<PAGE>

                   U.S. SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, D.C. 20549
                                   FORM 10-QSB

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

For Quarter Ended                                 Commission File
 September 30, 1996                                Number 0-22806


                       HYGENICS PHARMACEUTICALS, INC.                       
----------------------------------------------------------------------------
     (Exact Name of Small Business Issuer as specified in its Charter)


           Delaware                                    33-0120490    
--------------------------------                  ------------------
  State or Other Jurisdiction                     I.R.S. Employer  
of Incorporation or Organization                  Identification No.


	        26012 Marguerite Parkway #H132- Mission Viejo, California  92692     
-----------------------------------------------------------------------------
    (Address of Principal Executive Office)              (Zip Code)

                            (503) 225-1929                                 
--------------------------------------------------------------------------
        (Registrant's Telephone Number, including Area Code)


Indicate by check mark whether the Registrant (i) has filed all reports 
required to be filed by Section 13, or 15(d) of the Securities Exchange Act 
of 1934 during the preceding 12 months (of for such shorter period that the 
Registrant was required to file such reports) and (ii) has been subject to 
such filing requirements for the past 90 days.

                          Yes    X        No        
                              -------        ------

Indicate the number of shares outstanding of each of the issuer's 
classes of Common Stock as of the latest practicable date.

Common Stock, $.001 par value                      13,814,931    
-----------------------------                      -------------
       Title of Class                              Number of Shares 
                                                    Outstanding at  
                                                   September 30, 1996


<PAGE>
                         HYGENICS PHARMACEUTICALS, INC.
                         (A Development-Stage Company)





PART I - FINANCIAL INFORMATION                                     Page
------------------------------                                     ----
  
  ITEM 1 - FINANCIAL STATEMENTS

    Condensed consolidated balance sheet,
      September 30, 1996 ............................................1

    Condensed consolidated statements of operations,
      three months ended September 30, 1996 and 1995 ................2

    Condensed consolidated statements of operations,
      nine months ended September 30, 1996 and 1995 .................3

    Condensed consolidated statement of equity,
      nine months ended September 30, 1996 ..........................4

    Condensed consolidated statements of cash
      flows, nine months ended September 30, 1996
      and 1995 ......................................................5

    Notes to condensed consolidated financial 
      statements ....................................................6


  ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF
   FINANCIAL CONDITION AND RESULTS OF OPERATIONS ...................14


PART II - OTHER INFORMATION
---------------------------

    ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K ......................16



<PAGE>
                     PART I - FINANCIAL INFORMATION
                     HYGENICS PHARMACEUTICALS, INC.
                      (A Development-Stage Company)

                 CONDENSED CONSOLIDATED BALANCE SHEETS

                                                    September 30, 
ASSETS                                                   1996    
                                                    --------------

Current assets:
  Cash                                               $        132
  Deferred financing costs                                    ---
  Note Receivable                                         683,752
  Other                                                    13,630
                                                    --------------
      Total current assets                           $    697,514

Furniture and equipment, net                                  ---
Other assets                                                  ---
                                                    --------------
                                                     $    697,514
                                                    ==============

LIABILITIES AND STOCKHOLDERS' DEFICIENCY

Current liabilities:
  Accounts payable and accrued liabilities           $    617,800
  Notes payable                                         1,543,094
                                                    --------------
     Total current liabilities                          2,160,894
                                                    --------------

Redeemable preferred stock - Series B
 face value $100; 200,000 shares authorized;
 2,000 shares issued and outstanding                   	   200,000
                                                    --------------

Stockholders' equity (deficiency):
  Preferred stock - Series A, par value
   $.001 per share; 800,000 shares 
   authorized; 5,000 shares issued and
   outstanding                                                  5
  Common stock, par value $.001 per
   share; 13,114,931 and 11,065,500
   shares issued and outstanding at
   September 30, 1996                                       2,013
Additional paid-in capital                              3,800,680
Deficit accumulated during 
   development stage                                   (5,465,378)
                                                    --------------
     Total stockholders' deficiency                   	(1,662,680)
                                                    --------------
                                                     $    697,514
                                                    ==============

                      See accompanying notes to condensed
                       consolidated financial statements

<PAGE>
                          HYGENICS PHARMACEUTICALS, INC.
                          (A Development-Stage Company)

             CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
             For The Three Months Ended September 30, 1996 and 1995

                                                 1996             1995   
                                             -----------      ----------

Revenues          
  Sales                                      $      ---        $    ---
  Research and development                          ---             ---
  Royalties                                         ---	            ---
                                             -----------      ----------
Total Revenues                                      ---             ---

Cost of sales                                       ---             ---
                                             -----------      ----------
     Gross profit                                   ---  	          ---
                                             -----------      ----------
Other costs and expenses:
  Salaries and consulting                        99,375         189,019
  Rent                                            3,502           6,528
  Other selling, general and 
   administrative expenses                      (52,129)         89,686
                                             -----------      ----------
     Total other costs and expenses         	    50,748 	       285,233
                                             -----------      ----------
Operating loss                                 ( 50,748) 	     (285,233)

Interest expense                               ( 39,080)	      (194,754)

Other income                                     67,654	            222
                                             -----------      ----------
     Loss before income taxes                  ( 22,174)       (479,765)

Income taxes                                        ---	            ---
                                             -----------      ----------
     Net loss                                $ ( 22,174)      $(479,765)
                                             ===========      ==========
Net loss per common share                    $    (.002)      $     --- 
                                             ===========      ==========
Weighted average number of common 
  shares outstanding                         13,138,264             --- 
                                             ===========      ==========





                      See accompanying notes to condensed
                       consolidated financial statements

                                      2

<PAGE>
                            HYGENICS PHARMACUETICALS, INC.
                            (A Development-Stage Company)

                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
              For The Nine Months Ended September 30, 1996 and 1995

                                                  1996           1995   
                                              ----------      ----------
Revenues          
  Sales                                       $     ---       $	     ---
  Research and development                          ---	             ---
  Royalties                                         ---	             ---
                                              ----------      ----------
     Total Revenues                                 ---	             ---

Cost of sales                                       ---	             ---
                                              ----------      ----------

     Gross profit                                   ---	             ---

Other costs and expenses:
  Salaries and consulting                       305,090          417,919
  Rent                                           14,307           19,228
  Other selling, general and 
   administrative expenses                      136,916	         507,086
                                              ----------      ----------
     Total other costs and expenses	            456,313      	   944,233
                                              ----------      ----------
Operating loss                                 (456,313)	       (944,233)

Interest expense                               (578,611)        (456,454)

Other income                                     98,560            2,322
                                              ----------      ----------
     Loss before income taxes                  (480,051)	     (1,398,365)

Income taxes                                       (800)	           (800)
                                              ----------      -----------
     Net loss                                 $(480,851)     $(1,399,165)
                                              ==========     ============
Net loss per common share                     $   (.037)     $       --- 
                                              ==========     ============
Weighted average number of common
  shares outstanding                         12,680,162              --- 
                                             ===========     ============




                 See accompanying notes to condensed 
                  consolidated financial statements  
 
                                    3


<PAGE>
                                  HYGENICS PHARMACEUTICALS, INC.
                                  (A Development-Stage Company)
<TABLE>
              	CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIENCY)
                          For The Nine Months Ended September 30, 1996  
                                               
                                                                                     Deficit
<CAPTION>
                                                                                  Accumulated      
                                                                      Additional   During The       Total
                                 Common Stock     Preferred Stock A    Paid-In    Development   Stockholders'
                              Shares     Amount   Shares   Amount      Capital       Stage       Deficiency 
                              ------     ------   ------   ------     ----------  -----------  -------------
<S>                         <C>         <C>       <C>      <C>       <C>          <C>           <C>
Balances, January 1, 1996   11,580,908  $ 1,159   5,000    $   5     $3,324,409   $(4,528,214)  $(1,202,641)

Issuance of common stock 
  for conversion of 
  notes payable
  (Notes 4 and 6)            1,476,523      148                         325,633                     325,781

Common stock issued
  in connection with
  exercise of warrants
  (Note 6)                      57,500        6                           2,869                       2,875

Common stock issued to
  officer for services         700,000      700                                                         700

Warrants issued       
  at an exercise 
  price of $.05 per share in
  connection with private
  placement offering
  (Notes 4 and 6)                                                       144,019                     144,019

Warrants issued       
  at an exercise
  price of $.05 per share in
  connection with extension
  of bridge notes (Note 4)                                                3,750                       3,750
                         
Net loss                                                                            (937,164)      (936,464)
                            ----------  --------  ------   ------    -----------  ------------  ------------
Balances, Sept. 30, 1996    13,814,931   $ 2,013   5,000    $   5    $3,800,680  $(5,465,378)   $(1,662,680)
                            ==========  ========  ======   ======    ===========  ============  ============
</TABLE>
                                      See accompanying notes to condensed
                                       consolidated financial statements

<PAGE>
                             HYGENICS PHARMACEUTICALS, INC.
                              (A Development-Stage Company)


                  CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                For The Nine Months Ended September 30, 1996 and 1995

                                                    1996            1995   
                                               ------------     ------------
Cash flows from operating activities:
  Net loss                                     $  (480,851)     $(1,399,165)
  Adjustments to reconcile net loss to
   net cash used in operating activities: 
   Amortization of discounts on notes payable       27,730	         425,423
   Services paid through issuance of common stock      ---           10,000
 Changes in operating assets and liabilities:
      Other current assets                          (2,650)         (10,400)
      Accounts payable and accrued liabilities    (281,820)         (88,807)
                                               ------------     -------------
Net cash used in operating activities           	  (173,951)   	   (885,335)
                                               ------------     -------------
Cash flows from investing activities:
  Purchase of furniture and equipment                  ---             (300)
  Other assets                                         ---      	      (900)
  Increase in note receivable                     (683,752)             ---
                                               ------------     -------------
Net cash used in investing activities          	  (683,752)	         (1,200)
                                               ------------     -------------
Cash flows from financing activities:
  Proceeds from issuance of notes payable          822,500          865,500
  Payments on notes payable                        (10,000)             ---
  Deferred offering costs                              ---         (117,865)
  Proceeds from sale of common stock                 2,875              ---
                                               ------------     -------------
Net cash provided by financing activities      	   815,375      	   747,635
                                               ------------     -------------
Net change in cash                                 (42,328)        (138,900)

Cash at beginning of period                         42,460      	   138,900
                                               ------------     -------------
Cash at end of period                                  132      	       ---
                                               ============     =============


                         See accompanying notes to condensed
                          consolidated financial statements

                                         5
<PAGE>
                       HYGENICS PHARMACEUTICALS, INC.
                        (A Development-Stage Company)


                NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
           For The Three Months Ended September 30, 1996 and 1995 and
              For The Nine Months Ended September 30, 1996 and 1995 
  
NOTE 1 - QUARTERLY INFORMATION
------------------------------

The accompanying condensed consolidated financial statements have been 
prepared in accordance with requirements of the Security and Exchange 
Commission for interim financial statements.  Therefore, they do not include 
all disclosures that would be presented in the Company's Annual Report on 
Form 10-KSB.  The financial statements should be read in conjunction with the 
financial statements contained in the Company's Annual Report on Form 10-KSB 
for the year ended December 31, 1995.

The information furnished reflects all adjustments (consisting only of normal 
recurring adjustments) which are, in the opinion of management, necessary for 
a fair presentation of financial position for the interim period.  The 
results are not necessarily indicative of results to be expected for the full 
year.

NOTE 2 - ORGANIZATION AND BUSINESS
----------------------------------

Brian Pharmaceuticals, Inc. (BPI), a California corporation, was incorporated 
on December 3, 1984.  On November 14, 1994, BPI consummated a stock-for-stock 
exchange with Diversified Food Manufacturers, Ltd. (DFML), a publicly-held 
Delaware corporation.  As part of the exchange, DFML issued 7,610,000 shares 
of its common stock, 5,000 shares of its Series A preferred stock and 2,000 
shares of its Series B preferred stock in exchange for all of the outstanding 
shares of BPI.  The exchange has been accounted for as a reverse acquisition 
because stockholders of BPI maintain control of the surviving entity, BPI.  
Accordingly, for financial reporting purposes, the shares issued by DFML are 
considered outstanding based on the date of their original issuance by BPI, 
and the 1,800,000 shares of common stock retained by the stockholders of DFML 
are reflected as consideration issued to consummate the stock-for-stock 
exchange.  No value was ascribed to the shares retained by the stockholders 
of DFML since, at the date of exchange, DFML had nominal assets and 
stockholders' equity and had no operations.  On January 3, 1995, DFML changed 
its name to Hygenics Pharmaceuticals, Inc. (the Company).

The Company is considered a development-stage company and is involved in the 
research and development of antimicrobial skin cleansing/care formulations 
based upon Chlorhexidine Gluconate (CHG).  The Company is preparing to market 
its only product, Surgique(tm), 4%, CHG solution, is preparing several new 
CHG products for submission to the U.S. Food and Drug Administration (FDA) 
for approval and is outsourcing an extensive range of non-CHG products for 
marketing under its own label.




                                      6



<PAGE>
                           HYGENICS PHARMACEUTICALS, INC.
                            (A Development-Stage Company)

       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
          For The Three Months Ended September 30, 1996 and 1995 and
             For The Nine Months Ended September 30, 1996 and 1995 
	
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
---------------------------------------------------

Basis of Presentation
---------------------

The accompanying consolidated financial statements have been prepared 
assuming the Company will continue as a going concern, which contemplates, 
among other things, the realization of assets and satisfaction of liabilities 
in the normal course of business.  The Company's status as a development-
stage company, and its recurring losses from operations through September 30, 
1996 raise substantial doubt about its ability to continue as a going 
concern.  Successful marketing of its existing product, development and 
marketing of new products and its transition, ultimately, to the attainment 
of profitable operations are dependent upon the Company obtaining adequate 
financing.  The Company has received $1,999,000 in connection with private 
placements of debt securities.  Management plans to continue the development 
of new products,  initiate marketing of its FDA approved product as part of a 
full line of antimicrobial products and seek additional equity capital.  The 
accompanying condensed consolidated financial statements do not include any 
adjustments that may result from the outcome of this uncertainty.

NOTE 4 - NOTES PAYABLE 
----------------------

First Private Placement
-----------------------

In December 1994, the Company offered up to 70 convertible units at $5,000 
per unit under a private placement.  Each convertible unit consisted of a 
$5,000 convertible note and 5,000 shares of the Company's common stock.

Each convertible note bears interest payable monthly at 10% per annum, was 
due on November 15, 1995 (subject to six 30-day extensions at sole option of 
holder), may be prepaid by the Company at any time without penalty, and is 
convertible at any time at the option of the holder into shares of the 
Company's common stock at a conversion price equal to 75% of the closing bid 
price of the Company's common stock on the business day immediately preceding 
each such conversion.  The notes are collateralized by substantially all of 
the assets of the Company and by all of the common stock and preferred stock 
of the Company owned by its two major stockholders.

Through December 31, 1995, the Company had issued approximately 223.3 units 
for $1,116,500 in cash and 1,116,500 shares of its common stock.  The Company 
ascribed a value to such shares of $556,375 based on the market value, 
discounted for transferability restrictions, and reflected such value as an 
original issue discount to these notes (see Note 4) in the accompanying 
balance sheet.  As of September 30, 1996, the discount related to these notes 
has been amortized in full.

                                         7

<PAGE>
                           HYGENICS PHARMACEUTICALS, INC.
                               (A Development Company)

          NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
             For The Three Months Ended September 30, 1996 and 1995 and
                For The Nine Months Ended September 30, 1996 and 1995 
	
FIRST PRIVATE PLACEMENT, continued
----------------------------------

In November 1995, when the Company determined that it did not have the 
ability to repay these obligations by the original maturity date, the Company 
requested an extension of the maturity date of these notes payable, for a 
six-month period, to May 15, 1996.  As consideration for the extension, each 
stockholder who extended their note payable received warrants to purchase 
2,500 shares of the Company's common stock for each note unit of $5,000 held 
by the stockholder at an exercise price of $.05 per share exercisable for two 
years.  The Company ascribed a value to these warrants of $93,506 based on 
the market value of its common stock, discounted for transferability 
restrictions, less the exercise price of the warrants.  Management reflected 
such value as a discount to the notes (see Note 4) in the accompanying 
balance sheet.  As of September 30, 1996, the discount related to these 
warrants has been amortized in full.

Through September 30, 1996, $373,406 of these unit notes have been converted 
into 1,450,376 shares of the Company's common stock (see Note 4).  At 
September 30, 1996, $743,094 of these unit notes which remain outstanding are 
currently in default.                                                        


SECOND PRIVATE PLACEMENT
------------------------

On November, 1995, and subsequent to the closing of the First Private 
Placement, the Company increased the offering up to 240 convertible units at 
$5,000 per unit under a private placement (the "Second Private Placement").  
Each convertible unit consists of a $5,000 convertible unsecured note and a 
warrant exercisable for two years to purchase 5,000 shares of the Company's 
common stock at an exercise price of $.05 per share, subject to adjustment 
under certain circumstances.  The warrants are callable at any time by the 
Company with six months prior written notice.

Each convertible note bears interest payable monthly at 10% per annum, is due 
on May 15, 1996 (subject to six 30-day extensions at sole option of the 
holder) and is unsecured.  Each note may be prepaid by the Company at any 
time without penalty, and is convertible at any time, at the option of the 
holder, into shares of the Company's common stock at a conversion price equal 
to 75% of the closing bid price of the Company's common stock on the business 
day immediately preceding such conversion.




                                        8

<PAGE>
                          HYGENICS PHARMACEUTICALS, INC.
                               (A Development Company)


        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
           For The Three Months Ended September 30, 1996 and 1995 and
              For The Nine Months Ended September 30, 1996 and 1995

Second Private Placement, continued
-----------------------------------

Through September 30, 1996, the Company issued 156.5 units for $782,500 in 
cash and warrants to purchase 782,500 shares of the Company's common stock.  
In addition, the Company issued warrants to certain investors in the Second 
Private Placement with the same terms as described above, to purchase 50,000 
shares of the Company's common stock.  The Company ascribed a total value to 
these warrants of $155,569 based on the market value of the common stock, 
discounted for transferability restrictions, less the exercise price of the 
warrants and reflected such value as a discount to the notes (see Note 6) in 
the accompanying balance sheet.  As of September 30, 1996, $710,000 of these 
unit notes are in default and $72,500 have been converted into 435,555 shares 
of common stock.  As of September 30, 1996, the discount related to these 
warrants has been amortized in full.

Under the terms of the agreements, the Company shall use its best efforts to 
register the shares issued under the First and Second Private Placements, as 
well as any conversion changes with the Securities and Exchange Commission.

In March, 1996, the Company amended the terms of the Second Private Placement 
to increase the cost of each convertible unit to $20,000, to decrease the 
maximum number of units available to 60 and to extend the term of the related 
unit note to twelve months.  As of September 30, 1996, the company has 
retracted this offer.

NOTE 5 - NOTE PAYABLE
---------------------

In February, 1996, the Company issued notes totaling $100,000 plus warrants 
to purchase 100,000 shares of common stock at an exercise price of $.25 per 
share (the estimated fair market value of its common stock in February, 
1996); warrants to purchase 100,000 shares of common stock at an exercise 
price of $1.00 per share; and warrants to purchase 100,000 shares of common 
stock at an exercise price of $2.50 per share in connection with the note 
receivable.  In addition, the Company may be obligated to pay $50,000 for 
interest costs in connection with these loans if certain milestones were 
achieved.  Through September 30, 1996, notes totaling $10,000 have been 
repaid, and at September 30, 1996, $90,000 remained outstanding.


NOTE 6 - COMMON STOCK
---------------------

From January 1, 1996 to September 30, 1996, the Company issued warrants, 
valued at $144,019, to purchase 722,500 shares of the Company's common stock 
at an exercise price of $.05 per share as a part of the second private 
placement.  

On September 26, 1996, the company issued 700,000 shares of common stock to 
an officer for his services.
 	
                                      9

<PAGE>

                           HYGENICS PHARMACEUTICALS, INC.
                               (A Development Company)

        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
            For The Three Months Ended September 30, 1996 and 1995 and
              For The Nine Months Ended September 30, 1996 and 1995 

NOTE 7 - PREFERRED STOCK
------------------------

The Board of Directors has the authority, without further action by the 
stockholders, to issue up to 1,000,000 shares of the preferred stock, $.001 
par value.  Subject to previously designated series of preferred stock, the 
Board of Directors of the Company has authority to issue all or any portion 
of the authorized but unissued additional preferred stock in one or more 
series and to fix the rights, preferences, privileges and restrictions 
thereof, including dividend rights, conversion rights, voting rights, terms 
of redemption, liquidation preferences and the number of shares constituting 
any series or the designation of such series.


NOTE 8 - PROPOSED MERGER
------------------------

On January 15, 1996, the Company entered into a letter of intent with Oakmont 
Pharmaceuticals, Inc., a Delaware corporation ("Oakmont"), which provided for 
the merger of the Company and Oakmont on or before May 31, 1996, upon 
fulfillment of certain conditions including the execution of the merger 
Agreement (the "Merger").  In connection with the proposed Merger, the 
Company loaned to Oakmont $588,470 from proceeds raised in the Second Private 
Placement in 1996.  The Company has received from Oakmont a 12% secured note 
(the"Note") for the amount not exceeding $750,000.  The proceeds of the Note 
were to be used by Oakmont to acquire certain assets of Pennex 
Pharmaceuticals, Inc. before the Merger of the Company and Oakmont.  On March 
11, 1996, negotiations regarding the proposed Merger with the Company were 
terminated.  

Under the terms of the Note, the Company was to receive the principal amount 
and any unpaid interest thereby on June 30, 1996.  In addition, the Company 
demanded, pursuant to the terms of the Note, the issuance of an option to 
purchase 25% of the issued and outstanding shares of Oakmont.  There can be 
no guarantee that such monies will be repaid.  The non-repayment of these 
amounts to the Company would have a serious material effect on its financial 
position.  As of September 30, 1996, no monies have been received from the 
Oakmont note.

As of July 25, 1996, Oakmont Pharmaceuticals and Hygenics settled the dispute 
over the amount of warrants or options Hygenics is to receive and additional 
penalty interest due Hygenics.  The agreement is for Oakmont is to issue 
650,000 warrants or options of common stock, exercisable at a price of $.05 
per share for a period of eighteen months from January 15, 1996 and pay a 
monthly extension fee of $50,000 per month beginning September 1, 1996 for 
every month that all the principal and interest is not paid.  This monthly 
extension fee will be proportionately reduced based upon the portion paid 
against the principal and the number of remaining days on a per diem basis.  
As of September 30, 1996, no warrants have been issued to Hygenics nor has 
the extension fee been paid.

                                      10

<PAGE>
                           HYGENICS PHARMACEUTICALS, INC.
                               (A Development Company)


        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
           For The Three Months Ended September 30, 1996 and 1995 and
             For The Nine Months Ended September 30, 1996 and 1995

NOTE 9 - COMMITMENTS AND  CONTINGENCIES
---------------------------------------

Consulting
----------

In October 1991, the Company entered into certain agreements with certain 
medical advisors whereby BPI engaged the medical advisors to act as 
consultants for a period of three years following the Company's completion of 
an initial public offering, which was anticipated to occur in 1991.  HPI 
intends to fulfill the contractual obligation.  The related annual obligation 
is as follows:

               1996                    66,000
               1997                    44,000
                                    ---------
                                    $ 110,000
                                    =========
Trademark Infringement
----------------------

On June 27, 1995, the Company received notice from an unrelated entity 
objecting to the use of the name Hygenics Pharmaceuticals, Inc. as an 
infringement on an existing trademark, which is applied to a line of dental 
supplies and accessories.  The Company's trademark law firm registered a 
disagreement as to a potential conflict and no further action has been taken 
by either party.  The Company does not believe that an infringement exists 
and will vigorously defend its position; however, there can be no assurance 
that the Company will prevail in this matter.

Joint Venture Letter of Intent
------------------------------

On October 24, 1995, Hygenics signed a letter of intent to form a joint 
venture with Biocontrol, Inc. to develop topical antimicrobials using 
Biocontrol's patented drug delivery system.  The original term of this letter 
of intent, entered into on February 29, 1996, was extended to June 30, 1996. 
 As of September 30, 1996, this letter of intent to form a joint venture has 
not been extended and Biocontrol is waiting for the reorganization of 
Hygenics before renewing this agreement.  The Company cannot guarantee that a 
joint venture will be formed with Biocontrol, Inc., or, if so, that the joint 
venture will be successful in developing products for commercialization by 
the Company, or that, even if such products are developed, that the Company 
will be successful in commercializing them.





                                     11

<PAGE>
                           HYGENICS PHARMACEUTICALS, INC.
                               (A Development Company)


        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
           For The Three Months Ended September 30, 1996 and 1995 and
             For The Nine Months Ended September 30, 1996 and 1995

NOTE 9 - COMMITMENTS AND  CONTINGENCIES, continued
-------------------------------------------------

Employment Contracts
--------------------

The Company entered into three-year employment contracts with two officers 
and stockholders of the Company and a two-year agreement with a director 
commencing on June 1, 1995.  The contracts provide for annual compensation to 
the two officers of $110,000 and $135,000 of which approximately $2,917 per 
month of one officer's compensation was deferred to July 1, 1995.  The other 
officer was to receive an increase in his annual salary to $110,000 on July 
1, 1995.  Neither officer has received a full salary since July 1995.  As of 
September 30, 1996, the Company owes a total of $196,975 for accrued salaries 
to these officers. 

On September 26, 1996, the Board of Directors adopted an unanimous resolution 
by written consent approving an Employment Agreement employing Mr. William 
Goedecke as Chief Executive Officer with a compensation proving for 700,000 
shares of restricted Rule 144 stock and $100,000 per year in deferred salary.

Research
--------

In November 1992, the Company entered into an agreement with Medi-Flex 
Hospital Products, Inc. (Medi-Flex), an unrelated entity, whereby the Company 
agreed to assist Medi-Flex to obtain FDA approvals for a certain product and 
a manufacturing plan, and granted Medi-Flex a worldwide license to 
manufacture, market and sell 4% CHG in the Product Packages (as defined).  
The license is an exclusive license for the initial five-year term of the 
agreement; thereafter, the Company at its option may convert the license to a 
non-exclusive license if and only if Medi-Flex has not achieved certain 
cumulative sales levels (as defined).  The Company has received $317,500 from 
Medi-Flex related to this contract.  

On June 7, 1994, Medi-Flex informed the Company of Medi-Flex's termination of 
its agreement with the Company whereby, for certain "good faith" and 
technology transfer fees and future royalties, the Company was to develop a 
number of products for Medi-Flex.  Medi-Flex claims that the Company is in 
default of the Agreement and, in its June 7, 1994 notification, offered to 
provide the Company with a full release if the Company returned to Medi-Flex 
$317,000 of fees paid to the Company by June 20, 1994.  The Company believes 
that Medi-Flex's allegations are completely without merit.  On July 11, 1994, 
the Company informed Medi-Flex of its denial of all of its allegations and 
offered to meet with Medi-Flex to attempt to resolve the issues and concerns 
raised by each party and stated that, if Medi-Flex continued to pursue their 
unfounded allegations, the Company would respond with legal action.  To date, 
neither the Company, nor Medi-Flex, have taken legal action against the other 
in this matter.  While the Company believes that Medi-Flex's allegations are 
completely without merit and intends to take all available remedies at law to 
have its rightful claims to all 
                                       12

<PAGE>
                          HYGENICS PHARMACEUTICALS, INC.
                               (A Development Company)

      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
          For The Three Months Ended September 30, 1996 and 1995 and
            For The Nine Months Ended September 30, 1996 and 1995


Research, continued
-------------------

fees and royalties as provided in the Agreement with Medi-Flex satisfied, 
there is no certainty that the Company will prevail in this matter, or that 
the other party will not prevail in its claims of financial damage.  
Moreover, should Medi-Flex prevail in this matter, the impact could have a 
serious material effect on the Company's financial position.  Even if the 
Company should prevail in any such litigation, the attorneys fees and other 
litigation costs of such litigation could be a serious economic burden for 
the Company.


NOTE 10 - CONCENTRATION OF CREDIT RISK
--------------------------------------

At times, the Company maintains cash balances at certain financial 
institutions in excess of the federally insured amounts.  



                                        13


<PAGE>
                          HYGENICS PHARMACEUTICALS, INC.
                               (A Development Company)

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                       CONDITION AND RESULTS OF OPERATIONS

Brian Pharmaceuticals, Inc. (BPI), a California corporation, was incorporated 
on December 3, 1984.  On November 14, 1994, BPI consummated a stock-for-stock 
exchange with Diversified Food Manufacturers, Ltd. (DFML), a publicly-held 
Delaware corporation.  As part of the exchange, DFML issued 7,610,000 shares 
of its common stock, 5,000 shares of its Series A preferred stock and 2,000 
shares of its Series B preferred stock in exchange for all of the outstanding 
shares of BPI.  The exchange has been accounted for as a reverse acquisition 
because stockholders of BPI maintain control of the surviving entity, BPI.  
Accordingly, for financial reporting purposes, the shares issued by DFML are 
considered outstanding based on the date of their original issuance by BPI, 
and the 1,800,000 shares of common stock retained by the stockholders of DFML 
are reflected as consideration issued to consummate the stock-for-stock 
exchange.  No value was ascribed to the shares retained by the stockholders 
of DFML since, at the date of exchange, DFML had nominal assets and 
stockholders' equity and had no operations.  On January 3, 1995, DFML changed 
its name to Hygenics Pharmaceuticals, Inc. (the Company).

The Company is considered a development-stage company and is involved in the 
research and development of antimicrobial skin cleansing/care formulations 
based upon Chlorhexidine Gluconate (CHG).  The Company is preparing to market 
its only product, Surgique(tm), 4%, CHG solution, is preparing several new 
CHG products for submission to the U.S. Food and Drug Administration (FDA) 
for approval and is outsourcing an extensive range of non-CHG products for 
marketing under its own label.

The Company does not anticipate generating sales of its products until 1996 
and expects its products to be sold domestically and internationally.

Results of Operations
---------------------

Three Months Ended September 30, 1996 Compared to Three Months Ended 
September 30, 1995
--------------------------------------------------------------------

Salaries and consulting decreased $89,644 or 47% from $189,019 in 1995 to 
$99,375 in 1996.

Other selling, general and administrative expenses decreased from $89,686 in 
1995 to $(52,129) in 1996 primarily as a result of no contracts with outside 
services related to the bridge financing.

Interest expense increased $195,326 from $194,754 in 1995 to $390,080 in 1996 
due to the issuance of interest bearing notes payable in 1996.




                                          14

<PAGE>
                          HYGENICS PHARMACEUTICALS, INC.
                               (A Development Company)



                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS - CONTINUED

Nine Months Ended September 30, 1996 Compared to Nine Months Ended September 
30, 1995
----------------------------------------------------------------------------

Salaries and consulting decreased $112,829 or 27% from $417,919 in 1995 to 
$305,090 in 1996.

Other selling, general and administrative expenses decreased $370,170 or 73% 
from $507,086 in 1995 to $136,916 in 1996 primarily as a result of no 
contracts with outside services related to the bridge financing.

Interest expense increased $122,157 from $456,454 in 1995 to $578,611 in 1996 
due to the issuance of interest bearing notes payable in 1996 and the 
amortization of discounts on notes payable.

Liquidity and Capital Resources
-------------------------------

From January 1, 1996 to September 30, 1996, the Company issued 144.5 units at 
$5,000 per unit under a private placement for a total of $722,500.  Each unit 
consisted of a $5,000 convertible note and a warrant to purchase 5,000 shares 
of the Company's common stock at an exercise price of $.05.

As of September 30, 1996, current liabilities exceeded current assets by 
$1,463,380. This liquidity issue, among other things, raises substantial 
doubt about the Company's ability to continue as a going concern.  The 
Company's continuation as a going concern is dependent on its ability to 
obtain additional financing and ultimately to attain revenues which exceed 
its cost structure operations.  In addition, the Company must take measures 
to successfully collect its note receivable from Oakmont.  The Company is 
seeking to collect the funds owed and is pursuing all legal rights and 
remedies.  There are no assurances that management's plans will be effective 
in a manner which will enable the Company to continue as a going concern.

Events
------

On July 8, 1996, all members of the Company's Board of Directors and existing 
officers tendered resignation from their positions as directors of the 
Company effective as of July 1, 1996, following the Company's announcement 
that it will be unable to renew the officers and directors liability 
insurance policy, which expired on June 30, 1996.  No director or officer 
furnished any statement of disagreement as to the policies of the Company as 
part of such resignations.

Prior to tendering such resignations, the Board of Directors elected Dean 
Bradley as sole Director, Chief Executive Officer, Secretary and Chief 
Financial Officer of the Company.  Mr. Bradley is not the owner of any 
securities of the Company.

On September 26, 1996, the shareholders resolved by unanimous written consent 
to remove Dean Bradley as a sole Director, Chief Executive Officer, Secretary 
and Chief Financial Officer of the company.  In Mr. Bradley's place, the 
shareholders elected Charles H. Newman as President and a Director and Ronald 
Pellett as a Director.  Mr. William Goedecke was then elected by an unanimous 
vote by the Board of Directors as the Chief Executive Officer on September 
26, 1996 and issued 700,000 shares of common stock and $100,000 annual 
deferred compensation for his services.

                                        15

<PAGE>

                      PART II - OTHER INFORMATION

                       HYGENICS PHARMACEUTICALS, INC.
                       (A Development-Stage Company)




  ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K


There were Form 8-K reports filed during the quarter.

Effective July 8, 1996, a Form 8-K was filed stating that the Board of 
Directors and existing officers tendered their resignations as directors 
following the announcement that the officers and directors liability 
insurance policy expired.    		
On September 26, 1996, a Form 8-K was filed stating that Dean Bradley was 
removed as a sole Director, Chief Executive Officer, Secretary and Chief 
Financial Officer of the Company.  In Mr. Bradley's place, the shareholders 
elected Charles H. Newman as the President and a Director and Ronald Pellett 
as a Director.  

On September 26, 1996, the Directors adopted an unanimous resolution by 
written consent approving an Employment Agreement employing Mr. William 
Goedecke as Chief Executive Officer with a compensation providing for 700,000 
shares of restricted Rule 144 stock and $100,000 per year in deferred salary.


                            SIGNATURES
                            ----------


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




                                HYGENICS PHARMACEUTICALS, INC.    



Date:  November 20, 1996        By: S/S                                  
                                    William Goedecke, CEO



                                    S/S                                  
                                    Charles H. Newman, President      





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