobutyl
      Alcohol***





Isobutyl
      Alcohol, as know as Isobutanol, is a colorless, flamable, organic compound.
      It
      is classified as an alcohol and as such it is widely used as a solvent in
      chemical reactions, as well as being a useful starting material for organic
      synthesis.





Isobutanol
      is produced naturally during the fermentation of carbohydrates. It may also
      be a
      by-product of the decay process of organic matter. The main use of Isobutanol
      is
      as starting material in the manufacture of isobutyl acetate, which is mostly
      used in the production of lacquer and similar coatings. For our purposes, it
      is
      used as a gasoline additive for spark-ignition engines where it helps to prevent
      carburettor icing.





***Dimethyl
      Ether***





Dimethyl
      ether is colorless gaseous ether with an ethereal odor and is used as an aerosol
      spray propellant. Dimethyl ether is also a clean-burning alternative to
      liquified petroleum gas, liquified natural gas, diesel and gasoline. It can
      be
      made from natural gas, coal, or biomass.





***Nitrobenzene***





Nitrobenzene
      is an industrial chemical. It is an oily yellow liquid with an almond-like
      odor.
      It dissolves only slightly in water and will evaporate to air. Nitrobenzene
      is
      used to produce lubricating oils such as those used in motors and machinery.
      A
      small amount of nitrobenzene is used in the manufacture of dyes, drugs,
      pesticides, and synthetic rubber.


7
 Table
          of Contents


***Methylnaphthalene***





Methylnaphthalene
      (C 11 H 10 or
      CH 3 C 10 H 7 )
      is a
      colorless liquid oil. It does not dissolve in water, but it will dissolve in
      ethanol, ethyl ether, and most organic solvents. It is used for organic
      synthesis.





**Research
      and Development**




Our
      Chief
      Technology Officer and one of our directors, Mr. Rey Supera, has conducted
      numerous experiments of this mixed gasoline formula. Mr.Rey Supera has been
      a
      long time researcher in the petrochemical industry, in particular, the use
      of
      additives in gasoline products. At this time, he has concluded that our formula
      will work with acceptable experiment results. However, we are continually
      refining our formula to reduce emissions and prevent engine damage. We plan
      to
      continue conducting experiments on our formula to achieve a product that will
      rival traditional gasoline products. Our current experimental results, explained
      in the table below, include emission and damage testing of our formula compared
      with traditional gasoline.




Serial
            Examination
                project
            Unit
            **Regular
                Gas Specification**
            **Target
                Examination result**1
            Octane
                value
            /
            >=90
            902
            Temperature
                of Evaporation
            10%
                Evaporation
            C
            <=70
            6620%
                Evaporation
            C
            <=120
            9350%
                Evaporation
            C
            <=190
            185Stop
                point
            C
            <=20
            200Left
                content
            %
            <=2
            2.13
            Steam
                Barometric Pressure
            March
                16 - September 15
            KPa
            <=74
            70September
                16 -March 15
            KPa
            <=88
            824
            Sol
            Mg/100ml
            <=5
            55
            Sheet
                copper corrosion (50C, 3h)
            /
            <=1
            16
            Water-soluble
                acid and alkali
            /
            No
            No7
            Mechanical
                impurity
            /
            No
            No8
            Water
                content
            m/m
            <=0.15
            0.16




Our
      target examination results in the next 12 months consist of the
      following:


8
 Table
          of Contents




Serial
            Examination
                project
            Unit
            **Regular
                Gas Specification**
            **Target
                Examination result**1
            Octane
                value
            /
            >=90
            912
            Temperature
                of Evaporation
            10%
                Evaporation
            C
            <=70
            5620%
                Evaporation
            C
            <=120
            9050%
                Evaporation
            C
            <=190
            165Stop
                point
            C
            <=205
            190Left
                content
            %
            <=2
            13
            Steam
                Barometric Pressure
            March
                16 - September 15
            KPa
            <=74
            65September
                16 -March 15
            KPa
            <=88
            784
            Sol
            Mg/100ml
            <=5
            45
            Sheet
                copper corrosion (50C, 3h)
            /
            <=1
            16
            Water-soluble
                acid and alkali
            /
            No
            No7
            Mechanical
                impurity
            /
            No
            No8
            Water
                content
            m/m
            <=0.15
            0.13




As
      at
      August 31, 2007 we have not spent any money on research and development. Much
      of
      the work in this area has been provided by Mr. Rey Supera free of charge. Our
      projected research and development expenses will be around $30,000.00 in the
      next 12 months. Currently, we have two employees dedicated to research and
      development. We believe that new and timely development of products and
      technologies are important to our competitive position in the market and intend
      to continue to invest in research and development activities.




Present
      stage of development




Our
      Chief
      Technology Officer and one of our directors, Mr. Rey Supera, has conducted
      numerous experiments of our gasoline formula. However, we have not yet completed
      the development of formula. Our examination results are still not good enough.
      Our target results are listed in the table above. We expect to complete
      experimentation and become commercially available in mid 2008.




9
 Table
          of Contents




To
      remain
      competitive in the mixed gasoline industry, we must continue to develop highly
      effective and efficient key components. Our current technologies are based
      on
      the initial research activities conducted by Rey Supera. The costs associated
      with our research and development activities are not borne by customers since
      we
      will not have any customers, if we do at all, until the completion of the
      marketing and development of our mixed gasoline technology. We will either
      raise
      more funds from investors or borrow from existing directors to cover our
      projected research and development expenses.




**Key
      Success Factors**




Strategy




Our
      goal
      is for our mixed gasoline formula to become a leading formula in the market.
      In
      order to achieve our goal, we intend to increase awareness of our products
      with
      potential customers, such as major gasoline suppliers. We intend to do this
      by
      engaging in the following:




à
            Attending
                Oil Gas Technology Trade Meetings, Promotional Events and Conferences:
                We
                plan to attend a number of events attended by biotech institutions
                in
                order to further expose our products. These events will include biotech
                trade meetings and promotional events which are attended by oil gas
                companies and related seminars and conferences.




à
            Promoting
                through Internet-Based and Traditional Media Advertising: We intend
                to use
                Internet-based and traditional media to promote our technology and
                products directly to petro chemical companies. We believe that by
                increasing our consumer base we will attract petro chemical companies
                to
                use our mixed gasoline formula.




Our
      anticipated costs to implement the strategy for the next 12 months are estimated
      as follows:




à
            travel
                - $5,000.00




à
            marketing
                - $10,000.00




à
            research
                and development - $30,000.00




We
      intend
      to obtain funds to cover these costs by private equity fundraising or
      shareholder's loans, although we are not able to guarantee that funds will
      be
      available or on terms that are favorable to our company. We anticipate that
      the
      Company will start to receive revenues by sale or license of mixed gasoline
      formula to petro chemical companies before the end of August 2008.




Skilled
      Management Team




We
      intend
      to expand our current management to retain skilled directors, officers and
      employees with experience relevant to our business focus. Our current management
      team is highly skilled in technical areas such as researching and developing
      our
      technologies, but not as skilled in areas such as marketing and business
      management. Obtaining the assistance of individuals with in-depth knowledge
      of
      operations, technology and markets will allow us to build market share more
      effectively.




10
 Table
            of Contents





**Competition**




We
      are
      not aware of any competitors in Philippines that are developing a competing
      mixed gasoline formula. However, we face a significant amount of competition
      in
      the gasoline industry in general.




**Patents
      and Intellectual Property**




Our
      formula comes from ingredients commonly used and available to the public.
      However, we believe our formula has advantages above that of traditional
      gasoline products. We are in the process of researching patent rights, and
      we
      are not aware of anyone in Philippines having any patents, trademarks and/or
      copyright protection for the technologies and any proprietary rights to these
      technologies. We believe that the formula developed by us should be protected.
      In order to protect our products we plan to apply for patent protection and/or
      copyright protection in the United States, Philippines and other jurisdictions,
      and will require purchasers of our products to enter into non-disclosure
      agreements with us.




**Marketing
      Plan**




Our
      directors have developed business contacts through their past and current
      employment in the petro chemical industry in the Philippines and have developed
      an intimate understanding of business practices and customs in this area. They
      intend on actively promoting interest in mixed gasoline among their business
      contacts in the petro chemical industry. In addition, we intend to promote
      our
      mixed gasoline formula through traditional advertising and promotional media,
      such as newspaper and trade publications, and advanced media, such as targeted
      electronic mail, internet banner advertising and internet webpage links, to
      effect maximum exposure and penetration in the petro chemical marketplace.
      We
      also anticipate joining some petro chemical conferences to introduce our mixed
      gasoline and services to petro chemical companies.




Brand
      Equity




We
      have
      selected the name of our company to establish our brand name. Atheron will
      be
      the name of our mixed gasoline formula.




Advertising





We
      intend
      to develop our website as the primary medium to promote our mixed gasoline
      formula. We also intend to market our mixed gasoline formula by placing banner
      advertising on the home pages of relevant petro chemical websites.





We
      intend
      to produce promotional material for direct marketing. However, if we are unable
      to complete the development of our mixed gasoline formula, or if we are unable
      to sell our formula sufficiently, for any reason, we may go out of
      business.


11
 Table
            of Contents
  **Employees**





Our
      President Mrs. Susanna Hilario, and our Vice President Dr. Rey Supera, are
      the
      only employees of the company. They handle all of the responsibilities in the
      area of corporate administration, business development and research.





**Government
      Regulation and Supervision**





We
      are
      subject to the laws and regulations of those jurisdictions in which we plan
      to
      sell or license our gasoline formula technology that are generally applicable
      to
      operate a business, such as business license requirements, income taxes and
      payroll taxes. In general, the sale or licensing of our mixed gasoline formula
      in Philippines is subject to limited regulatory and/or supervisory requirements.
      The Philippine National Alcohol Commission under the Ministry of Trade and
      Industry is responsible for programs designed to use less hazardous octane
      enhancers, including ethanol versus tetraethyl lead (TEL) in gasoline.





**Item2.
      Description of Property**





We
      own no
      real property. We have office space at 3598 Durango St. Palanan, Makati City
      1235, Philippines. These facilities are provided to us at no charge by our
      director, Ms. Susanna Hilario, since May 2006.





**Item3.
      Legal Proceedings**





We
      are
      not a party to any pending legal proceeding. We are not aware of any pending
      legal proceeding to which any of our officers, directors, or any beneficial
      holders of 5% or more of our voting securities are adverse to us or have a
      material interest adverse to us.





**Item4.
      Submission of Matters to a Vote of Security
      Holders**





No
      matters have been submitted to our security holders for a vote, through the
      solicitation of proxies or otherwise, during the fourth quarter of the fiscal
      year ended December 31, 2007.





12
 Table
          of Contents


**PART
      II**





**Item5.
      Market for Common Equity and Related Stockholder
      Matters**





**Market
      Information**





Our
      common stock is currently quoted on the OTC Bulletin Board (“OTCBB”), which is
      sponsored by the NASD. The OTCBB is a network of security dealers who buy and
      sell stock. The dealers are connected by a computer network that provides
      information on current "bids" and "asks", as well as volume information. Our
      shares are quoted on the OTCBB under the symbol “AHRN.OB.”





The
      following table sets forth the range of high and low bid quotations for our
      common stock for each of the periods indicated as reported by the OTCBB. These
      quotations reflect inter-dealer prices, without retail mark-up, mark-down or
      commission and may not necessarily represent actual transactions.





Fiscal
                Year Ending August 31, 2007Quarter
                Ended
            
            High
                $
            
            Low
                $August
                31, 2007
            
            0
            
            0May
                31, 2007
            
            n/a
            
            n/aFebruary
                28, 2007
            
            n/a
            
            n/aNovember
                30, 2006
            
            n/a
            
            n/a





**Penny
      Stock**





The
      SEC
      has adopted rules that regulate broker-dealer practices in connection with
      transactions in penny stocks. Penny stocks are generally equity securities
      with
      a market price of less than $5.00, other than securities registered on certain
      national securities exchanges or quoted on the NASDAQ system, provided that
      current price and volume information with respect to transactions in such
      securities is provided by the exchange or system. The penny stock rules require
      a broker-dealer, prior to a transaction in a penny stock, to deliver a
      standardized risk disclosure document prepared by the SEC, that: (a) contains
      a
      description of the nature and level of risk in the market for penny stocks
      in
      both public offerings and secondary trading; (b) contains a description of
      the
      broker's or dealer's duties to the customer and of the rights and remedies
      available to the customer with respect to a violation of such duties or other
      requirements of the securities laws; (c) contains a brief, clear, narrative
      description of a dealer market, including bid and ask prices for penny stocks
      and the significance of the spread between the bid and ask price; (d) contains
      a
      toll-free telephone number for inquiries on disciplinary actions; (e) defines
      significant terms in the disclosure document or in the conduct of trading in
      penny stocks; and (f) contains such other information and is in such form,
      including language, type size and format, as the SEC shall require by rule
      or
      regulation.





The
      broker-dealer also must provide, prior to effecting any transaction in a penny
      stock, the customer with (a) bid and offer quotations for the penny stock;
      (b)
      the compensation of the broker-dealer and its salesperson in the transaction;
      (c) the number of shares to which such bid


13
 Table
          of Contents


and
      ask
      prices apply, or other comparable information relating to the depth and
      liquidity of the market for such stock; and (d) a monthly account statement
      showing the market value of each penny stock held in the customer's
      account.





In
      addition, the penny stock rules require that prior to a transaction in a penny
      stock not otherwise exempt from those rules, the broker-dealer must make a
      special written determination that the penny stock is a suitable investment
      for
      the purchaser and receive the purchaser's written acknowledgment of the receipt
      of a risk disclosure statement, a written agreement as to transactions involving
      penny stocks, and a signed and dated copy of a written suitability
      statement.





These
      disclosure requirements may have the effect of reducing the trading activity
      for
      our common stock. Therefore, stockholders may have difficulty selling our
      securities.





**Holders
      of Our Common Stock**





As
      of
      August 31, 2007, we had approximately thirty-two (32) holders of record of
      our
      common stock.





**Dividends**





There
      are
      no restrictions in our articles of incorporation or bylaws that
      restrict us from
      declaring dividends. The Nevada Revised Statutes, however, do prohibit us from
      declaring dividends where, after giving effect to the distribution of the
      dividend:





1.
            We
                would not be able to pay our debts as they become due in the usual
                course
                of business; or





2.
            Our
                total assets would be less than the sum of our total liabilities,
                plus the
                amount that would be needed to satisfy the rights of shareholders
                who have
                preferential rights superior to those receiving the
                distribution.





**Recent
      Sales of Unregistered Securities**





None.





**Securities
      Authorized for Issuance Under Equity Compensation Plans**





We
      have
      no equity compensation plans.


14
 Table
          of Contents


**Item6.
      Management’s Discussion and Analysis or Plan of
      Operation**





**Forward-Looking
      Statements**




Certain
      statements, other than purely historical information, including estimates,
      projections, statements relating to our business plans, objectives, and expected
      operating results, and the assumptions upon which those statements are based,
      are “forward-looking statements” within the meaning of the Private Securities
      Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933
      and Section 21E of the Securities Exchange Act of 1934. These
      forward-looking statements generally are identified by the words “believes,”
“project,” “expects,” “anticipates,” “estimates,” “intends,” “strategy,” “plan,”
“may,” “will,” “would,” “will be,” “will continue,” “will likely result,” and
      similar expressions. We
      intend
      such forward-looking statements to be covered by the safe-harbor provisions
      for
      forward-looking statements contained in the Private Securities Litigation Reform
      Act of 1995, and are including this statement for purposes of complying with
      those safe-harbor provisions. Forward-looking
      statements are based on current expectations and assumptions that are subject
      to
      risks and uncertainties which may cause actual results to differ materially
      from
      the forward-looking statements. Our
      ability to predict results or the actual effect of future plans or strategies
      is
      inherently uncertain. Factors which could have a material adverse affect on
      our
      operations and future prospects on a consolidated basis include, but are not
      limited to: changes in economic conditions, legislative/regulatory changes,
      availability of capital, interest rates, competition, and generally accepted
      accounting principles. These risks and uncertainties should also be considered
      in evaluating forward-looking statements and undue reliance should not be placed
      on such statements. We
      undertake no obligation to update or revise publicly any forward-looking
      statements, whether as a result of new information, future events or otherwise. Further
      information concerning our business, including additional factors that could
      materially affect our financial results, is included herein and in our other
      filings with the SEC.





**Overview**




Our
      primary objective in the next twelve months will be to complete development
      of
      our mixed gasoline formula, establish our marketing plan, and license our
      formula in the Philippines. If successful, we plan to license our formula in
      China and other countries in Asia.




Since
      our
      incorporation on May 8, 2006, we have taken active steps to implement our
      business plan. Our Chief Technology Officer and one of our directors, Rey
      Supera, has completed several experiments of our proposed gasoline formula.
      Much
      of the work in this area has been provided by Mr. Rey Supera free of charge.
      At
      this time, he has concluded that our formula will work with acceptable
      experiment results. However, we are continually refining our formula to reduce
      emissions and prevent engine damage. We plan to continue conducting experiments
      on our formula to achieve a product that will rival traditional gasoline
      products. Our projected research and development expenses will be around
      $30,000.00 in the next 12 month. Currently, we have two employees dedicated
      to
      research and development. We believe that new and timely development of products
      and technologies are important to our competitive position in the market and
      intend to continue to invest in research and development
      activities.




15
 Table
            of Contents





We
      plan
      to establish customer and partner relationships in the Philippines once our
      proposed gasoline formula is fully developed. We expect that the international
      market for our proposed gasoline formula will grow, and we intend to expand
      our
      presence in strategic international markets in response. To address a potential
      global opportunity, we may hire sales, service and support personnel locally
      to
      establish new relationships with petrochemical companies abroad. However, we
      do
      not expect to hire any employees in the next twelve months.




The
      following sets out the timeline of our proposed operations:




§
            Develop
                the first sample of our proposed gasoline formula by late 2006 to
                early
                2007. This will allow users to see the results of the gasoline formula
                technology and determine its effectiveness.




§
            Develop
                the complete and commercial version of our proposed gasoline formula
                by
                mid to late 2007. This will be the completed version of gasoline
                formula,
                which will be marketed to potential customers in Philippines. Commence
                an
                advertising campaign for our proposed gasoline formula following
                its
                development.




§
            Commence
                development of prospects for higher standard gasoline formula by
                early
                2008.




Furthermore,
      in our management’s opinion, we can expect to incur the following expenses to
      fund our plan of operation for the next twelve months:




§
            Audit
                fee, which consists primarily of accounting and auditing fees for
                the
                yearend audit. We estimate that our audit fees for the next twelve
                months
                will be approximately $10,000, which includes quarterly reviews;




§
            Bank
                charges, which consist primarily of charges by our bank for processing
                transactions through our checking account. We estimate that our bank
                charges for the next twelve months will be approximately $100;




§
            Legal
                fees, which consist primarily of fees paid by us regarding corporate
                and
                securities advice and our reporting obligations under the 1934 Securities
                and Exchange Act. We estimate that our legal fees for the next twelve
                months will be approximately $15,000 to $20,000; and




§
            Other
                operating expenses, which consist primarily of the expenses incurred
                for
                further development of our proposed gasoline formula; for the advertising
                campaign for our proposed gasoline formula; and for development of
                prospects for third party applications for our proposed containment
                system
                and other administrative expenses. We estimate that our other operating
                expenses for the next twelve months will be approximately $30,000.




We
      anticipate that, in time, the primary source of revenues for our business model
      will be the license fees paid by business enterprises for the use of our
      proposed gasoline formula. We also anticipate that we may receive compensation
      for professional services such as customized




16
 Table
            of Contents





research
      and development of our proposed gasoline formula. Currently, we do not have
      any
      customers as our gasoline formula is not yet fully developed.




**Purchase
      or Sale of Equipment**




We
      do not
      have plans to purchase any significant equipment in the next twelve
      months.




**Results
      of Operations for the Year Ended August 31, 2007 and 2006**




We
      have
      not earned any revenues since our inception on May 8, 2006. We do not anticipate
      earning revenues until such time that we have fully developed our mixed gasoline
      formula and are able to obtain license fees in connection with our formula.
      We
      are presently in the development stage of our business and we can provide no
      assurance that we will develop our formula or successfully market
      it.




We
      incurred operating expenses in the amount of $25,000 for the year ended August
      31, 2007, compared with $43,985 for the year ended August 31, 2006. The entire
      amount for both periods was attributable to professional fees. We have incurred
      total operating expenses of $68,985 from inception on May 8, 2006 through August
      31, 2007. The entire $68,985 was attributable to professional fees. We
      anticipate our operating expenses will increase as we undertake our plan of
      operations. The increase will be attributable to undertaking the additional
      research phases of our mixed gasoline formula.




We
      incurred a net loss of $25,000 for the year ended August 31, 2007, compared
      with
      $43,985 for the year ended August 31, 2006. We incurred a total net loss of
      $68,985 from inception on May 8, 2006 through August 31, 2007. Our losses for
      all periods are attributable to operating expenses together with a lack of
      any
      revenues.




**Liquidity
      and Capital Resources**





As
      of
      August 31, 2007, we had total current assets of $0 cash. Our total current
      liabilities as of August 31, 2007 were $25,985. This amount consists of a loan
      from a shareholder and officer of the Company. The loan is non-interest bearing
      and is due upon demand. As a result, we had working capital deficit of ($25,985)
      as of August 31, 2007.




Operating
      activities used $69,985 in cash for the period from inception (May 8, 2006)
      to
      August 31, 2007. Our net loss of $69,985 for this period was the primary
      component of our negative operating cash flow. We primarily relied on cash
      from
      the sale of our common stock and loans to fund our operations during the period
      ended August 31, 2007.




The
      success of our business plan beyond the next 12 months is contingent upon us
      obtaining additional financing. We intend to fund operations through debt and/or
      equity financing arrangements, which may be insufficient to fund our capital
      expenditures, working capital, or other cash requirements. We do not have any
      formal commitments or arrangements for the sales of stock or the advancement
      or
      loan of funds at this time. There can be no assurance that such additional
      financing will be available to us on acceptable terms, or at
      all.


17
 Table
          of Contents


**Off
      Balance Sheet Arrangements**





As
      of
      August 31, 2007, there were no off balance sheet arrangements.





**Going
      Concern**





Since
      we
      have only recently begun development of our gasoline formula and have not
      generated any revenue, our independent auditors have issued an opinion about
      our
      ability to continue as a going concern in connection with our audited financial
      statements for year ended August 31, 2007. This means that our auditors believe
      there is doubt that we can continue as an on-going business for the next twelve
      months unless we obtain additional capital to pay our bills. This is because
      we
      have generated no revenues and no revenues are anticipated unless and until
      we
      complete the development and marketing of our proposed gasoline formula.
      Accordingly, we must raise cash from sources other than the sale of our formula.
      Our only other source for cash at this time is equity investments by others
      in
      our company. Our accumulated deficit is $68,985 as of August 31, 2007. The
      discussion below provides an overview of our operations, discusses our results
      of operations, our plan of operations and our liquidity and capital
      resources.


18
 Table
            of Contents
  **Item7.
      Financial Statements**





Index
      to
      Financial Statements:




**Audited
                Financial Statements:**F-1
            Report
                of Independent Registered Public Accounting
                FirmF-2
            Balance
                Sheet as of August 31, 2007F-3
            Statements
                of Operations - Years Ended August 31, 2007 and 2006
                and period from May 8, 2006 (Inception) to August 31,
                2007F-4
            Statement
                of Stockholders’ Deficit for period from May 8, 2006
                (Inception) to August 31, 2007F-5
            Statements
                of Cash Flows - Years Ended August 31, 2007 and 2006
                and period from May 8, 2006 (Inception) to August 31,
                2007F-6
            Notes
                to Financial
                Statements





19
 Table
            of Contents


Board
            of
            Directors
 Atheron,
            Inc.
 Makati
            City 1235, Philippines
 
 We
            have
            audited the accompanying balance sheet of Atheron, Inc. (a development
            stage
            company) as of August 31, 2007 and the related statements of operations,
            stockholders’ deficit and cash flows for the periods ended August 31, 2007 and
            2006. 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 audit.
 
 We
            conducted our audits in accordance with the standards of the Public Company
            Accounting Oversight Board (United States). Those standards require that
            we plan
            and perform the audits to obtain reasonable assurance about whether the
            financial statements are free of material misstatement *.* The
            Company has determined that it is not required to have, nor were we engaged
            to
            perform, an audit of its internal control over financial reporting. Our
            audits included consideration of internal control over financial reporting
            as a
            basis for designing audit procedures that are appropriate in the circumstances,
            but not for the purpose of expressing an opinion on the effectiveness
            of the
            Company’s internal control over financial reporting. Accordingly, we express
            no
            such opinion. 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 Atheron, Inc. as of August
            31,
            2007, and the results of their operations and their cash flows for the
            periods
            ended August 31, 2007 and 2006, in conformity with U.S. generally accepted
            accounting principles.
 
 The
            accompanying financial statements have been prepared assuming that the
            Company
            will continue as a going concern. As discussed in Note 4 to the financial
            statements, the Company has limited working capital, has not yet received
            revenue from sales of products or services, and has incurred losses from
            operations. These factors raise substantial doubt about the Company’s ability to
            continue as a going concern. Management’s plans with regard to these matters are
            described in Note 4. The accompanying financial statements do not include
            any
            adjustments that might result from the outcome of this uncertainty.
 
 Maddox
            Ungar Silberstein, PLLC
 Bingham
            Farms, Michigan
 October
            18, 2007
 F-1
 Table
            of Contents
 **ATHERON,
        INC.**
 **(A
        DEVELOPMENT STAGE COMPANY)**
 **BALANCE
        SHEET**
 **As
        of August 31, 2007**
 
 ASSETSCurrent
                  AssetsCash
                  and equivalents
              $
              0Prepaid
                  expenses
              
              0TOTAL
                  ASSETS
              $
              0LIABILITIES
                  AND STOCKHOLDERS’ DEFICITCurrent
                  LiabilitiesLoan
                  payable - related party
              $
              25,985Stockholders’
                  DeficitCommon
                  Stock, $.001 par value, 75,000,000 shares authorized, 2,150,000
                  shares
                  issued and outstanding
              
              2,150Additional
                  paid-in capital
              
              44,850Deficit
                  accumulated during the development stage
              
              (68,985)Total
                  stockholders’ deficit
              
              (25,985)TOTAL
                  LIABILITIES AND STOCKHOLDERS’ DEFICIT
              $
              0
 
 *See
        accompanying notes to financial statements.*
 F-2
 Table
            of Contents
 **ATHERONINC.**
 **(A
        DEVELOPMENT STAGE COMPANY)**
 **STATEMENTS
        OF OPERATIONS**
 **Years
        ended August 31, 2007 and 2006**
 **Period
        from May 8, 2006 (Inception) to August 31, 2007**
 
 **Year**
                        **Ended**
                        **August
                          31,
                          2007**
                
                **Year**
                        **Ended**
                        **August
                          31,
                          2006**
                
                **Period
                            from**
                          **May
                            8, 2006**
                          **(Inception)
                            to**
                          **August
                            31,
                            2007**Revenues
                $
                -0-
                
                $
                -0-
                
                $
                -0-General
                    and administrative expenses:Professional
                    fees
                
                25,000
                
                
                43,985
                
                
                68,985Net
                    Loss
                $
                (25,000)
                
                $
                (43,985)
                
                $
                (68,985)Net
                    loss per share:Basic
                    and diluted
                $
                (0.01)
                
                $
                (0.02)
                
                $
                (0.03)Weighted
                      average shares outstanding:Basic and diluted
                
                2,150,000
                
                
                2,150,000
                
                
                2,150,000
 
 *See
        accompanying notes to financial statements.*
 F-3
 Table
            of Contents
 **ATHERON,
        INC.**
 **(A
        DEVELOPMENT STAGE COMPANY)**
 **STATEMENT
        OF STOCKHOLDERS’ DEFICIT**
 **Period
        from May 8, 2006 (Inception) to August 31, 2007**
 Common
                    stock
                
                
                Additional
                  paid-in
                
                
                Deficit
                  accumulated
                  during
                    the developmentShares
                
                Amount
                
                
                capital
                
                
                stage
                
                
                TotalIssuance
                    of common stockfor
                    cash @$.001
                
                2,150,000
                
                $
                2,150
                
                $
                40,850
                
                $
                -
                
                $
                43,000Net
                    loss for the period ended August 31, 2006
                
                -
                
                
                -
                
                
                -
                
                
                (43,985)
                
                
                (43,985)Balance
                    August 31, 2006
                
                2,150,000
                
                
                2,150
                
                
                40,850
                
                
                (43,985)
                
                
                (
                    985)Net
                    loss for the year ended August 31, 2007
                
                -
                
                
                -
                
                
                -
                
                
                (25,000)
                
                
                (25,000)Balance
                    August 31, 2007
                
                2,150,000
                
                $
                2,150
                
                $
                40,850
                
                $
                (68,985)
                
                $
                (25,985)
 
 *See
        accompanying notes to financial statements.*
 F-4
 Table
            of Contents
 **ATHERONINC.**
 **(A
        DEVELOPMENT STAGE COMPANY)**
 **STATEMENTS
        OF CASH FLOWS**
 **Years
        ended August 31, 2007 and 2006**
 **Period
        from May 8, 2006 (Inception) to August 31, 2007**
  **Year**
                        **Ended**
                        **August 31,
                          2007**
                
                **Year**
                        **Ended**
                        **August
                          31,
                          2006**
                
                **Period
                            From**
                          **May 8, 2006**
                          **(Inception)
                            to**
                          **August 31,
                            2007**CASH
                    FLOWS FROM OPERATING ACTIVITIESNet
                    loss
                $
                (25,000)
                
                $
                (43,985)
                
                $
                (68,985)Change
                  in non-cash
                  working capital itemsPrepaid
                    expenses
                
                0
                
                
                (4,000)
                
                
                0CASH
                    FLOWS USED BY OPERATING ACTIVITIES
                
                (25,000)
                
                
                (47,985)
                
                
                (68,985)CASH
                    FLOWS FROM FINANCING ACTIVITIESProceeds
                    from sales of common stock
                
                0
                
                
                43,000
                
                
                43,000Loan
                    from related party
                
                6,000
                
                
                19,985
                
                
                25,985CASH
                    FLOWS PROVIDED BY FINANCING ACTIVITIES
                
                6,000
                
                
                62,985
                
                
                68,985NET
                    INCREASE IN CASH
                
                0
                
                
                15,000
                
                
                0Cash,
                    beginning of period
                
                15,000
                
                
                -0-
                
                
                -0-Cash,
                    end of period
                $
                -0-
                
                $
                15,000
                
                $
                -0-SUPPLEMENTAL
                    CASH FLOWINFORMATIONInterest
                    paid
                $
                -0-
                
                $
                -0-
                
                $
                -0-Income
                    taxes paid
                $
                -0-
                
                $
                -0-
                
                $
                -0-
 
 *See
        accompanying notes to financial statements.*
 F-5
 Table
            of Contents
 **ATHERON,
        INC.**
 **(A
        DEVELOPMENT STAGE COMPANY)**
 **NOTES
        TO THE FINANCIAL STATEMENTS**
 **August
        31, 2007**
 
 NOTE
        1 -
        SUMMARY OF ACCOUNTING POLICIES
 
 Nature
        of
        Business
 
 Atheron,
        Inc. (“Atheron”) was incorporated in Nevada on May 8, 2006. Atheron is a
        development stage company located in Makati City 1235, Philippines. Atheron
        is
        developing technology for ethanol-methanol gasoline. Atheron operates out
        of
        office space owned by a director and stockholder of the Company. The facilities
        are provided at no charge. There can be no assurances that the facilities
        will
        continue to be provided at no charge in the future.
 
 Development
        Stage Company
 
 The
        accompanying financial statements have been prepared in accordance with the
        Statement of Financial Accounting Standards No. 7 ”Accounting and Reporting by
        Development-Stage Enterprises”. A development-stage enterprise is one in which
        planned principal operations have not commenced or if its operations have
        commenced, there has been no significant revenues there from.
 
 Cash
        and
        Cash Equivalents
 
 Atheron
        considers all highly liquid investments with maturities of three months or
        less
        to be cash equivalents. At August 31, 2007 the Company had $0 of unrestricted
        cash that was being held in an escrow account by its outside attorneys, to
        be
        used for future business operations.
 
 Fair
        Value of Financial Instruments
 
 Atheron’s
        financial instruments consist of cash and cash equivalents. The carrying
        amount
        of these financial instruments approximates fair value due either to length
        of
        maturity or interest rates that approximate prevailing market rates unless
        otherwise disclosed in these financial statements.
 
 Income
        Taxes
 
 Income
        taxes are computed using the asset and liability method. Under the asset
        and
        liability method, deferred income tax assets and liabilities are determined
        based on the differences between the financial reporting and tax bases of
        assets
        and liabilities and are measured using the currently enacted tax rates and
        laws.
        A valuation allowance is provided for the amount of deferred tax assets that,
        based on available evidence, are not expected to be realized.
 
 F-6
 Table
            of Contents
 **ATHERON,
        INC.**
 **(A
        DEVELOPMENT STAGE COMPANY)**
 **NOTES
        TO THE FINANCIAL STATEMENTS**
 **August
        31, 2007**
 
 NOTE
        1 -
        SUMMARY OF ACCOUNTING POLICIES (continued)
 
 Use
        of
        Estimates
 
 The
        preparation of financial statements in conformity with generally accepted
        accounting principles 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 the financial statements and
        the
        reported amount of revenues and expenses during the reporting period. Actual
        results could differ from those estimates.
 
 Basic
        loss per share
 
 Basic
        loss per share has been calculated based on the weighted average number of
        shares of common stock outstanding during the period.
 
 Recent
        Accounting Pronouncements
 
 Atheron
        does not expect the adoption of recently issued accounting pronouncements
        to
        have a significant impact on the Company’s results of operations, financial
        position or cash flow.
 
 NOTE
        2 -
        LOAN PAYABLE - RELATED PARTY
 
 Atheron
        received a $25,985 loan from a shareholder and officer of the Company. The
        loan
        is unsecured, non-interest bearing and is due upon demand.
 
 NOTE
        3 -
        INCOME TAXES
 
 For
        the
        period ended August 31, 2007, Atheron has incurred net losses and, therefore,
        has no tax liability. The net deferred tax asset generated by the loss
        carry-forward has been fully reserved. The cumulative net operating loss
        carry-forward is approximately $68,985 at August 31, 2007, and will expire
        in
        the year 2027.
 
 F-7
 Table
            of Contents
 **ATHERON,
        INC.**
 **(A
        DEVELOPMENT STAGE COMPANY)**
 **NOTES
        TO THE FINANCIAL STATEMENTS**
 **August
        31, 2007**
 
 NOTE
        3 -
        INCOME TAXES (continued)
 
 The
        cumulative tax effect at the expected rate of 34% of significant items
        comprising our net deferred tax amount is as follows:
  2007Deferred
                  tax asset attributable to:Net
                  operating loss carryover
              $
              23,000Valuation
                  allowance
              
              (23,000)Net
                  deferred tax asset
              $
              -
 
 NOTE
        4 -
        LIQUIDITY AND GOING CONCERN
  Atheron
        has limited working capital and has not yet received revenues from sales
        of
        products or services. These factors create substantial doubt about the Company’s
        ability to continue as a going concern. The financial statements do not include
        any adjustment that might be necessary if the Company is unable to continue
        as a
        going concern.
  The
        ability of Atheron to continue as a going concern is dependent on the Company
        generating cash from the sale of its common stock and/or obtaining debt
        financing and attaining future profitable operations. Management’s plans include
        selling its equity securities and obtaining debt financing to fund its capital
        requirement and ongoing operations; however, there can be no assurance the
        Company will be successful in these efforts.
 
 F-8
 Table
            of Contents
 
 **Item8.
        Changes In and Disagreements with Accountants on Accounting
        and Financial** **Disclosure**




No
      events
      occurred requiring disclosure under Item 304(b) of Regulation S-B.





**Item8A.
      Controls and Procedures**





We
      carried out an evaluation of the effectiveness of the design and operation
      of
      our disclosure controls and procedures (as defined in Exchange Act Rules
      13a-15(e) and 15d-15(e)) as of August 31, 2007. This evaluation was carried
      out
      under the supervision and with the participation of our Chief Executive Officer
      and Chief Financial Officer, Ms. Susanna Hilario. Based upon that evaluation,
      our Chief Executive Officer and Chief Financial Officer concluded that, as
      of
      August 31, 2007, our disclosure controls and procedures are effective. There
      have been no significant changes in our internal controls over financial
      reporting during the quarter ended August 31, 2007 that have materially affected
      or are reasonably likely to materially affect such controls.





Disclosure
      controls and procedures are controls and other procedures that are designed
      to
      ensure that information required to be disclosed in our reports filed or
      submitted under the Exchange Act are recorded, processed, summarized and
      reported, within the time periods specified in the SEC's rules and forms.
      Disclosure controls and procedures include, without limitation, controls and
      procedures designed to ensure that information required to be disclosed in
      our
      reports filed under the Exchange Act is accumulated and communicated to
      management, including our Chief Executive Officer and Chief Financial Officer,
      to allow timely decisions regarding required disclosure.





Limitations
      on the Effectiveness of Internal Controls





Our
      management does not expect that our disclosure controls and procedures or our
      internal control over financial reporting will necessarily prevent all fraud
      and
      material error. Our disclosure controls and procedures are designed to provide
      reasonable assurance of achieving our objectives and our Chief Executive Officer
      and Chief Financial Officer concluded that our disclosure controls and
      procedures are effective at that reasonable assurance level. Further, the design
      of a control system must reflect the fact that there are resource constraints,
      and the benefits of controls must be considered relative to their costs. Because
      of the inherent limitations in all control systems, no evaluation of controls
      can provide absolute assurance that all control issues and instances of fraud,
      if any, within our company have been detected. These inherent limitations
      include the realities that judgments in decision-making can be faulty, and
      that
      breakdowns can occur because of simple error or mistake. Additionally, controls
      can be circumvented by the individual acts of some persons, by collusion of
      two
      or more people, or by management override of the internal control. The design
      of
      any system of controls also is based in part upon certain assumptions about
      the
      likelihood of future events, and there can be no assurance that any design
      will
      succeed in achieving its stated goals under all potential future conditions.
      Over time, control may become inadequate because of changes in conditions,
      or
      the degree of compliance with the policies or procedures may deteriorate.


20
 Table
          of Contents





**Item8B.
      Other information**





None.





**PART
      III**





**Item9.
      Directors, Executive Officers, Promoters and Control Persons;
      Compliance with** **Section
      16(a) of the Exchange Act**





The
      following information sets forth the names of our current directors and
      executive officers, their ages and their present positions.




**Name**
            **Position
                Held with the Company**
            **Age**
            **Date
                First Elected or Appointed**Ms.
                Susanna Hilario
            President,
                Director, Treasurer
              (Principal
                Accounting Officer) and Secretary
            34
            May
                8, 2006Mr.
                Rey V. Supera
            Director
                and Chief Technology Officer
            29
            May
                8, 2006




Set
      forth
      below is a brief description of the background and business experience of
      executive officers and directors.





**Ms.
      Susanna Hilario** is our
      President, Director, Treasurer (Principal Accounting Officer), Secretary and
      a
      member of our board of directors. Since January 2001, Ms. Susanna Hilario has
      been the Operations Manager/Owner of **** CCW,
      Inc.
      Ms. Hilario has not held any directorships in any public companies prior to
      service with our company.





**Mr.
      Rey V. Supera** is
      our
      Chief Technology Officer and a member of our board of directors. Mr. Rey V.
      Supera was a technician/researcher in Kali Chemical Inc. from 1996 to 2005.
      Mr.
      Supera has not held directorships in public companies prior to service with
      our
      company.





**Term
      of Office**





Our
      Directors are appointed for a one-year term to hold office until the next annual
      general meeting of our shareholders or until removed from office in accordance
      with our bylaws. Our officers are appointed by our board of directors and hold
      office until removed by the board.





**Significant
      Employees**




We
      do not
      currently have any significant employees aside from our directors and officers.


21
 Table
          of Contents


**Family
      Relationships**




There
      are
      no family relationships between or among the directors, executive officers
      or
      persons nominated or chosen by us to become directors or executive
      officers.




**Involvement
      in Certain Legal Proceedings**




To
      the
      best of our knowledge, during the past five years, none of the following
      occurred with respect to our present or former director, executive officer,
      or
      employee: (1) any bankruptcy petition filed by or against any business of which
      such person was a general partner or executive officer either at the time of
      the
      bankruptcy or within two years prior to that time; (2) any conviction in a
      criminal proceeding or being subject to a pending criminal proceeding (excluding
      traffic violations and other minor offenses); (3) being subject to any order,
      judgment or decree, not subsequently reversed, suspended or vacated, of any
      court of competent jurisdiction, permanently or temporarily enjoining, barring,
      suspending or otherwise limiting his or her involvement in any type of business,
      securities or banking activities; and (4) being found by a court of competent
      jurisdiction (in a civil action), the SEC or the Commodities Futures Trading
      Commission to have violated a federal or state securities or commodities law,
      and the judgment has not been reversed, suspended or vacated.





**Audit
      Committee**





We
      do not
      have a separately-designated standing audit committee. The entire board of
      directors performs the functions of an audit committee, but no written charter
      governs the actions of the board of directors when performing the functions
      of
      that would generally be performed by an audit committee. The board of directors
      approves the selection of our independent accountants and meets and interacts
      with the independent accountants to discuss issues related to financial
      reporting. In addition, the board of directors reviews the scope and results
      of
      the audit with the independent accountants, reviews with management and the
      independent accountants our annual operating results, considers the adequacy
      of
      our internal accounting procedures and considers other auditing and accounting
      matters including fees to be paid to the independent auditor and the performance
      of the independent auditor.





We
      do not
      have an audit committee financial expert because of the
      size
      of our company and our board of directors at this time. We believe that we
      do
      not require an audit committee financial expert at this time because we retain
      outside consultants who possess these attributes.





For
      the
      fiscal year ending August 31, 2007, the board of directors:





1.
            Reviewed
                and discussed the audited financial statements with management,
                and





2.
            Reviewed
                and discussed the written disclosures and the letter from our independent
                auditors on the matters relating to the auditor's
                independence.


22
 Table
          of Contents


Based
      upon the board of directors’ review and discussion of the matters above, the
      board of directors authorized inclusion of the audited financial statements
      for
      the year ended August 31, 2007 to be included in this Annual Report on Form
      10-KSB and filed with the Securities and Exchange Commission.





**Section
      16(a) Beneficial Ownership Reporting Compliance**





Our
      officers, directors and shareholders owning greater than ten percent of our
      shares are not required to comply with Section 16(a) of the Securities Exchange
      Act of 1934 because we do not have a class of securities registered under
      Section 12 of the Securities Exchange Act of 1934.





**Code
      of Ethics Disclosure**





As
      of
      August 31, 2007, we have not adopted a Code of Ethics for Financial Executives,
      which include our principal executive officer, principal financial officer,
      principal accounting officer or controller, or persons performing similar
      functions.





**Item10.
      Executive Compensation**





**Summary
      Compensation Table**




The
        table
        below summarizes all compensation awarded to, earned by, or paid to both
        to our
        officers and to our directors for all services rendered in all capacities
        to us
        for our fiscal years ended August 31, 2007 and 2006.
  SUMMARY
                  COMPENSATION TABLENameand
                principalposition
              Year
              Salary($)
              Bonus
                ($)
              Stock
                Awards
                ($)
              Option
                Awards
                ($)
              Non-Equity
                Incentive
                  Plan
                Compensation
                ($)
              Nonqualified
                Deferred
                Compensation
                Earnings
                  ($)
              All
                  Other
                Compensation
                ($)
              Total
                ($)Rey
                  V. Supera
                Chief
                  Technology Officer & Director
              2007
                2006
              $0
                $0
              $0
                $0
              $0
                $0
              $0
                $0
              $0
                $0
              $0
                $0
              $0
                $0
              $0
                $0Susanna
                  Hilario
                President,
                  Chief Executive Officer, Chief Financial Officer, Treasurer (Principal
                  Accounting Officer), Secretary & Director
              2007
                2006
              $0
                $0
              $0
                $0
              $0
                $0
              $0
                $0
              $0
                $0
              $0
                $0
              $0
                $0
              $0
                $0


23
 Table
          of Contents


**Narrative
        Disclosure to the Summary Compensation Table**
  We
        do not
        compensate our executive officers by the payment of salaries or bonus
        compensation.
 
 **Stock
        Option Grants**
 
 We
        have
        not granted any stock options to the executive officers or directors since
        our
        inception.
 
 **Outstanding
        Equity Awards at Fiscal Year-End**
 
 The
        table
        below summarizes all unexercised options, stock that has not vested, and
        equity
        incentive plan awards for each named executive officer as of August 31,
        2007.
 
 **OUTSTANDING
                  EQUITY AWARDS AT FISCAL YEAR-END**OPTION
                  AWARDS
              STOCK
                  AWARDSName
              Number
                  of
                Securities
                Underlying
                Unexercised
                Options
                (#)
                Exercisable
              Number
                  of
                Securities
                Underlying
                Unexercised
                Options
                (#)
                Unexercisable
              Equity
                Incentive
                Plan
                Awards:
                Number
                  of
                Securities
                Underlying
                Unexercised
                Unearned
                Options
                (#)
              Option
                Exercise
                Price
                ($)
              Option
                Expiration
                Date
              Number
                of
                Shares
                or
                  Units
                of
                Stock
                  That
                Have
                Not
                Vested
                (#)
              Market
                Value
                of
                Shares
                or
                Units
                of
                Stock
                That
                Have
                Not
                Vested
                ($)
              Equity
                Incentive
                Plan
                Awards:
                Number
                of
                Unearned
                Shares,
                Units
                  or
                Other
                Rights
                That
                  Have
                Not
                Vested
                (#)
              Equity
                Incentive
                Plan
                Awards:
                Market
                  or
                Payout
                Value
                  of
                Unearned
                Shares,
                Units
                  or
                Other
                Rights
                That
                Have
                  Not
                Vested
                (#)Rey
                  V. Supera
              -
              -
              -
              -
              -
              -
              -
              -
              -Susanna
                  Hilario
              -
              -
              -
              -
              -
              -
              -
              -
              -
 
 **Compensation
        of Directors**
 
 The
        table
        below summarizes all compensation of our directors as of August 31,
        2007.
 
 **DIRECTOR
                  COMPENSATION**Name
              Fees
                  Earned or
                Paid
                  in
                Cash
                ($)
              Stock
                  Awards
                ($)
              Option
                  Awards
                ($)
              Non-Equity
                Incentive
                Plan
                Compensation
                ($)
              Non-Qualified
                Deferred
                Compensation
                Earnings
                ($)
              All
                Other
                Compensation
                ($)
              Total
                ($)Rey
                  V. Supera
              -
              -
              -
              -
              -
              -
              -Susanna
                  Hilario
              -
              -
              -
              -
              -
              -
              -
 
 **Narrative
        Disclosure to the Director Compensation Table**
 
 We
        do not
        pay any cash compensation to our directors.


24
 Table
          of Contents




**Item11.
      Security Ownership of Certain Beneficial Owners and
      Management and Related** **Stockholder
      Matters**





The
      following table sets forth, as of August 31, 2007, certain information as to
      shares of our common stock owned by (i) each person known by us to beneficially
      own more than 5% of our outstanding common stock, (ii) each of our directors,
      and (iii) all of our executive officers and directors as a group:





**Title
                of class**
            **Name
                and address of beneficial owner**
            **Amount
                of**
              **beneficial
                ownership**
            **Percent
                of class**Common
            Ms.
                Susanna Hilario
              7636
                Guijo cor Sacred Heart Street, San Antonio Village, Makati City,
                Philippines
            625,000
            29%Common
            Mr.
                Rey V. Supera
              3596
                Durango Street, Palanan, Makati City, Philippines
            625,000
            29%**Total
                of all directors and executive officers**
            **1,250,000**
            **58%**





(1)
            The
                persons named above have full voting and investment power with respect
                to
                the shares indicated. Under the rules of the Securities and Exchange
                Commission, a person (or group of persons) is deemed to be a "beneficial
                owner" of a security if he or she, directly or indirectly, has or
                shares
                the power to vote or to direct the voting of such security, or the
                power
                to dispose of or to direct the disposition of such security. Accordingly,
                more than one person may be deemed to be a beneficial owner of the
                same
                security. A person is also deemed to be a beneficial owner of any
                security, which that person has the right to acquire within 60 days,
                such
                as options or warrants to purchase our common
                stock.





(2)
            The
                percent of class is based on 2,150,000 shares of common stock issued
                and
                outstanding as of August 31, 2007.





25
 Table
          of Contents




**Item12.
      Certain Relationships and Related
      Transactions**





None
      of
      the following parties has, since our date of incorporation, had any material
      interest, direct or indirect, in any transaction with us or in any presently
      proposed transaction that has or will materially affect us:





§
            Any
                of our directors or officers;


§
            Any
                person proposed as a nominee for election as a
                director;


§
            Any
                person who beneficially owns, directly or indirectly, shares carrying
                more
                than 10% of the voting rights attached to our outstanding shares
                of common
                stock;


§
            Any
                of our promoters;


§
            Any
                relative or spouse of any of the foregoing persons who has the same
                house
                address as such person.





**Item13.
      Exhibits**





Exhibit
                Number
            Description3.1
            Articles
                of Incorporation, as amended(1)3.2
            By-laws,
                as amended(1)31.1
            Certification
                of Chief Executive Officer pursuant to
                Securities Exchange Act Rule 13a-14(a)/15d-14(a), as adopted pursuant
                to
                Section 302 of the Sarbanes-Oxley Act of 200231.2
            Certification
                of Chief Financial Officer pursuant to
                Securities Exchange Act Rule 13a-14(a)/15d-14(a), as adopted pursuant
                to
                Section 302 of the Sarbanes-Oxley Act of 200232.1
            Certification
                of Chief Executive Officer and Chief
                Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted
                pursuant
                to Section 906 of the Sarbanes-Oxley Act of
                2002





(1)
            Incorporated
                by reference to our Form SB-2 filed with the Securities and Exchange
                Commission on October 25, 2006.





**Item14.
      Principal Accountant Fees and Services**





**Audit
      Fees**





The
      aggregate fees billed by our auditors for professional services rendered in
      connection with a review of the financial statements included in our quarterly
      reports on Form 10-QSB and the audit of our annual consolidated financial
      statements for the fiscal years ended August 31, 2007 and 2006 were
      approximately $8,000 and $5,000 respectively.





**Audit-Related
      Fees**





Our
      auditors did not bill any additional fees for assurance and related services
      that are reasonably related to the performance of the audit or review of our
      financial statements.




**Tax
      Fees**





The
      aggregate fees billed by our auditors for professional services for tax
      compliance, tax advice, and tax planning were $0 and $0 for the fiscal years
      ended August
      31, 2007 and 2006 .





**All
      Other Fees**





The
      aggregate fees billed by our auditors for all other non-audit services, such
      as
      attending meetings and other miscellaneous financial consulting, for the fiscal
      years ended August
      31, 2007 and 2006 were
      $0
      and $0 respectively.


26
 Table
            of Contents




**SIGNATURES**





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





**Atheron,
      Inc.**





By:
            /s/
                Susanna HilarioSusanna
                Hilario
              President,
                Chief Executive Officer, Chief Financial Officer, Principal Financial
                Officer, Principal Executive Officer, Treasurer (Principal Accounting
                Officer),Secretary
                and DirectorNovember
                1, 2007





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




By:
            /s/
                Susanna HilarioSusanna
                Hilario
              President,
                Chief Executive Officer, Chief Financial Officer, Principal Financial
                Officer, Principal Executive Officer, Treasurer (Principal Accounting
                Officer),Secretary
                and DirectorNovember
                1, 2007




By:
            /s/
                Rey V. SuperaRey
                V. Supera
              Chief
                Technology Officer and DirectorNovember
                1, 2007