<PAGE>


                    SECURITIES AND EXCHANGE COMMISSION
                          Washington, D.C. 20549
                                     
                                FORM 10-QSB
                                     
[X]          QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                   OF THE SECURITIES EXCHANGE ACT OF 1934
                                     
                      For the quarterly period ended
                             NOVEMBER 30, 1995
                                     
                                    OR
                                     
[ ]        TRANSITIONAL REPORT PURSUANT TO SECTION 13 OR 15(d)
                    OF THE SECURITIES EXCHANGE ACT OF 1934
                                     
                     COMMISSION FILE NUMBER:  33-5384
                                     
                            DERMARX CORPORATION
          (Exact name of registrant as specified in its charter)
                                      
                    DELAWARE                           13-3301899
           (State or other jurisdiction of           (IRS Employer
            incorporation or organization)        Identification No.)
                                                 
            400 COLORADO BLVD., SUITE 420                   
                 DENVER, COLORADO                         80206
           (Address of principal executive             (Zip Code)
             offices)
                                     
Registrant's telephone number, including area code:  (303) 399-1632

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

      Indicate  the  number of shares outstanding of each of  the  issuer's
classes  of  common  stock, as of the latest practicable  date:   7,199,034
shares (as of February 29, 1996) of common stock, par value $.01 per share.



<PAGE>
                              
                              
                              DERMARX CORPORATION
                                
                                     INDEX

                                                                  Page No.
Part  I.    Financial Information                                     1

    Item 1.    Financial Statements                                   1
                                                              
               Balance Sheet - August 31, 1995                        1
                                                              
               Statements of Operations -                             2
               Three Months and Nine Months
               Ended November 30, 1995 and 1994
                                                              
               Statements of Cash Flows -                             3
               Nine Months Ended November 30, 1995
               and 1994
                                                              
               Notes to Financial                                     4
               Statements
                                                                    
    Item 2.    Management's Discussion and Analysis                   5
               of Financial Condition and
               Results of Operations
                                                              
Part II.    Other Information                                         6

    Item 5.    Increase of 5% ownership in class of subscriptions     6

    Item 6.    Exhibits and Reports on Form 8-K                       6

    Signature                                                         7

<PAGE>
                                                              



PART I.     FINANCIAL INFORMATION
     ITEM 1.    FINANCIAL STATEMENTS

<TABLE>
                          DERMARX CORPORATION
               BALANCE SHEET NOVEMBER 30, 1995 (Unaudited)
                                ASSETS
<CAPTION>
<S>                                                           <C>
Current assets:                                                  
     Cash                                                     $   913,716
     Accounts receivable                                           15,383
     Inventory - Finished goods                                    66,899
     Prepaid expense                                                8,050
                                                              ------------
          Total current assets                                  1,004,048
                                                              ------------   

Property and equipment, net of accumulated                       
     depreciation of $68                                            4,012
                                                                 
Other assets:                                                    
      Patents, net of accumulated amortization of $26,576         121,900
                                                              ------------
Total Assets                                                  $ 1,129,960
                                                              ============
        LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIENCY)
Current liabilities:                               
     Note payable - bank                                      $     6,000
     Notes payable - other                                         25,000
     Accounts payable and accrued expenses                         81,622
     Accrued interest - notes payable                               5,757
     Related party                                                 33,750
                                                              ------------
          Total current liabilities                               152,129
                                                              ------------   

Long-term debt:                                                  
    Note payable - bank                                             2,000
    Accrued expenses                                              196,679
     Notes payable - net of discounts                              33,560
     Note  payable - related party, net of discounts               48,268
     Accrued interest - note payable                                2,398
     Accrued  interest - note payable, related party                4,642
                                                              ------------
        Total long-term debt                                      287,547
                                                              ------------
            Commitments and Contingencies
Total Liabilities                                                 439,676
                                                              ------------

Common stockholders' equity (deficiency):                        
      Common  stock,  $.05 par  value:  8,000,000 
        shares authorized; 6,838,829 shares issued 
        and outstanding                                           341,941
      Additional paid-in capital                                4,092,118
      Accumulated (deficit)                                    (3,743,775)
                                                              ------------   
                                                                  690,284
                                                              ------------
Total Liabilities and Stockholder's Equity (deficit)          $ 1,129,960
                                                              ============

See accompanying notes to the financial statements.

                                  1

</TABLE>
<PAGE>
                                                      
<TABLE>                                
                                
                                   DERMARX CORPORATION
                                STATEMENTS OF OPERATIONS
                                
<CAPTION>
                                     Three Months Ended         Nine Months Ended
                                         November 30               November 30
                                      1995         1994         1995         1994
                                   ----------   ----------   ----------   ----------
                                       (unaudited)                (unaudited)

<S>                                <C>          <C>          <C>          <C>   
Sales                              $   8,422    $   6,215    $   40,548   $  35,477
                                                                
Cost of goods sold                    (1,958)        (940)      (12,028)     (5,277)
                                                      
Gross Profits                          6,464        5,275        28,520      30,200
                                                                
Operating Expenses                  (138,153)     (59,881)     (343,513)   (197,937)
                                                                
Operating Profit                    (131,689)     (54,606)     (315,093)   (167,737)
                                                                
Extraordinary Expenses              (111,450)           0      (111,450)          0
                                                                
Net (Loss) from continuing          
operations                          (243,139)     (54,606)     (426,543)   (167,737)
   
Dividends on series A                                           
preferred stock                         -            -           -            2,800
                                   ----------   ----------   ----------   ----------
                                    (243,139)     (54,606)   (426,543)     (170,537)
                                   ==========   ==========   ==========   ==========
Net (Loss) from                                         
discontinued operations                 -            -           -             -
                                                                
Net (Loss) attributable to        
common stock                       $(243,139)   $ (54,606)   $(426,543)   $(170,537)
                                                                
Net (Loss) per common                                           
share:
     From continuing operations    $    (.05)   $    (.02)  $    (.04)   $    (.05)
     From discontinued operations  $    (.05)   $    (.02)  $    (.04)   $    (.05)
                                                                
Weighted-average number of          
common shares outstanding           5,218,897    3,512,468   3,867,713    3,120,721
                                    =========    =========   =========    =========
                                                                
                                
See accompanying notes to the financial statements.
                                
                                           2

</TABLE>
<PAGE>
<TABLE>

   
                                   DERMARX CORPORATION
                                 STATEMENTS OF CASH FLOWS

<CAPTION>                                

                                                       Nine Months Ended November 30
                                                            1995          1994
                                                            ----          ----
                                                         (Unaudited)

<S>                                                     <C>           <C>
Cash flows from operating activities:                             
     Net (loss)                                         $ (448,538)   $ (167,737)
     Adjustments to reconcile net (loss) to net                       
       cash (used) by operating activities:
          Amortization of discounts on notes                 7,866         4,946
          Expenses paid by Issuance of stock
          Depreciation and amortization                      7,138         6,768
     Changes in assets and liabilities:                           
           (Increase) Decrease in accounts receivable       (3,923)        1,820
              receivable
           (Increase) Decrease in inventory                 12,029       (62,906)
           (Increase) Decrease in other assets              (7,002)          -
           Increase (Decrease) in accounts payable,
              accrued interest                             (59,315)       78,767
               and accrued expenses
           Increase (Decrease) dividends in arrears           -          (12,000)                                     -
                                                        -----------   -----------
     Net cash (used) by operating activities              (491,745)     (150,344)
                                                        -----------   -----------
Cash flows from financing activities:                             
     Net Proceeds of equity sale                         1,650,120          -
     Net proceeds from debt obligations                       -          315,500
     Purchase Treasury Shares                                 -         (147,500)
     Repayment of debt obligations                        (250,389)       (4,000)
                                                        -----------   -----------
Net cash provided by financing activities                1,399,731       164,000
                                                        -----------   -----------  
Net increase in cash and cash equivalents                  907,986        13,656
                                                                  
Cash and cash equivalents, beginning of year                 5,730         3,843
                                                        -----------   -----------
Cash and cash equivalents, end of period                $  913,716    $   17,499
                                                        ===========   ===========          

See accompanying notes to the financial statements.                                         


                                         3

</TABLE>
<PAGE>
                                                          
                              
                              DERMARX CORPORATION
                        NOTES TO FINANCIAL STATEMENTS

NOTE 1 - FINANCIAL STATEMENTS

The  balance  sheet  as of November 30, 1995, the  statements  of
operations  for  the three months and nine months ended  November
30,  1995 and 1994 and the statements of cash flows for the  nine
months ended November 30, 1995 and 1994 have been prepared by the
Company,  without  audit.   In  the opinion  of  management,  all
adjustments  (which  include only normal recurring  adjustments),
necessary  to present fairly the financial position, results  and
cash  flows as of November 30, 1995 and for all periods presented
have  been made.  The results of operations, for the nine  months
ended  November  30, 1995 are not necessarily indicative  of  the
results to be expected for the full year.

Certain information and footnote disclosure normally included  in
the  financial  statements prepared in accordance with  generally
accepted  accounting  principles  have  been  omitted.    It   is
suggested  that these financial statements be read in conjunction
with  the financial statement and notes thereto included  in  the
Company's  Form  10-KSB for its fiscal year  ended  February  28,
1995,   which   was  filed  with  the  Securities  and   Exchange
Commission.

NOTE 2 - MANAGEMENT PLANS

The  Company has completed the process of obtaining capital in  a
private placement.  The private placement involved an offering of
2,000,000 shares of the Company's common shares at the  price  of
$.50  per  common share.  During the quarter ended  November  30,
1995,  $928,500 had been raised in this offering.  Subsequent  to
November  30, 1995 this offering was completed with the placement
of the remaining shares raising an additional $71,500.

Intended  use  of  the private placement proceeds  includes  debt
repayment;  operating overhead; completion of product development
and  patent  application for an amorphous hydrogel; and  expenses
related  to  the market launch of three recently developed  wound
care  products  (a  skin  tear therapy,  an  antimicrobial  wound
cleanser and a polyurethane foam).

                               4

<PAGE>
               

               DERMARX CORPORATION AND SUBSIDIARY

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

RESULTS OF OPERATIONS

      The  Company's revenues increased to $8,422 in  its  fiscal
quarter ended November 30, 1995 from $6,215 in its fiscal quarter
ended November 30, 1994, an increase of $2,207.  This increase is
negligible  and  not  attributable to  any  particular  trend  or
effect.   The  Company's costs of goods sold as a  percentage  of
revenues  decreased  to 23% from 30% in the  three  months  ended
November  30, 1995 as compared to the comparable period one  year
ago.   Total expenses were $273,556, an increase of $212,735 from
the  comparable period one year ago.  This increase is  primarily
attributable  to  an increase in salary, marketing,  general  and
administrative, and other expenses incurred as the result of  the
Company's   efforts  to  develop  and  introduce  new   products.
Interest  expense  decreased  by $5,300  for  the  quarter  ended
November  30,  1995, compared to the same period  in  1994  as  a
result  of the debt conversion.  For the third quarter of  fiscal
year  1995,  the Company had a net loss of $265,134 or  $.05  per
share as compared to a net loss of $54,606 or $.02 per share  for
the previous comparable period.

LIQUIDITY AND CAPITAL RESOURCES

      Subsequent to the fiscal year ended February 28,  1995  the
Company  raised  $351,750 in a private placement  offering  dated
March  3, 1995 at the price of $.50 per common share.  Subsequent
to  August  31,  1995,  the  Company  commenced  another  private
placement offering of 2,000,000 shares of the Company's stock  at
the  price  of  $.50  per common share.  The Company  has  raised
$928,500 in this offering as of November 30, 1995.  Subsequent to
November  30, 1995, the Company raised an additional  $71,500  in
this  offering.  The Company extended an offer to certain holders
of  the  Company's debt to convert such debt to common shares  of
the Company's stock.  Holders of such debt converted $296,112  of
debt  and  accrued interest into 604,898 shares of the  Company's
common stock subsequent to August 31, 1995, thereby reducing  the
Company's outstanding debt significantly.

      As  a result of the private placement offering and the debt
conversion,  the Company has sufficient working capital  for  the
near  term  future to provide viability and continue as  a  going
concern.

OTHER MATTERS

      The  Company  entered into a two year  employment  contract
effective  November 1, 1995 with Dr. Gerit Mulder, an  expert  in
the  wound care industry.  Dr. Mulder is now a Vice President  of
the  Company, responsible for new product development, marketing,
distribution and customer support programs.

                               5
 
<PAGE>

      The Company was notified on February 28, 1996 by the United
States Patent Office that a patent was issued for its GeriMend(TM) 
product.  GeriMend(TM)  is a  topical ointment designed primarily 
for skin tears.

      As  of  September  1,  1995 the Company  has  received  FDA
approval to market DermaMend Foam(TM), its new polyurethane wound
dressing which contains an odor neutralizing ingredient.

PART II.  OTHER INFORMATION

ITEM 5.   INCREASE OF 5% OWNERSHIP IN CLASS OF SECURITIES

      During  the  quarter ended November 30,  1995  the  Company
conducted a private offering of 2,000,000 shares of the Company's
stock  at  an  offering price of $.50 per  share.   This  private
offering  was exempt from registration under Regulation  D,  Rule
505.   As a result of this private offering, at the quarter ended
November  30, 1995, the outstanding common shares of the  Company
had  increased by 65% over the number outstanding at the  end  of
the period ending August 31, 1995.

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

     None.


                               6
                     
<PAGE>
                                

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



                                   DERMARX CORPORATION
                                   (Registrant)



Dated:    March ______, 1996.      /s/ Maryanne Carroll
                                       -----------------------
                                       Maryanne Carroll,
                                       Chief Executive Officer


                               7