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                                   FORM 10-K/A
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D. C. 20549

[X]  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934 For the fiscal year ended - December 31, 2001
                                       OR
[_]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934 For the transition period from _________ to ________.
                         Commission file number 0-26476
                               GLYCOGENESYS, INC.
               (Exact name of Company as specified in its charter)

                    Nevada                            33-0231238
        State or other jurisdiction of             (I.R.S. Employer
        incorporation or organization             Identification No.)

                              Park Square Building
                        31 St. James Avenue, 8/th/ Floor
                           Boston, Massachusetts 02116
        (Address of principal executive offices, including postal code.)

                                 (617) 422-0674
              (Registrant's telephone number, including area code)

           Securities registered pursuant to Section 12(b) of the Act:
          Title of each class       Name of each exchange on which registered
              None

Securities registered pursuant to Section 12(g) of the Act:
Title of each class                                  Common Stock

Indicate by check mark whether the Company (1) has filed all reports required to
be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Company was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

                     YES      [X]     NO        [_]

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of the Registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [_]

The aggregate market value at April 12, 2002 of the voting stock of the
Registrant held by non-affiliates (based on the closing price of $1.40 on the
Nasdaq SmallCap market on that date) was approximately $31,360,000.

The number of shares outstanding each of the Registrant's classes of common
stock, as of April 12, 2002 was 37,064,044.

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                                EXPLANATORY NOTE

          On April 16, 2002, GlycoGenesys, Inc. (the "Company") filed its Annual
Report on Form 10-K for the year ended December 31, 2001 containing unaudited
consolidated financial statements for the year ended December 31, 2001 in
reliance on Securities and Exchange Release No. 34-45589 because the Company
elected not to have Arthur Andersen LLP issue a manually signed audit report for
the Company's consolidated financial statements for the year ended December 31,
2001. This Amendment No. 1 of the Company's Annual Report on Form 10-K (the
"Form 10-K/A") contains audited consolidated financial statements for the year
ended December 31, 2001 audited by Deloitte & Touche LLP.

                                     PART I

          Forward-looking statements are made throughout this document.
Typically, the use of the words "believe", "anticipate", "plan", "expect",
"seek", "estimate" and similar expressions identify forward-looking statements.
Unless a passage describes a historical event, the statement should be
considered a forward-looking statement. In keeping with the "Safe Harbor"
provision of the Private Securities Litigation Reform Act of 1995, it should be
noted that forward-looking statements regarding the Company's future
expectations and projections are not guarantees of future performance. They
involve risks, uncertainties and assumptions, and many of the factors that will
determine the Company's future results are beyond the Company's ability to
control or predict. Therefore, actual results may differ significantly from
those suggested by forward-looking statements. These risks include those
detailed under the heading "Certain Factors That May Affect Future Results"
immediately following the "Management's Discussion and Analysis of Results of
Operations and Financial Condition."

ITEM 1. BUSINESS

Overview

GlycoGenesys, Inc. (the "Company," formerly known as SafeScience, Inc.) is a
biotechnology company developing novel pharmaceutical products based on
carbohydrate compounds and related technologies. The Company's lead drug
candidate GCS-100 (formerly known as GBC-590), a potential treatment for
multiple forms of cancer, recently completed Phase II(a) clinical trials for
pancreatic cancer and completed Phase II(a) clinical trials for colorectal
cancer in 2001. In July 2001, the Company formed a joint venture (SafeScience
Newco, Ltd.) with Elan Corporation, plc ("Elan") to advance GCS-100 in the field
of oncology.

While the Company is also developing two agricultural products (Elexa, a
registered trademark of the Company, and Bb447), it continues to seek strategic
alternatives, including the sale, of its agricultural products business area.
The Company's near term objective is to continue to proceed through the various
phases of United States Food and Drug Administration (FDA) clinical trials for
GCS-100.

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The Company's business was founded in 1992 as IGG International, Inc. to pursue
carbohydrate based pharmaceutical research for cancer therapeutics. In 1995, the
Company merged with Alvarada Inc., a publicly-traded corporation having no
active operations. In 1998 the Company changed its name to SafeScience, Inc. and
more recently in October 2001 the Company changed its name to GlycoGenesys, Inc.
The Company's principal executive offices are located at 31 St. James Avenue,
8th Floor, Boston, MA 02116 and the telephone number is (617) 422-0674. The
Company's homepage is located on the World Wide Web at
http://www.glycogenesys.com

GlycoGenesys, Inc.

GlycoGenesys conducts its business through two wholly-owned subsidiaries,
International Gene Group, Inc. and SafeScience Products, Inc.

International Gene Group, Inc. ("IGG") develops human therapeutics. IGG has been
focused on developing GCS-100, a complex carbohydrate intended to fight
cancerous tumors and metastasis, which it exclusively licenses from Dr. David
Platt and Wayne State University and the Barbara Ann Karmanos Cancer Institute.

Theoretical Background of GCS-100. Cells recognize one another through pairs of
complementary structures on their surface. A structure on one cell carries
encoded biological information that a structure on another cell can decipher.

While nucleic acids and proteins were previously recognized as the major classes
of biological materials involved in cell recognition, it has recently been
scientifically established that carbohydrates play a role as well. Cell surface
components contain carbohydrate structures, which change characteristics as the
cell develops, differentiates, transforms and progresses through its life cycle.

It is contended that cell adhesion plays a role in cancer and cancer metastasis.
Metastasis is the process by which cancer cells spread throughout the body,
beginning at the primary tumor. The spread of the cancer cells throughout the
body is the main cause of death for cancer patients. These cells, once
circulating in the bloodstream after their detachment from the primary tumor,
must adhere to new cells in other parts of the body in order to proliferate to
form new tumor colonies. The Company believes that drugs, which inhibit this
process of adhesion, may inhibit metastasis although this theory has not been
scientifically established.

GCS-100 may offer a novel approach to controlling the progression of cancer, by
disrupting the cellular recognition process of roaming cancer cells and
preventing them from reattaching to each other and to normal tissue. The GCS-100
compound acts as a "molecular decoy" by recognizing a specific lectin on cell
surfaces called Galectin-3 which plays a role in aggregation of cancer cells. By
binding to Galectin-3, a protein that binds to specific carbohydrates, GCS-100
may thus prevent metastasis. In addition, independent research has shown that
Galectin-3 is involved in regulating cell growth, migration and apoptosis (cell
death). By binding to Galectin-3, GCS-100 may induce cancer cell death.
Furthermore, independent research has shown that Galectin-3 plays a role in
angiogenesis. Angiogenesis, identified in the 1980's, is the biological process
by which tumors form new blood vessels

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allowing them to obtain the nutrients necessary for tumor growth. By binding to
Galectin-3, GCS-100 may inhibit angiogenesis.

The Company believes that GCS-100 has the potential for therapeutic effect on
multiple cancer types (i.e., pancreatic, colorectal, prostate, breast and liver)
because the target for GCS-100 on the cancer cells is Galectin-3 which is over
expressed on all these cancer types. GCS-100 is delivered intravenously.

Phase I clinical trials of GCS-100, at the MD Anderson Cancer Center in Houston,
Texas and at Pennsylvania Oncology and Hematology Associates, an affiliate of
the University of Pennsylvania - School of Medicine in Philadelphia,
Pennsylvania, were completed in 1999. Phase I is intended to assess toxicity;
GCS-100 showed no dose limiting toxicity in patients.

A Phase II(a) clinical trial for colorectal cancer was completed in 2001 and a
Phase II(a) clinical trial for pancreatic cancer was completed in 2002. These
Phase II(a) trials were conducted at the following locations:

 .   Beth Israel/Deaconess Hospital in Boston, Massachusetts;
 .   University of Chicago Pritzker School of Medicine;
 .   University of Rochester Cancer Center;
 .   Christiana Healthcare in Wilmington, Delaware;
 .   Ocala Oncology Center in Ocala, Florida;
 .   Hematology and Oncology Associates in Kansas City, Missouri; and
 .   Medical Oncology Associates in San Diego, California

On March 23, 2001, the Company announced that GCS-100 demonstrated positive
clinical activity in colorectal cancer patients in the completed Phase II(a)
clinical trial. Specifically, five of 23 patients showed tumor stabilization for
periods of two to six months before disease state progression was observed, with
one of the five patients showing a period of tumor shrinkage. On April 8, 2002,
the Company announced the completion of its Phase II(a) pancreatic cancer
clinical trial. Phase II clinical trials are designed to help determine both the
safety and efficacy of a potential drug, which may involve several sets of
trials (Phase II(a), Phase II(b), etc.). Based on promising early data from
these trials, and the fact that higher doses of GCS-100 than administered in the
Phase II(a) colorectal and pancreatic trials have already been tested in
animals, with no dose limiting toxicity observed, a Phase I dose escalation
trial to include colorectal and other types of cancer patients began in February
2002. This trial is being conducted at Sharp Clinical Oncology Research Memorial
Hospital in San Diego. In addition, a Phase II dose escalation trial with
GCS-100 in combination with a standard cancer therapy is planned to begin in
2002/2003 and will enroll pancreatic cancer patients. These dose escalation
trials may enroll up to 75 cancer patients separated into groups, each receiving
a different dose level of GCS-100. Assuming the results of these dose escalation
trials support an expanded Phase II/III pivotal clinical trial for pancreatic
cancer, the Company intends to initiate such a trial in 2003/2004. In connection
with this trial the Company intends to seek fast track designation from the FDA
which would enable the Company to seek accelerated approval for GCS-100 for the
treatment of pancreatic cancer. GCS-100, whether delivered intravenously or by
other methods, may not prove

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effective in reducing or eliminating the spread of cancer in humans, be safe at
higher doses or be granted accelerated or other approvals by the FDA.

On September 19, 2001, we announced that we entered into a sponsored research
agreement with the Massachusetts Institute of Technology (MIT). The research
conducted by MIT will focus on an expanded analysis of GCS-100 and
identification of other compounds with promising biochemical and pharmaceutical
activity.

The estimated amount expended by the Company during the fiscal year ending 2001
on Company sponsored research was approximately $266,500, exclusive of amounts
totaling $2,319,000 paid to consulting companies or clinical research
organizations.

On July 10, 2001, the Company closed on a business venture with Elan and Elan
International Services, Ltd., a Bermuda exempted limited liability company
("Elan International"). As part of the transaction, Elan International and the
Company founded a Bermuda exempted limited liability company, SafeScience Newco,
Ltd., to further advance GCS-100. The Company owns 100% of the common stock and
60.2% of the non-voting convertible preferred shares of SafeScience Newco, Ltd.
and Elan International owns 39.8% of the non-voting convertible preferred shares
of SafeScience Newco, Ltd. Of the outstanding combined common and non-voting
preferred shares of SafeScience Newco, Ltd., the Company owns 80.1% and Elan
International owns 19.9%. Elan and the Company entered into license agreements
under which the Company licensed to SafeScience Newco, Ltd. its intellectual
property related to GCS-100 for use in the field of oncology and Elan licensed
to SafeScience Newco, Ltd. proprietary oral drug technology for $15,000,000. All
of the monetary components of these transactions were settled by the execution
of a cross receipt among the parties for all amounts due to the appropriate
parties.

At the time of the transaction, Elan International also purchased 2,700,000
shares of the Company's Common Stock, 1,116.79 shares of the Company's Series C
Non-Voting Preferred Stock ("Series C Stock") convertible into 1,116,790 shares
of Common Stock after two years and a five-year warrant to purchase 381,679
shares of Common Stock at an exercise price of $2.43 per share for an aggregate
purchase price of $5,000,000 which was paid in cash. Elan International also
acquired shares of the Company's Series A Convertible Exchangeable Non-Voting
Preferred Stock ("Series A Stock") for $12,015,000. The Series A Stock bears a
7% dividend payable-in-kind. The Series A Stock is exchangeable at the option of
Elan International at any time for all of the preferred stock of SafeScience
Newco, Ltd. held by the Company which, if exchanged, would give Elan
International 50% ownership of the fully diluted equity in SafeScience Newco,
Ltd. The Series A Stock shall be redeemed by the Company, if still outstanding
on July 10, 2007 at its option for either cash or shares of Common Stock with
fair market value equal to the redemption price. The proceeds from the issuance
of the Series A Stock were contributed by the Company to SafeScience Newco, Ltd.
Consequently, the value assigned to the Company's investment in SafeScience
Newco, Ltd. is the same as the value of the Series A Stock issued, which was
approximately $12,015,000.

Elan International and the Company may fund SafeScience Newco, Ltd.'s research
and development according to their respective equity holdings in SafeScience

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Newco, Ltd. Subject to mutual agreement, Elan International may acquire from the
Company up to $9.612 million of Series B Convertible Preferred Stock, which
bears a 7% dividend payable-in-kind and is convertible into Common Stock. As of
April 16, 2002, Elan International had acquired $1.4 million of the Company's
Series B Preferred Stock, constituting 862.70647 shares, on December 31, 2001.
The issuance of Series B Preferred Stock is intended to provide the Company with
funds to meet its funding obligations to SafeScience Newco, Ltd.

The Company has retained Beardsworth Consulting Group, a full service contract
research organization to support two projects: a Phase I dose escalation trial,
and database transfer/management for the recently completed Phase II(a) trials.
They will provide clinical research management, study monitoring, data
management and medical writing. The costs for both efforts are estimated to be
approximately $1,228,000 and be paid out over the next 9-12 months. In addition,
the costs associated with the Phase I dose escalation trial currently being
conducted at Sharp Clinical Oncology Research Memorial Hospital ("Sharp") is
estimated to cost approximately $545,000 to be paid to Sharp over the next 9-12
months.

Pipeline Development

In addition to expanding the clinical trial program for GCS-100, we will devote
resources to building a pipeline of drug candidates. Our research efforts will
focus on three initiatives: licensing new technologies from outside sources,
exploring the therapeutic potential of existing compounds in diseases other than
their original indication, and evaluating existing technologies currently
in-house. Priority will be given to drug candidates that provide therapeutic
activity in diseases that are life threatening or debilitating, have an unmet
medical need and for which Phase I/II clinical trials can be initiated in a
relatively short period of time.

We are critically evaluating all data in connection with CAN-296 and its market
potential in relation to our long term product focus on life threatening or
debilitating disease where there is an unmet medical need.

The Company is currently evaluating three new external programs of drug
candidates based on carbohydrate and related technology. As a result of this
process, we are seeking to add at least one new compound to our pre-clinical
development program during the next 12 months and may add one compound to our
clinical program during the next 12 to 18 months.

SafeScience Products, Inc.

Historically, SafeScience Products developed agriculture products and developed,
marketed and distributed chemically safe consumer and commercial products.

In the agricultural area, SafeScience Products has developed and/or licensed
products that include a Federal EPA-approved plant defense booster (Elexa) for
application to crops and other plants against certain fungal diseases. An
additional insecticidal product (Bb447) is being tested and developed against
both indoor and outdoor insect pests.

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On February 15, 2001, the Company received notice of unconditional registration
from the United States Environmental Protection Agency's Office of Pesticide
Programs, Biopesticides and Pollution Prevention Division for its Elexa(R)4
Plant Defense Booster. Elexa(R)4 is an effective non-toxic treatment that works
by stimulating the plant's own natural defense system to defend against fungal
diseases, such as powdery mildew and Botrytis, or gray mold, on grapes and
strawberries and powdery mildew on other crops, ornamental plants and flowers.
On June 8, 2001, conditional registration by the State of California's
Department of Pesticide Regulation was received for use as a plant defense
booster for application against various strains of powdery mildew disease on
grapes, strawberries, and greenhouse and nursery roses. In addition to
California, the state with the largest potential market, Elexa has received
registration in 13 other states, including New York. Modest resources, primarily
devoted to conducting field trials and maintaining product value, have been
allocated to our agricultural products business while the Company seeks
alternatives, including its sale.

On February 23, 2001 the Company announced the discontinuation of its consumer
and commercial operations. The Company estimated that the cost of disposing of
the business assets and the expenses incurred during the phase-out period were
$2,283,200. Estimated reductions in the assets and expenses were as follows:

   Accounts receivable                                             $  100,000
   Inventory                                                          555,720
   Barter credits                                                     263,880
   Machinery & equipment                                               41,919
   Leasehold improvements                                               2,978
   Provision for loss on discontinued operations 2000                 785,503
   Change in estimate of loss on discontinued operations 2001         533,200
                                                                   ----------
         Total                                                     $2,283,200
                                                                   ==========

Manufacturing; Source of Materials

     We have established manufacturing relationships with three firms, two of
which are involved in the production of GCS-100 and one that is involved in the
production of Elexa. The Company believes its current relationships will provide
the capability to meet our anticipated requirements for GCS-100 and Elexa for
the foreseeable future. We audit our contract-manufacturing firms for process
suitability, cGMP compliance and for the capacity to scale-up production in the
event that larger quantities of product are needed.

     Materials and components are selectively sourced from suppliers nationally.
We have good working relationships with all our manufacturing associates and
suppliers.

     Nonetheless, the Company does not have long term arrangements with its
manufacturing associates and the Company's operations could be disrupted if the
current manufacturers would have to be replaced.

Government Regulation

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     Certain of our activities are subject to extensive federal and local laws
and regulations controlling the development, testing, manufacture and
distribution of pharmaceutical and pesticide products. The pharmaceutical
products of our IGG subsidiary are subject to regulation as therapeutics by the
FDA, while our agricultural products are regulated under FIFRA (Federal
Insecticide, Fungicide and Rodenticide Act) by the EPA and by state regulatory
agencies. Our products are also regulated in most foreign countries by
governmental agencies in those countries. Compliance with FDA and EPA
regulations often results in substantial costs relating to safety and clinical
testing of new products, for the preparation and filing of registration
documents in their required formats and for other similar purposes. Moreover,
there are no assurances that we will receive necessary approvals.

Food and Drug Administration Regulation

     The FDA approval process consists of four steps that all new drugs,
antibiotics and biologicals must follow. These steps are:

         1.  investigational new drug application
         2.  clinical trials
         3.  new drug application (review and approval)
         4.  post-marketing surveys

     In 1993 the FDA approved new procedures to accelerate the approval of
certain new drugs and biological products directed at serious or
life-threatening illnesses. These new procedures are intended to expedite the
approval process for patients suffering from terminal illness, if the drugs
subject to approval provide a therapeutic advantage over existing treatment. We
believe that GCS-100 may fall under the FDA guidelines for accelerated approval,
since it is targeted as a potential treatment for cancer metastasis and primary
tumors, although there can be no assurance that it will be subject to such
accelerated approval standards.

     Human clinical trials are conducted in three phases, normally involving
progressively larger numbers of patients. Phase I clinical trials are concerned
primarily with learning more about the safety of a drug, by determining the
drug's toxicity. Typically oncology-related Phase I trials involve 20-40
patients, taking one to two years to complete. Phase I has been completed for
GCS-100 up to a dose level of 20 mg/m2. A recently started Phase I dose
escalation study will examine the safety of higher doses in patients.

     Assuming the results of Phase I testing present no unmanageable toxicity or
unacceptable safety problems, Phase II trials may begin. The primary objective
of this stage of clinical testing is to determine whether the drug is effective
in treating the disease or condition for which it is intended. Phase II studies
may take a year or longer and could involve 200 or more patients for each type
of disease or illness tested and could involve several sets of trials (II(a),
II(b), etc.). These studies are randomized controlled trials that also attempt
to disclose short-term side effects and risks in people whose health is
impaired. The cost per patient is estimated at $50,000 to $70,000. Phase II(a)
trials for pancreatic and colorectal cancers have been completed. We plan to

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commence an expanded Phase II pancreatic trial in 2002/2003 and may commence
additional clinical trials in 2003/2004.

         The objective of Phase III clinical trials is to develop information
that will allow the drug to be marketed and used safely. Phase III trials
involve hundreds of patients with the objective of expanding on the research
carried out in Phase II and to learn how the drug compares with existing,
approved drugs for this indication. Among the objectives of Phase III trial are
to discover less common or even rare side effects and adverse reactions, and to
generate information that will be incorporated into the drug's labeling and the
FDA-approved guidelines to physicians and others about how properly to use the
drug.

         The third step that is necessary prior to marketing a new drug is the
New Drug Application (NDA) submission and approval. In this step, all the
information generated by the clinical trials will be submitted to the FDA for
review and, if successful, the drug will be approved for marketing.

         The final step of the FDA approval process is the random surveillance
or surveys of patients being treated with the drug to determine its long-term
effects. This step has no effect on the marketing of the drug unless toxic
conditions arise. The time required to complete all four of these steps averages
seven years, but can take significantly longer. There is no assurance that the
Company will ever receive FDA approval of any of its products.

Environmental Protection Agency Approval

         Under FIFRA, we must obtain EPA approval for our agricultural products
before these products can be sold.

         EPA approval requires submitting a comprehensive data package
describing the product and its active ingredients. The package includes
information on product identity, product chemistry, mammalian toxicology,
non-target animal and plant studies and a clear and well-defined manufacturing
process. Although there is no set registration time schedule, due in part to
EPA's backlog of registration filings and need to be satisfied that all data
requirements are carefully reviewed and have been met, most low risk, exempt
from tolerance, pesticides (like those from GlycoGenesys) typically take from 12
to 24 months for approval. The EPA regulatory process for the first generation
(1%) Elexa PDB was completed and the product was approved for sale in October
1997. Unconditional registration approval from the EPA for the 4% formulation of
Elexa PDB, now referred to as Elexa(R)4 PDB, was received on February 15, 2001.
In addition, the Company has received a conditional registration from the State
of California for Elexa(R)4 PDB and registration in 13 other states, including
Florida and New York. In order to be in compliance with the conditional
registration received in California, the California Department of Pesticide
Regulation has required the Company to supply certain data on the physical
chemistry and storage stability of the product by December 31, 2002.

         The Company has initiated the registration process for its household
insecticide containing an insect-attacking, naturally occurring fungal agent,
referred to as Bb447. Bb447 is the active ingredient in bait stations that can
be used in homes and commercial settings for control of ants. EPA has recently

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notified the Company that registration for indoor ant control should be
approved, subject to the Company revising the label for the EPA.

Competition

         Our products will encounter significant competition from firms
currently engaged in the pharmaceutical, biotechnology, and agrochemical
products industries.

         In the pharmaceutical area, GCS-100, our lead drug candidate for the
treatment of various forms of cancer, addresses large markets which are already
populated with several biotechnology and large pharmaceutical companies. These
companies utilize different drug discovery platforms, including but not limited
to small molecules, protein-based drugs, liposome technology, and genomics. The
drug development industry is intensely competitive, and many of our actual or
potential competitors have significantly greater financial resources and/or drug
development experience than we do. There is no assurance that other
carbohydrate-based or non-carbohydrate-based drugs with similar clinical effects
to GCS-100 may not already be in development by other companies or that other
companies may not successfully develop such drugs in the future.

         The agricultural products under development may compete in several
different markets. Elexa(R)4-PDB and Bb447 would compete in the "high value"
agricultural market, and Bb447 will also compete in the home and commercial
markets. Many competitors have established brand recognition and customer
loyalty and are significantly larger, with much greater financial resources and
well-established chains of distribution, than the Company. It is our goal to
offer an alternative mode of action which can be used in conjunction with many
conventional pesticides in integrated pest management programs.

         CAN-296 was developed pre-clinically as an anti-fungal compound. The
current market has several competing approved drugs.

         Our failure to compete successfully against current or future
competitors could seriously harm our business, financial condition and results
of operation.

Product Liability

         The testing, marketing and sale of pharmaceutical and agricultural
products entails a risk of product liability claims by consumers and others. In
the event of a successful suit against us, payments and damage to our reputation
could have a material adverse effect on our business and financial condition.
Even if such suit is unsuccessful, our reputation could be damaged and
litigation costs and expenditure of management time on such matters could
adversely effect our business and financial condition.

Patent Status and Protection of Proprietary Technology

         On January 26, 2001, the Company executed an agreement, which has been
amended on May 14 and November 7, 2001, with Wayne State University and the
Barbara Ann Karmanos Cancer Institute. This agreement grants the Company an
exclusive world-wide license to patents, patent applications, and other

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intellectual property related to "GCS-100 Material" issued, developed, or
applied for by Wayne State University and the Barbara Ann Karmanos Cancer
Institute. This agreement adds the rights to these issued patents and patent
applications to the Company's existing patent portfolio, which consolidates the
rights to all of the parties' existing GCS-100 intellectual property within the
Company. Pursuant to this agreement, the Company made an initial payment of
$300,000 upon signing the agreement and is required to make up to an additional
$1,635,000 in license payments at the rate of 6% of cash raised through the sale
of securities of the Company. To date the Company has paid license fees of
$1,290,363 and owes license fees of $644,637 to be paid by July 11, 2002.
Additional payments of up to $3,000,000 are contingent upon reaching future
commercialization milestones.

         The Company granted Wayne State University and the Barbara Ann Karmanos
Cancer Institute warrants to jointly purchase 1,375,000 shares of common stock
at $1.15 that vest in quarterly installments over two years. On November 7,
2001, the Company also granted Wayne State University and the Barbara Ann
Karmanos Cancer Institute warrants to jointly purchase 125,000 shares of common
stock at $1.15 that vest through January 26, 2003. During the year ended
December 31, 2001, the Company recorded an expense of $1,046,730 related to the
warrants which vested under this agreement and expense of $1,139,635 in payment
of the 6% amount due on sales of securities.

         In order to maintain its rights under this agreement, the Company must
on the first occurrence of the following milestones: (a) pay Wayne State
University and the Barbara Ann Karmanos Cancer Institute $500,000 within thirty
(30) days following the date on which the Company commences Phase III clinical
drug investigations relating to GCS-100; (b) pay Wayne State University and the
Barbara Ann Karmanos Cancer Institute $1,000,000 within thirty (30) days
following the date on which the Company makes a new drug application ("NDA")
submission to the FDA relating to GCS-100; and (c) pay Wayne State University
and the Barbara Ann Karmanos Cancer Institute $1,500,000 within thirty (30) days
following the date on which the FDA approves an NDA of the Company covering
GCS-100. In addition, the Company will pay a 2% royalty jointly to Wayne State
University and the Barbara Ann Karmanos Cancer Institute on net sales of
GCS-100.

         Dr. David Platt, our former Chairman, CEO and Director, has granted
GlycoGenesys' IGG subsidiary an exclusive, world-wide license, including the
right to sublicense, for all products covered by certain patents, (if and when
granted) or patent applications that he has developed (including GCS-100). IGG
is responsible for payment of all costs connected with obtaining and maintaining
the patents. In the case of GCS-100, Dr. Platt is entitled to a royalty of 2% of
all net sales.

         The Company owns, or is the exclusive licensee of, all of its
intellectual property. This intellectual property includes eight issued US
patents which have expiration dates ranging from 2013 to 2018; three of these
eight patents relate directly to GCS-100. The intellectual property also
includes three foreign patents having expiration dates ranging from 2016 to
2017. Two of these three foreign patents relate directly to GCS-100. The
Company's intellectual property further includes eight pending US patent

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applications, of which six directly relate to GCS-100; and 28 pending foreign
patent applications of which 15 relate directly to GCS-100.

         To the extent that the Company currently relies upon unpatented,
proprietary technology, processes and know-how and the protection of such
intellectual property by confidentiality agreements, there can be no assurance
that others may not independently develop similar technology and know-how or
that confidentiality will not be breached. The Company believes our intellectual
property rights are significant and that the loss of all or a substantial
portion of such rights could have a material adverse effect on our business,
financial condition and results of operation. There is no assurance that any
patents will ever be granted on our unpatented intellectual property.

Uncertainties Associated with Research and Development Activities

         The Company intends to continue its research and development activities
on its human therapeutic products and to a limited extent its agricultural
products, which are not presently ready for market and are in various stages of
development. Research and development activities, by their nature, preclude
definitive statements as to the time required and costs involved in reaching
certain objectives although the costs of these activities will be significant.
If research and development requires more funding than anticipated, the Company
will have to reduce product development efforts or seek additional financing.
There can be no assurance that the Company would be able to secure any necessary
additional financing or that such financing would be available on favorable
terms.

Dependence Upon Key Personnel

         The Company relies greatly in its efforts on the services and expertise
of its current senior officers: Bradley J. Carver, CEO, President, Treasurer and
a member of the Board of Directors; John W. Burns, Senior Vice President, Chief
Financial Officer and Secretary; and Brian G. R. Hughes, Chairman of the Board.
The operation and future success of the Company could be adversely affected in
the event the Company were to lose any of their services.

Employees

         At December 31, 2001 we had approximately 11 employees on a full-time
basis and also employed one part-time worker. As of April 16, 2002 we had 12
full time employees and one part-time worker.

Consultants

         The Company's clinical, regulatory and scientific research team has
grown by recruiting additional people, as consultants, from the biotechnology
industry. Each consultant has many years of experience in specific areas of drug
development.

                                                                              12

<PAGE>

                                     PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

(a) Market Information

     In May 1998, the Company's securities became traded on the NASDAQ (Small
Cap) market under the symbol SAFS. On October 31, 2001 the symbol was changed to
GLGS reflecting the Company's name change to GlycoGenesys, Inc. Prior to May
1998, the Company's securities were traded over-the-counter by the National
Association of Securities Dealers, Inc. under the symbol IGGI. The table shows
the high and low sales prices of Company's common stock during 2000 and 2001:


QUARTER ENDED                                    SALES
                                             High      Low
2000

         March 31                           18.8750  11.0000
         June 30                            13.2500   4.5000
         September 30                        5.5000   1.5000
         December 31                         3.0600   1.0310
2001

         March 31                            1.9380   0.5630
         June 30                             2.0000   0.5500
         September 30                        2.1500   1.0000
         December 31                         2.0300   0.8000

(b) Holders

     As of December 31, 2001, the Company had 496 holders of record of its
common stock. This number does not include those beneficial owners whose
securities are held in street name. The total number of stockholders is
estimated to be approximately 8,000.

(c) Dividends

     The Company has never paid a cash dividend on its common stock and has no
present intention to declare or pay cash dividends on the common stock in the
foreseeable future. The Company intends to retain any earnings which it may
realize in the foreseeable future to finance its operations. Future dividends,
if any, will depend on earnings, financing requirements and other factors.

(d) Sales of Unregistered Securities

     Set forth in chronological order below is information regarding the number
of shares of capital stock issued by the Company during the year ended December
31, 2001. Further included is the consideration, if any, received by the Company
for such shares, and information relating to the section of the Securities Act
or rule of the Securities and Exchange Commission under which exemption from
registration was claimed.

                                                                              13

<PAGE>

1.     During the first quarter of 2001, the Company raised $875,000 in a
       private placement offering of Common Stock to accredited investors
       whereby 775,000 shares were sold, together with warrants to purchase
       77,500 shares of Common Stock each at prices of $2.20, $2.50, $3.00 and
       $5.00 per share exercisable for five years, and warrants to purchase
       90,000 shares at $0.01 per share exercisable for five years.

2.     On February 9, 2001, the Company issued an aggregate of 729,445 shares of
       Common Stock pursuant to the cashless exercise of an adjustable warrant
       to an accredited investor. There were no proceeds from the exercise.

3.     On February 9, 2001, the Company issued an aggregate of 160,000 shares of
       Common Stock pursuant to a license purchase agreement with Delta Omega
       Technologies, Inc. for the purchase of certain cleaning formulas.

4.     On July 10, 2001 Elan International Services, Ltd. ("EIS") purchased
       2,700,000 shares of Common Stock, 1,116.79 shares of Series C Preferred
       Stock convertible into 1,116,790 shares of Common Stock after two years,
       and a five-year warrant to purchase 381,679 shares of Common Stock at an
       exercise price of $2.43 per share for an aggregate purchase price of
       $5,000,000. EIS also acquired 4,944.44 shares of Series A Preferred Stock
       for $12,015,000. The Series A Preferred Stock was used by the Company to
       acquire its equity interest in SafeScience Newco, Ltd. The Series A
       Preferred Stock is convertible into Common Stock after two years at a
       conversion price of $2.43. The Series A Preferred Stock is exchangeable
       at the option of EIS at any time for all of the preferred stock of
       SafeScience Newco, Ltd. held by the Company which, if exchanged, would
       give EIS 50% ownership of the fully-diluted equity interest in
       SafeScience Newco, Ltd.

5.     On August 27, 2001 and October 11, 2001, the Company sold to accredited
       investors an aggregate of 470,370 shares of its Common Stock and warrants
       to purchase 235,186 shares of Common Stock for $635,000. The Company
       received net proceeds of approximately $593,000. The Common Stock was
       sold at a price of $1.35 per share. The warrants have an exercise price
       of $1.90 per share and have a term of 5 years.

6.     In 2001, the Company issued 148,312 shares of Common Stock to various
       consultants in consideration for services.

7.     In 2001, the Company issued 108,209 shares of Common Stock to a former
       employee in settlement of amounts due under an employment contract.

8.     During the fourth quarter of 2001, the Company raised $5,693,300 in a
       private placement offering of Common Stock to accredited investors
       whereby 4,280,362 shares were sold, together with 2,140,186 warrants to
       purchase shares of Common Stock at a weighted average price of $1.91 per
       share exercisable for five years, and warrants to purchase 171,216 shares
       at $0.01 per share exercisable for five years. Net proceeds from the
       offering were $5,402,230. In connection with this offering, the Company
       issued an aggregate of 151,130 shares of Common Stock and

                                                                              14

<PAGE>

       warrants to purchase 192,435 shares of Common Stock to employees and
       affiliates of The Shemano Group, Inc. and Social Capital Partners as
       placement agent fees.

9.     On December 31, 2001, the Company issued 862.70647 shares of Series B
       Preferred Stock to EIS for $1,466,601. Net proceeds of the sale were
       $1,341,224. The Series B Preferred Stock is convertible into Common Stock
       after two years at a conversion price of $1.70, subject to anti-dilution
       adjustments.

No underwriters were used in connection with these sales and issuances. The
sales and issuance of these securities were exempt from registration under the
Securities Act pursuant to Section 4(2) of the Securities Act and the rules and
regulations thereunder (including Rule 506 under Regulation D) on the basis that
the transactions did not involve a public offering. All of the foregoing
securities are deemed restricted securities for the purposes of the Securities
Act.

ITEM 6.   SELECTED FINANCIAL DATA

Selected Consolidated Financial Data

         The selected financial data presented below has been derived from the
financial statements of the Company. The following table summarizes certain
financial information and should be read in conjunction with "Management's
Discussion and Analysis of Results of Operations and Financial Condition" and
the consolidated financial statements and related notes included elsewhere in
this Annual Report on Form 10-K/A. The consolidated statement of operations data
set forth below for the fiscal years ended December 31, 1999 and 2000 and the
consolidated balance sheet data as of December 31, 2000, are derived from the
Company's consolidated financial statements which have been audited by Arthur
Andersen LLP, independent public accountants, for the fiscal years ended
December 31, 1999 and December 31, 2000, and which are included elsewhere in
this Annual Report on Form 10-K/A. The consolidated statement of operations data
set form below for the fiscal year ended December 31, 2001 and the consolidated
balance sheet data as of December 31, 2001 are derived from the Company's
consolidated financial statements which have been audited by Deloitte & Touche
LLP, independent auditors, for the fiscal year ended December 31, 2001 and which
are included elsewhere in this Annual Report on Form 10-K/A. The consolidated
statement of operations data for the years ended December 31, 1997 and 1998 as
well as the consolidated balance sheet data as of December 31, 1999, 1998 and
1997 are derived from the audited consolidated financial statements not included
in this Annual Report on Form 10-K/A. The information shown below may not be
indicative of the Company's future results of operations.

                                                                              15

<PAGE>

<TABLE>
<CAPTION>
                                                         As of December 31,
                                        ------------------------------------------------------------------------------------
                                             1997               1998               1999              2000            2001
                                             ----               ----               ----              ----            ----
<S>                                     <C>                <C>                 <C>              <C>              <C>
Balance Sheet Data:
Cash and cash equivalents               $ 2,594,312        $ 3,439,408       $  3,377,067      $  2,547,353     $  7,977,910
Working capital                           2,180,775          3,095,242          2,574,719         1,768,337        5,635,439
Total assets                              2,906,737          3,968,588          5,493,524         5,779,117        8,956,597
Other equity                                     --                 --                 --           866,216       15,091,827
Stockholders' equity (deficit)            2,443,120          3,500,449          4,521,117         1,845,751       (8,927,246)

<CAPTION>
                                                                          Year Ended December 31,
                                        ------------------------------------------------------------------------------------
Statement of Operations
Data:                                        1997               1998               1999              2000            2001
                                             ----               ----               ----              ----            ----
<S>                                     <C>                <C>                 <C>              <C>              <C>
 Research and development                 2,390,021          2,174,400          3,929,898         6,182,150        4,291,064
 General and administrative               2,428,072          4,420,886          5,837,861         4,093,507        4,045,088
 Restructuring charge (credit)                    -                  -                  -         1,478,956         (177,283)
                                        -----------        -----------       ------------      ------------     ------------
 Operating expenses                      (4,818,093)        (6,595,286)        (9,767,759)      (11,754,613)      (8,158,869)
                                        -----------        -----------       ------------      ------------     ------------
Other expense (income):
  Equity in loss of SafeScience
   Newco, Ltd.                                   --                 --                 --                --      (14,188,470)
 Other expense                                   --               (392)            (8,063)         (243,373)         (33,345)
 Interest income                             83,618            122,173            353,492           216,842          187,721
                                        -----------        -----------       ------------      ------------     ------------
Total other expense (income)                 83,618            122,781            345,429           (26,531)     (14,034,094)
                                        -----------        -----------       ------------      ------------     ------------
Loss from continuing operations          (4,734,475)        (6,473,505)        (9,422,330)      (11,781,144)     (22,192,963)

Loss from discontinued operations                --                 --         (2,879,388)       (5,489,167)        (533,200)
                                        -----------        -----------       ------------      ------------     ------------
Net loss before preferred stock
  dividend                               (4,734,475)        (6,473,505)       (12,301,718)      (17,270,311)     (23,130,436)
Accretion of dividend on
  Preferred stock                                --                 --                 --                --         (404,273)
                                        -----------        -----------       ------------      ------------     ------------
Net loss applicable to
  common stock                          $(4,734,475)       $(6,473,505)      $(12,301,718)     $(17,270,311)    $(23,130,436)
                                        ===========        ===========       ============      ============     ============

Basic and diluted net loss
per common stock from
continuing operations                         (0.43)             (0.50)             (0.59)            (0.64)           (0.82)
Basic and diluted net loss
per common stock from
discontinued operations                          --                 --              (0.18)            (0.30)           (0.02)
                                        -----------        -----------       ------------      ------------     ------------
Basic and diluted net loss
per common stock                              (0.43)             (0.50)             (0.77)            (0.94)           (0.84)
                                        ===========        ===========       ============      ============     ============
Weighted average number
of common shares
outstanding                              11,022,577         13,000,259         16,060,783        18,314,819       27,612,000
                                        ===========        ===========       ============      ============     ============
</TABLE>

                                                                              16

<PAGE>

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND
        FINANCIAL CONDITION

     The following discussion should be read in conjunction with the
consolidated financial statements and notes thereto appearing elsewhere in this
report.

Critical Accounting Policies

     In December 2001, the SEC requested that reporting companies discuss their
most "critical accounting policies" in management's discussion and analysis of
financial condition and results of operations. The SEC indicated that a
"critical accounting policy" is one that is important to the portrayal of a
company's financial condition and operating results and requires management's
most difficult, subjective or complex judgments, often as a result of the need
to make estimates about the effect of matters that are inherently uncertain.

     We have identified the policies below as critical to our business
operations and the understanding of our results of operations. The impact and
any associated risks related to these policies on our business operations is
discussed throughout Management's Discussion and Analysis of Financial Condition
and Results of Operations where such policies affect our reported and expected
financial results. For a detailed discussion on the application of these and
other accounting policies, see Note 2 in the Notes to the Consolidated Financial
Statements of this Annual Report on Form 10-K/A. The Company's preparation of
this Annual Report on Form 10-K/A requires it to make estimates and assumptions
that affect the reported amount of assets and liabilities, disclosure of
contingent assets and liabilities at the date of its financial statements, and
assurance that actual results will not differ from those estimates.

     In July 2001, the Securities and Exchange Commission issued a SEC Staff
Announcement which was codified as EITF Topic No. D-98, "Classification and
Measurement of Redeemable Securities". Topic No. D-98 provides additional
guidance for determining when an equity security is redeemable at the option of
the holder or upon the occurrence of an event that is solely within the control
of the issuer. Topic No. D-98 was to be applied retroactively in the first
fiscal quarter ending after December 15, 2001 by restating the financial
statements of prior periods.

     During the fiscal quarter ended December 31, 2001, we adopted Topic No.
D-98. At that time, our Series A, B and C Preferred shares contained provisions
for redemption in cash in the event that a change in control of the Company were
to occur without prior approval by our Board of Directors. We have negotiated
with the holders of these shares to amend those provisions by requiring the
event to be subject to approval of our Board of Directors. The Company believes
that the amended provisions will permit the Company to restore the full value to
stockholders' equity in the second quarter of fiscal 2002.

Severance and Termination Benefits

                                                                              17

<PAGE>

     In connection with the restructuring plan adopted in the second quarter of
2000, the Company accrued severance and other employee-related exit costs of
approximately $1.75 million. This restructuring resulted in the termination of 8
employees, including six sales and marketing, one general and administrative,
and one research and development positions.

     In accordance with EITF 94-3 "Liability Recognition for Certain Employee
Termination Benefits and Other Costs to Exit an Activity", the Company
established a liability for severance and other related costs associated with
involuntary termination of employees. The affected employees were notified of
their terminations and their severance benefits before the end of the second
quarter of 2000. All such employees were terminated by July 10, 2000.

Discontinued Operations

     On November 15, 2000, the Company engaged a merchant bank to explore
alternatives including sale or other disposition of the Company's consumer,
commercial and agriculture business areas. The Company terminated operations of
the consumer and commercial product business areas on February 23, 2001 and
began the process of liquidating all assets and liabilities pertaining to those
operations.

     Accordingly, the Company has treated its consumer and commercial products
operations as a discontinued operation in accordance with APB Opinion No. 30 and
has reclassified the 1999 financial statements to reflect this treatment. For
the year ended December 31, 2000, the Company recorded a reserve in the amount
of $1,750,000 which includes approximately $983,000 to reduce the carrying value
of assets to their estimated liquidation value and a liability of approximately
$767,000 to accrue for the cost of closing the operations.

     The net losses of these operations prior to March 31, 2001 are included in
the statements of operations under discontinued operations. Revenues from such
operations were $1,368,514 and $1,354,898 for the years ended December 31, 1999
and 2000, respectively. There were no revenues from these operations in 2001 or
prior to 1999.

                                                    Years Ended December 31,
                                                     2001            2000
                                                     ----            ----
Revenues                                                  --     $ 1,354,898
Cost of goods sold                                 $ 186,629       1,229,508
                                                   ---------     -----------
Gross margin                                        (186,629)        125,390
                                                   ---------     -----------
Marketing                                                 --       3,566,900
General and administrative                           346,571              --
Research and development                                  --         297,657
                                                   ---------     -----------
Total expenses                                       346,571       3,864,557
                                                   ---------     -----------
Operating loss                                      (533,200)     (3,739,167)
                                                   ---------     -----------
Provision                                                 --      (1,750,000)
                                                   ---------     -----------
Loss on discontinued operations                    $(533,200)    $(5,489,167)
                                                   =========     ===========

                                                                              18


<PAGE>

     The loss on discontinued operations reflected in the statements of
operations includes all the income statement accounts, write-down of the assets
to estimated net realizable values associated with the consumer products and
commercial products business and the estimated costs of discontinuing these
operations. For the year ended December 31, 2001, the Company recorded
additional expenses totaling $533,200 related to discontinued operations,
$186,629 of which related to an additional loss on disposal of assets and
$346,571 of which related to an accrual for additional rent expense for space
that the Company was unable to sublet.

Results of Operations: Year Ended December 31, 2001 versus Year Ended December
31, 2000

     We had a net loss attributable to common stockholders of $23,130,436 for
the twelve months ended December 31, 2001 versus a net loss of $17,270,311 for
the twelve months ended December 31, 2000. The net loss for the twelve months
ended December 31, 2001 included $14,188,470 for an adjustment for loss in
equity of SafeScience Newco, and $404,273 for dividends accreted on our Series A
convertible exchangeable preferred stock.

     Our total research and development expenses for the fiscal year ended
December 31, 2001 are the sum of expenses reported in two lines in the
Consolidated Statements of Operations: (1) Research and Development ("R&D"), and
(2) Equity in loss of SafeScience Newco, Ltd.

     Expenses related to the development of GCS-100 incurred during the first
half of fiscal 2001 were $2,726,632, which were charged to R&D expenses. In July
2001, GlycoGenesys, Inc. transferred its rights to GCS-100 in the field of
oncology to SafeScience Newco, Ltd. ("SafeScience Newco"). Costs related to
GCS-100 incurred after the transfer to SafeScience Newco are on behalf of
SafeScience Newco. Amounts for expenses incurred and work performed by
GlycoGenesys, Inc. on behalf of SafeScience Newco for GCS-100 are billed to
SafeScience Newco and netted against R&D expenses. Subsequent to our investment
in SafeScience Newco our expenses associated with development of GCS-100 flow
through "Equity in loss of SafeScience Newco." For the last six months of fiscal
2001 our equity in loss of SafeScience Newco was $14,188,470, of which
$12,015,000 was recorded as a research and development expense for our share of
the cost of the license granted to SafeScience Newco by Elan International
Services, Ltd., $2,103,615 in research and development charges incurred by the
Company billed to the joint venture, $130,000 of our allowable overhead charges
and the balance representing our portion of other SafeScience Newco expenses,
respectively.

     Total research and development expenses for the fiscal year ended December
31, 2001 were thus $6,394,679, the sum of the $4,291,064 recorded in R&D and
$2,103,615, our portion of the Equity in Loss of SafeScience Newco, Ltd.
attributable to our research and development expenses in connection with the
development of GCS-100 in the field of oncology. These amounts exclude the
$12,015,000 discussed in the preceding paragraph.

     Total research and development expenses thus increased $212,529, or 3.4%,
to $6,394,679 for the twelve months ended December 31, 2001 from

                                                                              19

<PAGE>

$6,182,150 for the twelve months ended December 31, 2000.

     We incurred research and development expenses of $1,140,000 related to
license fees paid to Wayne State University and non-cash research and
development expenses of $1,046,730 in connection with warrants issued to Wayne
State University to purchase common stock which vested during the year. Cost of
managing our clinical trials decreased from $2,097,000 to $1,675,000, or 20.1%,
during the year ended December 31, 2001 compared to 2000, primarily due to
completion of the field work on both the colorectal and pancreatic trials.
Sponsored research increased from $104,000 to $266,500, or 156%, during the year
ended December 31, 2001 compared to 2000 primarily due to our new relationship
with MIT.

     Research and development expenses for Elexa-4 and Bb-447, our agricultural
compounds, decreased from $1,578,000 for the twelve months ended December 31,
2000 to $315,000 for the twelve months ended December 31, 2001 and consisted
primarily of wages, consulting and license fees. The decrease reflects the
Company's de-emphasis of its agricultural products. We have engaged an
investment advisor to assist in the sale or other disposition of this registered
product. We expect future expenditures to be limited to a level similar to last
year.

     The Company is actively seeking to expand its product pipeline under
development. These new product candidates will either be developed jointly or
licensed by the Company. The cost related to the development of new product
candidates is projected to be in the range of $500,000-$1,000,000 during the
twelve months ended December 31, 2002 although it could be higher.

     General and administrative expenses decreased to $4,045,088 for the year
ended December 31, 2001 from $4,093,507 for the year ended December 31, 2000, a
decrease of $48,419, or 1.2%. This decrease was principally attributable to
reductions in outside consulting of $233,000, public relations of $220,000,
office expenses in the aggregate of approximately $200,000, expenses of $130,000
charged to SafeScience Newco flowing through our Equity in loss of SafeScience
Newco, travel expense of $123,000, rent expense related to the reclassification
in 2001 of approximately $57,600 to discontinued operations for space which is
deemed to be surplus offset by expenses previously charged as overhead to
operations now discontinued of $417,000, an increase in legal expense of
$249,000, or 42%, from $592,000 to $841,000 due primarily to professional fees
associated with the negotiation of the Elan transactions and non-cash
compensation for stock options granted to employees of $204,000.

     Interest income decreased to $187,721 for the year ended December 31, 2001
from $216,842 for the year ended December 31, 2000, a decrease of $29,121, or
13%. This decrease was attributable to a reduction in cash available for
investment and lower rates of return on those investments.

Results of Operations: Year Ended December 31, 2000 versus Year Ended December
31, 1999

     On November 15, 2000, The Board of Directors authorized the sale or other
disposition of the Company's consumer and commercial products business. The
Company discontinued operations on February 23, 2001 and began the process

                                                                              20

<PAGE>

of liquidating all assets pertaining to those operations. The net losses of
these operations prior to March 31, 2001 are included in the statements of
operations under discontinued operations.

                                            Years Ended December 31,
                                         2000                       1999
                                         ----                       ----
Revenues                             $ 1,354,898                $  1,368,514
Cost of goods sold                     1,229,508                   1,410,732
                                     -----------                ------------
Gross margin                             125,390                     (42,218)
                                     -----------                ------------
Marketing                              3,566,900                   2,818,050
Research and development                 297,657                      19,120
                                     -----------                ------------
Total expenses                         3,864,557                   2,837,170
                                     -----------                ------------
Operating loss                        (3,739,167)                 (2,879,388)
                                     -----------                ------------
Provision                             (1,750,000)                         --
                                     -----------                ------------
Loss on discontinued operations      $(5,489,167)               $ (2,879,388)
                                     ===========                ============

            The loss on discontinued operations reflected in the statement of
operations includes all the income statement accounts, write-down of the assets
to estimated net realizable values associated with the consumer products and
commercial products business and the estimated costs of discontinuing these
operations.

            Research and development expenses increased to $6,182,150 for the
year ended December 31, 2000 from $3,929,898 for the year ended December 31,
1999, an increase of $2,252,252, or 57.3%. This increase was principally
attributable to the Company's ongoing clinical trials of GCS-100, its lead
pharmaceutical compound and increased salaries and consulting expense on
agriculture product development. Included in research and development costs in
1999 are $197,143 of non-cash compensation resulting from the issuance of stock
grants, and stock options and warrants to purchase common stock.

            General and administrative expenses decreased to $4,093,057 for the
year ended December 31, 2000 from $5,837,861 for the year ended December 31,
1999, a decrease of $1,744,804, or 29.9%. This decrease was principally
attributable to a reduction in consulting expense and officers' compensation
partially offset by increases in other salaries and rent. Non-cash compensation
to various consultants and advisors of $577,383 in 2000 and $2,367,871 in 1999
resulted from the issuance of stock grants, stock options and warrants to
purchase common stock.

            During the second quarter of 2000, the Company began a restructuring
of operations including the replacement of its Chief Executive Officer. In
connection with this severance and other employee reductions, the Company
recorded a charge in the amount of $1,478,000 to cover the estimated costs of
terminating an existing employment agreement and other severance costs. (See
Note 3 to the consolidated financial statements included in the Annual Report on
Form 10-K)

                                                                             21

<PAGE>

            Interest income decreased to $216,842 for the year ended December
31, 2000 from $353,492 for the year ended December 31, 1999, a decrease of
$136,650, or 38.7%. This decrease was attributable to a reduction in cash
available for investment.

Liquidity and Capital Resources

            Since inception, the Company has funded its operations primarily
with the proceeds from equity securities totaling approximately $52,900,000. For
the year ended December 31, 2001, the Company's operations utilized cash of
approximately $7,939,000, primarily to fund the operating loss. This use of cash
was offset by equity financings that resulted in net proceeds of approximately
$13,068,000 to the Company. In 2000, the Company's operations utilized cash of
approximately $13,287,000 which was offset by equity financings that resulted in
net proceeds of approximately $12,851,000.

            Capital expenditures for the year ended December 31, 2001 were as
follows:

              Computer and office equipment          $16,733
                                                     =======

            The Company has no significant commitments for the purchase of
equipment, product manufacturing facilities or marketing efforts at present. The
Company leases office facilities under an operating lease that ends in March
2005. Rent expense for this space will be approximately $384,000 in 2002. The
Company anticipates that will be adequate for its space requirements for the
foreseeable future.

            The Company has retained Beardsworth Consulting Group, a
full-service contract research organization, to support two projects: A Phase I
dose escalation trial, and database transfer/management for the recently
completed Phase II(a) trials. They will provide clinical research management,
study monitoring, data management and medical writing. The costs for both
efforts will be approximately $1,128,000 and be paid out over the next 9-12
months. In addition, costs associated with the Phase I dose escalation trial
currently being conducted at Sharp Clinical Oncology Research Memorial Hospital
will be approximately $545,000 paid over the next 9-12 months. The Company
expects to incur substantial additional operating costs, including costs related
to ongoing and planned research and development activities and preclinical
studies.

            As of December 31, 2001, the Company's cash balances were
$7,978,000, as compared to $2,547,000 as of December 31, 2000. The Company has a
$100,000 stand-by secured line of credit with a bank which has no outstanding
balance and a secured letter of credit in the amount of $100,000 which is held
as security for deposits required by its lease of office space. The Company has
no other commercial financing sources at present but may seek such sources in
the future. It is not known whether additional funds could be borrowed from
stockholders or other sources.

            As of April 16, 2002, the Company's cash and cash equivalents was
approximately $ 9,703,000.

                                                                             22

<PAGE>

            The Company believes that its existing funds will be sufficient to
fund its operating expenses and capital requirements into the first quarter of
2003. The Company intends to raise additional debt and/or equity financing. As
of April 16, 2002, SafeScience Newco, Ltd. may receive up to approximately $10
million of additional funds of which approximately $8.1 million could be funded
by the Company through the issuance to Elan International Services, Ltd. ("EIS")
of Series B Preferred Stock and approximately $1.9 million of which would be
funded directly by EIS for the development of GCS-100 pursuant to our agreement
with EIS. However, we will not receive additional capital from EIS unless we
agree with EIS on a quarterly basis on the business plan for SafeScience Newco,
Ltd. The Company's future is dependent upon its ability to obtain financing to
fund its operations.

Item 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURE AND MARKET RISK

Market Risk

            The Company is exposed to market risk related to changes in interest
rates as well as changes in currency exchange rates as measured against the U.S.
dollar and each other which could positively or negatively affect results of
operations and retained earnings. As of December 31, 2001, the Company has
evaluated its risk and determined that any exposure to currency exchange is not
significant to the Company's overall consolidated financial results. There can
be no assurance that the Company's exposure will remain at these levels,
especially in the event of significant and sudden fluctuations in the value of
local currencies. The Company does not use derivative financial instruments for
speculative or trading purposes.

Interest Rate Sensitivity

            The Company maintains short-term investments in an overnight money
market account comprised of U.S. treasury bills. If market interest rates were
to increase immediately and uniformly by 10% from levels that existed at
December 31, 2001, the fair value of the portfolio would increase by an
immaterial amount.

Certain Factors That May Affect Future Results

You should carefully consider the risks described below before making an
investment decision. If any of the following risks actually occur, our business,
financial condition or results of operations could be materially and adversely
affected. In such case, the trading price of our common stock could decline, and
you may lose all or part of your investment.

WE HAVE EXPERIENCED SIGNIFICANT LOSSES THROUGHOUT OUR HISTORY, WE EXPECT THESE
LOSSES TO CONTINUE AND WE MAY NOT ACHIEVE PROFITABILITY IN THE FUTURE.

            We began operations more than nine years ago and began to generate
revenue only in the second quarter of 1999. Through December 31, 2000 we only
generated $2,723,000 from product sales. On February 23, 2001, we announced the
discontinuation of our consumer and commercial product business from which all
of our revenues to date have been generated. We do not expect to generate

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product revenue for several years, if at all. We will not generate funds on an
ongoing basis unless we are able to sell our consumer and commercial and/or
agricultural business areas, or generate revenues through the receipt of
payments in connection with any potential licensing, marketing or other
partnering arrangement with other pharmaceutical or biotechnology companies, or
bringing to market pharmaceutical or agricultural products. We have incurred an
estimated $66.7 million of losses since our inception, including $23.1 million
for the year ended December 31, 2001. Extensive losses can be expected to
continue for the foreseeable future.

OUR PRODUCTS ARE STILL IN DEVELOPMENT, THERE ARE UNCERTAINTIES ASSOCIATED WITH
RESEARCH AND DEVELOPMENT ACTIVITIES AND WE MAY BE UNABLE TO BRING THESE PRODUCTS
TO MARKET.

            Our proposed products require further research, development,
laboratory testing, regulatory approval and/or demonstration of commercial scale
manufacturing before they can be proven to be commercially viable. The products
are in the development stage and are subject to the risks inherent in the
development of new products. Potential products that appear to be promising at
early stages of development may not reach the market for a number of reasons.
Such reasons include the possibilities that potential products are found during
testing to be ineffective, or unsafe, that they fail to receive necessary
regulatory approvals, are difficult or uneconomical to manufacture on a large
scale, fail to achieve market acceptance or are precluded from commercialization
by proprietary rights of third parties. We cannot predict with any degree of
certainty when, or if, the research, development, testing and/or regulatory
approval process for our proposed products will be completed. Our product
development efforts may be unsuccessful, required regulatory approvals from U.S.
or foreign authorities may not be obtained, and products, if introduced, may not
be capable of being produced in commercial quantities at reasonable costs or be
successfully marketed. The failure of our research and development activities to
result in any commercially viable products or technologies would materially
adversely affect our future prospects.

WE MAY NOT BE ABLE TO OBTAIN ADDITIONAL FUNDING, WHICH COULD REDUCE OUR ABILITY
TO FUND, EXPAND OR CONTINUE OPERATIONS.

            The Company believes that its existing funds will be sufficient to
fund its operating expenses and capital requirements into the first quarter of
2003. The Company intends to raise additional debt and/or equity financing. As
of April 16, 2002, SafeScience Newco, Ltd. may receive up to approximately $10
million of additional funds of which approximately $8.1 million could be funded
by the Company through the issuance to EIS of Series B Preferred Stock and
approximately $1.9 million of which would be funded directly by EIS for the
development of GCS-100 pursuant to our agreement with EIS. However, we and EIS
must agree on a quarterly basis on the business plan for SafeScience Newco, Ltd.
in order to receive additional capital from EIS. The Company's future is
dependent upon its ability to obtain additional financing to fund its
operations. The Company expects to incur substantial additional operating costs,
including costs related to ongoing research and development activities,
preclinical studies and clinical trials. We may also seek funds in conjunction
with the in-licensing of additional biopharmaceutical products where we acquire
in licenses and development funds for our securities. Additional equity

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financing may result in dilution to our shareholders. If the market price of our
common stock declines, some potential investors may either refuse to offer us
any financing or will offer additional financing at unacceptable rates or
unfavorable terms. If we are unable to obtain financing necessary to fund our
operations, we may have to sell or liquidate GlycoGenesys.

OUR FAILURE TO PROTECT OUR INTELLECTUAL PROPERTY OR OUR INFRINGEMENT ON THE
PROPERTY RIGHTS OF OTHERS MAY IMPEDE OUR ABILITY TO OPERATE FREELY.

     We rely significantly upon proprietary technology and protect our
intellectual property through patents, copyrights, trademarks and contractual
agreements as appropriate. The Company owns, or is the exclusive licensee of,
all of its intellectual property. This intellectual property includes eight
issued US patents which have expiration dates ranging from 2013 to 2018; three
of these eight patents relate directly to GCS-100. The intellectual property
also includes three foreign patents having expiration dates ranging from 2016 to
2017. Two of these three foreign patents relate directly to GCS-100. The
Company's intellectual property further includes eight pending US patent
applications, of which six directly relate to GCS-100; and 28 pending foreign
patent applications of which 15 relate directly to GCS-100. We continually
evaluate our technology to determine whether to make further patent filings.

     To the extent aspects of our technology may be unpatentable or we determine
to maintain such technology as trade secrets, we protect such unpatented
technology by contractual agreements. Our unpatented technology or similar
technology could be independently developed by others. In addition, the
contractual agreements by which we protect our unpatented technology and trade
secrets may be breached. If our technology is independently developed or our
contractual agreements are breached, our technology will be less valuable and
our business will be harmed.

     There is always a risk that issued patents may be subsequently invalidated,
either in whole or in part, and this could diminish or extinguish our patent
protection for key elements of our technology. We are not involved in any
litigation or proceedings, nor are we aware of any basis for such litigation or
proceedings which would diminish or extinguish our patent protection. We cannot
be certain as to the scope of patent protection, if any, which may be granted on
our patent applications.

     Our potential products or business activities could be determined to
infringe intellectual rights of third parties despite our issued patents. Any
claims against us or any purchaser or user of our potential products, including
GCS-100, asserting that such product or process infringes intellectual property
rights of third parties, if determined adversely to us could have a material
effect on our business, financial condition or future operations. Any asserted
claims of infringement, with or without merit, could be time consuming, result
in costly litigation, divert the efforts of our technical and management
personnel, or require us to enter into royalty or licensing agreements, any of
which could materially adversely affect our operating results. Such royalty or
licensing agreements, if required, may not be available on terms acceptable to
us, if at all. In the event a claim is successful against us and we cannot
obtain a license to the relevant technology on acceptable terms, license a
substitute technology or redesign our products to avoid infringement, our

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business, financial condition and operating results would be materially
adversely affected.

WE DEPEND ON TECHNOLOGY LICENSED TO US BY THIRD PARTIES AND IF WE ARE UNABLE TO
CONTINUE LICENSING THIS TECHNOLOGY OUR FUTURE PROSPECTS MAY BE MATERIALLY
ADVERSELY AFFECTED.

     We license our technology, including GCS-100, from third parties. We
anticipate that we will continue to license technology from third parties in the
future. To maintain our license with Wayne State University and the Karmanos
Cancer Institute we must, among other things, pay Wayne State University and the
Karmanos Cancer Institute four monthly payments of approximately $76,000 through
July 2002 plus an additional $339,000 on May 14, 2002, pay 2% royalties on
product sales and up to $3 million in milestone payments and receive FDA or
equivalent agency approval to sell GCS-100 by January 1, 2006. To maintain our
license with Dr. Platt we must pay an annual license fee equal to the greater of
$50,000 or 2% of product sales starting this year. To maintain our joint
venture's license with Elan for its oral drug delivery technology we do not have
material obligations other than royalty payments, if any, which shall be
determined by SafeScience Newco prior to commercialization of GCS-100.

     The technology we license from third parties would be difficult to replace.
The loss of any of these technology licenses would result in delays in the
availability of our products until equivalent technology, if available, is
identified, licensed and integrated and could materially adversely affect our
future prospects. The use of replacement technology from other third parties
would require us to enter into license agreements with these third parties,
which could result in higher royalty payments and a loss of product
differentiation.

WE EXPECT TO REMAIN DEPENDENT ON THIRD PARTIES FOR RESEARCH AND DEVELOPMENT
ACTIVITIES NECESSARY TO COMMERCIALIZE OUR PRODUCTS.

     We do not maintain our own laboratories and employ five scientific
personnel. We contract out research and development operations, utilizing third
party contract manufacturers to supply clinical grade material and third party
contract research organizations, to perform pre-clinical and/or clinical studies
in accordance with our designed protocols, as well as sponsoring research at
medical and academic centers, such as MIT. In addition, we employ several
consultants to oversee various aspects of our protocol design, clinical trial
oversight and other research and development functions.

     Because we rely on third parties for much of our research and development
work, we have less direct control over our research and development. We face
risks that these third parties may not be appropriately responsive to our
timeframes and development needs.

OUR FUTURE PROSPECTS ARE HEAVILY DEPENDENT ON THE RESULTS OF GCS-100.

     While we have more than one product in development, we do not have a wide
array of products which we are developing. Most of our attention and resources
are directed to the development of GCS-100. If GCS-100 is ultimately

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ineffective in treating cancer, does not receive the necessary regulatory
approvals or does not obtain commercial acceptance, GlycoGenesys will be
materially adversely affected.

THE DEVELOPMENT OF GCS-100 IS NOT IN OUR EXCLUSIVE CONTROL AND IS JOINTLY
DETERMINED WITH ELAN AND EIS.

     We are developing GCS-100 through collaboration with Elan and EIS.
SafeScience Newco, Ltd. is a company that we formed and jointly own with EIS to
develop GCS-100 in the field of oncology. We own 80.1% and EIS owns 19.9% of
SafeScience Newco, Ltd. on a fully-diluted basis. Despite our majority ownership
of SafeScience Newco, Ltd., we do not fully control the development activities
regarding GCS-100, because we need consent of EIS for material development
decisions regarding GCS-100. As a result, development of GCS-100 will depend on
our ability to negotiate development issues with EIS.

OUR ECONOMIC INTEREST IN GCS-100 WILL BE REDUCED IF EIS EXERCISES ITS RIGHTS TO
ACQUIRE A 50% INTEREST IN SAFESCIENCE NEWCO, LTD.

     EIS has the right to exchange our Series A convertible exchangeable
preferred stock it owns for all of the convertible preferred securities we own
of SafeScience Newco, Ltd. at any time until July 10, 2007, which would give EIS
a 50% ownership interest in SafeScience Newco, Ltd. If EIS exercises this right,
our fully-diluted ownership in SafeScience Newco, Ltd. will be reduced to 50%
from its current 80.1%, which would reduce our economic interest in GCS-100.

IF OUR AGRICULTURE PRODUCTS ARE NOT ACCEPTED BY THE AGRICULTURAL COMMUNITY OUR
BUSINESS WILL SUFFER.

     Our focus is primarily pharmaceuticals and to a lesser extent agricultural
products. Although we currently do not market any products, commercial sales of
our proposed agricultural products will substantially depend upon the products'
efficacy and on their acceptance by the agricultural community. For example,
Elexa works by a different mode of action than current fungicides because it
increases a plant's natural resistance to disease instead of killing the fungus
directly. Widespread acceptance of Elexa in the agricultural field will require
educating the agricultural community as to the benefits and reliability of
Elexa. Our proposed products, Elexa 4 and Bb447, may not be accepted, and, even
if accepted, we are unable to estimate the length of time it would take to gain
such acceptance.

IF THE THIRD PARTIES WE RELY ON FOR MANUFACTURING OUR PRODUCTS ARE UNABLE TO
PRODUCE THE NECESSARY AMOUNTS OF OUR PRODUCTS, DO NOT MEET OUR QUALITY NEEDS OR
TERMINATE THEIR RELATIONSHIPS WITH US, OUR BUSINESS WILL SUFFER.

     We do not presently have our own manufacturing operations, nor do we intend
to establish any unless and until in the opinion of our management, the size and
scope of our business so warrants. While we have established manufacturing
relationships with two contract manufacturing firms involved in the production
of GCS-100 and one contract manufacturing firm involved in the production of
Elexa that we believe will provide the capability to meet our anticipated
requirements for the foreseeable future, we have not entered into

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any long-term arrangements for manufacturing and such arrangements may not be
obtained on desirable terms. Therefore, for the foreseeable future, we will be
dependent upon third parties to manufacture our products.

     Our reliance on independent manufacturers involves a number of risks,
including the absence of adequate capacity, the unavailability of, or
interruptions in, access to necessary manufacturing processes and reduced
control over delivery schedules. If our manufacturers are unable or unwilling to
continue manufacturing our products in required volumes, we will have to
identify acceptable alternative manufacturers. The use of a new manufacturer may
cause significant interruptions in supply if the new manufacturer has difficulty
manufacturing products to our specifications. Further, the introduction of a new
manufacturer may increase the variation in the quality of our products.

MANY OF OUR COMPETITORS HAVE SUBSTANTIALLY GREATER RESOURCES THAN WE DO AND MAY
BE ABLE TO DEVELOP AND COMMERCIALIZE PRODUCTS THAT MAKE OUR POTENTIAL PRODUCTS
AND TECHNOLOGIES OBSOLETE OR NON-COMPETITIVE.

     A biotechnology company such as ours must keep pace with rapid
technological change and faces intense competition. We compete with
biotechnology and pharmaceutical companies for funding, access to new
technology, research personnel and in product research and development. Many of
these companies have greater financial resources and more experience than we do
in developing drugs, obtaining regulatory approvals, manufacturing and
marketing. We also face competition from academic and research institutions and
government agencies pursuing alternatives to our products and technologies. We
expect that our products under development, including GCS-100, will face intense
competition from existing or future drugs. In addition, our product candidates
may face increasing competition from generic formulations or existing drugs
whose active components are no longer covered by patents.

     According to industry surveys there are approximately 402 new drug
candidates in development to treat various types of cancer. This research is
being conducted by 170 pharmaceutical and biotechnology companies and the
National Cancer Institute (NCI). We have conducted two Phase I clinical trials,
the first enrolled late stage patients with differing types of cancer and the
second enrolled patients with late stage prostate cancer. We also conducted and
completed two Phase II(a) clinical trials, one in patients with refractory or
relapsing pancreatic cancer and the other in refractory or relapsing colorectal
cancer. Published surveys indicate that, including GCS-100, approximately
twenty-six drugs are in various stages of clinical trial development for
pancreatic cancer and fifty five drugs in various stages of clinical trial
development for colorectal cancer. Our current clinical trial plan is to pursue
pancreatic cancer as a lead indication and we are planning to conduct a Phase
II/III pivotal trial in 2003/2004.

     There are approximately ten drugs currently having completed or in Phase
III clinical trial development, ten drugs in Phase II and six drugs in Phase I
for pancreatic cancer. Competitors may receive approval before us for competing
pancreatic cancer drugs, including without limitation the following drugs which
have completed Phase III trials: Imclone and Bristol Meyer's Erbitux;
Pharmacia's Camptosar; Snaofi-Synthelabo's tirapazamine; Aphton and Aventis

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Pasteur's anti-gastrin therapeutic vaccine; Genentech's Herceptin (already
approved for breast cancer); MGI Pharma's Irofulven; Supergens' Mitoextra and
rubiteacan, Janssen Pharmaceuticals' R115777 and Lorus Therapeutics' Virulizin.
In addition, GCS-100, if it receives FDA approval, will face competition from
existing cancer drugs approved for pancreatic cancer. These drugs are
flourouacil (5- FU) and Eli Lilly's gemcitabine (Gemzar). Combination studies
utilizing new drug candidates and Gemzar are ongoing and combination therapies
of new drug candidates and Gemzar may present future competition.

Our competitors may:

 .   successfully identify drug candidates or develop products earlier than we
     do;
 .   obtain approvals from the FDA or foreign regulatory bodies more rapidly
     than we do;
 .   develop products that are more effective, have fewer side effects or cost
     less than our products; or
 .   successfully market products that may compete with our products candidates.

     The success of our competitors in any of these efforts would adversely
affect our ability to develop, commercialize and market our product candidates.

OUR BUSINESSES ARE SUBJECT TO SIGNIFICANT GOVERNMENT REGULATION AND FAILURE TO
ACHIEVE REGULATORY APPROVAL OF OUR PRODUCTS WOULD SEVERELY HARM OUR BUSINESS.

     The FDA regulates the manufacture, distribution and promotion of
pharmaceutical products in the United States pursuant to the Federal Food Drug
and Cosmetic Act and related regulations. We must receive premarket approval by
the FDA for any commercial sale of our pharmaceutical products. Before receiving
such approval we must provide proof in human clinical trials of the nontoxicity,
safety and efficacy of our pharmaceutical products, which trials can take
several years. Premarket approval is a lengthy and expensive process. We may not
be able to obtain FDA approval for any commercial sale of our product. By
regulation, the FDA has 180 days to review an application for approval to market
a pharmaceutical product; however, the FDA frequently exceeds the 180-day time
period. In addition, based on its review, the FDA may determine that additional
clinical trials are required. Except for any potential licensing or marketing
arrangements with other pharmaceutical or biotechnology companies, we will not
generate any revenues in connection with our pharmaceutical products unless and
until we obtain FDA approval to sell our products in commercial quantities for
human application.

     The investigation, manufacture and sale of agricultural products are
subject to regulation by the EPA, including the need for approval before
marketing, and by comparable foreign and state agencies. Our agricultural
products will be able to be commercially marketed for use either in the United
States or other countries only by first obtaining the necessary approvals. While
we hope to obtain regulatory approvals for our proposed products, we may not
obtain these approvals on a timely basis, if at all. We have received approval
from the EPA, California and 13 other states for Elexa 4%.

                                                                              29

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REIMBURSEMENT PROCEDURES AND FUTURE HEALTHCARE REFORM MEASURES ARE UNCERTAIN AND
MAY ADVERSELY IMPACT OUR ABILITY TO SUCCESSFULLY SELL ANY PHARMACEUTICAL
PRODUCT.

     Our ability to successfully sell any pharmaceutical product will depend in
part on the extent to which government health administration authorities,
private health insurers and other organizations will reimburse patients for the
costs of our future pharmaceutical products and related treatments. In the
United States, government and other third-party payers have sought to contain
healthcare costs by limiting both coverage and the level of reimbursement for
new pharmaceutical products approved for marketing by the FDA. In some cases,
these payers may refuse to provide any coverage for uses of approved products to
treat medical conditions even though the FDA has granted marketing approval.
Healthcare reform may increase these cost containment efforts. We believe that
managed care organizations may seek to restrict the use of new products, delay
authorization to use new products or limit coverage and the level of
reimbursement for new products. Internationally, where national healthcare
systems are prevalent, little if any funding may be available for new products,
and cost containment and cost reduction efforts can be more pronounced than in
the United States.

OUR GROWTH MAY BE LIMITED IF WE ARE UNABLE TO RETAIN AND HIRE ADDITIONAL
QUALIFIED PERSONNEL AS NECESSARY.

     Our success will depend on our ability to retain key employees and our
continuing ability to attract and retain highly qualified scientific, technical
and managerial personnel. We may hire additional clinical operations personnel
in the future. Competition for such personnel is intense and we may not be able
to retain existing personnel or attract qualified employees in the future. Our
limited drug pipeline and small size make it more difficult to compete for such
personnel against larger, more diversified companies. At present, we employ
approximately 12 full time employees and one part-time worker. We depend upon
the personal efforts and abilities of our officers and directors, including
Bradley J. Carver, our President, CEO and a director, John W. Burns, our Senior
Vice President and Chief Financial Officer and Brian G.R. Hughes, Chairman of
the Board and would be materially adversely affected if their services ceased to
be available for any reason and comparable replacement personnel were not
employed.

THE BUSINESSES IN WHICH WE ENGAGE HAVE A RISK OF PRODUCT LIABILITY, AND IN THE
EVENT OF A SUCCESSFUL SUIT AGAINST US, OUR BUSINESS COULD BE SEVERELY HARMED.

     The testing, marketing and sale of agricultural and pharmaceutical products
entails a risk of product liability claims by consumers and others. In the event
of a successful suit against us, payments and damage to our reputation could
have a material adverse effect on our business and financial condition. Even if
such suit is unsuccessful, our reputation could be damaged and litigation costs
and expenditure of management time on such matters could adversely effect our
business and financial condition.

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WE ARE CONTRACTUALLY OBLIGATED TO ISSUE SHARES IN THE FUTURE, INCLUDING SHARES
TO BE ISSUED UPON THE CONVERSION OF OUTSTANDING PREFERRED STOCK AND WARRANTS
HELD BY EIS AND OTHERS, WHICH WILL CAUSE DILUTION OF YOUR INTEREST IN US.

     As of December 31, 2001,there are outstanding options to purchase 1,118,542
shares of common stock, at a weighted average exercise price of $5.69 per share
and outstanding warrants to purchase 8,227,230 shares of common stock at a
weighted average exercise price of $2.40 per share. Moreover, we may in the
future issue additional shares to raise capital, acquire other companies or
technologies, to pay for services, or for other corporate purposes. Any such
issuances will have the effect of further diluting the interest of the
purchasers of the current shareholders.

     In July 2001, in connection with a business venture and financing
transaction, we issued to EIS 1,116.79 shares of our Series C convertible
non-voting preferred stock, 4,944.44 shares of our Series A convertible
exchangeable non-voting preferred stock and a warrant to purchase 381,679 shares
of our common stock. In December 2001, we issued 862.70647 shares of our Series
B convertible non-voting preferred stock to EIS. Each share of our Series A
preferred stock and Series C preferred stock is presently convertible after July
10, 2003 into 1,000 shares of our common stock. Each share of our Series B
preferred stock is presently convertible after December 31, 2003 into 1,000
shares of our common stock. The Series A preferred stock and the Series B
preferred stock each bear a 7% dividend payable in Series A preferred stock and
Series B preferred stock, respectively, which compounds annually. In January
2002 we sold to EIS warrants to purchase a total of 597,205 shares of common
stock in connection with a private placement. Accordingly, as of December 31,
2001, a total of 7,902,820 shares of our common stock could be issued to EIS,
assuming the exercise of the warrants and the conversion into common stock of
all shares of Series A, Series B and Series C preferred stock currently
outstanding, but not including any dividends to be issued on the Series A and
Series B preferred stock. This amount of shares represents 21.3% of our
outstanding common stock as of December 31, 2001. Pursuant to provisions in our
agreement with EIS, if the exercise or conversion of any of our securities held
by EIS would result in EIS owning more than 9.9% of our common stock at any time
EIS may opt to receive non-voting securities instead of common stock. In
addition, as of December 31, 2001, we may elect to sell to EIS, subject to its
agreement, up to an additional 4,791.4111 shares of our Series B convertible
non-voting preferred stock in the future at a price per share of $1,700. Upon
conversion, a total of an additional 4,791,411 shares of common stock would be
issued to EIS assuming the purchase of all the remaining Series B preferred
stock, but not including any dividends to be issued on the Series B preferred
stock. Thus, we could potentially issue a total of 12,694,231 shares of our
common stock to EIS, assuming the exercise of all warrants and conversion of all
Series A, Series B and Series C preferred stock outstanding or that may be sold
to EIS in the future, but excluding any dividends to be issued on the Series A
and Series B preferred stock. This amount of shares represents 34.3% of our
outstanding common stock as of December 31, 2001.

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WE MUST COMPLY WITH THE LISTING REQUIREMENTS OF THE NASDAQ SMALLCAP MARKET OR
OUR COMMON STOCK MAY DECLINE AND THE LIQUIDITY OF AN INVESTMENT IN OUR
SECURITIES WOULD DECREASE.

     Our common stock could be delisted from The Nasdaq Stock Market for the
following reasons:

     .     if the bid price of our common stock falls below $1.00 per share for
           thirty (30) consecutive business days; or
     .     if our market capitalization falls below $35 million and we have less
           than (A) $2,000,000 in net tangible assets (total assets less total
           liabilities and goodwill) or (B) $2,500,000 in equity; or
     .     if the value of our common stock held by our stockholders (other than
           our directors, executive officers and 10% stockholders) is less than
           $1,000,000.

     On November 1, 2002, the $2,000,000 net tangible assets test will no longer
be a listing requirement and will be replaced by the requirement to have no less
than $2,500,000 in equity. There are other quantitative and qualitative criteria
of the Nasdaq SmallCap Market which if violated could lead to delisting of our
common stock.

     On June 6, 2001, we received a letter from The Nasdaq Stock Market
notifying us that the staff had determined that we did not comply with the
minimum standards for continued listing. On July 13, 2001, we filed a current
Report on Form 8-K/A containing our unaudited May 31, 2001 balance sheet on a
pro forma basis reflecting the closing of the transaction with Elan and EIS. On
July 16, 2001, we were notified by Nasdaq that they deemed us to be in
compliance with the net tangible assets/market capitalization/net income
requirement and all other requirements necessary for continued listing on the
Nasdaq SmallCap Market. However, we may not be able to maintain our compliance
with Nasdaq continued listing requirements in the future. As of April 16, 2002,
the closing bid price of our common stock has not been below $1.00 for a thirty
day period. However, the closing bid price has been below $1.00 for 21 days
ending on April 30, 2001 and as recently as October 2001 for a five day period
ending on October 26, 2001. Our market capitalization is above $35 million as of
April 16, 2002 but has been below $35 million as recently as December 2001. Our
net tangible assets and equity as reported in the financial statements are less
than $2,000,000 and $2,500,000, respectively, as of December 31, 2001, while our
market capitalization is above $35 million.

     If Nasdaq delisted our common stock, we would likely seek to list our
common stock for quotation on a regional stock exchange. However, if we were
unable to obtain listing or quotation on such market or exchange, trading of our
common stock would occur in the over-the-counter market on an electronic
bulletin board for unlisted securities or in what are commonly known as the
"pink sheets." In addition, delisting from Nasdaq and failure to obtain listing
or quotation on such market or exchange would subject our common stock to
so-called "penny stock" rules. These rules impose additional sales practice and
market making requirements on broker-dealers who sell and/or make a market in
such securities, such as disclosing offer and bid prices and compensation
received from a trade to a purchaser and sending monthly account statements to

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purchasers. Consequently, broker-dealers may be less willing or able to sell
and/or make a market in our common stock. These rules also require that
purchasers of "penny stock" be accredited investors which could reduce the
number of investors that could purchase our stock. Additionally, an investor
would find it more difficult to dispose of, or to obtain accurate quotations for
the price of, our common stock. As a result of delisting, it may become more
difficult for us to raise funds through the sale of our securities.

OUR STOCK PRICE COULD DECLINE IF A SIGNIFICANT NUMBER OF SHARES BECOME AVAILABLE
FOR SALE.

            As of December 31, 2001, approximately 21,020,453 shares of common
stock issued and outstanding are "Restricted Securities" as that term is defined
in Rule 144 promulgated under the Act. In general, a person (or persons whose
shares are aggregated) who has satisfied a one year holding period may sell,
within any three month period, an amount of restricted securities which does not
exceed the greater of 1% of the then outstanding shares of common stock or the
average weekly trading volume during the four calendar weeks prior to such sale.
Restricted securities can be sold, under certain circumstances, without any
quantity limitation, by persons who are not affiliates of GlycoGenesys and who
have beneficially owned the shares for a minimum period of two years. The
Company has filed a registration statement on Form S-3, which is not yet
effective, with respect to 7,233,266 outstanding shares which are restricted
securities, as well as with respect to shares issuable upon the exercise of
warrants. In addition, the Company has seven S-3 Registration Statements which
are currently effective.

            The sale of these restricted shares and the registered shares shall
increase the number of free-trading shares and may have a depressive effect on
the price of our securities. Moreover, such sales, if substantial, might also
adversely affect our ability to raise additional equity capital.

BECAUSE OUR MANAGEMENT COULD CONTROL A SIGNIFICANT PERCENTAGE OF OUR COMMON
STOCK, THEY COULD EXERCISE SUBSTANTIAL CONTROL OVER US.

            The holders of the common stock do not have cumulative voting
rights. Our directors, one of whom is an executive officer of GlycoGenesys, own
approximately 9.6% collectively of the outstanding shares of common stock as of
December 31, 2001. One of the conditions of the transactions between us, Elan
and EIS requires that we expand our board of directors to six members on the
next regularly scheduled stockholders' meeting at which time EIS may appoint one
director. EIS has currently decided not to appoint a director at the next
regularly scheduled stockholders' meeting, but may choose to do so in the
future. If EIS appoints a director, members of the board of directors and their
affiliates shall own approximately 18.5% of the outstanding common stock as of
December 31, 2001, assuming EIS has not converted or exercised any of our
securities held by it, and the same number of shares are outstanding at such
time as are currently outstanding. If EIS were to have converted or exercised
all of our securities held by it, the members of our board of directors and
their affiliates would own approximately 32.9% of the outstanding common stock
as of December 31, 2001, assuming the number of shares outstanding at such time
equals the number of shares currently outstanding plus the number of shares
issued on exercise or conversion of securities held by EIS. This percentage

                                                                              33

<PAGE>

would increase if we were to sell additional shares of our Series B preferred
stock to EIS. This concentration of ownership would allow these stockholders to
substantially influence all matters requiring stockholder approval including
without limitation election of directors and other significant corporate
transactions and could have the effect of delaying or preventing a change in
control or otherwise discouraging a potential acquirer from attempting to obtain
control of us, which in turn could materially adversely affect our stock price.

THE PRICE OF OUR COMMON STOCK HAS BEEN VOLATILE, WHICH COULD RESULT IN
SUBSTANTIAL LOSSES.

            The market price of our common stock, which is traded on the
National Association of Securities Dealers Automated Quotation (NASDAQ--Small
Cap) has been, and may continue to be, highly volatile. During the twelve months
ending December 31, 2001, our common stock has traded at prices ranging from
$0.55 to $2.43 per share. Factors such as announcements of clinical trial
results, financings, technological innovations or new products, either by us or
by our competitors or third parties, as well as market conditions within the
biotech and pharmaceutical industries, may have a significant impact on the
market price of our common stock.

            In addition, the stock market has from time to time experienced
extreme price and volume fluctuations, particularly in the biotechnology sector,
which have often been unrelated to the operating performance of particular
companies. Current market conditions are particularly unstable and there is a
large degree of uncertainty at this time. In general, biotechnology stocks tend
to be volatile even during periods of relative market stability because of the
high rates of failure and substantial funding requirements associated with
biotechnology companies. Market conditions and conditions of the biotechnology
sector could negatively impact the price of our common stock.

                                                                              34

<PAGE>

ITEM 8.   FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

This Annual Report on Form 10-K/A contains the following material changes in the
audited financial statements for the year ending December 31, 2001 which differs
from the previously filed unaudited financial statements for the year ending
December 31, 2001:

Page F-7 Consolidated Statements of Cash Flows:

Proceeds from sales of Series B Preferred stock have been reclassified as a
non-cash financing activity.

"Due from Elan International Services, Ltd." has been renamed "Due from Safe
Science Newco, Ltd." and has increased from $(177,646) to $(892,691).

"Proceeds from stock subscription receivable" has been classified in net cash
provided by financing activities section of the consolidated statements of cash
flows.

These changes in cash flows effect the Liquidity and Resources section of
Management's Discussion and Analysis of Results of Operations and Financial
Condition in Item 7 by increasing cash provided by financing activities and net
cash used in operating and discontinued activities.

The audited financial statements including the notes thereto contain several
additional changes from the previously filed unaudited financial statements that
the Company does not believe to be material. The audited financial statements
presented here should be read in full.

                                       F-1

                                                                              35

<PAGE>

Independent Auditors' Report

To the Board of Directors and Stockholders of GlycoGenesys Inc.:

We have audited the accompanying consolidated balance sheet of GlycoGenesys Inc.
(formerly SafeScience, Inc.) and subsidiaries (the "Company") as of December 31,
2001 and the related consolidated statements of operations, stockholders'
equity, and cash flows for the year then ended. These consolidated financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these consolidated financial
statements based on our audit.

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

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of GlycoGenesys Inc.
and subsidiaries at December 31, 2001 and the results of their operations and
their cash flows for the year then ended, in conformity with accounting
principles generally accepted in the United States of America.

The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in Note 1 to the
financial statements, the Company has incurred recurring losses from operations
and had an accumulated deficit of $66.7 million as of December 31, 2001. The
Company expects to incur substantial additional operating costs, including costs
related to ongoing research and development activities, preclinical studies and
clinical trials. In the event additional financing is not obtained, the Company
may be required to significantly reduce or curtail operations. These matters
raise substantial doubt about the Company's ability to continue as a going
concern. Management's plans in regard to these matters are also described in
Note 1. The financial statements do not include any adjustments that might
result from the outcome of this uncertainty.

/s/ Deloitte & Touche LLP

Boston, Massachusetts
May 29, 2002

                                       F-2

                                                                              36

<PAGE>

Report of Independent Public Accountants

To the Stockholders and Board of Directors of SafeScience, Inc.:

We have audited the accompanying consolidated balance sheet of SafeScience,
Inc. and subsidiaries (the Company) as of December 31, 2000, and the
related consolidated statements of operations, stockholders' equity and cash
flows for each of the two years in the period ended December 31, 2000. These
consolidated financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.

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

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of the Company as of
December 31, 2000, and the results of their operations and their cash
flows for each of the two years in the period ended December 31, 2000 in
conformity with accounting principles generally accepted in the United States.

The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in Note 1 to the
financial statements, the Company has incurred recurring losses from operations
and had an accumulated deficit of $44.0 million as of December 31, 2000. In
addition, the Company's business plan for 2001 is predicated on obtaining
additional financing for which the Company has not received any commitments as
of March 20, 2001. These factors raise substantial doubt about the Company's
ability to continue as a going concern. Managements' plan in regard to these
matters is described in Note 1. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.

/s/ Arthur Andersen LLP
Boston, Massachusetts
March 20, 2001

                                       F-3

                                                                              37

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)
                           CONSOLIDATED BALANCE SHEETS

                                     ASSETS

                                                     December 31,
                                                     ------------
                                                  2000           2001
                                                  ----           ----
CURRENT ASSETS:
 Cash and cash equivalents                     $2,547,353     $7,977,910
 Stock subscription receivable                  2,000,000             --
 Due from SafeScience Newco, Ltd.                      --        177,646
 Prepaid expenses and other current assets        288,134        271,899
                                               ----------     ----------
 Total current assets                           4,835,487      8,427,455
                                               ----------     ----------
PROPERTY AND EQUIPMENT, AT COST:
 Computer, office and laboratory equipment        455,994        469,253
 Furniture and fixtures                           281,274        284,748
 Motor vehicles                                    25,026         25,026
                                               ----------     ----------
                                                  762,294        779,027
  Less accumulated depreciation                   324,932        437,844
                                               ----------     ----------
                                                  437,362        341,183
                                               ----------     ----------
OTHER ASSETS:
 Notes receivable-related parties                 128,659             --
 Restricted cash                                  108,128        108,128
 Deposits                                         269,481         79,831
                                               ----------     ----------
 Total other assets                               506,268        187,959
                                               ----------     ----------
Total assets                                   $5,779,117     $8,956,597
                                               ==========     ==========

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

                                       F-4

                                                                              38

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)
                           CONSOLIDATED BALANCE SHEETS
                 LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

<TABLE>
<CAPTION>
                                                                         December 31,
                                                                         ------------
                                                                    2000              2001
                                                                    ----              ----
<S>                                                            <C>               <C>
CURRENT LIABILITIES:
 Accounts payable                                              $  1,360,615      $  1,094,872
 Accrued license fee                                                     --           451,164
 Accrued commissions                                                     --           416,447
 Other accrued liabilities                                          797,964           502,753
 Net liabilities of discontinued operations                         908,571           326,780
                                                               ------------      ------------
Total current liabilities                                         3,067,150         2,792,016
                                                               ------------      ------------
OTHER EQUITY:

Preferred stock, $0.01 par value
     Authorized - 5,000,000 shares
       Series A convertible, exchangeable preferred
         Stock, 7,500 shares authorized;
         4,944.44 shares issued and outstanding as
         of December 31, 2001
         (liquidation value $12,419,273 at
         December 31, 2001)                                              --        12,419,273
       Series B convertible preferred stock,
         6,000 shares authorized;
         862.70 shares issued and outstanding as of
         December 31, 2001
         (liquidation value $1,466,601 at
         December 31, 2001                                               --         1,341,224
       Series C convertible preferred stock,
         1,117 shares authorized;
         1,116.79 shares issued and outstanding as of
         December 31, 2001                                               --         1,331,330
Other                                                               866,216                --
                                                               ------------      ------------
Total other equity                                                  866,216        15,091,827
                                                               ------------      ------------
Commitments and Contingencies (Note 9)

STOCKHOLDERS' EQUITY (DEFICIT):
Common stock, $.01 par value
  Authorized - 100,000,000 shares
  Issued and outstanding - 23,998,504 and 33,568,952 shares
    at December 31, 2000 and 2001, respectively                     239,985           335,690
Additional paid-in capital                                       48,243,184        60,100,645
Note receivable from officer                                     (2,675,000)       (2,675,000)
Accumulated deficit                                             (43,962,418)      (66,688,581)
                                                               ------------      ------------
Total stockholders' equity (deficit)                              1,845,751        (8,927,246)
                                                               ------------      ------------
Total liabilities and stockholders' equity (deficit)           $  5,779,117      $  8,956,597
                                                               ============      ============
</TABLE>

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

                                       F-5

                                                                              39

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)
                      Consolidated Statements of Operations

<TABLE>
<CAPTION>
                                                             Years Ended December 31,
                                                --------------------------------------------------
                                                     1999             2000              2001
                                                     ----             ----              ----
<S>                                               <C>               <C>              <C>
OPERATING EXPENSES:
Research and development                          $  3,929,898      $  6,182,150     $  4,291,064
General and administrative                           5,837,861         4,093,507        4,045,088

Restructuring charge (credit)                               --         1,478,956         (177,283)
                                                   ------------      ------------      -----------
 Operating loss                                     (9,767,759)      (11,754,613)      (8,158,869)
                                                   ------------      ------------      -----------

OTHER (EXPENSE) INCOME:
 Equity in loss of SafeScience Newco, Ltd.                  --                --      (14,188,470)
 Other expense                                          (8,063)         (243,373)         (33,345)
 Interest income                                       353,492           216,842          187,721
                                                   ------------      ------------      -----------
    Total other (expense) income                       345,429           (26,531)     (14,034,094)
                                                   ------------      ------------      -----------

Loss from continuing operations                     (9,422,330)      (11,781,144)     (22,192,963)

Loss from discontinued operations                   (2,879,388)       (5,489,167)        (533,200)
                                                   ------------      ------------      -----------
    Net loss                                       (12,301,718)      (17,270,311)     (22,726,163)
Accretion of preferred stock dividend                       --                --         (404,273)
                                                   ------------      ------------      -----------
Net loss applicable to common stock               $(12,301,718)     $(17,270,311)    $(23,130,436)
                                                   ============      ============     ============
Basic and diluted net loss per common stock
from continuing operations                        $      (0.59)     $      (0.64)    $      (0.82)

Basic and diluted net loss per common stock
from discontinued operations                             (0.18)            (0.30)           (0.02)
                                                   ------------      ------------      -----------
Basic and diluted net loss per
  common stock                                    $      (0.77)     $      (0.94)    $      (0.84)
                                                   ============      ============      ===========
Weighted average number of common shares
outstanding                                         16,060,783        18,314,819       27,612,020
                                                   ============      ============      ===========
</TABLE>

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

                                       F-6

                                                                              40

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)
                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
              FOR THE YEARS ENDED DECEMBER 31, 2001, 2000, AND 1999

<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                           Total
                                                                     Additional         Notes                          Stockholders'
                                                 Common Stock        Paid-In        Receivable from    Accumulated        Equity
                                                                     Capital        Former Officer       Deficit         (Deficit)
------------------------------------------------------------------------------------------------------------------------------------
                                              Shares      Amount
<S>                                         <C>          <C>         <C>            <C>               <C>              <C>
BALANCE, DECEMBER 31, 1998                  14,107,216   $141,072    $17,749,766    $        --       $(14,390,389)    $  3,500,449

Options exercised                               78,877        789        116,731             --                 --          117,520

Expense associated with options granted to
    non-employees                                   --         --        528,233             --                 --          528,233

Private placements, net of finders fee of
    $445,259 (includes 1,112 shares for
    payment)                                 1,615,706     16,157      9,119,944             --                 --        9,136,101

Stock issued for services                      218,276      2,183      1,413,727             --                 --        1,415,910

Warrants exercised                             545,396      5,454      1,812,374             --                 --        1,817,828

Notes receivable from issuance of common
    stock                                      250,000      2,500      2,672,500     (2,675,000)                --               --

Common stock issued as legal settlement         20,453        204        306,590             --                 --          306,794

Net loss                                            --         --             --             --        (12,301,718)     (12,301,718)
                                            ----------    -------      ---------     ----------         ----------       ----------

BALANCE, DECEMBER 31, 1999                  16,835,924    168,359     33,719,865     (2,675,000)       (26,692,107)       4,521,117

Private Placements                           4,778,184     68,142     14,783,101             --                 --       14,851,243

Cashless exercise of warrants                2,262,256      2,262         (2,262)            --                 --               --

Reclassification to other equity                    --         --       (866,216)            --                 --         (866,216)

Exercise of common stock options                44,376        444           (444)            --                 --               --

Common stock issued for services and wages      93,287        933        804,562             --                 --          805,495

Common stock redeemed in payment of notes
    receivable                                 (15,523)      (155)      (195,422)            --                 --         (195,577)

Net loss                                            --         --             --             --        (17,270,311)     (17,270,311)
                                            ----------    -------      ---------     ----------         ----------       ----------
BALANCE, DECEMBER 31, 2000                  23,998,504    239,985     48,243,184     (2,675,000)       (43,962,418)       1,845,751

Common stock issued as part of private
placements, net of $906,227 in issuance      5,624,516     56,246      6,585,043             --                 --        6,641,289
costs

Common stock issued pursuant to exercise of
warrants                                       765,526      7,655        858,922             --                 --          866,577

Common stock issued for license purchase       160,000      1,600        198,400             --                 --          200,000

Exercise of common stock options               195,000      1,950        273,614             --                 --          275,564

Common stock issued for services and wages     125,406      1,254        107,355             --                 --          108,609

Amortization of value of warrants issued
for license                                         --         --      1,046,730             --                 --        1,046,730


Common stock issued as part of private
placements, net of $318,330 in issuance      2,700,000     27,000      3,191,670             --                 --        3,218,670
costs

Accreted dividends on Series A convertible,
  exchangeable, preferred  stock                    --         --       (404,273)            --                 --         (404,273)

Net loss                                            --         --             --             --        (22,726,163)     (22,726,163)
                                            ----------    -------     ----------     ----------        -----------       ----------
BALANCE, DECEMBER 31, 2001                  33,568,952   $335,690    $60,100,645    $(2,675,000)      $(66,688,581)    $ (8,927,246)
                                           ===========    =======     ==========     ==========        ===========       ==========
</TABLE>

   The accompanying notes are an integral part of these consolidated financial
                                   statements

                                       F-7

                                                                              41

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)
                      Consolidated Statements of Cash Flows

<TABLE>
<CAPTION>
                                                                     Years Ended December 31,
                                                                     ------------------------
                                                                1999           2000           2001
                                                                ----           ----           ----
<S>                                                        <C>             <C>            <C>
Cash Flows from Operating Activities:
Net loss                                                   $ (12,301,718)  $(17,270,311)  $(22,726,163)
Adjustments to reconcile net loss to net cash used
  in operating and discontinued activities:
  Operating expenses paid in common stock, options
    and warrants                                               2,367,871        805,495        382,223
  Amortization of value of warrants issued for
    license                                                           --             --      1,046,730
  Common stock issue for license purchase                             --             --        200,000
  Compensation charges related to loan forgiveness                    --        336,768             --

  Equity adjustment in SafeScience Newco, Ltd.                        --             --     14,188,470
  Depreciation                                                   125,563        160,662        112,912
Changes in assets and liabilities:
   Due from SafeScience Newco, Ltd.                                   --             --       (892,691)

   Prepaid expenses and other current assets                     (57,386)      (118,075)        16,235
   Accounts payable                                               80,649      1,033,153       (265,743)
   Accrued liabilities                                           459,503        133,044        580,587
   Net assets of discontinued operations                        (724,060)       724,060             --
   Net Liabilities of discontinued operations                         --        908,571       (581,791)
                                                           -------------   ------------   ------------
     Net cash used in operating and
       discontinued activities                               (10,049,578)   (13,286,633)    (7,939,231)
                                                           -------------   ------------   ------------
Cash flows from investing activities:
  Purchase of property and equipment                            (364,450)      (138,913)       (16,733)
  Deposits                                                       (12,741)      (255,411)       189,650
  Loans to related parties                                      (574,177)            --        128,659
                                                           -------------   ------------   ------------
Net cash provided by (used in) investing activities             (951,368)      (394,324)       301,576
                                                           -------------   ------------   ------------
Cash flows from financing activities:
Payments on notes payable                                        (15,908)            --             --

Proceeds from sale of common stock, net of
  issuance costs                                               9,136,101     12,851,243      6,641,289
Proceeds from exercise of options                              1,818,413             --          1,950
Proceeds from exercise of warrants                                    --             --            350
Proceeds from sale of common stock and warrants,
 net of issuance costs                                                --             --      3,218,670
Proceeds from sale of Series C preferred stock, net of
 issuance costs                                                       --             --      1,331,330
Proceeds from stock subscription receivable                           --             --      2,000,000
Issuance cost on Series B preferred stock                             --             --       (125,377)
                                                           -------------   ------------   ------------
Net cash provided by financing activities                     10,938,606     12,851,243     13,068,212
                                                           -------------   ------------   ------------
Net increase (decrease) in cash and cash equivalents             (62,341)      (829,714)     5,430,557
Cash and cash equivalents, beginning balance                   3,439,408      3,377,067      2,547,353
                                                           -------------   ------------   ------------
Cash and cash equivalents, ending balance                      3,377,067      2,547,353      7,977,910
                                                           =============   ============   ============
Supplemental disclosure of noncash financing activities:
  Issuance of common stock upon exercise of adjustable
     warrant                                                          --             --    $   866,227
                                                           =============   ============   ============
  Series A preferred stock issued for
   investment in SafeScience Newco, Ltd.                              --             --    $12,015,000
                                                           =============   ============   ============
  Series B preferred stock issued for expenses
    of joint venture                                                  --             --      1,466,601
</TABLE>

                                                                              42

<PAGE>

<TABLE>
<S>                                                   <C>            <C>            <C>
                                                      ============   ============   ============
  Exchange of common stock for notes receivable       $ (2,675,000)  $    195,577   $         --
                                                      ============   ============   ============

Supplemental disclosure of cash flow information:
  Cash paid for interest                              $        319   $      3,451   $     33,345
                                                      ============   ============   ============
</TABLE>

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

                                       F-8

                                                                              43

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001

(1) ORGANIZATION AND OPERATIONS

GlycoGenesys, Inc. ("the Company," formerly known as SafeScience, Inc.) was
formed in 1992 for the research and development of pharmaceutical products based
on carbohydrate chemistry. Today, the Company has two wholly owned subsidiaries:
International Gene Group, Inc. and SafeScience Products, Inc. International Gene
Group, Inc. focuses on the development of carbohydrate-based pharmaceutical
products and related technologies in connection with oncology and other life
threatening and/or debilitating diseases. SafeScience Products, Inc. develops
agricultural products, some of which are also based upon carbohydrate
chemistries. The therapeutic products will be either licensed from or jointly
developed with third parties. GlycoGenesys, Inc., International Gene Group, Inc.
and SafeScience Products, Inc. maintain an office in Boston, Massachusetts.

In July 2001, the Company and Elan International Services, Ltd. ("EIS") formed a
joint venture in Bermuda (SafeScience Newco, Ltd.) for the purpose of furthering
the development of the Company's drug candidate GCS-100 in the field of oncology
(See Note 3).

As of December 31, 2001, the Company has an accumulated deficit of $66,688,581.
Despite this accumulated deficit, the Company had a net working capital position
(current assets less current liabilities) of approximately $5.6 million at
December 31, 2001. The Company believes that its existing funds will be
sufficient to fund its operating expenses and capital requirements into the
first quarter of 2003. The Company intends to raise additional equity financing
to support its continued operations. Since inception, the Company has funded its
operations primarily through the proceeds from equity securities. Through
December 31, 2001, the Company had been successful in raising approximately
$52.9 million from such sales of equity securities. The Company raised an
additional $5.6 million from the issuance of equity securities in January 2002.
The Company could be reimbursed by SafeScience Newco, Ltd. up to approximately
$10 million of additional funds of which approximately $8.1 million could be
funded by the Company's issuance to EIS of Series B Preferred Stock and
approximately $1.9 million of which would be funded directly by EIS to
SafeScience Newco, Ltd. for expenses incurred in the development of GCS-100
pursuant to the Company's agreement with EIS (see Note 3). However, the Company
will not receive additional capital from EIS unless the Company agrees with EIS
on a quarterly basis on the business plan for SafeScience Newco, Ltd.

The Company's future is dependent upon its ability to obtain financing to fund
its operations. The Company expects to incur substantial additional operating
costs, including costs related to ongoing research and development activities,
preclinical studies and clinical trials.

                                       F-9

                                                                              44

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001
                                   (Continued)


To the extent that the Company is unable to raise additional capital on a timely
basis, management plans to slow down research activity to conserve cash.

Other than the $5,600,000 raised during January 2002, the Company has not
obtained commitments from any existing or potential investors to provide
additional financing as of April 16, 2002. In the event additional financing is
not obtained, the Company may be required to significantly reduce or curtail
operations. There is substantial doubt that the Company will have the ability to
continue as a going concern and, therefore, may be unable to realize its assets
and discharge its liabilities in the normal course of business. The financial
statements do not include any adjustments relating to the recoverability and
classification of recorded asset amounts or to amounts and classification of
liabilities that may be necessary should the Company be unable to continue as a
going concern.

Principal risks to the Company include the successful development and marketing
of pharmaceutical products, dependence on collaborative partners, the need to
obtain adequate financing to fund future operations, United States Food and Drug
Administration approval, dependence on key individuals and competition from
substitute products and larger companies.

On February 23, 2001 the Company announced the discontinuation of its consumer
and commercial operations. The cost of disposing of the business assets and the
expenses incurred during the phase out period is approximately $2,283,200 (see
Note 5).

(2)  SIGNIFICANT ACCOUNTING POLICIES

(a) Principles of Consolidation

The Company's consolidated financial statements include the accounts of the
Company and its wholly owned subsidiaries: International Gene Group, Inc. and
SafeScience Products, Inc. All material intercompany transactions and accounts
have been eliminated in the consolidated financial statements.

(b) Use of Estimates

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

                                      F-10

                                                                              45

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001
                                   (Continued)


(c) Cash and Cash Equivalents, and Restricted Cash

The Company considers all highly liquid debt instruments purchased with an
original maturity of three months or less to be cash equivalents. Cash and cash
equivalents at December 31, 2001 and 2000 include approximately $664,587 and
$653,478 in cash and approximately $7,313,323 and $1,893,875 in cash
equivalents, respectively, held in an overnight investment account, which is
reinvested daily in government securities funds and money market funds. The
Company has a $100,000 stand-by secured line of credit which has no outstanding
balance. Restricted cash represents funds held under an irrevocable standby
letter of credit. The letter of credit serves as a security for the Company's
facility lease. The funds are being held in an investment account. Such amounts
are classified as long-term assets.

(d) Impairment of Long-Lived Assets

The Company assesses long-lived assets and identifiable intangibles for
impairment whenever there is an indication that the carrying amount of the asset
may not be recoverable. Recoverability of these assets is determined by
comparing the forecasted undiscounted cash flows generated by those assets to
their net carrying value. The amount of impairment loss, if any, will generally
be measured by the difference between the net book value of the assets and the
estimated fair value of the related assets (see Recent Accounting
Pronouncements).

(e) Depreciation

The Company provides for depreciation using straight-line and accelerated
declining balance methods to allocate the cost of property and equipment over
their estimated useful lives as follows:

Asset                                                            Estimated
Classification                                                  Useful Life

Computer, office and laboratory equipment                       3 - 5 years
Furniture and fixtures                                            7 years
Motor vehicles                                                    4 years


(f) Research and Development

Research and development costs, which consist primarily of expenses for clinical
trials, preclinical research, drug manufacturing for clinical trials, sponsored
research, consultants, supplies and testing, are charged to operations as
incurred.

                                      F-11

                                                                              46

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001
                                   (Continued)


(g) Net Loss Per Share

The Company applies Statement of Financial Accounting Standards Statement
("SFAS") No. 128, "Earnings per Share". Basic loss per share is computed using
the weighted-average number of common shares outstanding. The dilutive effect of
the potential common shares consisting of outstanding stock options and warrants
is determined using the treasury stock method in accordance with SFAS No. 128.
Diluted weighted average shares outstanding at December 31, 2001 and 2000
excluded the potential common shares from convertible preferred stock, warrants
and stock options because to do so would be anti-dilutive for the periods
presented. At December 31, 2001, 2000 and 1999, there are 8,227,230, 2,665,104
and 75,000 warrants outstanding, respectively, with a weighted average exercise
price of $2.40, $4.03 and $10.40, respectively, and 1,118,542, 1,163,417 and
585,424 stock options outstanding, respectively, with a weighted average
exercise price of $5.69, $6.39 and $10.42, respectively, and in 2001, 6,923,945
shares, issuable upon conversion of outstanding preferred stock which were
omitted from earnings per share calculations.

(h) Comprehensive Income (Loss)

The Company applies SFAS No. 130, "Reporting Comprehensive Income". SFAS No. 130
establishes standards for reporting and display of comprehensive income and its
components in the financial statements. Comprehensive income (loss) is defined
as the change in equity of a business enterprise during a period from
transactions and other events and circumstances from nonowner sources. The
Company's comprehensive net loss is the same as net loss for all periods
presented.

(i) Disclosures About Segments of an Enterprise

SFAS No. 131, "Disclosures About Segments of an Enterprise and Related
Information", establishes standards for reporting information regarding
operating segments in annual financial statements and requires selected
information for those segments to be presented in interim financial reports
issued to stockholders. SFAS No. 131 also establishes standards for related
disclosures about products and services and geographic areas. Operating segments
are identified as components of an enterprise about which separate discrete
financial information is available for evaluation by the chief operating
decision-maker, or decision-making group, in making decisions on how to allocate
resources and assess performance. Due to the discontinuation of its consumer and
commercial products business, the Company operates in one segment.

                                      F-12

                                                                              47

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001
                                   (Continued)


(j) Concentrations of Risk

SFAS No. 105, "Disclosure of Information About Financial Instruments with

Off-Balance-Sheet Risk and Financial Instruments with Concentrations of Credit
Risk", requires disclosure of any significant off-balance-sheet risk and credit
risk concentrations. The Company has no significant off-balance-sheet risk or
credit risk concentrations. The Company maintains its cash and cash equivalents
with a financial institution and invests in investment-grade securities.

(k) Financial Instruments

The estimated fair values of the Company's consolidated financial instruments,
which include cash equivalents, and accounts payable, approximate their carrying
value due to the short maturity of these instruments.

(l) Post Retirement Benefits

The Company does not provide post retirement benefits.

(m) Reclassification

Certain items in the prior years consolidated financial statements have been
reclassified to conform to their 2001 presentation. Marketing expenses for the
years ended December 31, 1999 and 2000 have been reclassified as research and
development because they relate to development of Elexa-4 and Bb447.

(n) Advertising Costs - The Company had no advertising expenses during the
fiscal years ended December 31, 2001, 2000 or 1999.

(o) Derivative Instruments and Hedging Accounting

In June 1998, the Financial Accounting Standards Board (FASB) issued SFAS No.
133, "Accounting for Derivative Instruments and Hedging Activities". As amended
in June 1999, the statement is effective for all fiscal quarters of all fiscal
years beginning after June 15, 2000. In June 2000, the FASB issued statement No.
138, which is a significant amendment to SFAS NO. 133. SFAS NO. 133 and its
amendments establish accounting and reporting standards for derivative
instruments, including certain derivative instruments embedded in other
contracts (collectively, the derivatives) and for hedging activities. The
Emerging Issues Task Force (EITF) has also issued a number of derivative-related
tentative and final consensuses. The adoption of these statements did not have a
material impact on the Company's consolidated financial position or results of
operations.

                                      F-13

                                                                              48

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001
                                   (Continued)

(p) Stock-based compensation plans

As discussed in Note 6, the Company applies Accounting Principles Board Opinion
No. 25 "Accounting for Stock Issued to Employees" and related interpretations in
accounting for its stock-based compensation plans.

(q) Recent Accounting Pronouncements

In July 2001, the FASB issued SFAS No. 141, "Business Combinations" and SFAS No.
142, "Goodwill and Other Intangible Assets". SFAS 141 requires that all business
combinations be accounted for under a single method - the purchase method. Use
of the pooling-of-interest method is no longer permitted. SFAS 141 requires that
the purchase method be used for all business combinations initiated after June
30, 2001. SFAS 142 requires, among other things, that goodwill no longer be
amortized to earnings, but instead reviewed for impairment annually, or more
frequently if applicable. The adoption of these standards on January 1, 2002 had
no effect on the Company.

In June 2001, the FASB issued SFAS No. 143, "Accounting for Asset Retirement
Obligations". SFAS 143 establishes accounting standards for recognition and
measurement of a liability for an asset retirement obligation and the associated
asset retirement cost. SFAS 143 requires the recognition of the fair value of a
liability for an asset retirement obligation in the period in which it is
incurred if a reasonable estimate of fair value can be made. If a reasonable
estimate of fair value cannot be made in the period the asset retirement
obligation is incurred, the liability shall be recognized when a reasonable
estimate of fair value can be made. The fair value of a liability for an asset
retirement obligation is the amount at which that liability could be settled in
a current transaction between willing parties, that is, other than in a forced
or liquidation transaction. SFAS 143 is effective for financial statements
issued for fiscal years beginning after June 15, 2002. The provisions of SFAS
143 will become effective for the Company on January 1, 2003. The effects of
adopting this standard have not been determined.

In August 2001, the FASB issued SFAS No. 144, "Accounting for the Impairment or
Disposal of Long-Lived Assets". SFAS 144 establishes a "primary-asset" approach
to determine the cash flow estimation period for a group of assets and
liabilities that represents the unit of accounting for a long-lived asset to be
held and used. SFAS 144 requires that a long-lived asset to be (1) abandoned,
(2) exchanged for a similar productive asset, or (3) distributed to owners in a
spin-off be considered held and used until it is abandoned, exchanged, or
distributed. The provisions of SFAS 144 became effective for the Company on
January 1, 2002. The effects of adopting this standard in fiscal 2002 are not
considered to be material.

                                      F-14

                                                                              49

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001
                                   (Continued)


(3)  JOINT VENTURE WITH ELAN INTERNATIONAL SERVICES

At the time SafeScience Newco, Ltd. was formed, EIS purchased 2,700,000 shares
of the Company's common stock, 1,116.79 shares of the Company's Series C
non-voting convertible preferred stock ("Series C Preferred Stock") and a
five-year warrant to purchase 381,679 shares of common stock at an exercise
price of $2.43 per share. The aggregate purchase price of $5,000,000 was paid in
cash.

Also, EIS was issued 4,944.44 shares of the Company's newly created Series A
convertible exchangeable preferred stock ("Series A Preferred Stock") valued at
$12,015,000 (See Note 7). Each share of Series A Preferred Stock is convertible
into 1000 shares of common stock, subject to anti-dilution rights. The Series A
Preferred Stock is, at EIS's option, exchangeable for non-voting preferred
shares of SafeScience Newco, Ltd. ("Newco Preferred Shares"), originally issued
to the Company and representing 30.1% of the aggregate outstanding shares of
SafeScience Newco, Ltd. ("Aggregate Newco Shares").

The Company used the $12,015,000 in value from its issuance of the Series A
Preferred Stock to acquire 80.1% of the Aggregate Newco Shares. The issuance of
Series A Preferred Stock and the acquisition of the Aggregate Newco Shares were
simultaneously completed in the form of a non-cash cross-receipt. This
acquisition consisted of 100% of the voting common shares of SafeScience Newco,
Ltd. ("Newco Common Shares") and 60.2% of the Newco Preferred Shares, which
represent 50% and 30.1%, respectively, of the Aggregate Newco Shares. In
addition, EIS contributed $2,985,000 to SafeScience Newco, Ltd. to acquire 39.8%
of the Newco Preferred Shares, which represent 19.9% of the Aggregate Newco
Shares.

In addition, Elan granted SafeScience Newco, Ltd. a license to Elan's
proprietary drug delivery technology for a license fee of $15,000,000 and the
Company granted SafeScience Newco, Ltd. a license to GCS-100 in the field of
oncology as an integral part of these transactions. Upon SafeScience Newco,
Ltd.'s completing this transaction, the cost of the Elan license was expensed at
inception as a research and development cost by SafeScience Newco, Ltd. because
revenues resulting from such technology were not likely in the foreseeable
future. The Company's share of this expense was approximately $12,015,000 and is
included in Equity in Loss of SafeScience Newco, Ltd. in the accompanying
consolidated statement of operations for the year ended December 31, 2001.

                                      F-15

                                                                              50

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001
                                   (Continued)

SafeScience Newco, Ltd. was formed by issuing Newco Common Shares and Newco
Preferred Shares valued at $15,000,000 to the Company and EIS. The Company owns
100% of the outstanding Newco Common Shares, which represents 100% of the
outstanding voting shares of SafeScience Newco, Ltd. The Newco Preferred shares
are non-voting and are convertible, at the option of the holder thereof, into
voting Newco Common Shares at any time after July 10, 2003. While EIS currently
does not own any Newco Common Shares and is unable to convert any of its Newco
Preferred Shares into Newco Common Shares until July 10, 2003, it has retained
significant minority investor rights that the Company considers to be
"participating rights" as defined in EITF Issue 96-16 "Investors' Accounting for
an Investee When the Investor Has a Majority of the Voting Interest but the
Minority Shareholder Has Certain Approval or Veto Rights". EIS's participating
rights prevent the Company from exercising sole control over SafeScience Newco,
Ltd. Accordingly, the Company has not consolidated the financial statements of
SafeScience Newco, Ltd. but instead accounted for its investment in SafeScience
Newco, Ltd. using the equity method.

Subject to the continued agreement by the parties to the business plan of
SafeScience Newco, Ltd., the Company will provide additional funding to
SafeScience Newco, Ltd. as needed in relation to its 80.1% ownership interest in
SafeScience Newco, Ltd. To the extent such funding is provided, EIS has agreed
to acquire up to $9,612,000 of Series B Preferred Stock, at the option of the
Company, to provide the Company with funds for its pro rata share of development
funding for Safe Science Newco, Ltd. On December 31, 2001, the Company issued
862.70647 shares of Series B Preferred Stock to EIS for $1,466,601, which
represented the Company's share of the joint venture's on-going research and
development expenses of $1,830,962 for the four months ended October 31, 2001.

The Company performed research for SafeScience Newco, Ltd. and incurred research
expenses of approximately $2,676,000 on behalf of SafeScience Newco, Ltd. during
the period of inception (July 10, 2001) through December 31, 2001. In addition,
management fees and other direct expenses of SafeScience Newco, Ltd. totaled
approximately $37,000. The Company's 80.1% share of SafeScience Newco, Ltd.
ongoing operating expenses for the period ended December 31, 2001 was
approximately $2,173,000 and is included in Equity in Loss of SafeScience Newco,
Ltd. in the Company's consolidated statements of operations. As of December 31,
2001, the Company has a receivable from SafeScience Newco, Ltd. of $892,691.
This receivable represents research and development expenses from November 1,
2001 through December 31, 2001 paid for by the Company for services performed on
behalf of SafeScience Newco, Ltd. As of December 31, 2001, the

                                      F-16

                                                                              51

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001
                                   (Continued)


Company has a payable recorded to SafeScience Newco, Ltd. of $715,045. This
payable represents the Company's 80.1% share in SafeScience Newco, Ltd.'s
expenses for the period of November 1, 2001 through December 31, 2001. These
amounts are reported net in the accompanying consolidated balance sheet as of
December 31, 2001.

Summarized financial information for SafeScience Newco, Ltd. is presented below.
The amounts presented below are for 100% of SafeScience Newco, Ltd. as of
December 31, 2001 and for the period from inception through December 31, 2001.

Statement of Operations Information

Operating expenses                                $17,713,445
Net loss                                          $17,713,445

Balance Sheet Information

Current and total assets                          $    21,304
Current and total liabilities                     $   903,787
Stockholders' deficit                             $  (882,483)
Total liabilities and stockholders' deficit       $    21,304

(4)      RESTRUCTURING CHARGE

During the second quarter of 2000, the Company implemented a restructuring plan
to reduce the size and realign its organization to conform with strategic
changes. The major components of the restructuring relates to the elimination of
approximately 8 employees across the following functions: sales and marketing
(6), general and administrative (1), and research and development (1).
Components of the charge include severance and other related expenses. At
December 31, 2001 approximately $258,200 of accrued restructuring charges
remained which is comprised of severance costs. Approximately $372,000 of the
expense has been paid by the issuance of common stock. The total cash paid
through December 31, 2001 was approximately $671,000.

                                      F-17

                                                                              52

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001
                                   (Continued)


Restructuring reserve activities for the twelve months ended December 31, 2000
and 2001 were as follows:

<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------------
                                                                                                          Remaining Balance
                                             Reductions in         Revised         Paid during 2000       December 31, 2000
                           Estimated      Estimated Liability     Estimated
                            Expense                               Liability
-----------------------------------------------------------------------------------------------------------------------------
<S>                       <C>                 <C>                <C>                  <C>                     <C>
Severance and
 Benefits                 $1,410,000          $(246,044)         $1,163,956           $(737,956)              $426,000
-----------------------------------------------------------------------------------------------------------------------------
Litigation
                             100,000                  -             100,000                   -                100,000
-----------------------------------------------------------------------------------------------------------------------------
Other                        215,000                  -             215,000            (215,000)                     -
                          ----------          ---------          ----------           ----------              --------
-----------------------------------------------------------------------------------------------------------------------------
Total                     $1,725,000          $(246,044)         $1,478,956           $(952,956)              $526,000
                          ==========          =========          ==========           ==========              ========
-----------------------------------------------------------------------------------------------------------------------------

<CAPTION>
-----------------------------------------------------------------------------------------------------------------------------
                           Remaining                                                                      Remaining Balance
                            Balance          Reductions in         Revised         Paid during 2001       December 31, 2001
                          December 31,    Estimated Liability     Estimated
                              2000                                Liability
------------------------------------------------------------------------------------------------------------------------------
<S>                       <C>                 <C>                <C>                  <C>                     <C>
Severance and
 Benefits                 $  426,000          $ (77,283)         $  348,717           $ (90,482)              $258,235
------------------------------------------------------------------------------------------------------------------------------
Litigation
                             100,000           (100,000)                  -                   -                      -
------------------------------------------------------------------------------------------------------------------------------
Other                              -                  -                   -                   -                      -
                          ----------          ---------          ----------           ---------               --------
------------------------------------------------------------------------------------------------------------------------------
Total                     $  526,000          $(177,283)         $  348,717           $ (90,482)              $258,235
                          ==========          =========          ==========           =========               ========
------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(5) DISCONTINUED OPERATIONS

         On November 15, 2000, the Company engaged a merchant bank to explore
alternatives including sale or other disposition of the Company's consumer,
commercial and agriculture business areas. The Company terminated operations of
the consumer and commercial product business areas on February 23, 2001 and
began the process of liquidating all assets and liabilities pertaining to those
operations.

         Accordingly, the Company treated its consumer and commercial products
operations as a discontinued operation in accordance with APB Opinion No. 30 and
reclassified the 1999 financial statements to reflect this treatment. For the
year ended December 31, 2000, the Company recorded a reserve in the amount of
$1,750,000 which includes approximately $983,000 to reduce the carrying value of
assets to their estimated liquidation value and a liability of approximately
$767,000 to accrue for the cost of closing the operations. For the year ended
December 31, 2001, the Company recorded additional expenses totaling $533,200
related to discontinued operations, $186,629 of which related to an additional
loss on disposal of assets and $346,571 of which related to an accrual for
additional rent expense for space that the Company was unable to sublet. The
liability for discontinued operations was reduced by payments made in 2001.

                                      F-18

                                                                              53

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001
                                   (Continued)


         The net losses of these operations are included in the statements of
operations under discontinued operations. The loss from discontinued operations
consists of the following:


<TABLE>
<CAPTION>
                                                            Years Ended December 31,
                                             1999            2000               2001
<S>                                      <C>              <C>              <C>
Revenues                                 $ 1,368,514      $ 1,354,898      $        --
Cost of goods sold                         1,410,732        1,229,508          186,629
                                         -----------      -----------      -----------
Gross margin                                 (42,218)         125,390         (186,629)
                                         -----------      -----------      -----------
Marketing                                  2,818,050        3,566,900               --
General and administrative                        --               --          346,571
Research and development                      19,120          297,657               --
                                         -----------      -----------      -----------
Total expenses                             2,837,170        3,864,557          346,571
                                         -----------      -----------      -----------
Operating loss                            (2,879,388)      (3,739,167)        (533,200)
Provision for loss on disposal                    --       (1,750,000)              --
                                         -----------      -----------      -----------
Loss from discontinued operations        $(2,879,388)     $(5,489,167)     $  (533,200)
                                         ===========      ===========      ===========
</TABLE>

(6)     STOCKHOLDERS' EQUITY (DEFICIT)

     (a) Authorized Shares

The authorized capital stock of GlycoGenesys, Inc. consists of 105,000,000
shares consisting of 100,000,000 shares of common stock, $0.01 par value per
share, of which 33,568,952 were outstanding as of December 31, 2001 and
5,000,000 shares of preferred stock of which 6,924 shares were outstanding as of
December 31, 2001.

     (b) Sales of Common Stock

In 1999, the Company sold 1,399,101, 307,500, and 216,605 shares of common stock
for $4.50, $3.50 and $ 15.24 weighted average price per share, respectively. The
Company also issued 545,396 shares of common stock for warrants exercised at an
average of $ 3.333 per share.

                                      F-19

                                                                              54

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001
                                   (Continued)

In 2000, the Company sold 484,429, 333,334 and 3,960,421 shares of common stock
at $ 14.45, $12.00 and $1.1875 per share, respectively. The Company also issued
2,262,256 shares of common stock for warrants exercised on a cashless basis.
Warrants to purchase 108,996, 83,334 and 1,964,168 shares of common stock were
included in each transaction, respectively.

The stock subscription receivable at December 31, 2000 was received in cash by
the Company during the first quarter of 2001 and, accordingly, the amount is
reported as a current asset in the accompanying consolidated balance sheet as of
December 31, 2000.

In 2001, the Company sold 775,000, 2,700,000, 470,370 and 4,280,362 shares of
common stock at a weighted average price of $1.13, $1.31, $1.35 and $1.33 per
share, respectively. Warrants to purchase 420,000, 381,679, 235,186 and
2,311,402 shares of common stock were included in each transaction,
respectively. The Company also issued 765,526 shares of common stock for
warrants exercised including 729,445 which were exercised on a cashless basis.

(c) Stock Option Plans

The Company has a Nonqualified Stock Option Plan (1996 Plan) and has registered
500,000 shares of common stock with the Securities and Exchange Commission for
future issuance under option agreements. The exercise price of each option will
be determined by the Board of Directors and must be exercised within ten years
from May 1, 1996. The Company may issue these options to its officers,
directors, employees and consultants. As of December 31, 2001, no shares were
available for future grant.

Effective December 1, 1998, the Company adopted the 1998 Stock Option Plan (1998
Plan) under which 600,000 shares of common stock were reserved for issuance
under option agreements. As with the 1996 Plan, the exercise price of the each
option will be determined by the Board of Directors and may be issued to
officers, directors, employees and consultants. Additionally, the options must
be exercised within 10 years from December 1, 1998. As of December 31, 2001, no
shares were available for future grant.

Effective June 7, 2000, the Company adopted the 2000 Stock Incentive Plan under
which 1,000,000 shares of common stock were reserved for issuance under option
agreements. On June 5, 2001, the plan was amended to increase the number to
2,250,000 shares of common stock reserved for issuance under option agreements.
As with the 1998 Plan, the exercise price of the each option will be determined
by the Board of Directors and may be issued to officers, directors, employees
and consultants. Additionally, the options must be exercised within 10 years
from date of issuance. As of December 31, 2001, options to purchase 1,502,970
shares were available for future grant.

                                      F-20


                                                                              55

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001
                                   (Continued)




The following table summarizes all stock option activity to employees and
consultants for services as of December 31, 2001.

                                                                  Weighted
                                                                  Average
                                                    Number   Exercise Price
                                                    Of Shares     Per Share

Balance, December 31, 1998                            190,147      $  1.74
  Granted                                             486,931        12.94
  Exercised                                           (78,877)        3.67
  Forfeited                                           (12,777)       13.38
                                                    ---------      -------
Balance, December 31, 1999                            585,424        10.42
  Granted                                             768,357         4.22
  Exercised                                           (44,376)        0.01
  Cancelled                                          (145,988)       13.00
                                                    ---------      -------
Balance, December 31, 2000                          1,163,417         6.39
  Granted                                             425,629         0.72
  Exercised                                          (195,000)        0.01
  Cancelled                                          (275,504)        5.34
                                                    ---------      -------
Balance, December 31, 2001                          1,118,542      $  5.69
                                                    =========      =======

Exercisable at December 31, 1999                      561,424      $ 10.42
                                                    =========      =======

Exercisable at December 31, 2000                      596,236      $  8.89
                                                    =========      =======

Exercisable at December 31, 2001                      806,869      $  6.67
                                                    =========      =======

                                      F-21


                                                                              56

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001
                                   (Continued)


The following table presents weighted-average price and life information about
significant option groups outstanding at December 31, 2001:

<TABLE>
<CAPTION>
            ---------Options Outstanding----------               ---Options Exercisable---
                                         Weighted
                                         Average
                                        Remaining     Weighted                   Weighted
                                       Contractual     Average                    Average
                          Number          Life        Exercise    Number         Exercise
Range of Exercise Prices  Outstanding  (in years)      Price      Exercisable      Price
<S>        <C>               <C>          <C>           <C>           <C>          <C>
$  0.0100 $ 0.9500          20,500       7.39          $ 0.24        20,500       $  0.24
   1.4700   1.4700         183,500       9.72            1.47       128,500          1.47
   1.7800   1.7800         140,000       5.97            1.78        46,655          1.78
   2.3500   3.0000         134,267       8.12            2.58       102,668          2.65
   3.4375   3.4375          73,079       1.81            3.44        73,079          3.44
   4.9700   4.9700         225,000       8.53            4.97        93,747          4.97
   5.5000  12.6250          67,272       6.34            6.22        66,796          6.18
  13.3750  13.3750         263,442       0.51           13.38       263,442         13.38
  13.6880  17.8125          11,040       0.99           15.22        11,040         15.22
  20.7500  20.3750             442       1.53           20.37           442         20.38
                         ---------       ----          ------       -------       -------
$  0.0100 $20.3750       1,118,542       5.80          $ 5.69       806,869       $  6.67
                         =========       ====          ======       =======       =======
</TABLE>

(d) Pro Forma Disclosures of Stock-Based Compensation

In October 1995, the Financial Accounting Standards Board issued SFAS No. 123,
"Accounting for Stock-Based Compensation". SFAS No. 123 requires the measurement
of the fair value of stock options or warrants granted to employees to be
included in the statement of operations or, alternatively, disclosed in the
notes to financial statements. The Company has determined that it will continue
to account for stock-based compensation for employees under Accounting
Principles Board (APB) Opinion No. 25, "Accounting for Stock Issued to
Employees", and elect the disclosure-only alternative under SFAS No. 123. The
Company records the fair market value of stock options and warrants granted to
nonemployees in the consolidated statement of operations. The Company has
computed the pro forma disclosures required under SFAS No. 123 for stock options
granted in 1999, 2000 and 2001 using the Black-Scholes option pricing model. The
weighted average assumptions used for 1999, 2000 and 2001 are as follows:

                                                  1999        2000          2001
  Risk-free interest rate                         5.8%       5.17%        4.302%
  Expected dividend yield                           -           -             -
  Expected life                                5 years     5 years     9.3 years
  Expected volatility                              60%        150%         99.5%
  Weighted average fair value
    of options granted                          $ 8.84      $ 2.44        $ 1.36


                                      F-22

                                                                              57

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001
                                   (Continued)

Had compensation cost for the Company's stock option plans been determined
consistent with SFAS No. 123, net loss would have been as follows:

<TABLE>
<CAPTION>
                                                 1999           2000            2001
<S>                                          <C>            <C>             <C>
As reported
 Net loss applicable to common shareholders $ (12,301,718)  $ (17,270,311)  $ (23,130,436)
                                            ==============  ==============  ==============
Pro forma
 Net loss applicable to common shareholders $ (12,792,904)  $ (18,550,776)  $ (23,708,592)
                                            ==============  ==============  ==============
Basic and diluted net loss per common share $       (0.77)  $       (0.94)  $       (0.84)
                                            ==============  ==============  ==============
Pro forma
Basic and diluted net loss per common share $       (0.80)  $       (1.01)  $       (0.87)
                                            ==============  ==============  ==============
</TABLE>

(e) Common Stock Warrants

The following table summarizes all warrant activity in connection with equity
financing as of December 31, 2001:

                                                Common Stock
                                                  Warrants
                                                              Weighted
                                                               Average
                                        Number of           Exercise Price
                                          Shares               Per Share

Balance, December 31, 1998                 650,385            $     4.10
  Granted                                   14,750                  4.75
  Exercised                               (545,396)                 4.75
  Cancelled                                (44,739)                 4.75
                                       -----------            ----------
Balance, December 31, 1999                  75,000                 10.40
  Granted                                4,872,360                  2.05
  Exercised                             (2,262,256)                 0.00
  Expired                                  (20,000)                 6.00
                                       -----------            ----------
Balance, December 31, 2000               2,665,104                  4.01
  Granted                                6,385,857                  1.51
  Exercised                               (765,526)                 0.00
  Cancelled                                (58,205)                11.34
                                       -----------            ----------
Balance, December 31, 2001               8,227,230            $     2.40
                                       ===========            ==========
Exercisable, December 31, 1999              75,000            $    12.40
                                       ===========            ==========
Exercisable, December 31, 2000           2,665,104            $     4.01
                                       ===========            ==========
Exercisable, December 31, 2001           7,400,667            $     2.54
                                       ===========            ==========

                                      F-23

                                                                              58

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001
                                   (Continued)


Warrants issued to certain investors contain anti-dilution provisions which
require the exercise price to be adjusted for securities transactions sold at
prices lower than the then current exercise price.

During 2001, the Company granted 1,500,000 warrants in connection with the
licensing agreement discussed in Note 10, 3,348,267 warrants in connection with
the issuance of common stock discussed in Note 6(b) and 1,537,590 warrants
issued to other investors in the Company.

(7)  OTHER EQUITY

(a) Adjustable Warrant.

In September 2000, The EITF issued 00-19  "Accounting for Derivative Financial
Instruments Indexed to and Potentially Settled in a Company's Own Stock", which
requires freestanding contracts that are settled in a company's own stock,
including common stock warrants, to be designated as an equity instrument, asset
or a liability. Under the provisions of EITF 00-19, a contract designated as an
asset or a liability must be carried at fair value, with any changes in fair
value recorded in the results of operations. A contract designated as an equity
instrument must be included within equity and no fair value adjustments are
required.

In accordance with EITF 00-19, the Company has determined that the outstanding
adjustable warrant, as of December 31, 2000, which required the issuance of
729,445 shares of the Company's common stock should be designated as temporary
equity. Under the transition rules of EITF 00-19, the Company was required to
record as temporary equity as of December 31, 2000, the intrinsic value of the
warrants outside of stockholders' equity. As of December 31, 2000, the Company
has reclassified the intrinsic value of the warrants of $866,216 to temporary
equity from additional paid-in capital. As of December 31, 2000, these warrants
had a fair value of approximately $866,216. On February 5, 2001, the Company
issued 729,445 shares of common stock in satisfaction of the warrants and
reclassified the temporary equity to additional paid-in capital.

                                      F-24

                                                                              59

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001
                                   (Continued)


(b) Preferred Stock

As more fully described in Note 3, during 2001 the Company issued Series A,
Series B and Series C Preferred Stock. At December 31, 2001, the Series A, B and
C Preferred stock contained provisions for redemption in cash in the event that
a change in control of the Company were to occur without prior approval by the
Board of Directors. During 2001, the SEC Staff made an announcement, Topic No.
D-98, which required that certain equity instruments that have liquidation
features similar to redemption features be reclassified as other equity. This
announcement was applied retroactively in the Company's fourth quarter of 2001,
by restating the third quarter 2001 financial statements to reclassify out of
stockholders' equity the outstanding preferred stock.

On April 16, 2002, the Company and EIS, the holder of the Series A, B, and C
Preferred Stock, amended the original terms of the preferred stock. As a result
of this amendment, the Company expects to reclassify the Series A, B and C
Preferred Stock into stockholders' equity as of April 16, 2002.

Series A Preferred Stock

            The Company's articles of incorporation provide for the issuance of
up to 7,500 shares of Series A Preferred Stock, of which 4,944.44 shares are
outstanding, and contains the designations, preferences and relative rights,
qualifications and restrictions of the Series A Preferred Stock.

            Dividends

            The Series A Preferred Stock receives a 7% annual dividend, payable
in kind. If the board of directors declares a dividend on outstanding shares of
Common Stock or any other capital stock that is junior or pari passu to the
Series A Preferred Stock, the holders of Series A Preferred Stock will be
entitled to receive the same amount of dividends as would be declared payable on
the number of shares of Common Stock into which the shares of Series A Preferred
Stock could be converted on the record date for such dividend.

                                      F-25

                                                                              60

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001
                                   (Continued)

          Liquidation

          Upon the Company's liquidation, dissolution or winding up, upon a
change in control or a sale of all or substantially all of the assets of the
Company, the holders of Series A Preferred Stock will be entitled to receive
before any distribution or payment is made to the holders of Common Stock or any
other series of preferred stock ranking, as to liquidation rights, junior to the
Series A Preferred Stock, and subject to the liquidation rights and preferences
of any class or series of preferred stock senior to, or on a parity with, the
Series A Preferred Stock as to liquidation preferences, an amount equal to
$2,430 per share, as adjusted for stock splits, stock dividends,
recapitalizations and the like, plus any accrued and unpaid dividends.

          If, upon the Company's liquidation, dissolution or winding up, the
assets and funds available for distribution to stockholders are insufficient to
pay the holders of Series A Preferred Stock the full amounts to which they are
entitled, then the holders of Series A Preferred Stock will share ratably,
together with the holders of capital stock with pari passu liquidation
preferences, in any distribution of available assets, pro rata in proportion to
the full liquidation preference to which each holder is entitled.

          After payment is made in full to the holders of Series A Preferred
Stock and the holders of capital stock with pari passu liquidation preferences,
the remaining assets available for distribution will be distributed among the
holders of Common Stock, the holders of Series A Preferred Stock and the holders
of capital stock with pari passu liquidation preferences based on the number of
shares of Common Stock held by each, assuming conversion of any other class of
series of capital stock convertible into shares of Common Stock.

          Voting Rights

          Holders of Series A Preferred Stock are not entitled to vote on
matters submitted to a vote of stockholders, except to (i) amend the articles of
incorporation so as to affect adversely the shares of Series A Preferred Stock,
(ii) change the rights of the holders of the Series A Preferred Stock in any
other respect, or (iii) authorize, create, designate or issue of any additional
equity securities having any rights that are senior or pari passu to the Series
A Preferred Stock with respect to liquidation preference or rights to dividends
or distributions, which shall require the approval of at least a majority of the
outstanding shares of Series A Preferred Stock, voting separately as a class.

                                      F-26

                                                                              61

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001
                                   (Continued)


          Conversion

          Each share of Series A Preferred Stock is convertible at any time
after two years after issuance, at the option of the holder, into the number of
shares of Common Stock equal to the Series A liquidation preference divided by
$2.43. The applicable conversion rate will be adjusted upon the occurrence of
various dilutive and other events specified in our articles of incorporation. In
the event of a merger in which our stockholders own less than 50% of the
surviving entity, all of the outstanding shares of Series A Preferred Stock will
automatically convert at our option or upon the election of the holders of at
least a majority of the outstanding shares of Series A Preferred Stock, into
Common Stock at the applicable conversion rate.

          Anti-Dilution Adjustments

          The conversion rate for the Series A Preferred Stock will be adjusted
upon the occurrence of various events, such as stock splits, recapitalizations,
mergers and consolidations, distribution of dividends payable in shares of our
Common Stock, and certain issuances of capital stock at below the lower of the
Series A conversion price and the fair market value of the Common Stock as
described in the articles of incorporation.

          Redemption

          On July 11, 2007, the Company is required to redeem all of the
outstanding shares of Series A Preferred Stock at a price per share equal to
$2,430 per share plus any accrued and unpaid dividends, at its option, in either
cash or by issuance of shares of Common Stock with an aggregate fair market
value equal to such redemption price.

          Exchange Rights

          The original purchaser (or any of its affiliates) of the Series A
Preferred Stock shall have the right, exercisable at its option at any time to
exchange all of the shares of Series A Preferred Stock for all the non-voting
convertible preferred shares of SafeScience Newco, Ltd., a Bermuda exempted
limited liability company, held by the Corporation and which shall be
convertible into 50% of Newco's common shares on a fully-diluted basis (or, if
such preferred shares of SafeScience Newco held by the Company shall have been
converted prior to the exercise of this exchange right, the Series A Preferred
Stock shall be exchangeable for the common shares of SafeScience Newco issued
upon such conversion).

                                      F-27

                                                                              62

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001
                                   (Continued)

          Other than in the case of a required conversion of the Series A
Preferred Stock, if any shares of the Series A Preferred Stock are converted
into shares of Common Stock, this exchange right shall be cancelled. In the case
of a required conversion of the Series A Preferred Stock, this exchange right
shall remain valid and enforceable.

Series B Preferred Stock

          The Company's articles of incorporation provide for the issuance of up
to 6,000 shares of Series B Preferred Stock, of which 862.70 shares were issued
on December 31, 2001 and are outstanding, and contains the designations,
preferences and relative rights, qualifications and restrictions of the Series B
Preferred Stock.

          Dividends

          The Series B Preferred Stock receives a 7% annual dividend, payable in
kind. If the board of directors declares a dividend on outstanding shares of
Common Stock or any other capital stock that is junior or pari passu to the
Series B Preferred Stock, the holders of Series A Preferred Stock will be
entitled to receive the same amount of dividends as would be declared payable on
the number of shares of Common Stock into which the shares of Series A Preferred
Stock could be converted on the record date for such dividend.

          Liquidation

          Upon liquidation, dissolution or winding up, upon a change in control
or a sale of all or substantially all of the assets of the Company, the holders
of Series B Preferred Stock will be entitled to receive before any distribution
or payment is made to the holders of Common Stock or any other series of
preferred stock ranking, as to liquidation rights, junior to the Series B
Preferred Stock, and subject to the liquidation rights and preferences of any
class or series of preferred stock senior to, or on a parity with, the Series B
Preferred Stock as to liquidation preferences, an amount equal to $1,700 per
share, as adjusted for stock splits, stock dividends, recapitalizations and the
like, plus any accrued and unpaid dividends.

          If, upon liquidation, dissolution or winding up, the assets and funds
available for distribution to stockholders are insufficient to pay the holders
of Series B Preferred Stock the full amounts to which they are entitled, then
the holders of Series B Preferred Stock will share ratably, together with the
holders of capital stock with pari passu liquidation preferences, in any
distribution of available assets, pro rata in proportion to the full liquidation
preference to which each holder is entitled.

                                      F-28

                                                                              63

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001
                                   (Continued)


          After payment is made in full to the holders of Series B Preferred
Stock and the holders of capital stock with pari passu liquidation preferences,
the remaining assets available for distribution will be distributed among the
holders of Common Stock, the holders of Series B Preferred Stock and the holders
of capital stock with pari passu liquidation preferences based on the number of
shares of Common Stock held by each, assuming conversion of any other class of
series of capital stock convertible into shares of Common Stock.

          Voting Rights

          Holders of Series B Preferred Stock are not entitled to vote on
matters submitted to a vote of stockholders, except to (i) amend the articles of
incorporation so as to affect adversely the shares of Series B Preferred Stock,
(ii) change the rights of the holders of the Series B Preferred Stock in any
other respect, or (iii) authorize, create, designate or issue of any additional
equity securities having any rights that are senior or pari passu to the Series
B Preferred Stock with respect to liquidation preference or rights to dividends
or distributions, which shall require the approval of at least a majority of the
outstanding shares of Series B Preferred Stock, voting separately as a class.

          Conversion

          Each share of Series B Preferred Stock is convertible at any time
after two years after issuance, at the option of the holder, into the number of
shares of Common Stock equal to the Series B liquidation preference divided by
$1.70. The applicable conversion rate will be adjusted upon the occurrence of
various dilutive and other events specified in the articles of incorporation. In
the event of a merger in which the Company's stockholders own less than 50% of
the surviving entity, all of the outstanding shares of Series B Preferred Stock
will automatically convert at the Company's option or upon the election of the
holders of at least a majority of the outstanding shares of Series B Preferred
Stock, into Common Stock at the applicable conversion rate.

          Anti-Dilution Adjustments

          The conversion rate for the Series B Preferred Stock will be adjusted
upon the occurrence of various events, such as stock splits, recapitalizations,
mergers and consolidations, distribution of dividends payable in shares of the
Company's Common Stock, and certain issuances of capital stock at below the
lower of the Series B conversion price and the fair market value of the Common
Stock as described in the Company's articles of incorporation.

                                      F-29

                                                                              64

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001
                                   (Continued)

            Redemption

            Shares of Series B Preferred Stock are not redeemable.

Series C Preferred Stock

            The Company's articles of incorporation provide for the issuance of
up to 1,117 shares of Series C Preferred Stock, of which 1,116.79 were issued
during 2001 and are outstanding, and contains the designations, preferences and
relative rights, qualifications and restrictions of the Series C Preferred
Stock.

            Dividends

            The Series C Preferred Stock do not bear a dividend.

            Liquidation

            Upon our liquidation, dissolution or winding up, upon a change in
control or a sale of all or substantially all of the assets of the Company, the
holders of Series C Preferred Stock will be entitled to receive, pari passu with
the holders of Common Stock and subject to the rights of holders of senior
classes or series of capital stock, our assets in proportion to the number of
shares of Common Stock into which the Series C Preferred Stock held by such
holder are convertible.

            Voting Rights

            Except as required by law, holders of Series C Preferred Stock are
not entitled to vote on matters submitted to holder of the Common Stock or any
other class of capital stock.

            Conversion

            Each share of Series C Preferred Stock is convertible at any time
after two years after issuance, at the option of the holder, into 1,000 shares
of Common Stock. The applicable conversion rate will be adjusted upon the
occurrence of various dilutive and other events specified in the Company's
articles of incorporation. In the event of a merger in which the Company's
stockholders own less than 50% of the surviving entity, all of the outstanding
shares of Series C Preferred Stock will automatically convert at the Company's
option or upon the election of the holders of at least a majority of the
outstanding shares of Series C Preferred Stock, into Common Stock at the
applicable conversion rate.

                                      F-30

                                                                              65

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001
                                   (Continued)
            Anti-Dilution Adjustments

            The conversion rate for the Series C Preferred Stock will be
adjusted upon the occurrence of various events, such as stock splits,
recapitalizations, mergers and consolidations described in our articles of
incorporation.

            Redemption

            Shares of Series C Preferred Stock are not redeemable.

(8)  RELATED PARTY TRANSACTIONS

In January 1994, the Company agreed that one of its founders, Dr. David Platt,
would receive a royalty of 2% of net sales, in exchange for the licensed patent
rights on certain products being developed. The Company has agreed to pay all of
the costs to procure and maintain any patents granted under this agreement. The
agreement includes a requirement that the royalties paid in the sixth year of
this agreement and all subsequent years meet a minimum requirement of $50,000.
If this requirement is not met, Dr. Platt may terminate the agreement and retain
the patent rights. The Company may terminate the agreement on 60 days' notice.
The Company has not made any royalty payments under the agreement. The parties
executed an amendment to the agreement to delay the first year of this minimum
threshold from 1999 to 2002.

On December 6, 1996, Dr. Platt signed a Confidentiality and Invention Agreement
with the Company. The Agreement provides that Dr. Platt assigns all his rights,
title and interest in any invention, data or idea, made or conceived or reduced
to practice either alone or jointly with others to the Company. Further, the
agreement provides all rights thereto shall remain the sole property of the
Company and Dr. Platt agreed not to disclose any information about the Company's
confidential information.

            On June 15, 1999, the Company entered into a transaction whereby Mr.
Salter, its former executive vice president, relinquished an option to purchase
100,000 shares of common stock for a price of $0.01 per share which would have
vested on January 1, 2000 and, in exchange, the Company issued to him a stock
option for 250,000 shares of common stock at an exercise price of $10.70 per
share, the estimated fair market value of the common stock on the date of the
transaction. The option was exercised immediately. The Company loaned Mr. Salter
an amount representing the entire exercise price. The principal balance of this
note is $2,675,000, and accrues interest at 4.92% per annum, compounded
semi-annually. Mr. Salter pledged the 250,000 shares of common stock as
collateral. The loan is non-recourse and is secured by the pledged shares. All
outstanding principal, together with accrued interest in the unpaid principal
balance of this note, will be due on June 15, 2004. The balance outstanding as
of December 31, 2001 is $2,675,000.

                                      F-31

                                                                              66

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001
                                   (Continued)

            The Board has agreed to compensate Mr. Hughes for services rendered
beyond his role as a director, effective October 1, 2001, in the amount of
$1,200 per day, not to exceed $60,000 per year, and he has received $8,100 in
connection therewith for the period October 1, 2001 to December 31, 2001.

Notes receivable from related parties at December 31, 2000 included $61,548 of
promissory notes from Bradley J. Carver, Chief Executive Officer and President
of the Company. The loan was paid in full with interest during 2001.

(9) COMMITMENTS AND CONTINGENCIES

(a) Clinical Trials

            The Company retained Beardsworth Consulting Group, a full-service
contract research organization, to support two projects: A Phase I dose
escalation trial, and database transfer/management for the recently completed
Phase II(a) trials. They will provide clinical research management, study
monitoring, data management and medical writing. The costs for both efforts will
be approximately $1,228,000 and be paid out over the next 9-12 months. In
addition, costs associated with the Phase I dose escalation trial currently
being conducted at Sharp Memorial Hospital will be approximately $545,000 paid
over the next 9-12 months.

            The costs of these trials are intended to be qualified expenses of
SafeScience Newco pursuant to our agreements with EIS and therefore potentially
reimbursable to GlycoGenesys through the method described in Note 3 up to a
maximum of approximately $10,200,000.

(b) Leases

The Company leases office space in Boston, Massachusetts, under an operating
lease expiring in May 2005. The Company also leases certain equipment under
operating leases.

                                      F-32

                                                                              67

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001
                                   (Continued)

Minimum future payments under the operating leases as of December 31, 2001 for
each of the next four calendar years are approximately as follows:

Years ending December 31,     ($000)
------------------------------------
        2002                $   407
        2003                    429
        2004                    449
        2005                     80
                            --------
                            $ 1,365

                            ========

Rent expense in the accompanying consolidated statements of operations was
approximately $223,000, $395,000 and $388,000, in 1999, 2000 and 2001,
respectively. Additional rent expense of $346,000 was charged to discontinued
operations for surplus space.

 (10) LICENSING AGREEMENTS

In September 2000, the Company entered into a sales and distribution agreement
with BioSafe Technologies, Inc. of Denison, Texas, under which GlycoGenesys has
the right to market the patented BioSafe head lice cleansing product in the
consumer market within the United States, Mexico and Canada. The Company agreed
to purchase $150,000 of product and had the right to extend the term of the
agreement by purchasing product totaling approximately $312,500 before April 15,
2002. The Company and BioSafe Technologies agreed to terminate the license
agreement on April 27, 2001.

      During 2001, the Company executed an agreement with Wayne State University
and the Barbara Ann Karmanos Cancer Institute. This agreement grants the Company
an exclusive world-wide license to patents, patent applications, and other
intellectual property related to "GCS-100 Material" issued, developed, or
applied for by Wayne State University and the Barbara Ann Karmanos Cancer
Institute. This agreement adds the rights to these issued patents and patent
applications to the Company's existing patent portfolio, which consolidates the
rights to all of the parties' existing GCS-100 intellectual property within the
Company. Pursuant to this agreement, the Company is required to make up to
$1,935,000 in license payments. As of December 31, 2001, the Company had paid
license fees of $688,500 and owed license fees of $451,164. The balance of the
license payments under this agreement will be payable in 2002.

                                      F-33

                                                                              68

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001
                                   (Continued)

            The Company also granted Wayne State University and the Barbara Ann
Karmanos Cancer Institute warrants to jointly purchase 1,500,000 shares of
common stock at $1.15 that vest in quarterly installments over two years. Under
this agreement, Wayne State University and the Barbara Ann Karmanos Cancer
Institute are required to support the advancement of GCS-100 material over a two
year period. During the year ended December 31, 2001, the Company recorded an
expense of $1,046,730 related to the warrants which vested under this agreement
during the year and expense of $1,139,664 related to the license fees discussed
in the preceding paragraph.

            In order to maintain its rights under this agreement, the Company
may be required to make additional payments of up to $3,000,000 which are
contingent upon reaching future commercialization milestones. Specifically, the
Company must on the first occurrence of the following milestones: (a) pay Wayne
State University and the Barbara Ann Karmanos Cancer Institute $500,000 within
thirty (30) days following the date on which the Company commences Phase III
clinical drug investigations relating to GCS-100; (b) pay Wayne State University
and the Barbara Ann Karmanos Cancer Institute $1,000,000 within thirty (30) days
following the date on which the Company makes a new drug application ("NDA")
submission to the FDA relating to GCS-100; and (c) pay Wayne State University
and the Barbara Ann Karmanos Cancer Institute $1,500,000 within thirty (30) days
following the date on which the FDA approves an NDA of the Company covering
GCS-100. In addition, the Company will pay a 2% royalty jointly to Wayne State
University and the Barbara Ann Karmanos Cancer Institute on net sales of
GCS-100.

(11) INCOME TAXES

The Company accounts for income taxes under SFAS No. 109, "Accounting for Income
Taxes", the objective of which is to recognize the amount of current and
deferred income taxes payable or refundable at the date of the consolidated
financial statements as a result of all events that have been recognized in the
accompanying consolidated financial statements, as measured by enacted tax laws.

At December 31, 2001, the Company has net operating loss carryforwards for
federal income tax purposes of $62,511,942 which expire through 2021. The
Company also has certain tax credits available to offset future federal and
state income taxes, if any. Net operating loss carryforwards and credits are
subject to review and possible adjustments by the Internal Revenue Service and
may be limited in the event of certain cumulative changes in excess of 50% in
the ownership interests of significant stockholders over a three-year period.

                                      F-34

                                                                              69

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001
                                   (Continued)

The components of the Company's deferred tax asset follow:

                                                2000           2001
                                                ----           ----
Net operating loss carryforwards            $ 14,558,000   $25,174,000
Tax credit carryforwards                         456,000       682,000
Temporary differences                          2,672,000     1,671,000
                                            ------------   -----------
Total deferred tax assets                     17,686,000    27,527,000
Less valuation allowance                     (17,686,000)  (27,527,000)
                                            ------------   -----------
Deferred tax assets                         $          -   $         -
                                            ============   ===========

In evaluating realizability of these deferred tax assets, management has
considered the Company's short operating history, the volatility of the market
in which it competes and the operating losses incurred to date, and it believes
that given the significance of this evidence, a full valuation reserve against
its deferred tax assets is required as of December 31, 2000 and 2001. The
increase in the valuation allowance during these periods primarily relates to
the increase in the Company's net operating loss carryforwards.

(12) Employee Benefit Plan

The Company instituted the GlycoGenesys 401(k) Plan (the Plan) in 1998, pursuant
to which employees may defer compensation for income tax purposes under Section
401(k) of the Internal Revenue Code. Substantially all of the Company's
employees are eligible to participate in the Plan. Participants may contribute
up to 20% of their annual compensation to the Plan, subject to certain
limitations. The Company could match a discretionary amount as determined by the
Board of Directors. The Company did not make any contributions to the Plan
during 1999, 2000 and 2001.

(13) Subsequent Events

During the first quarter of 2002, the Company raised $5,650,666 in a private
placement offering of common stock whereby 3,008,608 shares were sold at a
weighted average price of $1.88 per share, as well as warrants to purchase
2,256,457 shares each at a weighted average price of $2.25 per share exercisable
for five years, and warrants to purchase 903,243 shares at $0.01 per share. Net
proceeds of this offering were $5,237,039. As part of this issuance, Elan
International Services, Ltd. purchased 597,205 shares at $1.79, pursuant to
their pre-emptive rights, as well as warrants to purchase 447,904 shares and
149,301 shares at a price of $2.15 and $0.01, respectively, exercisable for five
years.

                                      F-35

                                                                              70

<PAGE>

                               GLYCOGENESYS, INC.
                            (f/k/a SafeScience, Inc.)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001
                                   (Continued)

(14) Quarterly Financial Data (Unaudited)

Unaudited quarterly financial data for 2000 and 2001 is summarized below.

<TABLE>
<CAPTION>
                                                              Quarters Ended

                                  Mar. 31,   June 30,    Sept. 30,   Dec. 31,    Mar. 31,    June 30,     Sept. 30,    Dec. 31,
                             --------------------------------------------------------------------------------------------------
                                   2000        2000        2000        2000        2001        2001         2001         2001
                             --------------------------------------------------------------------------------------------------
<S>                               <C>         <C>         <C>         <C>           <C>           <C>          <C>    <C>
OPERATING EXPENSES:
  Research and
    development                   1,211       1,522       2,162       1,287         1,742         985          438    1,126
  General and
    administrative                  915       1,212         942       1,025         1,331       1,052          788      874
  Restructuring
    charge                            0       1,731        (252)          0          (183)          0            0        6
Total expenses                    2,126       4,465       2,852       2,312         2,890       2,037        1,226    2,006
 Operating loss                  (2,126)     (4,465)     (2,852)     (2,312)       (2,890)     (2,037)      (1,226)  (2,006)
OTHER INCOME/(EXPENSE):
 Other income
  Other income/
   Other expense                      0           0           0           0            (6)        (19)          (6)      (2)
  Interest income                    21         107          57          31            28           2           20       15
  Other income                        0           0           0           0             0           0            0      123
Total other income                   21         107          57          31            22         (17)          14      136
 Other expense
  Equity in loss of
    SafeScience
     Newco, Ltd.                      -           -           -           -             0           0       13,146    1,043
  Preferred stock
   dividend accretion                 -           -           -           -             0           0          189      215
  Interest expense                   33         188           1          22             -           -            -        -
Total other expense                  33         188           1          22             0           0       13,335    1,258
Total other income
  (expense)                         (12)        (81)         56           9            22         (17)     (13,321)  (1,022)
Loss from continuing
 operations                      (2,138)     (4,546)     (2,796)     (2,303)       (2,868)     (2,054)     (14,547)  (3,128)
Loss from discontinued
 operations                         560       1,147       1,276       2,505           187          57            0      289
Net loss                         (2,698)     (5,693)     (4,072)     (4,808)       (3,055)     (2,111)     (14,547)  (3,417)
                                  =====       =====       =====       =====         =====       =====       ======    =====
Basic
Net loss per common shares*
 Continuing operations            (0.13)      (0.25)      (0.15)      (0.11)        (0.11)      (0.08)       (0.51)   (0.12)
 Discontinued operations          (0.03)      (0.07)      (0.08)      (0.12)        (0.01)      (0.00)       (0.00)   (0.01)
                                   ----        ----        ----        ----          ----        ----         ----     ----
Total                             (0.16)      (0.32)      (0.23)      (0.23)        (0.12)      (0.08)       (0.51)   (0.13)
                                   ====        ====        ====        ====          ====        ====         ====     ====
</TABLE>

*Quarterly diluted net loss per common share are the same amounts as basic net
loss per common share for each quarter presented.

                                      F-36

                                                                              71

<PAGE>

                                    PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

DIRECTORS AND EXECUTIVE OFFICERS

Directors

The Board of Directors presently is comprised of four directors. Set forth below
is certain information with respect to each of the directors of the Company.

Bradley J. Carver, 40, the Chief Executive Officer since June 2000, has been
President and Treasurer and a member of the Board of Directors of the Company
since March 1995 and has been the President, Chief Financial Officer, Treasurer
and a member of the Board of Directors of IGG since February 1993. Mr. Carver is
a Class III director whose term expires in 2004. Mr. Carver has been President,
Chief Financial Officer, Treasurer and a member of the Board of Directors of
SafeScience Products, Inc., a wholly owned subsidiary of the Company since its
inception on June 23, 1995. Mr. Carver received a Bachelor of Arts degree in
management from Michigan State University in 1983.

David W. Dube, 46, has been a director of the Company since May 1998. Mr. Dube
is a Class III director whose term expires in 2004. Mr. Dube is President of
Peak Capital Corporation, a corporate finance and management firm. Mr. Dube was
Senior Vice President and Chief Financial Officer of FAB Capital Corporation, a
merchant banking and securities investment firm, and served in various other
capacities from September 1997 through October 1999. Mr. Dube was the President
and Chief Executive Officer of Optimax Industries, Inc., a publicly traded
company with interests in the horticultural, decorative giftware and truck part
accessories industries from July 1996 to September 1997. From February 1991 to
June 1996, Mr. Dube had been the principal of Dube & Company, a financial
consulting firm. Mr. Dube serves on the boards of directors of publicly-traded
CareerEngine Network, Inc., and New World Wine Group, Ltd. Mr. Dube is a
Certified Public Accountant in the state of New Hampshire, and holds general and
principal securities licenses.

Theodore J. Host, 56, has been a director of the Company since December 1998.
Mr. Host is a Class I director whose term expires in 2002. Since October 2001,
Mr. Host has been the CEO and Director, and from November 1999 until October
2001 was President, CEO, and a Director of Prestige Brands International, a
consumer products company. From October 1992 through April 1995, Mr. Host was
the President and Chief Operating Officer, and from April 1995 through February
1996, Chief Executive Officer, of The Scotts Company, a lawn care company. In
addition, Mr. Host worked with McCown DeLeeuw & Co. to create a consumer
products start up company from March 1996 to November 1999. Mr. Host holds a
Bachelor of Arts degree in business and a Master of Arts degree in business from
New York University.

Brian G.R. Hughes, 47, has been a director of the Company since December 1998.
Mr. Hughes is a Class II director whose term expires in 2003. Mr. Hughes is past
President of the Association of Alumni and Alumnae of the Massachusetts
Institute of Technology (MIT). Since July 1978, Mr. Hughes has held a variety

                                                                              72

<PAGE>

of positions with the MIT Corporation, the board which governs MIT. From
February 1989 through April 1995 Mr. Hughes was Vice Chairman and then CEO of
American Rocket Company, which worked to develop and commercialize safe, clean,
low cost hybrid rocket propulsion. Mr. Hughes holds a Bachelor of Science in
Mechanical Engineering from the Massachusetts Institute of Technology and a
Master in Business Administration from the Harvard Business School.

In addition to Mr. Carver who is listed as being a director of the Company, the
Company has the following executive officers:

John W. Burns, 56, has been the Company's Chief Financial Officer since January
2000. Prior thereto, Mr. Burns was the CFO/Senior Vice President, Finance &
Business Operations for South Shore Hospital, a regional healthcare services
provider based in South Weymouth, MA, from February 1993 to February 1999. From
January 1989 to December 1992, Mr. Burns was the Vice President/Treasurer and a
subsidiary CFO/Vice President, Finance for Eastern Enterprises, a NYSE company
engaged in energy and marine transportation. Mr. Burns has also held corporate
finance and treasury positions with Allied-Signal, Citicorp Investment Bank, and
International Paper. Mr. Burns holds a Master of Business Administration in
Finance from New York University and a Doctor of Philosophy degree in
Mathematics from Stevens Institute of Technology.

Christopher P. Szustkiewicz, Ph. D., 57, joined the Company in April 2002 as
Senior Vice President, Operations and Development. Dr. Szustkiewicz was the Vice
President, Planning & Program Management of Pharmacologics, LLC, an affiliate of
MDS, Inc., an investment and drug development company focused in oncology and
other therapeutic areas, from September 1999 to September 2001 and the Vice
President, MDS China Operations from June 1997 to August 1999. From August 1996
until May 1997, Dr. Szustkiewicz was the Managing Director for Clinical
Development Consultants, a health care consulting company based in Smithtown,
NY. Prior thereto, Dr. Szustkiewicz was the Vice President & General Manager of
International Pharmaceutical Outcomes in Uniondale, NY from February 1994 to
July 1996. In addition, Dr. Szustkiewicz has held executive positions with NDA
Clinical Trial Services, Inc., which he co-founded and Smithkline Beecham
Laboratories. Dr Szustkiewicz holds a Doctor of Philosophy degree in
Pharmacogenetics from West Virginia University.

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

Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and directors, and persons who own more than 10% of the Company's
outstanding shares of Common Stock (collectively, "Section 16 Persons"), to file
initial reports of ownership and reports of changes in ownership with the
Commission and Nasdaq. Section 16 Persons are required by Commission regulations
to furnish the Company with copies of all Section 16(a) forms they file. Based
solely on the its review of the copies of such forms received by it, or written
representations from certain Section 16 Persons that all Section 16(a) reports
required to be filed for such persons had been filed, the Company believes that
during the fiscal year ended December 31, 2001 the Section 16 Persons complied
with all Section 16(a) filing requirements applicable to them except for the
inadvertent late filing of a Form 4 by Theodore Host.

                                                                              73

<PAGE>

ITEM 11. EXECUTIVE COMPENSATION

     The following table sets forth the compensation paid or accrued during
2001, 2000 and 1999 for services rendered during such period by the chief
executive officer and chief financial officer (the "named executive officers").
No other executive officer of the Company had aggregate compensation from the
Company exceeding $100,000 in 2001.

                           Summary Compensation Table

<TABLE>
<CAPTION>
                                                                                       Securities
                                                                                       Underlying          All Other
           Position                        Year         Salary           Bonus          Options          Compensation
           --------                        ----         ------           -----          -------          ------------
<S>                                        <C>         <C>              <C>            <C>               <C>
Bradley J. Carver, Chief                   2001        $191,667         $35,000          69,400            1,795(2)
   Executive Officer,                      2000        $180,000              --          12,057            2,071(2)
   President and Treasurer (1)             1999        $157,500              --         100,000            3,160(3)

John W. Burns, Senior Vice President       2001        $178,750         $25,000         125,400            2,033(2)
and Chief Financial Officer                2000        $155,359              --         103,802            1,187(2)
</TABLE>

(1)  In June 2000, Mr. Carver was appointed to the additional position of Chief
     Executive Officer.
(2)  Consists of transportation-related payments and life insurance premiums.
(3)  Consists of transportation-related payments.

Option Grant Table. The following table set forth certain information regarding
options granted during the year ended December 31, 2001 to the named executive
officers.

<TABLE>
<CAPTION>
                     OPTION GRANTS DURING YEAR ENDED DECEMBER 31, 2001
                                     Individual Grants
-----------------------------------------------------------------------------------------
                           Number of       Percent of
                          Securities      Total Options                                        Potential Realizable Value at
                          Underlying       Granted to        Exercise or                    Assumed Annual Rates of Stock Price
                            Options       Employees in       Base Price                       Appreciation for Option Term (2)
        Name              Granted (#)    Fiscal Year (1)     ($/Share)    Expiration Date       5%($)                10%($)
        ----              -----------    ---------------     ---------    ---------------       -----                ------
<S>                       <C>            <C>                 <C>          <C>               <C>                     <C>
Bradley J. Carver          51,000(3)          14.5%            $0.01          2/15/11         121,608               193,942
Bradley J. Carver          19,400(3)           5.5%            $1.47          9/19/11          12,879                37,399
John W. Burns              51,000(3)          14.5%            $0.01          2/15/11         121,608               193,943
John W. Burns              14,400(3)           4.1%            $1.47          9/19/11           9,559                27,760
John W. Burns              60,000(4)          17.1%            $1.47          9/19/11          39,831               115,668
</TABLE>

(1)  Based on options to purchase an aggregate of 350,629 shares granted to
     officers and employees during the fiscal year ended December 31, 2001.
(2)  These columns show the hypothetical gains or option spreads of the options
     granted based on the fair market value of the Common Stock on the date of
     grant and assumed annual compound share appreciation rates of 5% and 10%
     over the full term of the options. The assumed rates of appreciation are
     mandated by the SEC and do not represent the Company's estimate or
     projection of future share prices. Actual gains, if any, on option
     exercises will depend on the timing of such exercise and the future
     performance of the Common Stock. Values are net of the option exercise
     prices, but do not include deductions for taxes or other expenses
     associated with the exercise.

(3)  The underlying shares were fully vested on the date of grant.

                                                                              74

<PAGE>

(4)  The underlying shares vest quarterly in equal installments over a three
     year period.

Year-end Option Table. The following table sets forth certain information
regarding options exercised during the year ended December 31, 2001 by the named
executive officers.

<TABLE>
<CAPTION>
                                        AGGREGATE OPTION EXERCISES AS OF DECEMBER 31, 2001
                                                    AND YEAR-END OPTION VALUES

                         Number of
                          Shares
                        Acquired On        Value           Number of Securities Underlying        Value of Unexercised Options at
       Name              Exercise       Realized ($)    Unexercised Options at Fiscal Year-End          Fiscal Year-End (1)
       ----              --------       ------------    --------------------------------------          -------------------
                                                           Exercisable        Unexercisable        Exercisable      Unexercisable
                                                           -----------        -------------        -----------      -------------
<S>                     <C>             <C>             <C>                   <C>                 <C>               <C>
Bradley J. Carver         51,000          $48,960            131,457                  --             258,970                 --
John W. Burns             51,000          $48,960             64,391             113,811             126,850            224,208
</TABLE>

(1)  Value is based on the closing price of the Common Stock on December 31,
     2001 of $1.97, the last trading day of the Company's 2001 fiscal year, less
     the applicable option exercise price.

Compensation Committee Report on Executive Compensation

The Compensation Committee of the Board of Directors of the Company determines
the cash and other incentive compensation, if any, to be paid to the Company's
executive officers and key employees.

Executive compensation consists of both cash and equity-based compensation. Cash
compensation is comprised of base salary and bonus. Base salary is determined
pursuant to employment agreements entered into with executive officers with
reference to market norms. Bonus compensation is related to the Company's
financial and non-financial performance. Bonus payments are made at the
discretion of the Compensation Committee at the end of the year. The
Compensation Committee awarded bonuses to Bradley Carver and John Burns of
$35,000 and $25,000, respectively, for 2001.

Equity-based compensation is comprised primarily of stock option grants. In
establishing equity-based compensation, the Compensation Committee places
particular emphasis on the achievement of the Company's long-term performance
goals. The Company believes that equity-based compensation closely aligns the
economic interest of the Company's executive officers with the economic
interests of the Company's shareholders. The Compensation Committee reviews the
outstanding unvested options of the key executives from time to time and may
grant additional options to encourage the retention of key executives. The
Compensation Committee retained an outside executive compensation firm to
provide consulting services and recommendations regarding executive
compensation. Executive compensation decisions and grants of stock options made
by the Compensation Committee were based in large part upon such
recommendations.

On February 15, 2001, the members of the Compensation Committee approved the
grant of an option award in the amount of 51,000 shares to each of Mr. Carver

                                                                              75

<PAGE>

and Mr. Burns. These grants were made in connection with performance during the
2000 fiscal year consistent with the remaining shares available for issuance
under the 1998 Stock Option Plan and the 2000 Stock Incentive Plan. On September
17, 2001, the Compensation Committee voted to increase Mr. Carver's base salary
from $180,000 to $220,000 and to increase Mr. Burns' base salary from $170,000
to $200,000. On September 19, 2001, the Compensation Committee voted the grant
of an option in the amounts of 19,400 and 14,400 shares to Mr. Carver and Mr.
Burns, respectively, also in connection with performance during the 2000 fiscal
year representing the balance of the proposed award following the approval of
the increase to the number of shares available in the 2000 Stock Incentive Plan
at the annual meeting of stockholders on June 5, 2001. In addition, on September
19, 2001, the Compensation Committee voted the grant of an option award in the
amount of 60,000 shares to Mr. Burns in consideration of his special
achievements and efforts in connection with the Company's financing.

The Chief Executive Officer's compensation generally is based on the same
policies and criteria as the other executive officers. Mr. Carver's base salary
was increased from $180,000 to $220,000 on September 17, 2001. Mr. Carver
received a $35,000 bonus for 2001. In establishing Mr. Carver's compensation,
the factors described above are taken into account. The Compensation Committee
believes that Mr. Carver's compensation, including salary and stock options,
falls within the Company's compensation philosophy and are within industry
norms. The Company retained an independent compensation consultant to help the
Company develop a formal compensation policy. Based upon a review of peer
companies and the industry in which the Company operates, the independent
compensation consultant provided the Company with a report on option grants to
existing employees and new hires, as well as a future cash bonus plan. The
objective of a formal compensation policy is to enable the Company to attract
and retain qualified executives, and reward executives for performance against a
blend of individual and Company goals agreed upon for each executive toward the
maximization of shareholder value. The Compensation Committee has implemented
this policy against which to assess executive compensation.

The above report of the Compensation Committee shall not be deemed to be
incorporated by reference by any general statement incorporating by reference
this Annual Report on Form 10-K into any filing under the Securities Act of 1933
or the Securities Exchange Act of 1934 and shall not otherwise be deemed filed
under such Acts.

                             Compensation Committee
                                  David W. Dube
                                Theodore J. Host
                                Brian G.R. Hughes

Compensation Committee Interlocks and Insider Participation

During the fiscal year ended December 31, 2001, Mr. Dube, Mr. Host and Mr.
Hughes served on the Compensation Committee. During the 2001 fiscal year, all
executive officer compensation decisions were made by the Compensation Committee
or the full Board of Directors. The Compensation Committee reviews and makes
recommendations regarding the compensation for top management and key employees
of the Company, including salaries and bonuses. No member of the

                                                                              76

<PAGE>

Compensation Committee during the 2001 fiscal year was an officer of the
Company.

Director Compensation

The Company's directors who are not employees of the Company will receive cash
compensation for their services equal to $2,000 per month, replacing the prior
meeting-based compensation. On December 1, 1998, directors who were not also
employees of the Company received non-qualified options to purchase 20,000
shares of Common Stock. Such options are fully vested. The exercise price of
such options is $5.50 per share, the average of the closing bid price of the
Common Stock during the twenty trading days prior to the date of grant of the
options, and the options bear a term of ten years from the date of the grant. In
addition, on December 7, 2000, each non-employee member of the Board of
Directors was awarded an option to purchase 20,000 shares of Common Stock under
the Corporation's 2000 Stock Incentive Plan. The exercise price of such options
is $2.35 per share, the average of the closing stock price on the 20 trading
days preceding the date of grant of the options. These options have a term of
ten years and vest quarterly over a two-year period to begin on December 1,
2000; provided, that such vesting shall cease in the event the Director ceases
to be a Director, in which case the shares vested prior thereto remain vested
and exercisable for the remaining ten-year term. Further, on December 7, 2000,
Mr. Hughes was granted options to purchase 25,000 shares of Common Stock at an
exercise price of $2.35 per share in connection with his assuming the position
of Chairman of the Company. Also, on September 19, 2001, each non-employee
member of the Board of Directors was awarded an option to purchase 25,000 shares
of Common Stock under the Company's 2000 Stock Incentive Plan. The exercise
price of such options is $1.47 per share, the average of the closing stock price
on the 20 trading days preceding the date of grant of the options. The options
have a term of ten years and are fully vested.

Directors who are employees of the Company or its affiliates do not receive any
compensation for their services as a director. Accordingly, Mr. Carver was not
compensated for his services as a director in 2001.

Employment Contracts

The Company has an employment agreement with Mr. Carver, as CEO and President of
the Company, dated as of June 29, 1999 (the "Employment Agreement"). The
following summary does not purport to be complete and is subject to and is
qualified in its entirety by reference to the Employment Agreement. A copy of
the Employment Agreement has been previously filed with the Securities and
Exchange Commission.

The Employment Agreement expires on June 29, 2002. The Employment Agreement
provides that Mr. Carver is entitled to an annual base salary of $220,000, and
to receive bonuses, in the discretion of the Compensation Committee, based upon
the Company and the executive meeting certain performance targets established by
the Compensation Committee.

Under the terms of the Employment Agreement, if the Company terminates the
executive's employment other than for Cause (as defined in the Employment

                                                                              77

<PAGE>

Agreement), or the executive terminates his employment because of a material
breach by the Company of his Employment Agreement, then the Company shall
continue to pay such executive his annual base salary in effect at the time of
termination for the duration of the term of the Employment Agreement, to be paid
at the time otherwise due, and any bonus not yet paid to the executive earned in
the year prior to termination, to be paid at the time otherwise to have been
paid, as if his employment had not been terminated.

In the event of termination of the employment of the executive by reason of
death or permanent disability (as defined in the Employment Agreement) of the
executive, the Company shall pay to the executive or his estate or other
successor in interest, at the time otherwise due, his annual base salary and any
benefits due to the executive through the date of termination, but reduced in
the case of permanent disability by any payments received under any disability
plan, program or policy paid for by the Company.

If the Company terminates the employment of the executive for Cause, or the
executive terminates his employment with the Company other than because of a
material breach by the Company of his Employment Agreement, the Company shall
pay the executive his annual base salary and benefits earned through the date of
termination, and the Company shall have no further obligations to the executive
under his Employment Agreement.

Under the terms of the Employment Agreement, the executive is prohibited from
competing with the Company during the periods of his employment with the Company
and for one year following the end of the scheduled term of such employment.
However, in the event of termination of the executive's employment by the
Company other than for Cause, or by the executive because of the material breach
by the Company of his Employment Agreement, the executive is prohibited from
competing with the Company after any such termination only for so long as the
executive is entitled to receive his annual base salary from the Company.

Mr. Carver is also subject to nondisclosure and confidentiality provisions under
the Employment Agreement, which provisions survive any termination of the
Employment Agreement.

Mr. Burns, who became an officer of the Company in January 2000, receives an
annual salary of $200,000 pursuant to an employment letter and has been granted
options whose vesting accelerates in the event of a change of control as defined
in the 2000 Stock Incentive Plan.

The Company has an employment agreement with Dr. Szustkiewicz, as Senior Vice
President of Operations and Development of the Company, dated as of March 18,
2002. The following summary does not purport to be complete and is subject to
and is qualified in its entirety by reference to the employment agreement. A
copy of which is attached as an Exhibit to the Company's Annual Report on Form
10-K.

The employment agreement provides that Dr. Szustkiewicz is entitled to an annual
base salary of $195,000 and an option to purchase 100,000 shares of the
Company's Common Stock with an exercise price equal to the higher of (i) the
closing price of the Common Stock on Dr. Szustkiewicz' starting date or (ii)

                                                                              78

<PAGE>

the average of the closing price on the twenty trading days preceding Dr.
Szustkiewicz' date of hire. The options vest in equal quarterly installments
over a three-year period; provided that the options will be fully vested upon a
change of control of the Company. Dr. Szustkiewicz will be eligible to receive
additional grants of stock options in the discretion of the Compensation
Committee, based upon the Company and the executive meeting certain performance
targets established by the Compensation Committee.

Under the terms of the employment agreement, the Company may terminate Dr.
Szustkiewicz' employment at any time, provided, that if the Company terminates
Dr. Szustkiewicz' employment other than for Cause (as defined in the employment
agreement), or because of a change of control, then the Company shall pay Dr.
Szustkiewicz a lump sum amount equal to (i) three months salary if his
termination occurs during his first eighteen months of employment, (ii) four
months salary if his termination occurs after eighteen months of employment
and(iii) six months salary if his termination occurs after twenty-four months of
employment.

                             STOCK PERFORMANCE GRAPH

The following graph compares the cumulative total return to shareholders of
Common Stock of the Company from December 31, 1996 through December 31, 2001 to
cumulative total return of the Nasdaq Stock Market (U.S.) Index and the Nasdaq
Biotechnology Index for the same period of time. The graph assumes $100 is
invested in the Company's stock and in each of the two indexes at the closing
market quotations on December 31, 1996 and that dividends are reinvested. The
performances shown on the graph are not necessarily indicative of future price
performance.

<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------------
                                                                      Cumulative Total Return
----------------------------------------------------------------------------------------------------------------------------
                                            12/96        12/97         12/98         12/99         12/00          12/01
----------------------------------------------------------------------------------------------------------------------------
<S>                                         <C>          <C>           <C>           <C>           <C>            <C>
GlycoGenesys, Inc.                          100.00       131.82        190.91        422.73         43.20          71.64
----------------------------------------------------------------------------------------------------------------------------
Nasdaq Stock Market (U.S.)                  100.00       122.48        172.68        320.89        193.01         153.15
----------------------------------------------------------------------------------------------------------------------------
Nasdaq Biotechnology                        100.00        99.93        144.18        290.72        357.52         299.62
----------------------------------------------------------------------------------------------------------------------------
</TABLE>

This stock price performance graph shall not be deemed to be incorporated by
reference by any general statement incorporating by reference this Annual Report
on Form 10-K statement into any filing under the Securities Act of 1933, as
amended, or the Exchange Act and shall not otherwise be deemed filed under such
Acts.

                                                                              79

<PAGE>

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

     The Company entered into a termination agreement with David Platt, its
former chief executive officer, as of June 1, 2000. Pursuant to the terms of the
termination agreement, the Company agreed to continue to pay Dr. Platt his
salary of $180,000 he received as chief executive officer through June 29, 2002,
subject to certain terms and conditions. The Company continues to provide health
insurance for Dr. Platt through June 29, 2002. Dr. Platt's obligations,
including, among other things, confidentiality, use or disclosure of company
materials, assignment of inventions and non-competition contained in his
employment agreement with the Company dated June 29, 1999 were maintained. In
addition, Dr. Platt agreed not to sell or otherwise transfer his shares or
options in the Company prior to June 29, 2002, and in consideration thereof, the
Company granted certain piggyback, or incidental, registration rights. Dr. Platt
agreed to reimburse the Company approximately $85,000 for certain personal
expenses and loans out of the proceeds of any sales by him of the Company's
stock.

     On January 7, 1994, as amended on April 14, 1999, the predecessor to the
Company entered into a licensing agreement with Dr. Platt, the Company's former
Chief Executive Officer and Chairman of the Board of Directors and a current 5%
stockholder, to pay Dr. Platt a royalty of two percent (2%) of the net sales of
the Company's GCS-100 product. The Company also agreed to pay all of the costs
to procure and maintain any patents granted under that agreement. The agreement
includes a requirement that the royalties paid in the sixth year of this
agreement and all subsequent years meet a minimum threshold of $50,000. The
parties executed an amendment to the agreement to delay the first year of this
minimum threshold from 1999 to 2002. If this threshold is not met (or if the
Company does not pay Dr. Platt the difference between the amount of actual
royalties and $50,000), Dr. Platt may terminate the agreement and retain the
patent rights. The Company may terminate the agreement on sixty days' notice.
The Company has not made any royalty payments under the agreement.

     On June 15, 1999, the Company entered into a transaction whereby Mr.
Salter, its former executive vice president, relinquished an option to purchase
100,000 shares of common stock for a price of $0.01 per share which would have
vested on January 1, 2000 and, in exchange, the Company issued to him a stock
option for 250,000 shares of common stock at an exercise price of $10.70 per
share, the estimated fair market value of the common stock on the date of the
transaction. The option was exercised immediately. The Company loaned Mr. Salter
an amount representing the entire exercise price. The principal balance of this
note is $2,675,000, and accrues interest at 4.92% per annum, compounded
semi-annually. Mr. Salter pledged the 250,000 shares of common stock as
collateral. The note is non-recourse and is secured by the pledged shares. All
outstanding principal, together with accrued interest in the unpaid principal
balance of this note, will be due on June 15, 2004. The balance outstanding at
March 31, 2002 is $2,675,000.

     The Company has agreed to compensate Mr. Hughes for services rendered
beyond his role as a director in the amount of $1,200 per day, effective October
1, 2001, and Mr. Hughes has received $8,100 in connection therewith for the
period October 1, 2001 to December 31, 2001.

                                                                              80

<PAGE>

                                    PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K.

(a)    Documents filed as part of this report:

   1) The following financial statements of GlycoGenesys, Inc. are contained in
      Item 8 of Part II of this Form 10-K/A:

      Report of Independent Auditors--Deloitte & Touche LLP

      Report of Independent Public Accountants--Arthur Andersen LLP

      Consolidated Balance Sheets as of December 31, 2001 and 2000

      Consolidated Statements of Operations for the years ended December 31,
      2001, 2000 and 1999.

      Consolidated Statements of Stockholders' Equity (Deficit) for the years
      ended December 31, 2001, 2000 and 1999.

      Consolidated Statements of Cash Flows for the years ended December 31,
      2001, 2000 and 1999.

      Notes to Consolidated Financial Statements

   2) Financial Statement Schedules:

      Financial statements of SafeScience Newco, Ltd. and Report of Independent
      Auditors--Deloitte & Touche

      Other financial statement schedules are omitted because the required
      information is not present or not present in sufficient amounts to require
      submission of the schedule or because the information is reflected in the
      consolidated financial statements or notes thereto.

                                                                              81

<PAGE>

Independent Auditors Report

To the Board of Directors and Stockholders of SafeScience Newco, Ltd.

We have audited the accompanying balance sheet of SafeScience Newco, Ltd. (a
development stage company) as of December 31, 2001 and the related statements of
operations, stockholders' equity, and cash flows for the period from inception
(July 10, 2001) through December 31, 2001. 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 an audit in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of the Company at December 31,
2001 and the results of their operations and their cash flows for the period
from inception (July 10, 2001) through December 31, 2001 in conformity with
accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. The Company is a development stage
company engaged in the development of a pharmaceutical product. As discussed in
Note 1 to the financial statements, the Company incurred a net loss of $17.7
million for the period from inception through December 31, 2001, and had an
accumulated deficit of $882,483 as of December 31, 2001. The Company expects to
incur substantial additional operating costs, including costs related to ongoing
research and development activities. Future funding is subject to continued
agreement of a business plan by the Company's owners. In the event funding is
not obtained, the Company may be required to curtail operations. These matters
raise substantial doubt about the Company's ability to continue as a going
concern. Managements' plans in regard to these matters are also described in
Note 1. The financial statements do not include any adjustments that might
result from the outcome of this uncertainty.

/s/ Deloitte & Touche

Hamilton, Bermuda
May 29, 2002

                                                                              82

<PAGE>

                             SafeScience Newco, Ltd.
                          (A Development Stage Company)


                                  BALANCE SHEET

                                     ASSETS
<TABLE>
<CAPTION>
                                                                                      December 31,
                                                                                         2001
                                                                                      ------------
<S>                                                                                   <C>
CURRENT ASSETS:

        Cash and cash equivalents                                                     $    19,054
        Prepaid expenses                                                                    2,250
                                                                                      -----------
               Total assets                                                           $    21,304
                                                                                      ===========

                      LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

CURRENT LIABILITIES:
        Accounts payable to related parties                                           $   903,787
                                                                                      -----------
Total current liabilities                                                             $   903,787
                                                                                      -----------

STOCKHOLDERS' EQUITY (DEFICIT):
        Convertible preferred stock,
          $1.00 par value
        Authorized-6,000 shares
           6,000 shares issued and outstanding
           as of December 31, 2001
           (liquidation value $7,500,000)                                                   6,000


        Common Stock, $1.00 par value
        Authorized - 6,000 shares
           6,000 shares issued and outstanding
            as of December 31, 2001                                                         6,000


        Additional Paid-in Capital                                                     16,818,962
        Deficit accumulated during the development stage                              (17,713,445)
                                                                                      -----------
      Total stockholders' equity (deficit)                                               (882,483)
                                                                                      -----------
                     Total liabilities & stockholders' equity (deficit)               $    21,304
                                                                                      ===========
</TABLE>

     The accompanying notes are an integral part of these financial statements.

                                                                              83

<PAGE>

                             SafeScience Newco, Ltd.
                          (A Development Stage Company)

                             STATEMENT OF OPERATIONS

                                         For The Period
                                         from Inception
                                         (July 10, 2001)
                                         through
                                         December 31, 2001
                                         -----------------
Operating expenses:
 Research and development                $  17,694,894
 General and administrative                     18,551
                                           -----------
    Total operating expenses                17,713,445
                                           -----------

     Net loss                            $ (17,713,445)
                                           ===========

   The accompanying notes are an integral part of these financial statements.

                                                                              84

<PAGE>

                             SafeScience Newco, Ltd.
                          (A Development Stage Company)

                   STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)

<TABLE>
<CAPTION>
                                Convertible                                             Deficit
                              Preferred Stock        Common Stock                     Accumulated
                            --------------------  --------------------    Additional  During the        Total
                            Number     $1.00      Number     $1.00         Paid-in    Development    Stockholder's
                            of Shares  Par Value  of Shares  Par Value     Capital       Stage      Equity (deficit)
                            ---------  ---------  ---------  ---------     -------    -----------   ----------------
<S>                         <C>       <C>         <C>        <C>         <C>          <C>           <C>
Inception of the Company:
Issuance of preferred
stock on July 10, 2001          6,000     $6,000         --         --   $ 7,494,000            --  $   7,500,000
Issuance of common stock
  on July 10, 2001                 --         --      6,000     $6,000     7,494,000            --      7,500,000
Capital contribution               --         --         --         --     1,830,962            --      1,830,962
Net Loss                           --         --         --         --            --   (17,713,445)   (17,713,445)
                            ---------  ---------  ---------  ---------   -----------  ------------  -------------
Balance, December 31, 2001      6,000     $6,000      6,000     $6,000   $16,818,962  $(17,713,445) $    (882,483)
                            =========  =========  =========  =========   ===========  ============  =============
</TABLE>

   The accompanying notes are an integral part of these financial statements.

                                                                              85

<PAGE>

                             SafeScience Newco, Ltd.
                          (A Development Stage Company)

                             STATEMENT OF CASH FLOWS

                                                           For The Period
                                                           from Inception
                                                           (July 10, 2001)
                                                               through
                                                          December 31, 2001
                                                          -----------------
Cash flows from operating activities:
 Net loss                                                   $ (17,713,445)
 Adjustments to reconcile net loss to net cash
   used in operating activities:
      Write-off of acquired technology                         15,000,000
      Changes in assets and liabilities:
        Prepaid expenses and other current assets                  (2,250)
        Accounts payable                                          903,787
                                                            -------------
           Net cash used in operating activities               (1,811,908)

Cash flows from financing activities:
 Capital contributions received                                 1,830,962
                                                            -------------
           Net cash provided by financing activities            1,830,962
                                                            -------------

Net increase in cash and cash equivalents                          19,054

Cash and cash equivalents, beginning balance                           --
                                                            -------------
Cash and cash equivalents, ending balance                   $      19,054
                                                            =============

Supplemental disclosure of non-cash financing activities:
 Issuance of preferred stock and
   common stock for technology license                      $  15,000,000
                                                            =============

   The accompanying notes are an integral part of these financial statements.

                                                                              86

<PAGE>

              SAFESCIENCE NEWCO, LTD. (A Development Stage Company)
 Notes to Financial Statements (including data applicable to unaudited periods)
                                December 31, 2001

(1) Operations

On July 10, 2001, GlycoGenesys, Inc. (GlycoGenesys, formerly known as
SafeScience, Inc.) and Elan Corporation, plc and EIS International Services Ltd.
("EIS"), formed SafeScience Newco Ltd. ("SafeScience Newco") an exempted Company
incorporated in Bermuda. SafeScience Newco is owned by GlycoGenesys and EIS
holding 80.1% and 19.9% fully-diluted interests, respectively. GlycoGenesys and
EIS own 100% and 0% of the common stock and 60.2% and 39.8% of the preferred
stock of SafeScience Newco, respectively. The primary objective of SafeScience
Newco is the business of development, testing, registration, manufacturing,
commercialization and licensing of GCS-100 as defined in the Subscription, Joint
Development and Operating Agreement dated July 10, 2001 between EIS and
GlycoGenesys.

On July 10, 2001, EIS acquired 4,944.44 shares of GlycoGenesys's Series A
convertible exchangeable preferred stock (Series A Preferred Stock) for
$12,015,000. The Series A Preferred Stock is convertible, at EIS's option, into
GlycoGenesys's common stock or exchangeable into shares of SafeScience Newco
preferred stock held by GlycoGenesys representing a 30.1% interest in
SafeScience Newco on a fully-diluted basis. Such exchange would increase EIS's
ownership in SafeScience Newco to 50% on a fully-diluted basis. GlycoGenesys
used the Series A Preferred Stock sale to purchase its 80.1% interest in
SafeScience Newco on a fully-diluted basis. SafeScience Newco used this, along
with EIS's 19.9% investment on a fully-diluted basis, to pay $15.0 million to
Elan for a license giving SafeScience Newco rights to use EIS's drug delivery
technologies. Immediately, upon completing this transaction, the cost of the
license was expensed as a research and development cost because revenue
resulting from such technology was not likely in the foreseeable future.

     While GlycoGenesys owns 100% of the voting common stock and 80.1% of the
outstanding capital stock on a fully-diluted basis of SafeScience Newco, Ltd. ,
EIS has retained significant minority investor rights that are considered
"participating rights" as defined in Emerging Issues Task Force (EITF) Issue
96-16, "Investors' Accounting for an Investee When the Investor Has a Majority
of the Voting Interest but the Minority Shareholder Has Certain Approval or Veto
Rights". EIS's participating rights overcome the presumption that GlycoGenesys
exercises control over SafeScience Newco.

Upon continued agreement of a business plan, and once agreement has been reached
on funding, GlycoGenesys and EIS contribute to SafeScience Newco in relation to
their relative fully-diluted ownership interests (see Note 5). In July 2001,
GlycoGenesys entered into an $9,612,000 stock subscription agreement (the
"Securities Purchase Agreement") with EIS. The stock purchases under the
Securities Purchase Agreement are restricted for GlycoGenesys's funding of
SafeScience Newco. As of December 31, 2001 there had been 862.71 shares
purchased under the Securities Purchase Agreement.

                                                                              87

<PAGE>

              SAFESCIENCE NEWCO, LTD. (A Development Stage Company)
                          Notes to Financial Statements
                                December 31, 2001
                                   (continued)

SafeScience Newco is in the development stage and is devoting substantially all
of its efforts toward product research and development. SafeScience Newco is
subject to a number of risks similar to those of other development stage
companies. Principal among these risks are the dependence on key individuals,
the need to develop commercially usable products, competition from substitute
products and larger companies, and the need to obtain adequate financing
necessary from GlycoGenesys and EIS to fund further product development.

The Company incurred a net loss of $17.7 million for the period from inception
through December 31, 2001 and had an accumulated deficit of $882,483 as of
December 31, 2001. The Company expects to incur substantial additional operating
costs, including costs related to ongoing research and development activities.
As discussed above, future funding is subject to continued agreement of a
business plan by the Company's owners. In the event funding is not obtained, the
Company may be required to curtail operations. These matters raise substantial
doubt about the Company's ability to continue as a going concern. The financial
statements do not include any adjustments that might results from the outcome of
this uncertainty.

(2) Summary of Significant Accounting Policies

The accompanying financial statements reflect the application of certain
accounting policies described below and elsewhere in the notes to the financial
statements.

(a) Fair Value of Financial Instruments

The carrying amounts of SafeScience Newco's financial instruments, which include
the amounts due to related parties, approximate their fair value.

(b) Concentrations of Limited Suppliers

Certain materials used in SafeScience Newco's development process are procured
from a single source. The failure of a supplier, including a subcontractor, to
deliver on schedule could delay or interrupt the development process and thereby
adversely affect SafeScience Newco's operating results.

(c) Use of Estimates

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

                                                                              88

<PAGE>

              SAFESCIENCE NEWCO, LTD. (A Development Stage Company)
                          Notes to Financial Statements
                                December 31, 2001
                                   (Continued)

(d) Research and Development Expenses

SafeScience Newco charges research and development expenses to operations as
incurred. The cost of the license from Elan was immediately expensed because
revenues resulting from such technology were not likely in the foreseeable
future.

(e) Comprehensive Loss

Comprehensive loss is defined as the change in stockholders' deficit during a
period from transactions and other events and circumstances from non-owner
sources. SafeScience Newco's net loss is equal to its comprehensive loss.

(f) Organization Costs

All organization costs have been expensed as incurred.

(g) Disclosures about Segments of an Enterprise

Operating segments are identified as components of an enterprise about which
separate discrete financial information is available for evaluation by the chief
operating decision maker, or decision making group, in making decisions
regarding resource allocation and assessing performance. To date, SafeScience
Newco has viewed its operations and manages its business as principally one
operating segment.

(3) Income Taxes

Under current Bermuda law, SafeScience Newco is not required to pay any taxes in
Bermuda on either income or capital gains. SafeScience Newco has received an
undertaking from the Minister of Finance in Bermuda that, in the event of such
taxes being imposed, SafeScience Newco will be exempt from taxation until the
year 2016.

(4) Stockholders' Deficit

(a) Authorized Stock

SafeScience Newco has authorized capital stock of 12,000 shares, of which 6,000
are $1.00 par value common stock and 6,000 are $1.00 par value convertible
preferred stock.

                                                                              89

<PAGE>

              SAFESCIENCE NEWCO, LTD. (A Development Stage Company)
                          Notes to Financial Statements
                                December 31, 2001
                                   (Continued)

(b) Common Stock

In July 2001, SafeScience Newco sold 6,000 shares of common stock at $1,250 per
share resulting in net proceeds of $7,500,000.

(c) Convertible Preferred Stock

In July 2001, SafeScience Newco sold 6,000 shares of convertible preferred stock
(Preferred Stock) at $1,250 per share resulting in net proceeds of $7,500,000.
The rights, preferences and privileges of the Preferred Stock are as follows:

Voting Rights

Preferred stockholders do not have voting rights.

Dividends

Preferred stockholders are entitled to dividends as and when declared by the
Board of Directors. Preferred stockholders are entitled to participate equally
on a pro rata basis in any dividend declared for the holders of common stock.

Liquidation Preference

In the event of liquidation, dissolution or winding-up of SafeScience Newco and
before any distribution to common stockholders and any prior series of preferred
stock, the holders of Preferred Stock are entitled to receive $1,250 per share,
respectively, plus all declared but unpaid dividends.

Conversion

Each share of Preferred Stock is convertible, at the option of the holder, into
one share of common stock, subject to adjustments for dilutive issuances of
stock at any time after July 10, 2002.

(5) Related Party Transactions

SafeScience Newco's research and development and general and administrative
costs were paid for directly by the SafeScience Newco stockholders. These
transactions are in the normal course of operations and amounts payable to these
stockholders are summarized as follows:

                                                                              90

<PAGE>

              SAFESCIENCE NEWCO, LTD. (A Development Stage Company)
                          Notes to Financial Statements
                                December 31, 2001
                                   (Continued)

                                        December 31,
                                            2001
                                        ------------
         Due to GlycoGenesys, Inc.       $  884,515
         Due to Elan, plc                $   19,272
                                         ----------
         Total                           $  903,787
                                         ==========

These balances are unsecured and interest free with no set terms of repayment.
They are classified as current liabilities as SafeScience Newco will reimburse
GlycoGenesys and Elan upon its funding by its stockholders.

                                                                              91

<PAGE>

Exhibits:

3)  See (c) below.


(b) Reports on Form 8-K.

          1)   Current Report on Form 8-K filed with the Securities and Exchange
               Commission on December 21, 2001 reporting the completion of a
               securities offering.

(c) Exhibits.

The following documents are incorporated herein by reference from the
Registrant's Form 10, as filed with the Securities and Exchange Commission, SEC
file No. 0-26476:

3.1    Articles of Incorporation of Alvarada, Inc.
3.2    Amendment to the Articles of Incorporation dated March 1, 1995.
3.3    Amendment to the Articles of Incorporation dated March 3, 1995.
3.4    Amendment to the Articles of Incorporation dated May 23, 1995
3.5    Bylaws of Alvarada, Inc.
3.6    Articles of Incorporation of International Gene Group.
3.7    Bylaws of the Company of International Gene Group.
3.8    Articles of Incorporation of Agricultural Glycosystems, Inc.
3.9    Bylaws of the Company of Agricultural Glycosystems, Inc.
4.1    Specimen Stock Certificate.
10.1   Agreement and Plan of Reorganization.
10.2   Licensing Agreement with Dr. Platt.


The following documents are incorporated herein by reference from the
Registrant's Form S-8 Registration Statement filed with the Commission on May
14, 1996, SEC file No. 333-04764:

10.5   Incentive Stock Option Plan.

The following documents are incorporated herein by reference from the
Registrant's Registration Statement on Form SB-2, filed with the Commission on
November 20, 1996, SEC file no. 333-16087:

10.10  Warrant Agreement with James C. Czirr.

The following documents are incorporated herein by reference from the
Registrant's Form 10-K for the period ending December 31, 1997:

10.12  Licensing Agreement with Agrogene Ltd.
99.1   Office Lease

The following documents are incorporated by reference from the Registrant's Form
8-K filed on April 7, 2000:

10.1   Securities Purchase Agreement by and among GlycoGenesys, Inc., Strong

                                                                              92

<PAGE>

       River Investments, Inc. and Montrose Investments Ltd., dated March 19,
       2000.
10.2   Form of Closing Warrants dated March 29, 2000.
10.3   Form of Adjustable Warrants dated March 29, 2000.
10.4   Registration Rights Agreement by and among GlycoGenesys, Inc., Strong
       River Investments, Inc. and Montrose Investments Ltd. dated March 29,
       2000.
10.5   Letter of Agreement by and among GlycoGenesys, Inc., Strong River
       Investments, Inc. and Montrose Investment Ltd. dated March 29, 2000.

The following documents are incorporated herein by reference from the
Registrant's Form 10-Q for the quarter ending September 30, 2000:

10.22  Employment Agreement between GlycoGenesys, Inc. and Bradley J. Carver
       dated June 29, 1999.
10.23  1998 Stock Option Plan
10.24  2000 Stock Incentive Plan

The following document is incorporated herein by reference from the Registrant's
Form 8-K filed on January 3, 2001:

10.1   License Agreement by and among SafeScience, Inc., Wayne State University
       and the Barbara Ann Karmanos Cancer Institute dated January 26, 2001.

The following document is incorporated herein by reference from the Registrant's
Form 10-K for the period ending December 31, 2000:

10.18  Product Formula between SafeScience, Inc. and Delta-Omega Technologies,
       Inc. dated January 5, 2001.

The following document is incorporated herein by reference from the Registrant's
Form 8-K filed on May 23, 2001:

10.1   Amendment No. 1 dated May 14, 2001 to the License Agreement by and among
       SafeScience, Inc., Wayne State University and the Barbara Ann Karmanos
       Cancer Institute dated January 26, 2001.

The following documents are incorporated herein by reference from the
Registrant's Form 8-K filed on June 29, 2001:

10.1   Securities Purchase Agreement dated June 22, 2001 between SafeScience,
       Inc. and Elan International Services, Ltd.
10.2   Subscription, Joint Development and Operating Agreement dated as of June
       29, 2001 among Elan Corporation, plc, Elan International Services, Ltd.,
       SafeScience, Inc. and SafeScience Newco, Ltd.
10.3   SafeScience License Agreement dated as of June 29, 2001 between
       SafeScience, Inc. and SafeScience Newco Ltd.
10.4   Elan License Agreement dated as of June 29, 2001 between Elan
       Corporation, plc and SafeScience Newco, Ltd.
10.5   SafeScience Registration Rights Agreement dated as of June 29, 2001
       between SafeScience, Inc. and Elan International Services, Ltd.

                                                                              93

<PAGE>

10.6   SafeScience Newco Registration Rights Agreement dated as of June 29, 2001
       among SafeScience Newco, Ltd. SafeScience, Inc. and Elan International
       Services, Ltd.

The following documents are incorporated herein by reference from the
Registrant's Form 10-Q for the quarter ending June 30, 2001:

4.1    Certificate of Designations, Preferences and Rights of Series A, Series B
       and Series C Preferred Stock of SafeScience, Inc.

10.7   Warrant dated July 10, 2001 issued to Elan International Services, Ltd.

The following documents are incorporated herein by reference from the
Registrant's Form 10-Q for the quarter ending September 30, 2001:

4.1    Certificate of Amendment to the Articles of Incorporation of the Company
       filed on October 31, 2001.

10.1   Amendment No. 2 dated November 7, 2001 to the License Agreement by and
       among GlycoGenesys, Inc., Wayne State University and the Barbara Ann
       Karmanos Cancer Institute dated January 26, 2001.

The following documents are an exhibit hereto:

10.1   Employment Agreement between GlycoGenesys, inc. and Chris Szustkiewicz,
       Ph.D. Dated March 18, 2002, as amended on March 22, 2002.*
23.1 Consent of Arthur Andersen LLP
23.2 Consent of Deloitte & Touche LLP
23.3 Consent of Deloitte & Touche (Hamilton, Bermuda)

--------------
* Previously filed on Annual Report of Form 10-K filed with the Securities and
Exchange Commission on April 16, 2002.

                                                                              94

<PAGE>

                                   SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this Report on Form 10-K/A to be
signed on its behalf by the undersigned, thereunto duly authorized, in Boston,
Massachusetts on this 30th day of May 2002.

                               GLYCOGENESYS, INC.
                      (formerly known as SafeScience, Inc.)

                                 BY:

                                        /s/ Bradley J. Carver
                                        Bradley J. Carver, President and
                                        Treasurer

                                        /s/ John W. Burns
                                        John W. Burns, Senior Vice President,
                                        Chief Financial Officer and Secretary

                                        /s/ Patrick J. Joyce
                                        Patrick J. Joyce, Principal Accounting
                                        Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
on Form 10-K/A has been signed by the following persons in the capacities and on
the dates indicated:

Signatures                          Title                          Date

/s/ Bradley J. Carver      President, Treasurer and
Bradley J. Carver          a member of the Board
                           of Directors                       May 30, 2002

/s/ John W. Burns          SVP, CFO and Secretary             May 30, 2002
John W. Burns

/s/ Patrick J. Joyce       Principal Accounting Officer       May 30, 2002
Patrick J. Joyce

/s/ David W. Dube
David W. Dube              Director                           May 30, 2002

/s/ Theodore J. Host
Theodore J. Host           Director                           May 30, 2002

/s/ Brian G. R. Hughes
Brian G. R. Hughes         Chairman of the
                           Board of Directors                 May 30, 2002

                                                                              95