U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                  FORM 10-KSB/A
                                (Amendment No.1)


(Mark One)

[X]      ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
         ACT OF 1934

         For the fiscal year ended December 31, 2003

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

         For the transition period from ________________ to ________________

                         Commission file number: 0-15070
                        REGENERX BIOPHARMACEUTICALS, INC.
                 (Name of small business issuer in its charter)

               DELAWARE                           52-1253406
    (State or other jurisdiction of   (I.R.S. Employer Identification number)
    incorporation or organization)

          3 BETHESDA METRO CENTER, SUITE 700, BETHESDA, MARYLAND 20814
           (Address of principal executive offices including zip code)

                     Issuer's telephone number: 301-961-1992
           Securities registered under Section 12(b) of the Act: None
                Securities registered under Section 12(g) of the Act:

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

Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports) and (2) has been
subject to such filing requirements for the past 90 days. YES  X  NO
                                                              ---    ---

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

State the issuer's revenues for its most recent fiscal year: $0.

The aggregate market value of the voting stock held by non-affiliates of the
registrant, computed by reference to the closing price of such stock on the OTC
Bulletin Board on March 2, 2004, was approximately $23,319,941. (The exclusion
from such amount of the market value of the shares owned by any person shall not
be deemed an admission by the registrant that such person is an affiliate of the
registrant.)

The number of shares of issuer's Common Stock outstanding as of March 2, 2004
was 32,542,548.

TRANSITIONAL SMALL BUSINESS DISCLOSURE FORMAT (CHECK ONE) YES     NO  X
                                                              ---    ---

The primary purpose of this Amendment No. 1 to the Form 10-KSB for the year
ended December 31, 2003, is to timely file required Part III information and to
make other textual changes. The Part III information was originally expected to
be incorporated from the proxy statement for the 2004 annual meeting, however,
the proxy statement will not be filed until May.


<PAGE>


                                     PART I

ITEM 1.  BUSINESS

GENERAL

         RegeneRx Biopharmaceuticals, Inc. ("RegeneRx") was formed in 1982 and
is a pharmaceutical research and development company focusing on the development
of products to treat a variety of human diseases. RegeneRx's current primary
business focus is the commercialization of Thymosin beta 4 ("T(beta)4"), a 43
amino acid peptide. RegeneRx is concentrating its efforts on the use of T(beta)4
for the treatment of injured tissue and non-healing wounds to enable more rapid
repair and/or tissue regeneration.

         RegeneRx utilizes a virtual company strategy in order to effectively
control costs while focusing on the clinical development of T(beta)4. RegeneRx
uses this model for certain research and development, clinical trials, and
manufacturing operations, as well as other functions critical to its mission.
RegeneRx believes this approach enhances its ability to allocate resources
rapidly to different projects. The strategy consists of (i) identifying,
evaluating and licensing pharmaceutical product opportunities that appear to
have a significant commercial potential; (ii) designing pre-clinical and/or
clinical protocols to test such products; (iii) 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 its designed protocols; and (iv) pursuing sublicense
arrangements with established pharmaceutical companies to support late stage
clinical testing and ultimately marketing if regulatory approval is obtained.

PRIMARY COMMERCIAL DEVELOPMENT FOCUS - THYMOSIN BETA 4

         General. Originally isolated from the thymus, Thymosin beta 4 is a
chemically synthesized copy of a natural human peptide that circulates in the
blood and plays a vital role in the regeneration, remodeling and healing of
tissues. Although it is recognized that wound healing is a complex process, most
companies working to develop new drugs in this area have focused primarily on
adding different growth factors to stimulate healing and have, to date, failed
to demonstrate dramatic improvements in the healing process. T(beta)4 represents
a new type of compound being developed to speed the healing of injured tissues,
accelerate the growth of blood vessels and reduce inflammation. It represents a
technology platform from which RegeneRx intends to investigate potential
clinical uses beyond chronic dermal wounds. Unlike compounds such as
Platelet-Derived Growth Factor, Keratinocyte Growth Factor, Epidermal Growth
Factor, or basic Fibroblast Growth Factor, T(beta)4 is not a growth factor and,
unlike Interleukin-1 or Tumor Necrosis Factor, T(beta)4 is not a cytokine.
(Cytokines are proteins and peptides, which act as immune regulators and
modulate the functional activities of individual cells and tissues.) Rather, it
regulates the actin molecule and reduces inflammation in most mammalian cells
and as such plays a vital role in the healing of injured or damaged tissues.
Actin comprises up to 10% of the protein of non-muscle cells and plays a central
role in cell structure (formation of the cytoskeleton) and in the movement of
cells throughout the body. Research studies from the National Institute of
Health ("NIH") established that T(beta)4 stimulates the migration of human
keratinocytes (skin cells) and the migration of human endothelial cells.
Endothelial cells are the major cell types responsible for the formation of
blood vessels and other tissues. These studies were the first to document the
important role of T(beta)4 in wound healing.

         Product Development. RegeneRx first began evaluating T(beta)4 in
diseases associated with actin toxicity, such as cystic fibrosis. In March 1997,
RegeneRx provided funding under a research contract with Vanderbilt University
to determine the effect of T(beta)4 in a sheep model of Adult Respiratory
Distress Syndrome, a syndrome associated with septic shock. In animal models of
septic shock, Thymosin beta 4 has been shown to reduce endotoxin-induced death,
presumably by modulating pathologic mediators of inflammation and cell death,
including the depolymerization of actin. RegeneRx is considering additional
studies for this use of Thymosin beta 4 and holds two patents related to this
application. See "--Proprietary Rights" below.

         RegeneRx's main product development focus is the use of T(beta)4 for
the treatment of non-healing wounds and similar medical problems, such as
Epidermolysis Bullosa, chronic pressure ulcers and diabetic lower extremity
ulcers. RegeneRx entered into a Material Transfer - Cooperative Research and
Development Agreement with the


                                       2
<PAGE>


NIH during the second quarter of 1997. Under this agreement, RegeneRx received
an option to elect an exclusive or non-exclusive commercialization license from
the NIH for any patent rights that might result from the NIH research study that
relate to the use of T(beta)4 as a tissue growth and repair factor. A
provisional patent application was filed by NIH in July 1998, with a Patent
Cooperation Treaty application filed in July 1999, pertaining to the work
performed on T(beta)4. On February 6, 2001, RegeneRx executed an agreement with
the NIH giving RegeneRx an exclusive worldwide license from the NIH for all
claims to T(beta)4 within the patent application. In exchange for the exclusive
license, RegeneRx must make certain royalty and milestone payments to the NIH.
No assurance can be given as to whether or when a patent will be issued, or as
to any conditions that might be attached to the patent.

         To date, the NIH has performed pre-clinical animal studies using
T(beta)4, supplied by RegeneRx, which have indicated that T(beta)4 is effective
in healing injured dermal and ocular tissue and improving wound healing and
chemical burns in normal, elderly, diabetic, and steroid-suppressed rodents and
other mammals. In December of 2002, RegeneRx initiated research under an
Investigational New Drug Application ("IND"), from the U.S. Food and Drug
Administration ("FDA") allowing it to begin Phase I human clinical trials. The
Phase I study was successfully completed in September of 2003. For additional
information regarding the regulatory approval process for RegeneRx's products,
see "-- Government Regulation" below.

         Other areas RegeneRx may explore with T(beta)4 are the healing of eye
injuries, including chemical burns and inflammatory processes, post surgical
healing, and wound healing in patients undergoing steroidal therapy, among other
indications. RegeneRx also is reconsidering the possible applications of
T(beta)4 for the treatment of septic shock and cystic fibrosis, as well as other
internal wound healing applications.

         All of RegeneRx's efforts to develop additional applications would
likely require substantial additional capital or a strategic alliance or other
partnership arrangement with a firm providing the capital and/or necessary
expertise. RegeneRx has placed development of T(beta)4 for wound healing as its
highest product development priority. For additional information regarding
RegeneRx's efforts to commercialize Thymosin beta 4, see "--Proprietary Rights"
below.

MANUFACTURING

         RegeneRx, uses outside contract manufacturers to manufacture bulk
T(beta)4 and formulate it into a final product, which product was used for its
Phase I clinical trials and will be used for future clinical trials. Additional
manufacturers have been identified for manufacturing of the bulk T(beta)4 as
well as for the final T(beta)4 products. No agreements with these manufacturers
have been entered into, however, and no assurance can be given that such
agreements will be negotiated on terms favorable to RegeneRx, or at all.
Contractors will be selected on the basis of their supply capability, ability to
produce a drug substance in accordance with current Good Manufacturing Practice
requirements of the FDA and to meet Company-established specifications. Although
RegeneRx has enough bulk T(beta)4 for its currently scheduled clinical trials,
there can be no assurance that RegeneRx will have sufficient funds to cover the
costs of manufacturing additional materials for further development.


COMPETITION

         RegeneRx is engaged in a business that is highly competitive. Research
and development activities for the development of drugs to treat patients with
cystic fibrosis, septic shock and non-healing wounds are being sponsored or
conducted by private and public institutions and by major pharmaceutical
companies located in the United States and a number of foreign countries. Most
of these companies and institutions have financial and human resources that are
substantially greater than those of RegeneRx, and that have extensive experience
in conducting research and development activities and clinical testing and in
obtaining the regulatory approvals necessary to market pharmaceutical products.
With respect to wound healing, Johnson & Johnson has marketed Regranex(TM) for
this purpose in patients with diabetes foot ulcers with some success. Other
companies, such as Novartis, are developing and marketing artificial skins which
could compete with RegeneRx's products in certain wound healing areas. Moreover,
wound healing is a large and highly fragmented marketplace attracting many
companies, large and small, to develop products for treating acute and chronic
wounds.


                                       3
<PAGE>

GOVERNMENT REGULATION

         In the United States, the Federal Food, Drug, and Cosmetic Act, as
amended, and the regulations promulgated thereunder, and other federal and state
statutes and regulations govern, among other things, the testing, manufacture,
labeling, storage, recordkeeping, approval, advertising, and promotion of
RegeneRx's products on a product-by-product basis. Regulation by governmental
authorities in the United States and foreign countries will be a significant
factor in the manufacturing and marketing of RegeneRx's products and in its
ongoing research and product development activities. Any product developed by
RegeneRx will require regulatory approval by governmental agencies prior to
commercialization. In particular, human therapeutic products are subject to
rigorous pre-clinical and clinical testing and other approval procedures by the
FDA and similar health authorities in foreign countries. The process of
obtaining these approvals and the subsequent compliance with appropriate federal
and state statutes and regulations require the expenditure of substantial
resources. Any failure by RegeneRx to obtain regulatory approvals, or any delay
in obtaining such approvals, could adversely affect the marketing of products
being developed by RegeneRx, its ability to receive product or royalty revenues
and its liquidity and capital resources.

         Pre-clinical testing in the laboratory must ordinarily be conducted to
evaluate the potential efficacy and the safety of an investigational drug. The
results of these studies are submitted to the FDA as part of an Investigational
New Drug Application, or IND, which must be reviewed and allowed to go into
effect by the agency before clinical testing can begin. Typically, clinical
evaluation involves a three-stage process. In Phase I, trials are conducted with
a small number of subjects to determine the safety profile, the pattern of drug
distribution and metabolism. In Phase II, trials are conducted with small groups
of patients afflicted with a specific disease in order to determine preliminary
efficacy, optimal dosages and expanded evidence of safety. In Phase III, large
scale, multi-center, comparative trials are generally conducted with patients
afflicted with a target disease in order to provide enough data for the
statistical proof of efficacy and safety required by the FDA and other
regulatory authorities.


         The results of the pre-clinical and clinical testing with detailed
information on manufacturing are submitted to the FDA in the form of a New Drug
Application, or NDA, or Biologics License Application, or BLA, for approval to
commence commercial sales. In responding to an NDA or BLA, the FDA may grant
marketing approval, request additional information or deny the application if
the FDA determines that the application does not satisfy its regulatory approval
criteria. Therefore, even if RegeneRx completes Phase III clinical trials for
certain of its products, and submits an NDA or BLA to the agency, there can be
no assurance that the FDA will grant marketing approvals, or if granted, that
they will be granted on a timely basis. If the FDA does approve a product, it
may require, among other things, post-marketing testing, including potentially
expensive Phase IV studies, and surveillance to monitor the safety and
effectiveness of the drug. In addition, the FDA may in some circumstances impose
restrictions on the use of the drug that may be difficult and expensive to
administer. Product approvals may be withdrawn if compliance with regulatory
requirements is not maintained or if problems occur after the product reaches
the market.

         Among the conditions for an NDA or a BLA approval is the requirement
that the applicable manufacturing, clinical, pharmacovigilance, quality control
and manufacturing procedures conform on an ongoing basis with current Good
Clinical Practices, current Good Manufacturing Practices, and computer
information system validation standards. Before approval of a BLA, the FDA will
perform a prelicensing inspection of clinical sites, manufacturing facilities
and the related quality control records to determine its compliance with these
requirements. To assure compliance, applicants must continue to expend time,
money and effort in the area of training, production and quality control. After
the applicant is licensed for the manufacture of any product, manufacturers are
subject to periodic inspections by the FDA. If a company fails to comply with
FDA regulatory requirements, FDA may pursue a wide range of remedial actions.

         In recent years, an increasing number of legislative proposals have
been introduced or proposed in Congress related to the regulation of drug
products, and RegeneRx cannot predict the outcome or effect of such legislation
on its business.


         In December 2002, RegeneRx requested T(beta)4 be designated an "Orphan
Drug" under the Orphan Drug Act. Under the Act, the FDA may designate a product
or products as having Orphan Drug status to treat "a rare disease or condition"
which is a disease or condition that affects populations of less than 200,000
individuals in the United


                                       4
<PAGE>

States, or, if victims of a disease number more than 200,000, the sponsor
establishes that it does not realistically anticipate its product sales will be
sufficient to recover its costs. If a product is designated as an Orphan Drug,
then the sponsor is entitled to receive certain incentives to undertake the
development and marketing of the product. One such incentive is marketing
exclusivity. The sponsor that obtains the first marketing for a designated
Orphan Drug for a given indication is eligible to receive marketing exclusivity
for a period of seven years. There may be multiple designations of Orphan Drug
status for a given drug and for different indications. The sponsor of the first
approved NDA (or BLA) for a given drug for its use in treating a given rare
disease may receive marketing exclusivity for that specific use. Even if a
sponsor of a product for an indication for use with an Orphan Drug designation
is the first to obtain FDA approval of an NDA (or BLA) for that designation and
obtains marketing exclusivity, another sponsor's application for the same drug
product may be approved by the FDA during the period of exclusivity if the FDA
concludes that it is clinically superior. In early 2003, RegeneRx received a
response indicating that at that time there was insufficient information in
order to base a grant of the designation. The FDA, however, recommended that
RegeneRx resubmit a new application when additional scientific and/or clinical
evidence had been obtained. RegeneRx is in the process of preparing such
application for resubmission.

PROPRIETARY RIGHTS

         Under a research agreement with The George Washington University
("GWU"), RegeneRx funded T(beta)4 research at GWU and was granted a sole and
exclusive world-wide license to any patents that resulted from such research.
While RegeneRx no longer funds research under this agreement, RegeneRx remains
obligated under the research agreement to pay GWU a royalty of 4% of the net
sales, if any, of specified products covered by patents issued in connection
with the agreement. Pursuant to the research agreement, RegeneRx has exclusive
rights to patent applications filed in the United States and in Europe
disclosing the use of T(beta)4 for the treatment of septic shock and associated
syndromes, including Adult Respiratory Distress Syndrome. Two U.S. patents have
been issued. The first patent, No. 5,578,570, entitled "Method of Treating
Septic Shock Using T(beta)4," issued on November 26, 1996 and expires in
November 2013 and the second patent, No. 5,593,964, entitled "Method of Treating
Septic Shock By Preventing Actin Polymerization," issued on January 14, 1997 and
expires in October 2014. No sales have occurred and as a result, no royalty
payments have yet been incurred or paid to GWU pursuant to the research
agreement. RegeneRx has also filed numerous other patents related to T(beta)4
and related compounds and indications for their use.

         As discussed above under "--Primary Commercial Development Focus -
Thymosin Beta 4 - Product Development," RegeneRx has obtained exclusive rights
under a patent application filed by the NIH for the use of T(beta)4 in the
treatment of non-healing wounds. Subsequently, RegeneRx has filed numerous
additional patent applications covering various compositions, uses and other
aspects of T(beta)4. Recently, RegeneRx was issued a patent in Australia on
T(beta)4 and wound healing, entitled "Thymosin B4 Promotes Wound Repair" which
expires twenty years from the filing date July 29, 1999. In addition, RegeneRx
holds the rights to a U.S. patent relating to the treatment of an autoimmune
skin disease that results in hair loss, Alopecia. The patent, No. 6,030,948,
entitled "Hair Regeneration Compositions for Treatment of Alopecia and Method of
Application Related Thereto," issued February 29, 2000 and expires in December
of 2017. There can be no assurance that these, or any other future patent
applications under which RegeneRx has rights, will result in the issuance of a
patent or that any patent issued will not be subject to challenge. In the case
of a claim of patent infringement by or against RegeneRx, there can be no
assurance that RegeneRx will be able to afford the expense of any litigation
that may be necessary to enforce its proprietary rights.


EMPLOYEES

         RegeneRx utilizes a business strategy that involves contracting out
research, development, manufacturing, and other functions to third parties
partially in order to minimize the expense and overhead associated with the
maintenance of a large infrastructure. Consistent with this strategy, RegeneRx
currently utilizes several consultants, along with various other professional
advisors, to advise its Chief Executive Officer and Board of Directors on all
company matters. RegeneRx currently has three employees in addition to retaining
several outside consultants and contractors.


                                       5
<PAGE>


CLINICAL TRIALS


         Under its current business model, RegeneRx uses a Contract Research
Organization, or CRO, to conduct all facets related to clinical trials. This
includes any preclinical pharmacokinetics, toxicology, and formulation work
required for human clinical trials. The CRO is also responsible for the conduct
of clinical trials on behalf of RegeneRx. This enables RegeneRx to efficiently
perform high quality clinical trials without the need to build infrastructure to
support such trials and without giving up any rights to its products. The FDA
accepted RegeneRx's IND application in December 2002 and TherImmune Research
Corporation , a CRO, completed Phase I human clinical trials in September 2003
on behalf of RegeneRx. Phase I enrolled 15 subjects. RegeneRx has raised
additional capital for certain Phase II clinical trials. Phase II trials are
scheduled to begin in the second quarter of 2004. RegeneRx has entered into an
agreement with PAREXEL International, LLC, another CRO, to conduct its Phase II
trials.

MATERIAL AGREEMENTS

RESEARCH, DEVELOPMENT AND LICENSING AGREEMENTS

         RegeneRx has a research agreement with The George Washington
University, whereby RegeneRx funded T(beta)4 research at GWU and was granted a
sole and exclusive world-wide license to any patents that resulted from such
research. While RegeneRx no longer funds research under this agreement, RegeneRx
remains obligated under the research agreement to pay GWU a royalty of 4% of the
net sales, if any, of specified products covered by patents issued in connection
with the agreement. Pursuant to the research agreement, RegeneRx has exclusive
rights to patent applications filed in the United States and in Europe
disclosing the use of T(beta)4 for the treatment of septic shock and associated
syndromes, including Adult Respiratory Distress Syndrome. Two U.S. patents have
been issued. No sales have occurred and as a result, no royalty payments have
yet been incurred or paid to GWU pursuant to the research agreement.

National Institute of Health

         RegeneRx entered into a Material Transfer - Cooperative Research and
Development Agreement with the National Institute of Health during the second
quarter of 1997. Under this agreement, RegeneRx received an option to elect an
exclusive or non-exclusive commercialization license from the NIH for any patent
rights that might result from the NIH research study that relate to the use of
T(beta)4 as a tissue growth and repair factor. A provisional patent application
was filed by NIH in July 1998, with a Patent Cooperation Treaty application
filed in July 1999, pertaining to the work performed on T(beta)4. On February 6,
2001, RegeneRx executed an agreement with the NIH giving RegeneRx an exclusive
worldwide license from the NIH for all claims to T(beta)4 within the patent
application. In exchange for the exclusive license, RegeneRx must make certain
royalty and milestone payments to the NIH. Although the initial patent under the
Agreement was issued in Australia in February 2004, no assurance can be given as
to whether or when any other such patents will be issued, or as to any
conditions that might be attached to the patent.

         To date, the NIH has performed non-clinical animal studies using
T(beta)4, supplied by RegeneRx, which have indicated that T(beta)4 is effective
in healing injured dermal and ocular tissue and improving wound healing and
chemical burns in normal, elderly, diabetic, and steroid-suppressed rodents and
other mammals. In December of 2002, RegeneRx initiated research under an
Investigational New Drug Application, from the U.S. Food and Drug Administration
allowing it to begin Phase I human clinical trials. The Phase I study was
successfully completed in September of 2003

Defiante Farmaceutica, L.d.a.

         On January 22, 2004, RegeneRx exclusively licensed certain European
rights to T(beta)4 to Defiante Farmaceutica, L.d.a., a Portuguese company that
is a wholly owned subsidiary of Sigma-Tau, S.p.A., a pharmaceutical company
headquartered in Rome, Italy. Defiante will develop T(beta)4 for internal and
external wounds in Europe and certain other contiguous and geographically
relevant countries. The Agreement expires on a country-by-country basis upon the
later of the expiration of the last to expire of any granted patent in the
territory having at


                                       6
<PAGE>


least one valid claim covering the products then on the market, the expiration
of any other exclusive or proprietary marketing rights or twelve years from the
effective date.

         Under the Agreement, Defiante will pay RegeneRx a royalty on commercial
sales and will purchase all required T(beta)4 from RegeneRx. When RegeneRx
completes positive Phase II clinical trials in the United States, Defiante must
either pay RegeneRx $5 million or initiate pivotal Phase III clinical trials in
Europe to maintain the license. Defiante also will be obligated to attain future
clinical and regulatory milestones in the licensed territory. As those
milestones are obtained, certain performance criteria regarding commercial
registration and minimum annual royalties will be required in each licensed
country. The agreement does not prevent RegeneRx from sublicensing the
technology in countries outside the licensed territory, and has no impact on any
U.S. rights.

CONTRACT RESEARCH ORGANIZATION AGREEMENTS

         In general, RegeneRx enters into a master services agreement with a CRO
that describes the general scope of the relationship and a protocol for specific
tasks within the agreement. Then, the work is done and the payments are made
according to task orders that the company signs with the CRO. RegeneRx had
previously engaged TherImmune Research Corporation (which was acquired by
GeneLogic, Inc. in April 2003), a CRO, to completed its Phase I trials of
T(beta)4. RegeneRx paid a total of approximately $1.2 million to TherImmune for
their work on the Phase I trials completed in September of 2003. RegeneRx
recently entered into a masters services agreement in March 2004 with PAREXEL
International, LLC to conduct its Phase II trials to begin in the second quarter
of 2004. RegeneRx will pay up to approximately $2 million for the contemplated
Phase II clinical trials, although it is under no obligation to undertake any
such trials at this time. The Master Services Agreement is in effect until the
sooner of the completion of the services related to the clinical trials under
the agreement or five years. It may be terminated upon prior written notice to
the other party with differing terms when either party is in breach of the
agreement.


ITEM 2.  PROPERTIES

         RegeneRx's corporate headquarters are located in Bethesda, Maryland
where it leases office space in an executive office suite. RegeneRx entered into
the lease agreement for this property in April 2002. The lease agreement
provides for a twelve-month term, which automatically renews upon expiration for
an additional twelve months unless either RegeneRx or the lessor provides notice
of termination as described in the agreement. For additional information, see
Note 8 of the Notes to Financial Statements included in this annual report.

ITEM 3.  LEGAL PROCEEDINGS

         None.

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

         None.

                                     PART II

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

         In March 2001, RegeneRx's common stock began trading on the OTC
Bulletin Board under the symbol RGRX. Prior to that date, and during 2000 and
1999, RegeneRx's common stock traded in the over-the-counter market in the "pink
sheets." RegeneRx also has outstanding classes of warrants to purchase RegeneRx
common stock for which there is no public market.

         The following table sets forth the high and low bid prices for
RegeneRx's common stock for the periods indicated as reported by myhdvest.com.
These quotations reflect inter-dealer prices, without retail mark-up, mark-down,
or commission, and may not represent actual transactions.


                                       7
<PAGE>

                  FOR THE YEAR ENDED           HIGH         LOW
                  DECEMBER 31, 2003:
                  First Quarter                $.55         $.27
                  Second Quarter               $1.70        $.40
                  Third Quarter                $1.30        $.70
                  Fourth Quarter               $1.25        $1.08

                  DECEMBER 31, 2002:

                  First Quarter                $.68         $.15
                  Second Quarter               $.72         $.35
                  Third Quarter                $.53         $.22
                  Fourth Quarter               $.60         $.28

         As of December 31, 2003, there were approximately 1,035 holders of
record of RegeneRx's common stock.

         RegeneRx has never paid a cash dividend on its common stock and does
not anticipate that any cash dividends will be paid on the common stock in the
foreseeable future due to RegeneRx's limited funds for operations.


EQUITY COMPENSATION PLAN INFORMATION

         The following table gives information about RegeneRx's common stock
that may be issued upon the exercise of options, warrants and rights under all
existing equity compensation plans as of December 31, 2003.



<TABLE>
<CAPTION>
                                                                                              NUMBER OF SECURITIES
                                                                                             REMAINING AVAILABLE FOR
                                    NUMBER OF SECURITIES TO      WEIGHTED-AVERAGE             FUTURE ISSUANCE UNDER
                                    BE ISSUED UPON EXERCISE      EXERCISE PRICE OF          EQUITY COMPENSATION PLANS
                                    OF OUTSTANDING OPTIONS,     OUTSTANDING OPTIONS,          (EXCLUDING SECURITIES
                                      WARRANTS AND RIGHTS       WARRANTS AND RIGHTS          REFLECTED IN COLUMN (A))

          PLAN CATEGORY                        (A)                        (B)                          (C)
<S>                                         <C>                           <C>                       <C>
Equity compensation plans                   1,225,000                     0.32                      1,275,000
approved by stockholders

Equity compensation plans not                   0                          0                            0
approved by stockholders

Total                                       1,225,000                     0.32                      1,275,000
</TABLE>


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

PLAN OF OPERATION FOR THE NEXT 12 MONTHS

         Since its inception in 1982, RegeneRx's activities had consisted of
conducting research and development, sponsoring clinical trials of its
proprietary products, the construction and equipping of laboratory and
production


                                       8
<PAGE>

facilities, and the manufacture of products for research, testing and clinical
trials. In 2000, RegeneRx adopted a modified business plan calling on the
outsourcing of most of the activities necessary to its mission of developing its
Thymosin beta 4, or T(beta)4, technology for the treatment of chronic wounds.
This business model allows for the rapid and effective deployment of necessary
resources without the burden of expensive and unwieldy infrastructure. It also
allows RegeneRx to expand or contract its efforts depending on capital resources
or other circumstances. RegeneRx has not generated revenues from operations and
does not anticipate generating product revenues or other revenues from
operations for the foreseeable future. During 2003 and 2002, Company earned no
revenues. RegeneRx's accumulated deficit of $39,179,190 through December 31,
2003 has been funded primarily by the proceeds from the issuance of equity
securities (and interest earned on such funds), the licensing of technology
developed or acquired by RegeneRx, limited product sales and royalties, and the
sale of royalty rights. RegeneRx will require substantial funding in order to
complete research and development activities, manufacturing for clinical trials,
and the eventual marketing of any products that RegeneRx intends to develop.

         On June 11, 2003, RegeneRx completed the sale of 3,184,713 shares of
restricted common stock pursuant to a private placement at a price of $.628 per
share to Defiante Farmaceutica, L.d.a., a Portuguese company that is a wholly
owned subsidiary of Sigma-Tau, S.p.A., a pharmaceutical company headquartered in
Rome, Italy. RegeneRx received approximately $2.0 million in proceeds. In
addition, RegeneRx granted Defiante warrants to purchase up to $1.5 million of
additional restricted common stock of RegeneRx at prices ranging from $1.00 to
$1.25 per share (or higher under certain circumstances) over a period of 18
months.

         On January 23, 2004, RegeneRx completed the sale of 2,393,580 shares of
common stock pursuant to a private placement at a price of $.95 per share to
Defiante and several private investors. RegeneRx received approximately $2.3
million in proceeds. In addition, RegeneRx granted investors warrants to
purchase 1 share of common stock for every 4 shares of common stock purchased in
the offering at a price of $1.50 per share over a period of 30 months.


         Although RegeneRx has no products that have received regulatory
approval to date, RegeneRx's Investigational New Drug Application was accepted
by the United States Food and Drug Administration in December 2002 allowing
RegeneRx to commence the human testing of T(beta)4 for dermal wounds. RegeneRx
initiated a Phase I human clinical trial in March 2003, which studies were
designed to establish safety in human subjects, and successfully completed the
trial in September 2003. There were no significant adverse events associated
with the drug in Phase I and results demonstrated it was well tolerated by all
subjects. RegeneRx has recently raised additional capital for Phase II trials
that are expected to begin in the first half of 2004. RegeneRx believes the
Phase II trials, which it hopes to conduct in a somewhat parallel fashion, will
take approximately 12-15 months each and will cost just over $2 million.
RegeneRx plans to independently develop T(beta)4 in the United States for
chronic dermal wounds through completion of Phase III clinical trials.

         On January 22, 2004, RegeneRx exclusively licensed certain European
rights to T(beta)4 to Defiante. Defiante will develop T(beta)4 for internal and
external wounds in Europe and certain other contiguous and geographically
relevant countries. The Agreement expires on a country-by-country basis upon the
later of the expiration of the last to expire of any granted patent in the
territory having at least one valid claim covering the products then on the
market, the expiration of any other exclusive or proprietary marketing rights or
twelve years from the effective date.

         Under the Agreement, Defiante will pay RegeneRx a royalty on commercial
sales and will purchase all required T(beta)4 from RegeneRx. When RegeneRx
completes positive Phase II clinical trials in the United States, Defiante must
either pay RegeneRx $5 million or initiate pivotal Phase III clinical trials in
Europe to maintain the license. Defiante also will be obligated to attain future
clinical and regulatory milestones in the licensed territory. As those
milestones are obtained, certain performance criteria regarding commercial
registration and minimum annual royalties will be required in each licensed
country. The agreement does not prevent RegeneRx from sublicensing the
technology in countries outside the licensed territory, and has no impact on any
U.S. rights.

         At December 31, 2003, RegeneRx had cash and cash equivalents totaling
$1,019,889 and working capital of $890,166 and total assets were $1,109,818.
RegeneRx believes that its cash balances, and an additional $2,300,000 from the
January 2004 private placement, will be sufficient to sustain current operations
at least through December 31, 2004. RegeneRx is currently pursuing several
potential financing alternatives for continuation of its


                                       9
<PAGE>

research, development and clinical trials programs. There is no assurance that
RegeneRx will be able to raise additional capital necessary to timely execute
its current plan of operation or continue such plan of operation beyond December
2004 unless substantial additional capital is raised.


         As RegeneRx utilizes a virtual company strategy it does not currently
expect to purchase or sell any properties or significant equipment and does not
expect to have significant changes in the number of its employees. For more
information about RegeneRx's virtual company strategy, see "Item 1. Business -
General."























                                       10
<PAGE>


ITEM 7.  FINANCIAL STATEMENTS

         The following audited financial statements and related documents are
presented herein on the following pages:

                                                                 PAGE

INDEPENDENT AUDITORS' REPORT                                       9

FINANCIAL STATEMENTS

         BALANCE SHEETS                                           13

         STATEMENTS OF OPERATIONS                                 14

         STATEMENTS OF STOCKHOLDERS' EQUITY                       15

         STATEMENTS OF CASH FLOWS                                 16

         NOTES TO FINANCIAL STATEMENTS                            17

















                                       11


<PAGE>




                    [REZNICK FEDDER & SILVERMAN LETTERHEAD]


                          INDEPENDENT AUDITORS' REPORT



To the Board of Directors
RegeneRx Biopharmaceuticals, Inc.


         We have audited the accompanying balance sheets of RegeneRx
Biopharmaceuticals, Inc. as of December 31, 2003 and 2002, and the related
statements of operations, stockholders' equity and cash flows for the years then
ended. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.

         We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we plan
and perform the 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 financial statements referred to above present
fairly, in all material respects, the financial position of RegeneRx
Biopharmaceuticals, Inc. as of December 31, 2003 and 2002, the results of its
operations and its cash flows for the years then ended, in conformity with
accounting principles generally accepted in the United States of America.




                                                 /s/ Reznick Fedder & Silverman



Bethesda, Maryland
February 1, 2004






                                      12
<PAGE>

                       RengeneRx Biopharmaceuticals, Inc.

                                 BALANCE SHEETS

                           December 31, 2003 and 2002
<TABLE>
<CAPTION>
                                                                         2003           2002
                                                                    ------------    ------------
<S>                                                                 <C>             <C>
                                      ASSETS

Current assets
  Cash and  cash equivalents                                        $  1,019,889    $    474,338
  Due from related parties                                                26,897          24,817
  Other current assets                                                    36,428          18,929
                                                                    ------------    ------------
          Total current assets                                         1,083,214         518,084

Fixed assets, net of accumlated depreciation of $7,613 and $5,300          3,377           3,836
Proprietary rights, net of accumulated amortization of
     $2,973 and $1,187                                                    23,227          25,013
                                                                    ------------    ------------
          Total assets                                              $  1,109,818    $    546,933
                                                                    ============    ============

                          LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities
    Accounts payable                                                $     81,268    $    138,984
    Accrued expenses                                                      91,734          78,116
    Letter agreements with vendors                                        20,046          20,046
                                                                    ------------    ------------
            Total current liabilities                                    193,048         237,146
                                                                    ------------    ------------
Commitments                                                                   --              --

Stockholders' equity
    Preferred stock, $.001 par value per share,
       1,000,000 authorized; no shares issued                                 --              --
    Common stock, par value $.001 per share,
       100,000,000 shares authorized; 30,098,968
        and 26,965,479 issued and outstanding                             30,099          26,966
    Additional paid-in capital                                        40,065,861      38,102,136
    Accumulated deficit                                              (39,179,190)    (37,519,315)
    Stock subscriptions                                                       --        (300,000)
                                                                    ------------    ------------
           Total stockholders' equity                                    916,770         309,787
                                                                    ------------    ------------
           Total liabilities and stockholders' equity               $  1,109,818    $    546,933
                                                                    ============    ============
</TABLE>

   The accompanying notes are an integral part of these financial statements

                                      13

<PAGE>

                        RegeneRx Biopharmaceuticals, Inc.

                            STATEMENTS OF OPERATIONS

                     Years ended December 31, 2003 and 2002


<TABLE>
<CAPTION>
                                                           2003             2002
                                                       ------------    ------------
<S>                                                    <C>             <C>
Revenue                                                $         --    $         --
                                                       ------------    ------------
Expenses
   Research and development                                 775,752         885,631
   General and administrative                               848,743         559,641
                                                       ------------    ------------
Total expenses                                            1,624,495       1,445,272
                                                       ------------    ------------
Operating loss                                           (1,624,495)     (1,445,272)
                                                       ------------    ------------
Other income (expense)
   Other income                                                  --          10,648
   Interest income                                             7,57        1 30,077
   Interest expense                                         (42,951)             --
                                                       ------------    ------------
Total other income (expense)                                (35,380)         40,725
                                                       ------------    ------------
Net loss                                               $ (1,659,875)   $ (1,404,547)
                                                       ============    ============
Basic and diluted net loss per common share            $      (0.06)   $      (0.05)
                                                       ------------    ------------
Weighted average number of common shares outstanding     28,522,042      25,560,301
                                                       ============    ============

</TABLE>

    The accompanying notes are an integral part of these financial statements


                                       14

<PAGE>

                        RegeneRx Biopharmaceuticals, Inc.

                       STATEMENTS OF STOCKHOLDERS' EQUITY

                     Years ended December 31, 2003 and 2002

<TABLE>
<CAPTION>
                                          Common Stock                                                                 Total
                                      ------------------------     Additional      Accumulated       Stock          stockholders'
                                      Shares            Amount   paid-in capital     deficit      subscriptions        equity
                                      ------            ------   ---------------     -------      -------------        ------
<S>                                  <C>               <C>         <C>             <C>             <C>               <C>
Balance, December 31, 2001           19,477,429        $ 19,477    $ 36,415,289    $(36,114,768)   $   (300,000)         19,998
Issuance of common stock              7,346,383           7,347       1,665,621              --              --       1,672,968
Exercise of warrants                    141,667             142          18,275              --              --          18,417
Stock option compensation                    --              --           2,951              --              --           2,951
Net loss                                     --              --              --      (1,404,547)             --      (1,404,547)
                                     ----------        --------    ------------    ------------    ------------      ----------
Balance, December 31, 2002           26,965,479          26,966      38,102,136     (37,519,315)       (300,000)        309,787
Issuance of common stock              3,184,713           3,185       1,986,815              --              --       1,990,000
Issuance of warrants                         --                          40,648              --              --          40,648
Exercise of options and warrants        306,500             306          30,345              --              --          30,651
Repayment and modification of
 subscription receivable               (357,724)           (358)       (109,642)             --         300,000         190,000
Stock option compensation                    --              --          15,559              --              --          15,559
Net loss                                     --              --              --      (1,659,875)             --      (1,659,875)
                                     ----------          ------    ------------    ------------    ------------      ----------
Balance, December 31, 2003           30,098,968        $ 30,099    $ 40,065,861    $(39,179,190)   $         --      $  916,770
                                     ==========        ========    ============    ============    ============      ==========
</TABLE>

    The accompanying notes are an integral part of these financial statements

                                       15


<PAGE>

                       RegeneRx Biopharmaceuticals, Inc.

                            STATEMENTS OF CASH FLOWS

                     Years ended December 31, 2003 and 2002

<TABLE>
<CAPTION>
                                                                   2003            2002
                                                               -----------      ---------
<S>                                                             <C>           <C>
Cash flows from operating activities:
  Net loss                                                      (1,659,875)   $(1,404,547)
  Adjustments to reconcile net loss to net cash used in
  operating activities:
     Depreciation and amortization                                   4,099          3,289
     Compensation expense - stock options                           15,559          2,951
     Interest expense related to issuance of warrants               40,648             --
     Write-off of accounts payable                                      --        (43,329)
     Changes in operating assets and liabilities:
       Increase in other current assets                             (3,336)        (6,298)
       Increase in due from related party                           (2,080)       (15,619)
       Increase (decrease) in accounts payable                     (57,716)       123,601
       Increase (decrease) in accrued expenses                      13,618         52,823
                                                               -----------      ---------
              Net cash used in operating activities             (1,649,083)    (1,287,129)
                                                               -----------      ---------
Cash flows from investing activities:
    Purchase of fixed assets                                        (1,854)        (4,208)
    Purchase of license agreement                                       --         (5,000)
                                                               -----------      ---------
              Net cash used in investing activities                 (1,854)        (9,208)
                                                               -----------      ---------
Cash flows from financing activities:
  Proceeds from exercise of warrants                                30,651         18,417
  Proceeds from issuance of common stock                         1,990,000      1,717,000
  Repayment of subscription receivable                             190,000             --
  Deferred stock offering costs                                    (14,163)       (65,232)
                                                               -----------      ---------
     Net cash provided by financing activities                   2,196,488      1,670,185
                                                               -----------      ---------
     Net increase in cash and cash equivalents                     545,551        373,848
Cash and cash equivalents at beginning of period                   474,338        100,490
                                                               -----------      ---------
Cash and cash equivalents at end of period                     $ 1,019,889    $   474,338
                                                               ===========    ===========
Supplemental disclosure of significant noncash investing and
financing activities:
     Modification of subscription receivable                   $   110,000    $        --
                                                               ===========    ===========
     Issuance of common stock for license agreement            $        --    $    21,200
                                                               ===========    ===========
</TABLE>


    The accompanying notes are an integral part of these financial statements

                                       16
<PAGE>

                        REGENERx Biopharmaceuticals, Inc.

                          NOTES TO FINANCIAL STATEMENTS

                           December 31, 2003 and 2002


1.  ORGANIZATION AND BUSINESS

    Organization and Nature of Operations

    RegeneRx Biopharmaceuticals, Inc. (the "Company"), a Delaware corporation,
    was incorporated in 1982. The Company operates predominantly in a single
    industry segment, the biotechnology industry, which consists of researching
    and developing new pharmaceutical products for the treatment of diseases or
    conditions that arise as a result of immune system disorders, including
    chronic viral infections, cancer and autoimmune disease.

    During 1997, the Company entered into a Material Transfer Agreement -
    Cooperative Research and Development Agreement ("MTA-CRADA") with the
    National Institutes of Health ("NIH"), pursuant to which an NIH investigator
    used Thymosin beta 4, provided by the Company, in several studies including
    clinical trials, for the treatment of non-healing wounds. In exchange for
    providing the product and other data, the Company received an option to
    elect to negotiate for an exclusive or non-exclusive commercialization
    license from NIH pursuant to a patent application filed by NIH in 1998. The
    Company's option expired on February 11, 1999. The Company's Chairman is a
    co-inventor on the patent application filed by the NIH. As a result, he had
    an equal, undivided interest in the intellectual property described in the
    patent which he subsequently assigned to the Company on May 1, 2000,
    resulting in full but non-exclusive rights to the Company. On February 6,
    2001, the Company signed an exclusive licensing agreement with NIH whereby
    the Company obtained on exclusive worldwide license to Thymosin beta 4 as a
    wound-healing drug. In exchange for the exclusive license, the Company must
    make certain royalty and milestone payments to NIH.

    The Company anticipates incurring additional losses in the future as it
    continues development of Thymosin Beta 4 and expands clinical trials for
    other indications of Thymosin Beta 4. To achieve profitability, the Company,
    alone or with others, must successfully develop and commercialize its
    technologies and proposed products, conduct pre-clinical studies and
    clinical trials, obtain required regulatory approvals and successfully
    manufacture and market such technologies and proposed products. The time
    required to reach profitability is highly uncertain, and there can be no
    assurance that the Company will be able to achieve profitability on a
    sustained basis, if at all.

    The Company has incurred negative cash flows from operations since its
    inception. The Company has expended and expects to continue to expend in the
    future, substantial funds to complete its planned product development
    efforts. The Company expects that its existing capital resources will be
    adequate to fund the Company's projected operations beyond the year ending
    December 31, 2004, based on current and projected expenditure levels.
    Management plans to continue to refine its operations, control expenses,
    evaluate alternative methods to conduct its business, and seek available and
    attractive sources of financing and sharing of development costs through
    strategic collaboration agreements or other resources. Should appropriate
    sources of financing not be available, management would delay certain
    clinical trials and research activities until such time as appropriate
    financing was available. There can be no assurance that the Company's
    financing efforts will be successful. If adequate funds are not available,
    our financial condition and results of operations will be materially and
    adversely affected.

    Should the Company obtain substantial additional funding, other factors
    including competition, dependence on third parties, uncertainty regarding
    patents, protection of proprietary rights, manufacturing of peptides and
    technology obsolescence could have a significant impact on the Company and
    its operations.


                                       17
<PAGE>


                        RegeneRx Biopharmaceuticals, Inc.

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                     Years ended December 31, 2003 and 2002


2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     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 contingent assets and liabilities at
     the date of the financial statements and the reported amounts of income and
     expenses during the reporting period. Actual results could differ from
     those estimates.

     Cash and Cash Equivalents
     -------------------------

     The Company considers all highly liquid investments with original
     maturities of three months or less when acquired to be cash equivalents.
     The Company primarily invests excess cash in high-quality, liquid money
     market instruments (principally government and government agency notes and
     bills) maintained by financial institutions. Cash and cash equivalents are
     stated at cost which approximates fair value.

     Fixed Assets
     ------------

     Fixed assets are stated at cost less accumulated depreciation. Expenditures
     for maintenance and repairs which do not significantly prolong the useful
     lives of the assets are charged to expense. Depreciation is computed using
     the straight-line method over the estimated useful lives of two to ten
     years.

     Proprietary Rights
     ------------------

     Proprietary rights are stated at cost and amortized using the straight-line
     method over the remaining life of approximately 15 years.

     Revenue Recognition
     -------------------

     The Company will recognize revenue from royalties from sales when received.
     The Company will recognize consulting revenue as the consulting services
     are performed.

     Research and Development
     ------------------------

     Research and development costs are expensed as incurred.


     Income Taxes
     ------------

     The Company accounts for income taxes using the asset and liability
     approach, which requires the recognition of deferred tax assets and
     liabilities for the expected future tax consequences of temporary
     differences between the carrying and tax bases of assets and liabilities. A
     valuation allowance is recorded if, based upon the evidence available, it
     is more likely than not that some portion or all of the deferred tax assets
     will not be realized.


                                       18
<PAGE>

                        RegeneRx Biopharmaceuticals, Inc.

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                     Years ended December 31, 2003 and 2002


2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

    Letter Agreements with Vendors
    ------------------------------


    The Company has entered into letter agreements with two vendors as
    settlement for past due trade payables. The letter agreements are due on
    demand. As of December 31, 2003 and 2002, $20,046 remains payable to these
    vendors.


    Fair Value of Financial Instruments
    -----------------------------------

    The estimated fair values of the Company's cash and cash equivalents, due
    from related parties, accounts payable, letter agreements with vendors and
    accrued expenses approximate their carrying values, due to their short-term
    nature.

    Loss Per Share
    --------------
                                                         2003           2002
                                                    ------------   ------------
    Net loss available for common shareholders (A)  $ (1,659,875)  $ (1,404,547)
                                                    ============   ============
    Average outstanding:
    Common stock (B)                                  28,522,042     25,560,301
    Stock options and warrants                                --             --
                                                    ------------   ------------
    Common stock and stock equivalents (C)            28,522,042     25,560,301
                                                    ============   ============
    Loss per share:
    Basic (A/B)                                     $      (0.06)  $      (0.05)
    Diluted (A/C)                                   $      (0.06)  $      (0.05)

    Unexercised employee stock options and warrants, which were previously
    granted, to purchase 3,431,797 and 2,528,297 shares of the Company's
    common stock as of December 31, 2003 and 2002, respectively, were not
    included in the computations of diluted earnings per share. The Company
    incurred a net loss for the years ended December 31, 2003 and 2002,
    therefore, all potential common shares are antidilutive and not included
    in the calculation of diluted net loss per share.

    Stock Based Compensation
    ------------------------

    The Company uses the intrinsic-value method in accounting for its employee
    stock options rather than the alternative fair value accounting method.
    Companies that follow the intrinsic-value method must provide pro forma
    disclosure of the impact of applying the fair-value method.

    Transactions with nonemployees in which consideration is received for the
    issuance of equity instruments are accounted for based on the fair value of
    the consideration received or the fair value of the equity instruments
    issued, whichever is more reliably measurable.


                                       19
<PAGE>

                        RegeneRx Biopharmaceuticals, Inc.

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                     Years ended December 31, 2003 and 2002


2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

    Stock Based Compensation (Continued)
    ------------------------

    Effective January 1, 2003, the Company adopted the disclosure provisions of
    SFAS No. 148, "Accounting for Stock-Based Compensation-Transition and
    Disclosure-an amendment of SFAS 123." SFAS No. 148 provides additional
    transition guidance for those entities that elect to voluntarily adopt the
    accounting provisions of SFAS No. 123, "Accounting for Stock-Based
    Compensation." SFAS No. 148 also mandates certain new disclosures that are
    incremental to those required by SFAS No. 123.

    The following table summarizes relevant information as to reported results
    under the Company's intrinsic-value method of accounting for stock awards,
    with supplemental information as if the fair value recognition provisions
    had been applied:

                                               For the Years Ended December 31,
                                                     2003          2002
                                                 -----------    -----------
Net loss, as reported                            $(1,659,875)   $(1,404,547)
Less: stock-based compensation                       (97,973)       (98,034)
                                                 -----------    -----------
Adjusted net loss                                $(1,757,848)   $(1,502,581)
                                                 ===========    ===========
Basic and diluted loss per share - as reported   $     (0.06)   $     (0.05)
Basic and diluted loss per share - as adjusted   $     (0.06)   $     (0.06)

The fair value for each option granted was estimated as the date of grant using
the Black-Scholes option-pricing model, assuming no expected dividends and the
following assumptions:

                                                     2003          2002
                                                 -----------    -----------
Risk free rate of return                                3.72%          3.98%
Expected life (in years)                                  10             10
Volatility                                            145.98%        191.37%


    Recent Accounting Pronouncements
    --------------------------------

    In November 2002, the Financial Accounting Standards Board ("FASB") issued
    FASB Interpretation No. ("FIN") 45, "Guarantor's Accounting and Disclosure
    Requirements for Guarantees, including Indirect Guarantees of Indebtedness
    of Others, an interpretation of FASB Statements No. 5, 57 and 107 and
    Rescission of FASB Interpretation No. 34." FIN 45 clarifies the requirements
    of SFAS No. 5, "Accounting for Contingencies," relating to the guarantor's
    accounting for, and disclosure of, the issuance of certain types of
    guarantees. The adoption of FIN 45 did not have a material impact on either
    the operating results or financial position of the Company. The Company has
    complied with the disclosure provisions of FIN 45.


                                       20
<PAGE>

                        RegeneRx Biopharmaceuticals, Inc.

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                     Years ended December 31, 2003 and 2002


3.   LICENSES

     In May 2003, the FASB issued SFAS No. 150, "Accounting for Certain
     Financial Instruments with Characteristics of Both Liabilities and Equity."
     SFAS No. 150 establishes standards for how an issuer classifies and
     measures financial instruments. The standard is effective for new or
     modified contracts after May 31, 2003, and otherwise is effective at the
     beginning of the first interim period beginning after June 15, 2003. The
     adoption of SFAS No. 150 did not have a material impact on either the
     operating results or financial position of the Company.

     On April 23, 2002, the Company issued 40,000 shares of common stock
     pursuant to a license agreement with Morris A. Mann, M.D. through which the
     Company obtained an exclusive world-wide license to a certain patent
     related to Thymosin beta 4. In addition, the Company paid a license fee of
     $5,000 and will be required to pay royalties on future revenues related to
     the licensed patent. As of December 31, 2003, no such royalties have been
     incurred or paid by the Company.

     The Company has a worldwide license to certain uses of Thymosin beta 4
     under a research agreement with George Washington University ("GWU") under
     which the Company is obligated to pay GWU a royalty of 4% on commercial
     sales. No such royalties have been incurred or paid as of December 31,
     2003.

4.   RELATED PARTY TRANSACTIONS

     The Company had entered into a note receivable agreement with the Chairman
     of the Company in the original amount of $115,617. The note bore interest
     at 11.5% and was repayable in equal monthly installments. Payments on the
     note receivable were recognized as income by the Company when received and
     a total of $22,000 in payments were received in 2002. In March 2002, the
     Board of Directors agreed to forgive the remaining balance of $42,000 on
     the loan.

     In addition to his position with the Company, the Chairman of the Company
     is also Chairman of the Department of Biochemistry and Molecular Biology at
     GWU. The Company has not funded any research personally conducted by the
     Chairman, and anticipates that any future funding, if any, will also be
     limited to research projects performed by principal investigators at GWU
     other than Chairman. No funding was provided during 2003 or 2002.

     The Company has made advances to two officers which are non-interest
     bearing and due on demand. At December 31, 2003 and 2002, $26,897 and
     $24,817, respectively, are due from the officers.

     In February 2003, the Board of Directors approved the modification of the
     subscription notes receivable agreements between the Company and two
     officers totaling $150,000 for the purchase of Common Stock. Under the
     modified agreements, the two officers paid a total of $40,000 and returned
     357,724 shares of Common Stock to the Company.

     In September 2003, the Company entered into a consulting agreement for a
     term of one year with an affiliate of an outside director of the Company.
     As consideration for certain business consulting services, the Company
     agreed to pay $4,000 per month. During the year ended December 31, 2003,
     the Company paid $16,000 under the agreement.


                                       21
<PAGE>

                        RegeneRx Biopharmaceuticals, Inc.

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                     Years ended December 31, 2003 and 2002


5.  COMPOSITION OF CERTAIN FINANCIAL STATEMENT CAPTIONS

    Fixed assets consist of the following:

                                                                December 31,
                                                              -----------------
                                                                2003      2002
                                                              -------   -------
     Furniture and equipment                                  $10,990   $ 9,136
     Less: accumulated depreciation                             7,613     5,300
                                                              -------   -------
                                                              $ 3,377   $ 3,836
                                                              =======   =======

     Accrued expenses consist of the following:
                                                                December 31,
                                                              -----------------
                                                                2003      2002
                                                              -------   -------
     Directors' bonus                                         $    --   $43,060
     Directors' fees                                               --     9,082
     Professional fees                                         84,612    24,000
     Other                                                      7,122     1,974
                                                              -------   -------
                                                              $91,734   $78,116
                                                              =======   =======

6.   NOTES PAYABLE AND STOCKHOLDERS' EQUITY

     Common Stock and Warrants
     -------------------------

     During 1997, the Company completed a private placement of Units in which it
     sold a total of five Units at a price of $50,000 per Unit. Each Unit
     consisted of (i) 500,000 shares of Common Stock and (ii) 165,000 Class D
     Warrants, each of which is exercisable to purchase one share of Common
     Stock at an exercise price of $.10 per share and has a term of 10 years.

     In June 1997, the Company entered into an agreement with an unrelated third
     party to provide financial advisory services. The agreement stipulated
     compensation for services to be performed at $10,000 and warrants to
     purchase 360,000 shares of the Company's Common Stock. The warrants became
     exercisable one year after the date of grant at a price equal to the 20-day
     average price per share for the period immediately prior to the grant date.
     The warrants expire five years subsequent to the grant date. During the
     year ended December 31, 2002, $7,424 of accrued expenses for services
     performed were written off.

     Notes Payable and Warrants
     --------------------------

     During October 1997, the Company received a $60,000 unsecured loan bearing
     interest of 8% per annum. The note was paid in full during 1999, including
     accrued interest. Additionally, during July 1997, the Company received a
     $50,000 unsecured loan from an individual to provide additional operating
     capital. The terms of the loan agreement provided for repayment within six
     months with interest at the rate of 8% per annum.


                                       22
<PAGE>

                        RegeneRx Biopharmaceuticals, Inc.

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                     Years ended December 31, 2003 and 2002


6.   NOTES PAYABLE AND STOCKHOLDERS' EQUITY (Continued)

     Additionally, the noteholder received a warrant to purchase 100,000 shares
     of the Company's Common Stock at $.13 per share. The warrant has a term of
     five years. In January 1998, the terms of the note were amended to provide
     for monthly repayment of the loan in equal amounts from January through
     June 1998. In consideration of the amended terms, the noteholder received
     an additional warrant to purchase 41,666 shares of the Company's Common
     Stock at $.13 per share with a term of five years. The note principal and
     accrued interest was repaid in full during 1998. During the year ended
     December 31, 2002, the warrants were exercised.

     Shareholders Rights Plan
     ------------------------

     In April 1994, the Board of Directors adopted a Shareholders Rights Plan,
     pursuant to which it declared a dividend distribution of one Preferred
     Stock Purchase Right ("Right") for each outstanding share of Common Stock.
     The dividend distribution was payable to stockholders of record at the
     close of business April 29, 1994.

     The Rights can become exercisable only if a person or group acquires more
     than 25% of the Common Stock or announces a tender offer, the consummation
     of which would result in ownership by a person or group of more than 25% of
     the Common Stock. Each Right would then entitle the holder to purchase
     one-hundredth (1/100) of a share of a new series of preferred stock at an
     exercise price of $16.00.

     If the Company is acquired in a merger or other business combination
     transaction with, or a significant portion of the Company's business is
     acquired by, a person or group that has acquired more than 25% of its
     outstanding Common Stock, each Right will entitle its holder (other than
     such person or group or any of their affiliates or associates) to purchase,
     at the then-current exercise price of the Right, a number of the acquiring
     company's common shares having a value that is twice such exercise price.
     In addition, if a person or group acquires more than 25% of the Company's
     outstanding Common Stock, each Right will entitle its holder (other than
     such person or group or any of their affiliates or associates) to purchase,
     at the then-current exercise price of the Right, a number of shares of
     Common Stock having a market value that is twice such exercise price.

     Prior to the time that the Rights become exercisable, they are redeemable
     at the option of the Board of Directors at a redemption price of $0.01 per
     Right. The Board of Directors is required to redeem the Rights in the event
     of an all-cash tender offer for all of the outstanding shares of the Common
     Stock that meets certain requirements. The Rights will expire on April 29,
     2004.

     Sales of Common Stock
     ---------------------

     In March 2002, the Company completed a private placement of its common
     stock. Under the terms of the private placement, the Company sold 7,346,383
     restricted shares of its common stock at a price of $.235 per share. The
     total funds raised, net of offering costs, in the private placement
     amounted to $1,672,968.

     In June 2003, the Company completed the sale of 3,184,713 shares of its
     common stock pursuant to a private placement at a price of $.628 per share
     to Defiante Farmaceutica, L.d.a. ("Defiante"), a Portuguese company that is
     a wholly owned subsidiary of Sigma-Tau, S.p.A., a pharmaceutical company
     headquartered in Rome, Italy. The Company received proceeds, net of
     offering costs, of $1,990,000. In addition, the Company granted Defiante
     warrants to purchase 750,000 shares of its common stock at a price of $1.00
     per share, exercisable through December 2005 and 600,000 shares of its
     common stock at a price of $1.25, exercisable between December 11, 2003 and
     December 11, 2004.


                                       23
<PAGE>

                        RegeneRx Biopharmaceuticals, Inc.

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                     Years ended December 31, 2003 and 2002


6.   NOTES PAYABLE AND STOCKHOLDERS' EQUITY (Continued)

     Bridge Loan Agreements
     ----------------------

     In May 2003, the Company entered into Bridge Loan Agreements (the "Bridge
     Loans") with certain shareholders. The Bridge Loans totaling $400,000,
     accrued interest at 10% per annum and were scheduled to mature in November
     2005. In addition, the Company issued warrants to purchase 200,000 shares
     of its common stock at $.10 per share. The principal and accrued interest
     were repaid in June 2003. The Company recorded interest expense of $40,648
     related to the issuance of the warrants.

     Stock Based Compensation
     ------------------------

     The Company accounts for stock based compensation using the intrinsic value
     method prescribed in Accounting Principles Board Opinion (APB) No. 25,
     "Accounting for Stock Issued to Employees," and related interpretations.
     Under APB No. 25, compensation cost is measured as the excess, if any, of
     the quoted market price on the Company's Common Stock at the date of the
     grant over the exercise price of the option granted. Compensation cost for
     stock options, if any, is recognized ratably over the vesting period.
     Generally, the Company's policy is to grant options with an exercise price
     equal to the quoted market price of the Company's Common Stock on the grant
     date. Effective January 1, 2003, the Company adopted the disclosure
     provisions of SFAS No. 148, "Accounting for Stock-Based
     Compensation-Transition and Disclosure-an amendment of SFAS 123." The
     following table summarizes relevant information as to reported results
     under the Company's intrinsic-value method of accounting for stock awards,
     with supplemental information as if the fair value recognition provisions
     had been applied:


<TABLE>
<CAPTION>

                                                   For the Years Ended December 31,
                                                      --------------------------
                                                           2003           2002
                                                      -----------    -----------
<S>                                                   <C>            <C>
     Net loss, as reported                            $(1,659,875)   $(1,404,547)
     Less: stock-based compensation                       (97,973)       (98,034)
                                                      -----------    -----------
     Adjusted net loss                                $(1,757,848)   $(1,502,581)
                                                      ===========    ===========
     Basic and diluted loss per share - as reported   $     (0.06)   $     (0.05)
     Basic and diluted loss per share - as adjusted   $     (0.06)   $     (0.06)
</TABLE>

     During 2002, the Company granted 900,000 options to members of the Board of
     Directors and 85,000 options to members of the Medical Advisory Board.
     During 2003, the Company granted 15,000 options to an employee and 15,000
     options to a consultant. The grant price was equal or greater than the fair
     market price of the common stock at the date of the grant.

     2000 Stock Options and Incentive Plan
     -------------------------------------

     During 2000, a Stock Option and Incentive Plan was approved under which a
     Board of Directors committee may grant options to purchase shares of common
     stock of the Company up to 1,000,000 shares. The number of options that can
     be granted may increase based on shares repurchased by the Company or
     surrendered to the Company in payment of the exercise prices of options
     granted under the plan. Options may be granted only to


                                       24
<PAGE>

                        RegeneRx Biopharmaceuticals, Inc.

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                     Years ended December 31, 2003 and 2002


6.   NOTES PAYABLE AND STOCKHOLDERS' EQUITY (Continued)

     directors, officers or employees of or consultants or advisors to the
     Company and options granted to any participant cannot exceed 100,000 shares
     in any one year. The exercise price of the options are to be determined by
     the Plan committee but shall never be less than the fair market value of
     the Common Stock on the date of the grant.


     During 2002, the Board of Directors of the Company approved the amended and
     restated 2000 Stock Option and Incentive Plan increasing the number of
     options that can be granted annually to an individual from 100,000 to
     450,000 and increasing number of authorized shares reserved for issuance
     under the plan increased from 1,000,000 to 2,500,000.

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

     The Directors Stock Option Plan was adopted by the Board of Directors and
     approved by the stockholders in 1987. Under the Plan, options to purchase
     10,000 shares of Common Stock are granted automatically to each person who
     becomes a director after April 10, 1987, and who, at the time such person
     becomes a director, is not an employee of the Company. Options granted
     under the Plan have an exercise price per share equal to the fair market
     value of the Common Stock on the date of the grant. In 1992, the Plan was
     amended, with the approval of stockholders at the 1992 Annual Meeting (i)
     to add an automatic annual grant to each non-employee director of an option
     to purchase 5,000 shares of Common Stock if the individual is re-elected as
     a Director at the Annual Meeting, and (ii) to increase to 200,000 the
     number of shares of Common Stock issuable under the Plan. Options granted
     under the Plan have a ten-year term and become exercisable in 20%
     increments beginning on the date of the grant and on each anniversary date
     thereafter. The Plan expired in 1997. As of December 31, 2003, 10,000
     options were outstanding under the Plan.

     Options, Warrants and Rights Outstanding And Exercisable
     --------------------------------------------------------


     The following table summarizes the Company's stock options activity for
     2003 and 2002:


                                                                    Weighted
                                      Number        Exercise         average
                                     of shares     price range    exercise price
                                     ---------   ---------------  --------------

    Outstanding, December 31, 2001     230,000  $ 0.28 to $10.50    $    1.14
    Granted                            985,000      0.25 to 0.45         0.27
    Exercised                               --                --           --
    Terminated                         (10,000)             9.50         9.50
                                     ---------   ---------------    ---------
    Outstanding, December 31, 2002   1,205,000  $0.085 to $10.50         0.27
    Granted                             30,000      0.40 to 1.07         0.74
    Exercised                               --                --           --
    Terminated                         (10,000)            10.50        10.50
                                     ---------   ---------------    ---------
    Outstanding, December 31, 2003   1,225,000  $ 0.04 to $10.50    $    0.28
                                     =========   ===============    =========


                                       25
<PAGE>

                        RegeneRx Biopharmaceuticals, Inc.

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                     Years ended December 31, 2003 and 2002


6.  NOTES PAYABLE AND STOCKHOLDERS' EQUITY (Continued)

    Options, Warrants and Rights Outstanding And Exercisable (Continued)
    --------------------------------------------------------------------


    The following table summarizes information about the options outstanding at
    December 31, 2003:


<TABLE>
<CAPTION>

                                    Options, warrants and rights        Options, warrants and
                                              outstanding                rights exercisable
                                --------------------------------------------------------------
                                                Weighted
                                                 average
                                                remaining
                                               contractual  Weighted                  Weighted
                                   Number         life       average      Number      average
    Range of exercise prices    Outstanding      (Years)    exercise   Outstanding    exercise
    ------------------------    -----------      -------    --------   -----------    --------
    <C>                           <C>              <C>      <C>         <C>           <C>
    $0.085                           25,000        7.01     $ 0.085        25,000     $ 0.085
    0.10 to 0.53                  1,185,000        7.72        0.28       717,450        0.27
    1.07                             15,000        9.52        1.07        15,000        1.07
                                  ---------                             ---------
                                  1,225,000                               757,450
                                  =========                            ==========
</TABLE>


    In August 1999, the Company granted 7,500,000 options, at an exercise price
    of $0.04. All 7,500,000 of these options were exercised in 2000 with payment
    in the form of four subscription notes receivable agreements totaling
    $300,000 and consulting services valued at $7,500. The notes bore interest
    at the rate of 6.09% with interest paid quarterly. The Company earned
    interest income of $18,270 on these notes, and as of December 31, 2002,
    there was a stock subscription receivable of $300,000. The notes matured in
    February 2003, at which time, two of the subscription notes receivable
    totaling $150,000 were repaid and the Board of Directors approved the
    modification of the subscription notes receivable agreements between the
    Company and two officers totaling $150,000 for the purchase of common stock.
    Under the modified agreements, the two officers paid a total of $40,000 and
    returned 357,724 shares of common stock to the Company.

    The following table summarizes the Company's warrants activity for 2003 and
    2002:

                                                                    Weighted
                                       Number       Exercise         average
                                      of shares    price range    exercise price
                                      ---------  ---------------  --------------

    Outstanding, December 31, 2001    1,326,666   $0.10 to $0.13    $    0.11
    Granted                             138,297             0.35         0.35
    Exercised                          (141,666)            0.13         0.13
    Terminated                               --               --           --
                                      ---------  ---------------    ---------
    Outstanding, December 31, 2002    1,323,297   $0.10 to $0.35         0.13
    Granted                           1,550,000     0.10 to 1.25         0.98
    Exercised                          (306,500)            0.10         0.10
    Terminated                         (360,000)            0.12         0.12
                                      ---------  ---------------    ---------
    Outstanding, December 31, 2003    2,206,797   $0.10 to $1.25    $    0.73
                                      =========  ===============    =========


                                       26
<PAGE>



7.  INCOME TAXES

    Deferred tax assets are comprised of the following:

                                                          December 31,
                                                  ----------------------------
                                                      2003            2002
                                                  ------------    ------------
    Net operating loss carryforwards              $ 14,168,000    $ 13,873,000
    Capital loss carryforward                          200,000         231,000
    Research and development tax credit                602,000         614,000
                                                  ------------    ------------
                                                    14,970,000      14,718,000
    Valuation allowance                            (14,970,000)    (14,718,000)
                                                  ------------    ------------
    Net deferred tax assets                       $        --     $         --
                                                  ============    ============


                                       27
<PAGE>

                        RegeneRx Biopharmaceuticals, Inc.

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                     Years ended December 31, 2003 and 2002


7.   INCOME TAXES (Continued)

     The Company has provided a full valuation allowance for deferred tax assets
     since realization of these future benefits cannot be reasonably assured as
     a result of recurring operating losses. If the Company achieves
     profitability, these deferred tax assets would be available to offset
     future income tax liabilities and expense, subject to certain limitations.

     At December 31, 2003, the Company had net operating loss, capital loss and
     research and development tax credit carryforwards of approximately $37.8
     million, $.6 million and $.6 million, respectively, for income tax purposes
     which expire in various years through 2023. Certain substantial changes in
     the Company's ownership would result in an annual limitation on the amount
     of the net operating loss carryforwards which can be utilized.

8.   COMMITMENTS

     Lease
     -----

     In August 1999, the Company entered into an agreement to lease office space
     in Bethesda, Maryland. The lease was for a period of three months and
     expired on November 30, 1999. Under the terms of the lease agreement, the
     lease automatically renewed upon expiration for an additional three months,
     unless either the Company or the lessor provided notice of termination of
     the lease 60 days prior to expiration. In April 2002, the Company entered
     into an agreement to lease additional office space. The lease was for a
     period of twelve months. Under the terms of the lease agreement, the lease
     renewed automatically upon expiration for an additional twelve months,
     unless either the Company or the leaser provides notice of termination of
     the lease as described in the agreement. In December 2003, the Company
     entered into a new one-year lease agreement which included all existing
     office space plus additional office space required by the Company. The
     Company's rent expense for 2003 and 2002 was $38,892 and $32,961,
     respectively. The future minimum lease payments for the year ending
     December 31, 2004 are $27,192.

     Employment Continuity Agreements
     --------------------------------

     The Company has entered into employment contracts with two executives. The
     agreements are three years in length and provide for minimum salary levels,
     an option to purchase shares of the Company's stock and include incentive
     bonuses determined by the Board of Directors of the Company. The aggregate
     minimum commitment for future salaries, excluding bonuses, as of December
     31, 2003 is approximately $285,000.

9.   SUBSEQUENT EVENTS

     License and Supply Agreement
     ----------------------------


     On January 22, 2004, the Company entered into a Thymosin Beta 4 License and
     Supply Agreement (the Agreement) with Defiante, to grant to Defiante the
     exclusive right to use Thymosin Beta 4 to conduct research and development
     activities in Europe. Under the Agreement, the Company will receive fees
     and royalty payments based on a percentage of sales of Thymosin Beta 4 -
     related products by Defiante, as defined. The term of the Agreement is the
     later of the expiration of any patents developed under the Agreement, any
     marketing rights or 2016.



                                       28
<PAGE>


     Sale of Common Stock and Issuance of Warrants
     ---------------------------------------------

     On January 23, 2004, the Company completed a private placement of its
     common stock. Under the terms of the private placement, the Company sold
     2,393,580 shares of common stock at $.95 per share. In addition, the
     Company granted 598,397 warrants, each of which is exercisable immediately
     to purchase one share of common stock at an exercise price of $1.50 per
     share and has a term of 30 months. The total funds raised in the private
     placement totaled approximately $2.3 million.


                                       29
<PAGE>


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

         None.

ITEM 8A.  CONTROLS AND PROCEDURES

         As of a date within 90 days of the filing date of this report, based on
an evaluation of the Company's disclosure controls and procedures (as defined in
Rules 13a-14(c) and 15d-14(c) under the Securities Exchange Act of 1934) the
chief executive and financial officer of the Company has concluded that the
Company's disclosure controls and procedures are effective to ensure that
information required to be disclosed by the Company in its Exchange Act reports
is recorded, processed, summarized and reported within the applicable time
periods specified by the SEC's rules and forms.

         There were no significant changes in the Company's internal controls or
in any other factors that could significantly affect those controls subsequent
to the date of the most recent evaluation of the Company's internal controls by
the Company, including any corrective actions with regard to any significant
deficiencies or material weaknesses.

                                    PART III

ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
           COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT

         RegeneRx's Board of Directors consists of five directors. RegeneRx's
bylaws allow for not less than three and not more than seven Directors.
Directors are elected annually to serve one-year terms.

         The following table sets forth, with respect to each director and
executive officer, his name and age, the year in which he first became a
director of RegeneRx, and his principal occupation and business experience
during the past five years.



<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------------
              NAME,
  YEAR FIRST BECAME DIRECTOR                                         PRINCIPAL OCCUPATION AND
        OF COMPANY, TITLE              AGE                              BUSINESS EXPERIENCE
--------------------------------------------------------------------------------------------------------------------
<S>                                    <C>      <C>
J.J. Finkelstein, 2002                 52       RegeneRx's President and CEO since 2002 and a member of the Board
President and CEO                               of Directors since 2002. Mr. Finkelstein has been a chief
                                                executive officer and consultant in the bioscience industry for
                                                the past twenty years, having served as Chief Executive Officer of
                                                three biomedical companies since 1982, including as CEO of
                                                RegeneRx from 1984 to 1989 and as Vice-Chairman from 1989 to 1991.

--------------------------------------------------------------------------------------------------------------------

Allan L. Goldstein, 1982               66       Chairman of the Board of RegeneRx since 1982; Chief Executive
Chairman and Chief Scientific                   Officer of RegeneRx from 1982 to 1986, and 1999 to 2002; Chief
Officer                                         Scientific Advisor of RegeneRx from 1982 to present; Professor and
                                                Chairman of Department of Biochemistry and Molecular Biology at
                                                The George Washington University School of Medicine and Health
                                                Sciences from 1978 to present.

--------------------------------------------------------------------------------------------------------------------

Albert Rosenfeld, 1982                 83       Secretary - Treasurer of RegeneRx from 1999 to present; Consultant
Secretary and Treasurer                         on Future Programs for March of Dimes Birth Defect
--------------------------------------------------------------------------------------------------------------------
</TABLE>


                                                        30
<PAGE>


<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------------
              NAME,
  YEAR FIRST BECAME DIRECTOR                                         PRINCIPAL OCCUPATION AND
       OF COMPANY, TITLE               AGE                              BUSINESS EXPERIENCE
--------------------------------------------------------------------------------------------------------------------
<S>                                    <C>      <C>
                                                Foundation from 1973 to present; Adjunct Assistant Professor,
                                                Department of Human Biological Chemistry and Genetics at
                                                University of Texas Medical Branch, from 1974 to 1998; author and
                                                lecturer on scientific matters.

--------------------------------------------------------------------------------------------------------------------

Richard J. Hindin, 2002                61       Director of Chicken Out Rotisserie Inc., founded in 1991, which
                                                operates 28 restaurants in four states and the District of
                                                Columbia, with annual sales in excess of $30 million. In 1967, he
                                                co-founded Britches of Georgetown, Inc., (Britches) a clothing
                                                retailer specializing in the sale of upscale men's and women's
                                                apparel and accessories. Mr. Hindin also serves as Chairman of the
                                                Board of The Institute of Advanced Studies in Immunology and
                                                Geriatric Medicine, a non-profit 501(c)(3) corporation that
                                                specializes in disseminating medical information to the public as
                                                well as providing the pharmaceutical industry with an independent
                                                source for testing vaccines and drugs for the elderly. Mr. Hindon
                                                is also President of Hinsilblon Laboratories Ltd., a company based
                                                in Cape Coral, Florida which sells odor neutralization products
                                                and delivery systems.

--------------------------------------------------------------------------------------------------------------------

Joseph C. McNay, 1987                  69       Managing Principal, Chairman and Chief Investment Officer of Essex
                                                Investment Management Company, LLC, a registered investment
                                                advisor, from 1976 to present; Director of Softech, Inc. and MPSI
                                                System, Inc.

--------------------------------------------------------------------------------------------------------------------
</TABLE>

                      MEDICAL AND SCIENTIFIC ADVISORY BOARD

         RegeneRx has an advisory board called the Medical and Scientific
Advisory Board. RegeneRx's Medical and Scientific Advisory Board consists of
experts in various medical and scientific fields who advise RegeneRx on key
aspects of its wound-healing technology platform, based on T(beta)4. They advise
RegeneRx in such areas as potential therapeutic uses for T(beta)4, strategies
for clinical development, and evaluation of new scientific or medical data. In
addition, the members also introduce RegeneRx to companies who might be
interested in working with it on its technology.

         All outside MSAB members receive options for 30,000 shares of stock at
the trailing 20-day average bid, which vest over three years. They also receive
$1,000 for each MSAB annual meeting they attend plus all travel expenses. The
MSAB has had no annual meetings to date.

         The members of the MSAB are Allan L. Goldstein (Chairman); Albert
Rosenfeld; Herve Byron, MD; Barrett Katz, MD, MBA; Steve Kovacs, MD, MBA;
Claudio De Simone, Ph.D.; Jo-David Fine, MD, MPH.


                                       31
<PAGE>


                   BOARD OF DIRECTORS' MEETINGS AND COMMITTEES

         The Company's Board of Directors met 5 times in fiscal 2003. During
2003, no director of the Company attended fewer than 75% of the aggregate of the
total number of Board meetings and the total number of meetings held by the
committees of the Board of Directors on which he served. The Board of Directors
of the Company has standing Audit, Compensation and Stock Option committees.

         The Audit Committee seeks to ensure that appropriate audits of the
Company are conducted, as well as the adequacy of the internal accounting
controls and the integrity of financial reporting. The members of the Audit
Committee are Directors McNay and Rosenfeld. The Audit Committee met once during
fiscal 2003. For additional information regarding the audit committee, see
"Audit Committee Matters" below.

         The Compensation Committee is responsible for the determination of
compensation paid to executive officers. The members of the Compensation
Committee are Directors McNay and Rosenfeld. The Compensation Committee met once
in fiscal 2003.

         The Stock Option Committee is responsible for administering the
Company's stock option plans and in this capacity approves stock option grants.
Each director is a member of the Stock Option Committee. The Stock Option
Committee met once in fiscal 2003.

         The entire Board of Directors of the Company acts as the Nominating
Committee for selecting nominees for election to the Board. The Nominating
Committee generally meets once per year to make nominations. While the
Nominating Committee will consider nominees recommended by stockholders, the
Nominating Committee has not actively solicited such nominations. Pursuant to
the Company's bylaws, nominations for election as directors by stockholders at
an Meeting must be made in writing and delivered to the Company's Secretary not
less than fourteen days nor more than fifty days prior to the date of the
meeting. If, however, notice of the meeting is given to stockholders less than
twenty-one days prior to the meeting, the nominations must be received by the
close of business on the seventh day following the day on which notice of the
meeting was mailed to stockholders.

AUDIT COMMITTEE MATTERS

         Audit Committee Report. The Audit Committee has issued the following
report with respect to the audited financial statements of the Company for the
year ended December 31, 2003:

              o   The Audit Committee has reviewed and discussed with the
                  Company's management the Company's 2003 audited financial
                  statements;

              o   The Audit Committee has discussed with the Company's
                  independent auditors (Reznick Fedder & Silverman, P.C.) the
                  matters required to be discussed by Statement on Auditing
                  Standards No. 61;

              o   The Audit Committee has received the written disclosures and
                  letter from the independent auditors required by Independence
                  Standards Board No. 1 (which relates to the auditors'
                  independence from the Company) and has discussed with the
                  auditors their independence from the Company; and

              o   Based on the review and discussions referred to in the three
                  items above, the Audit Committee recommended to the Board of
                  Directors that the fiscal 2003 audited financial statements be
                  included in the Company's Annual Report on Form 10-KSB for the
                  year ended December 31, 2003.

         Submitted by the Audit Committee of the Company's Board of Directors:

                                 Joseph C. McNay
                                 Albert Rosenfeld


                                       32

<PAGE>


         Independence and Other Matters. Under the definition of independence
contained in the National Association of Securities Dealers' listing standards
for the Nasdaq Stock Market, Mr. McNay is "independent." Because he is an
officer of the Company, Mr. Rosenfeld is not "independent" under this
definition. Mr. McNay is the audit committee financial expert as defined in Item
401(e) of Regulation S-B. The Company's Board of Directors has not adopted a
written charter for the audit committee.

DIRECTORS' COMPENSATION

         Directors McNay and Rosenfeld were previously owed director fees earned
prior to 1999 and totaling $9,082 at the end of 2002. These amounts were repaid
during 2003. Non-employee directors are paid $1,000 per board meeting attended
in person (or $300 if attended by telephone conference) and an annual amount of
$5,000. Employee directors, such as Directors Goldstein and Finkelstein, are not
paid for board service and meeting attendance. In addition, directors are not
compensated for committee service or meeting attendance.

COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT

         Section 16(a) of the Securities Exchange Act of 1934, as amended
("Exchange Act"), requires the Company's directors and executive officers, and
persons who own more than 10% of the Company's common stock, to report to the
SEC their initial ownership of the Company's common stock and any subsequent
changes in that ownership. Specific due dates for these reports have been
established by the SEC and the Company is required to disclose any late filings
or failures to file.

         To the Company's knowledge, based solely on its review of the copies of
such reports furnished to the Company or written representations that no reports
were required during the fiscal year ended December 31, 2003, the Company
believes that during the past fiscal year its officers, directors and greater
than ten percent (10%) beneficial owners complied with all filing requirements.

CODE OF ETHICS

         The Company adopted a Code of Ethics for its Principal Executive
Officer and Senior Financial Officer (the "Code of Ethics"). A copy of the Code
of Ethics is filed as an exhibit to this Form 10-KSB. The Code of Ethics is also
available free of charge by writing to the Company at 3 Bethesda Metro Center,
Suite 700, Bethesda, Maryland 20814.










                                       33
<PAGE>


ITEM 10.  EXECUTIVE COMPENSATION

         The following table summarizes for the years indicated the compensation
paid by RegeneRx to its Chief Executive Officer during 2003 and all executive
officers of RegeneRx that earned a salary and bonus for 2003 in excess of
$100,000.

<TABLE>
<CAPTION>


                                                                                                 LONG TERM
                                                            ANNUAL COMPENSATION             COMPENSATION AWARDS (4)
                                                            -------------------             -----------------------
                                                                                Other         Restricted
                                                                                Annual          Stock
                                      Fiscal                                 Compensation       Award      Options      All Other
     Name and Principal Position       Year       Salary        Bonus           ($)(3)           ($)         (#)       Compensation
     ---------------------------       ----       ------        -----           ------           ---         ---       ------------

<S>                                    <C>       <C>         <C>                    <C>            <C>   <C>          <C>
     J.J. Finkelstein,                 2003      $175,000    $20,000                --             --         --            --
     President and Chief               2002      $175,000    (2)                    --             --    500,000            --
     Executive Officer(1)              2001            --         --                --             --         --      $107,670
                                                                  --                                          --

     Allan L. Goldstein,               2003      $110,000    $20,000(2)             --             --         --            --
     Chairman and Chief                2002      $110,000         --                --             --    300,000       $37,674
     Scientific Advisor                2001       $55,000         --                --             --         --        $5,000
</TABLE>

-----------------

(1)  On March 19, 2002, J.J. Finkelstein was appointed as RegeneRx's President
     and Chief Executive Officer, replacing Dr. Goldstein who will remain as
     Chairman and Chief Scientific Advisor of RegeneRx.
(2)  Dr. Goldstein and J.J. Finkelstein were awarded a $20,000 bonus for work
     performed in 2002. The amounts were accrued as of 12/31/02 and paid in
     2003.
(3)  Dr. Goldstein and Mr. Finkelstein did not receive any (a) personal benefits
     or perquisites which exceeded the lesser of $50,000 or 10% of his salary
     and bonus; (b) payments of above-market preferential earnings on deferred
     compensation; (c) payments of earnings with respect to long term incentive
     plans prior to settlement or maturation; (d) amounts reimbursed for payment
     of taxes; or (e) preferential discounts on stock.
(4)  RegeneRx had no long-term incentive plans in existence and made no payouts
     or awards under such plans.




                                       34
<PAGE>



The following table provides information as to the value realized and unrealized
by Dr. Goldstein and Mr. Finkelstein related to stock options during 2003. No
stock options were exercised by Dr. Goldstein or Mr. Finkelstein during 2003.

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------------
                               AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
                                           AND FY-END OPTION VALUES
--------------------------------------------------------------------------------------------------------------------
                                                        NUMBER OF SECURITIES             VALUE OF UNEXERCISED
                                                       UNDERLYING UNEXERCISED                IN-THE-MONEY
                                                         OPTIONS AT FY-END                 OPTIONS AT FY-END
                                                                (#)                                ($)
--------------------------------------------------------------------------------------------------------------------
                             SHARES
                            ACQUIRED       VALUE
                          ON EXERCISE     REALIZED    EXERCISABLE   UNEXERCISABLE     EXERCISABLE     UNEXERCISABLE
        NAME                  (#)           ($)          (#)             (#)              ($)               ($)*
--------------------------------------------------------------------------------------------------------------------

<S>                            <C>          <C>         <C>            <C>              <C>              <C>
Allan L. Goldstein             --           --          201,000         99,000          176,880           87,120

--------------------------------------------------------------------------------------------------------------------

J.J. Finkelstein               --           --          335,000        165,000          294,800          145,200

--------------------------------------------------------------------------------------------------------------------
</TABLE>

* Based on a closing stock price on December 31, 2003 of $1.21 and an exercise
price of $0.33.

ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         The following table shows, as of March 2, 2004, the beneficial
ownership of RegeneRx's common stock by:

              o   any persons or entities known by management to beneficially
                  own more than five percent of the outstanding shares of
                  RegeneRx common stock as of the record date;
              o   each director of RegeneRx; and
              o   all of the executive officers and directors of RegeneRx as
                  a group.

         The persons named in the following table have sole voting and
dispositive powers for all shares of common stock shown as beneficially owned by
them, subject to community property laws where applicable and except as
indicated in the footnotes to the table.

         Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission. Shares of common stock subject to
outstanding options, warrants or other rights to acquire held by a person that
are currently exercisable or exercisable within 60 days after March 2, 2004 are
included in the number of shares beneficially owned by the person and deemed
outstanding shares for purposes of calculating the person's percentage
ownership. These shares are not, however, deemed outstanding for the purpose of
computing the percentage ownership of any other person. As of March 2, 2004,
there were 32,542,548 shares of RegeneRx common stock outstanding.



<TABLE>
<CAPTION>
                                                                                                    Percent of
                                                                              Beneficial           Common Stock
                      Name of Beneficial Owner                                Ownership             Outstanding
-------------------------------------------------------------------------------------------------------------------
<S>                                                                          <C>                      <C>
J. J. Finkelstein
Director, President and Chief Executive Officer                               2,012,388(1)             6.12

Allan L. Goldstein,
Chairman and Chief Scientific Officer                                         2,333,786(2)             7.13

Albert Rosenfeld, Director, Secretary and Treasurer                              86,766(3)             0.27
</TABLE>




                                       35
<PAGE>



<TABLE>
<CAPTION>
                                                                                                    Percent of
                                                                              Beneficial           Common Stock
                      Name of Beneficial Owner                                Ownership             Outstanding
-------------------------------------------------------------------------------------------------------------------
<S>                                                                          <C>                      <C>
Richard J. Hindin, Director                                                   1,803,258(4)             5.54

Joseph C. McNay, Director                                                     1,410,777(5)             4.31

Sidney J. Silver                                                              1,900,000(6)             5.85

Defiante Farmaceutica Unipessoal, L.d.a.                                     10,105,822(7)            29.63

All executive officers and directors as a group (5 persons)                   7,646,975(8)            22.80
</TABLE>

--------
(1)  Consists of (i) 1,608,638 shares owned directly by Mr. Finkelstein over
     which he has sole voting and dispositive powers; and (ii) 12,500 shares
     held by Mr. Finkelstein's minor daughter with respect to which Mr.
     Finkelstein shares voting and dispositive powers. The address for Mr.
     Finkelstein is c/o RegeneRx Biopharmaceuticals, Inc., 3 Bethesda Metro
     Center, Suite 700, Bethesda, Maryland 20814. Does not include 96,250
     options to purchase common stock to be issued to Mr. Finkelstein under the
     Amended and Restated Option Plan that are currently unexercisable.

 (2) Consists of (i) 2,091,536 shares owned directly by Dr. Goldstein and his
     wife over which they share voting and dispositive powers. The address for
     Dr. Goldstein is c/o RegeneRx Biopharmaceuticals, Inc., 3 Bethesda Metro
     Center, Suite 700, Bethesda, Maryland 20814. Does not include 57,750
     options to purchase common stock to be issued to Dr. Goldstein under the
     Amended and Restated Option Plan that are currently unexercisable.

(3)  Consists of (i) 10,100 shares owned directly by Mr. Rosenfeld over which he
     has sole voting and dispositive powers; and (ii) 76,666 shares which Mr.
     Rosenfeld has the right to acquire through the exercise of stock options
     that are currently exercisable. Does not include 33,334 options to purchase
     common stock to be issued to Mr. Rosenfeld under the Amended and Restated
     Option Plan that are currently unexercisable. The address for Mr. Rosenfeld
     is c/o RegeneRx Biopharmaceuticals, Inc., 3 Bethesda Metro Center, Suite
     700, Bethesda, Maryland 20814.

(4)  Consists of (i) 1,750,188 shares owned directly by Mr. Hindin over which he
     has sole voting and dispositive powers; and (ii) 33,333 which Mr. Hindin
     has the right to acquire through the exercise of stock options that are
     currently exercisable. Does not include 66,667 options to purchase common
     stock to be issued to Mr. Hindin under the Amended and Restated Option Plan
     that are currently unexercisable. The address for Mr. Hindin is 407 Chain
     Bridge Road, McLean, Virginia 22101.

(5)  Consists of (i) 1,142,795 shares owned directly by Mr. McNay over which he
     has sole voting and dispositive powers; (ii) 76,666 shares which Mr. McNay
     has the right to acquire through the exercise of stock options that are
     currently exercisable; and (iii) 191,316 shares which Mr. McNay has the
     right to acquire pursuant to the exercise of warrants. Does not include
     33,334 options to purchase common stock to be issued to Mr. McNay under the
     Amended and Restated Option Plan that are currently unexercisable. The
     address for Mr. McNay is c/o RegeneRx Biopharmaceuticals, Inc., 3 Bethesda
     Metro Center, Suite 700, Bethesda, Maryland 20814.

(6)  The address for Mr. Silver is c/o Silver, Freedman & Taff, L.L.P., 1100 New
     York Avenue, N.W., Washington, D.C. 20005.

(7)  Consists of (i) 8,492,664 shares owned directly by Defiante over which they
     have sole voting and dispositive powers and (ii) 1,613,158 shares which
     Defiante have the right to acquire pursuant to the exercise of warrants.
     The address for Defiante Farmaceutica Unipessoal, L.d.a. is Rua dos
     Ferreiros, 260, Funchal-Madeira (Portugal) 9000-082. Claudio Cavazza and
     Paolo Cavazza exercise the voting, investment and dispositive rights over
     the securities.

(8)  Includes the shares noted in the footnotes above.


                                       36
<PAGE>



ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         RegeneRx made advances to two officers prior to July 2002 which were
non-interest bearing and due on demand. At December 31, 2003 and 2002, $17,417
and $23,417, respectively, are due from the officers. Of the amounts due from
the officers, $17,417 and $23,417 due in 2003 and 2002, respectively, were
related to the previous personal loans while the remainder were related to
routine corporate travel advances.

         In February 2003, the Board of Directors approved the modification of
the subscription notes receivable agreements between RegeneRx and two officers
totaling $150,000 for the purchase of common stock. Under the modified
agreements, the two officers paid a total of $40,000 and returned 357,724 shares
of common stock to the company.

         In May 2003, RegeneRx entered into Bridge Loan Agreements with certain
shareholders, including Richard J. Hindin, a director. The Bridge Loans totaling
$400,000, accrued interest at 10% per annum and were scheduled to mature in
November 2005. In addition, RegeneRx issued warrants to purchase 200,000 shares
of its common stock at $.10 per share. The principal and accrued interest were
repaid in June 2003. RegeneRx recorded interest expense of $40,648 related to
the issuance of the warrants.

EMPLOYMENT AGREEMENTS

         On January 1, 2002, Dr. Goldstein and J.J. Finkelstein entered into
employment contracts with RegeneRx to serve as Chairman and Chief Scientific
Advisor and President and Chief Executive Officer, respectively. In February
2004, the Compensation Committee voted to increase the salaries of Dr. Goldstein
and Mr. Finkelstein to $125,000 and $200,000, respectively. The other terms of
the agreements are as otherwise stated below.

Employment Contract of Dr. Goldstein
------------------------------------

         Pursuant to the terms of his employment agreement, Dr. Goldstein is not
obligated to devote 100% of his time to RegeneRx and continues to be employed by
The George Washington University in Washington, D.C. The initial term of Dr.
Goldstein's employment agreement is three years. The agreement will
automatically be extended for successive one-year terms unless RegeneRx or Dr.
Goldstein elects not to extend the agreement. The agreement provides for annual
compensation of $110,000 and eligibility to receive an annual bonus in the
discretion of the Board of Directors of RegeneRx. In consideration for his
services, RegeneRx also granted Dr. Goldstein an option to purchase 300,000
shares of RegeneRx's common stock at a purchase price equal to fair market value
pursuant to the Amended and Restated Option Plan. Dr. Goldstein's option vested
as to 34% of the option shares on the first anniversary of the grant (January 1,
2003) and in twenty-four (24) equal monthly installments thereafter so long as
he remains employed by RegeneRx. In the event of Dr. Goldstein's termination
without cause or upon the occurrence of certain change in control events, Dr.
Goldstein's stock shall immediately vest and be released from RegeneRx's
repurchase option.

         Pursuant to the agreement, Dr. Goldstein is entitled to participate in
and receive all standard employee benefits under applicable Company welfare
benefits plans and programs to the same extent as other senior executives of
RegeneRx and to participate in all applicable incentive plans, including stock
option, stock, bonus, savings and retirement plans provided by RegeneRx which
are offered to senior executive officers in RegeneRx. The agreement also
provides that Dr. Goldstein will receive such perquisites as RegeneRx may
establish from time to time which are commensurate with his position and
comparable to those received by other senior executives of RegeneRx (including
vacation of at least four (4) weeks per annum and holidays, leaves of absence
and leaves for illness and temporary disability in accordance with the policies
of RegeneRx and federal, state and local law).

         Dr. Goldstein is prohibited under the agreement participating in or
taking any position, investment or interest known by him to be adverse or
antagonistic to RegeneRx, its business or prospects, financial or otherwise. In
addition, Dr. Goldstein is bound by a proprietary information, nonsolicitation,
noncompetition and inventions assignment agreement as part of his employment
agreement.

         If Dr. Goldstein's employment is terminated without cause (as defined
in the employment agreement) or he terminates his employment for any reason
within 12 months after a change of control event, RegeneRx is obligated


                                       37
<PAGE>


to pay him a lump sum payment in an amount equal to his then annual base salary
(less federal and state tax withholding) as severance pay. Dr. Goldstein is
required to sign a release in favor of RegeneRx as a condition to receiving the
severance payment.

         Pursuant to the employment agreement, RegeneRx may terminate Dr.
Goldstein in the event of his death, or any illness, disability or other
incapacity that renders him unable regularly to perform his duties generally for
more than either one hundred twenty (120) consecutive days or more than a total
of one hundred eighty (180) days in any consecutive twelve (12) month period.
Dr. Goldstein may resign his employment for good reason by giving notice to
RegeneRx. Good reason generally is defined by the employment agreement as a
material change in his duties or responsibilities with RegeneRx, which causes
his position to become one of lesser responsibility or importance, or a
relocation of his place of employment by more than 60 miles or a material
reduction in the benefits and perquisites provided to him or any material
failure by RegeneRx to pay his the compensation and benefits under this
Agreement. If Dr. Goldstein resigns with good reason, RegeneRx is obligated to
pay him the severance described above.

Employment Contract of Mr. Finkelstein
--------------------------------------

         Pursuant to the terms of his employment agreement, Mr. Finkelstein is
expected to devote 100% of his time and efforts to RegeneRx. The initial term of
Mr. Finkelstein's employment agreement is three years. The agreement will
automatically be extended for successive one-year terms unless RegeneRx or Mr.
Finkelstein elects not to extend the agreement. The agreement provides for
annual compensation of $175,000 and eligibility to receive an annual bonus in
the discretion of the Board of Directors of RegeneRx. In consideration for his
services, RegeneRx also granted Mr. Finkelstein an option to purchase 500,000
shares of RegeneRx's common stock at a purchase price equal to fair market value
pursuant to the Amended and Restated Option Plan. Mr. Finkelstein's option
vested as to 34% of the option shares on the first anniversary of the grant
(January 1, 2003) and in twenty-four (24) equal monthly installments thereafter
so long as he remains employed by RegeneRx. In the event of Mr. Finkelstein's
termination without cause or upon the occurrence of certain change in control
events, Mr. Finkelstein's stock shall immediately vest and be released from
RegeneRx's repurchase option.

         Pursuant to the agreement, Mr. Finkelstein is entitled to participate
in and receive all standard employee benefits under applicable Company welfare
benefits plans and programs to the same extent as other senior executives of
RegeneRx and to participate in all applicable incentive plans, including stock
option, stock, bonus, savings and retirement plans provided by RegeneRx which
are offered to senior executive officers in RegeneRx. The agreement also
provides that Mr. Finkelstein will receive such perquisites as RegeneRx may
establish from time to time which are commensurate with his position and
comparable to those received by other senior executives of RegeneRx (including
vacation of at least four (4) weeks per annum and holidays, leaves of absence
and leaves for illness and temporary disability in accordance with the policies
of RegeneRx and federal, state and local law). Under the employment agreement,
RegeneRx also is obligated to maintain a life insurance policy covering the life
of Mr. Finkelstein with coverage in the amount of not less than $1,000,000 and a
disability insurance policy with coverage in the maximum amount allowable or
appropriate as determined by his base salary, provided that RegeneRx is not
obligated to pay more than $600 per month in the aggregate, for life and
disability coverage.

         Mr. Finkelstein is prohibited under the agreement participating in or
taking any position, investment or interest known by him to be adverse or
antagonistic to RegeneRx, its business or prospects, financial or otherwise. In
addition, Mr. Finkelstein is bound by a proprietary information,
nonsolicitation, noncompetition and inventions assignment agreement as part of
his employment agreement.

         If Mr. Finkelstein's employment is terminated without cause (as defined
in the employment agreement) or he terminates his employment for any reason
within 12 months after a change of control event, RegeneRx is obligated to pay
him a lump sum payment in an amount equal to his then annual base salary (less
federal and state tax withholding) as severance pay. In addition, RegeneRx will
reimburse him for premiums he pays for life and disability insurance for a 12
month period. Such reimbursement, in the aggregate, generally will be capped at
the $600 per month. Mr. Finkelstein is required to sign a release in favor of
RegeneRx as a condition to receiving any severance payment.

         Pursuant to the employment agreement, RegeneRx may terminate Mr.
Finkelstein in the event of his death,


                                       38
<PAGE>


or any illness, disability or other incapacity that renders him unable regularly
to perform his duties generally for more than either one hundred twenty (120)
consecutive days or more than a total of one hundred eighty (180) days in any
consecutive twelve (12) month period. Mr. Finkelstein may resign his employment
for good reason by giving notice to RegeneRx. Good reason generally is defined
by the employment agreement as a material change in his duties or
responsibilities with RegeneRx, which causes his position to become one of
lesser responsibility or importance, or a relocation of his place of employment
by more than 60 miles or a material reduction in the benefits and perquisites
provided to him or any material failure by RegeneRx to pay his the compensation
and benefits under this Agreement. If Mr. Finkelstein resigns with good reason,
RegeneRx is obligated to pay him the severance described above.

ITEM 13.  EXHIBITS AND REPORTS ON FORM 8-K

(a)  Exhibits

<TABLE>
<CAPTION>

Exhibit No.        Description of Exhibit                                             Reference*
<S>                <C>                                                                <C>
3.1                Restated Certificate of Incorporation of Company                   Exhibit 3.1 to Registration Statement
                                                                                      No. 33-9370, Amendment No. 1 (filed
                                                                                      November 26, 1986)

3.2                Amendment to Restated Certificate of Incorporation of Company      Exhibit 3.2 to the Company's Transitional
                                                                                      Report on Form 10-K, File No. 0-15070
                                                                                      (filed March 18, 1991)

3.3                Amendment to Restated Certificate of Incorporation of Company      Exhibit 3.3 to the Company's Annual
                                                                                      Report on Form 10-KSB, File No. 0-15070
                                                                                      (filed April 2, 2001)

3.4                Bylaws of Company                                                  Exhibit 3.2 to Registration Statement
                                                                                      No. 33-9370 (filed October 8, 1986)

3.5                Amendment No. 1 to Bylaws of Company adopted                       Exhibit 4.7 to Registration Statement
                   August 11, 1989                                                    No. 33-34551, Amendment No. 3 (filed
                                                                                      June 21, 1990)

3.6                Amendment No. 2 to Bylaws of Company                               Exhibit 4.8 to Registration Statement
                   adopted  June 18, 1990                                             No. 33-34551, Amendment No. 3 (filed
                                                                                      June 21, 1990)

3.7                Amendment No. 3 to Bylaws of Company                               Exhibit 3.6 to the Company's
                   adopted November 30, 1990                                          Transitional Report on Form 10-K,
                                                                                      File No. 0-15070 (filed March 18,
                                                                                      1991)

4.1                Form of Stock Certificate                                          Exhibit 4.1 to Registration Statement
                                                                                      No. 33-9370, Amendment No. 1 (filed
                                                                                      November 26, 1986)

4.2                Rights Agreement, dated as of April 29, 1994,                      Exhibit 1 to the Company's Current
                   between the Company and American Stock                             Report on Form 8-K, File No. 0-15070
                   Transfer & Trust Company, as Rights Agent                          (filed May 2, 1994)

4.3                Warrant Agreement, dated March 12, 1997                            Exhibit 4.3 to the Company's Annual
                                                                                      Report on Form 10-K, File No. 0-15070
                                                                                      (filed March 31, 1997)

4.4                Warrant Agreement, dated January 23, 2004                          Exhibit 4.4 to the Company's Registration
                                                                                      Statement on Form SB-2, File No. 333-113417
                                                                                      (filed March 9, 2004)
</TABLE>


                                       39
<PAGE>


<TABLE>
<CAPTION>

<S>                <C>                                                                <C>
10.1               Patent License Agreement - Exclusive, between the U.S. Public      Exhibit 10.1 to the Company's Annual
                   Health Service and the Company                                     Report on Form 10-KSB, File No.
                                                                                      0-15070 (filed April 2, 2001)**

10.2               Amended and Restated Directors Stock Option                        Exhibit 10.25 to the Company's Annual
                   Plan                                                               Report on Form 10-K, File No. 0-15070
                                                                                      (filed March 26, 1993)

10.3               2000 Stock Option and Incentive Plan                               Filed as an Appendix to the Company's
                                                                                      preliminary proxy materials, File No.
                                                                                      0-15070 (filed September 29, 2000)

10.4               Unit Purchase Agreement dated March 12, 1997                       Exhibit 10.25 to the Company's Annual
                                                                                      Report on Form 10-K, File No. 0-15070
                                                                                      (filed March 31, 1997)

10.5               Registration Rights Agreement, dated March 12, 1997                Exhibit 10.26 to the Company's Annual
                                                                                      Report on Form 10-K, File No. 0-15070
                                                                                      (filed March 31, 1997)

10.6               Lease Agreement dated April 5, 2002 between the Company and HQ     Exhibit 10.7 to RegeneRx' Annual
                   Global Workplaces, Inc.                                            Report on Form 10-KSB, File No.
                                                                                      0-15070 (filed March 31, 2003)

10.7               Employment Agreement                                               Exhibit 10.8 to the Company's Registration
                                                                                      Statement on Form SB-2, File No. 333-113417
                                                                                      (filed March 9, 2004)

10.8               Employment Agreement                                               Exhibit 10.9 to the Company's Registration
                                                                                      Statement on Form SB-2, File No. 333-113417
                                                                                      (filed March 9, 2004)

10.9               License Agreement                                                  Exhibit 10.10 to the Company's Registration
                                                                                      Statement on Form SB-2, File No. 333-113417
                                                                                      (filed March 9, 2004)***

10.10              Securities Purchase Agreement                                      Exhibit 10.11 to the Company's Registration
                                                                                      Statement on Form SB-2, File No. 333-113417
                                                                                      (filed March 9, 2004)

10.11              Master Services Agreement                                          Exhibit 10.12 to the Company's Registration
                                                                                      Statement on Form SB-2, Amendment No. 1,
                                                                                      File No. 333-113417 (filed April 23, 2004)

14                 Code of Ethics                                                     Previously filed

23                 Consent of Reznick Fedder & Silverman, P.C.                        Previously filed

31.1               Certification dated April 29,  2004                                Certification pursuant to Section 302
                                                                                      of the Sarbanes-Oxley Act of 2002
                                                                                      (filed herewith)

32.1               Certification dated April 29,  2004                                Certification Pursuant to 18 U.S.C.
                                                                                      Section 1350, as Adopted Pursuant to
                                                                                      Section 906 of The Sarbanes-Oxley Act
                                                                                      of 2002 (filed herewith)
</TABLE>

-----------------

                                       40
<PAGE>

* Except where noted, the exhibits referred to in this column have heretofore
been filed with the Securities and Exchange Commission as exhibits to the
documents indicated and are hereby incorporated by reference thereto. The
Registration Statements referred to are Registration Statements of the Company.
**  Portions of this document have been omitted pursuant to a previously granted
confidential treatment application.
*** Portions of this document have been omitted pursuant to a request for
confidential treatment

(b) REPORTS ON FORM 8-K

     The Company did not file any reports on Form 8-K during the fourth quarter
of the 2003 fiscal year.

ITEM 14.  PRINCIPAL ACCOUNTANT FEES AND SERVICES


Fees paid to RegeneRx's independent auditors, Reznick Fedder & Silverman for the
last two fiscal years ended December 31 were as follows:

                                               2003                 2002
                                               ----                 ----
           AUDIT FEES:                       $ 22,500             $ 15,000
           AUDIT-RELATED FEES:1              $ 7,500               $ 7,500
           TAX FEES:2                        $ 5,000              $ 10,000
           ALL OTHER FEES:3                    $ 0                   $ 0

        (1) Review of quarterly Forms 10-QSB and year end Annual Report on Form
            10-KSB.
        (2) Tax preparation service
        (3) Service, other than audit fees, audit related fees or tax services

All audit related services, tax services and other services were pre-approved by
the Audit Committee, which concluded that the provision of such services by
Reznick Fedder & Silverman was compatible with the maintenance of that firm's
independence in the conduct of its auditing functions.

         The Audit Committee pre-approves all audit and non-audit engagement
fees, and terms and services. On an ongoing basis, management communicates
specific projects and categories of services for which advance approval of the
Audit Committee is required. The Audit Committee reviews these requests and
advises management and the independent auditors if the Audit Committee
pre-approves the engagement of the independent auditors for such projects and
services. On a periodic basis, the independent auditors report to the Audit
Committee the actual spending for such projects and services compared to the
approved amounts.








                                       41
<PAGE>



                                   SIGNATURES

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

                                     REGENERX BIOPHARMACEUTICALS, INC.
                                     (Registrant)



         April 29, 2004              By:  /s/J.J.Finkelstein
                                          ------------------------------------
                                         J.J. Finkelstein
                                         President and Chief Executive Officer

         Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated. In addition, each
of the following persons hereby grants Power of Attorney to J.J. Finkelstein to
sign on each of their behalf for the purposes of filing any further amendments
to this report:



<TABLE>
<CAPTION>
                 Signature                                      Title                               Date

<S>                                           <C>                                              <C>
/s/Allan L. Goldstein                         Chairman of the Board, Chief Scientific          April 29, 2004
------------------------------------          Advisor, and Director
Allan L. Goldstein


/s/J.J. Finkelstein                           President, Chief Executive Officer, and          April 29, 2004
-------------------------------------         Director
J.J. Finkelstein


/s/Albert Rosenfeld                           Secretary, Treasurer, and Director               April 29, 2004
------------------------------------
Albert Rosenfeld

/s/Joseph C. McNay                            Director                                         April 29, 2004
------------------------------------
Joseph C. McNay

/s/Richard J. Hindin                          Director                                         April 29, 2004
------------------------------------
Richard J. Hindin

</TABLE>