CONFORMED COPY
                             UNITED STATES
                   SECURITIES AND EXCHANGE COMMISSION
                        WASHINGTON, D. C.  20549

                              FORM  10-QSB


  (Mark One)

  [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES
  EXCHANGE ACT OF 1934
                      For the quarterly period ended:   June 30, 1999

  [  ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
  EXCHANGE ACT OF 1934
                      For the transition period from    to

                                Commission file number:  1-14068


                          SEPRAGEN CORPORATION
   (Exact name of small business issuer as specified in its charter)

       California                                   68-0073366
  (State or other jurisdiction of               (I.R.S. Employer
  incorporation or organization)               Identification No.)

           30689 Huntwood Avenue, Hayward, California  94544
                (Address of principal executive offices)

  (Issuer's telephone number (including area code):  (510) 476-0650

  (Former name, former address and former fiscal year if changed
  since last report:

  Check whether the issuer (1) has 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 issuer was required to
  file such reports), and (2) has been subject to such filing
  requirements for the past 90 days.    Yes  X    No

  State the number of shares outstanding of each of the registrant's
  classes of Common equity, as of the latest practicable date:

                                                    August 31, 1999

                           Class A Common Stock          4,057,216
                           Class B Common Stock            701,177
                           Class E Common Stock          1,209,894


  PART I  -  FINANCIAL INFORMATION
  Item  1.  -  Financial Statements
                          SEPRAGEN CORPORATION

                        CONDENSED BALANCE SHEET

                                 ASSETS

                                                       June 30, 1999

   Current Assets:
        Cash and cash equivalents                           $54,673
        Accounts receivable, less allowance for
          doubtful accounts of $20,000 as of
          June 30, 1999                                     429,640
        Inventories                                         229,606
        Prepaid expenses and other                           32,011
          Total current assets                              745,930

        Furniture and equipment, net                        138,947
        Intangible assets                                    82,698
                                                            967,575

            LIABILITIES AND DEFICIT IN SHAREHOLDERS' EQUITY


   Current Liabilities:
        Accounts payable                                    498,903
        Customer deposits                                    88,499
        Notes Payable, including $135,000 from
          shareholders                                      539,598
        Accrued payroll and benefits                        292,844
        Accrued liabilities                                  76,556
        Interest payable                                     61,045
          Total current liabilities                       1,557,445

   Preferred stock, no par value - 5,000,000
     shares authorized; and 175,439 convertible,
     preferred issued and outstanding                       500,000

   Commitments:
     Class E common stock, no par value -
        1,600,000 shares authorized; 1,209,894
        shares issued and outstanding at
        September 30, 1998, redeemable at $.01
        per share                                                 -

   Deficit in Shareholders' equity:
     Class A common stock, no par value -
        20,000,000 shares authorized; 4,057,216
        shares issued and outstanding                     9,752,226
     Class B common stock, no par value -
        2,600,000 shares authorized; 701,177
        shares issued and outstanding                     4,065,618
        Additional paid in capital                          202,220
        Accumulated deficit                             (15,109,934)

   Total deficit in shareholders' equity                   (589,870)

                                                            967,575

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



                          SEPRAGEN CORPORATION

                   CONDENSED STATEMENTS OF OPERATIONS

                             Three Months              Six Months
                            Ended June 30           Ended June 30

                          1999       1998       1999         1998

   Revenues:
     Net Sales        $330,206   $211,471   $883,867     $843,804

   Selling, general
     and
     administrative    197,968    311,570    428,779      605,516
   Research and
     development       131,907    191,430    288,134      404,524
   Total costs and
     expenses          511,947     629,741 1,239,361    1,519,867

   Loss from
     operations       (181,741)  (418,270)  (355,494)    (676,063)

   Interest income,
     (expense) net     (12,000)   (20,000)   (18,000)    (109,282)

      Net loss        (193,741)  (438,270)  (373,494)    (785,345)


   Net loss per
     common share,
     basic and
     diluted             $(.04)     $(.15)     $(.08)       $(.28)

   Weighted average
     shares
     outstanding     4,758,393  2,856,431  4,758,393    2,856,431



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

                          SEPRAGEN CORPORATION

                   CONDENSED STATEMENTS OF CASH FLOWS


                                       Six Months Ended June 30,
                                           1999            1998
   Cash flows from operating
     activities:
        Net Loss                     $(373,494)      $(785,345)

     Adjustments to reconcile
       net loss to net cash used
       in operating activities:
         Depreciation and
           Amortization                 59,109         138,047

         Changes in assets and
            liabilities:
              Accounts receivable       98,205         362,612
              Inventories              215,786          74,698
              Prepaid expenses
                and other                    -              (1)
              Accounts payable        (466,775)         287,307
              Accrued liabilities      (20,067)        (35,503)
              Accrued payroll
                and benefits           136,781          84,040
              Interest payable          18,001          39,282
              Customer deposits         47,702        (254,681)

     Net cash used in operating
       activities                     (284,752)        (89,544)

   Cash flows from investing
     activities:
       Acquisition of fixed assets      (6,309)              -
       Net cash used by investing        (6309)              -
       Proceeds from notes
         payable to shareholders             -          50,000
       Proceeds from issuance of
         notes payable                 304,598           8,000
     Net cash provided by
       financing activities            304,598          58,000

   Net increase (decrease) in cash      13,537         (31,544)

   Cash and cash equivalents at
     the beginning of the period        41,136          44,448

   Cash and cash equivalents at
     the end of the period            $ 54,673        $ 12,904

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

                          SEPRAGEN CORPORATION

                NOTES TO CONDENSED FINANCIAL STATEMENTS
                  SIX MONTH PERIOD ENDED JUNE 30, 1999


  Note 1 - Basis of Presentation

       These condensed financial statements have been presented on a
  going concern basis.  Sepragen Corporation ("the Company") has
  incurred recurring losses and cash flow deficiencies from
  operations that raise substantial doubt about its ability to
  continue as a going concern.  As of June 30, 1999, the Company had
  an accumulated deficit of $15,109,934.

       The Company will be required to conduct significant research,
  development and testing activities which, together with expenses to
  be incurred for manufacturing, the establishment of a large
  marketing and distribution presence and other general and
  administrative expenses, are expected to result in operating losses
  for the foreseeable future.  Accordingly, there can be no assurance
  that the Company will ever achieve profitable operations.  The
  Company will have to obtain additional financing to support its
  operating needs beyond September 30, 1999.  The Company is
  currently pursuing alternative funding sources to meet its cash
  flow needs, including private debt and equity financing. Management
  intends to use such funding to further its marketing efforts and
  expand sales.  It is uncertain, however, whether the Company will
  be successful in such pursuits.  No adjustments have been made to
  the accompanying condensed financial statements for this
  uncertainty.


  Note 2 - Interim Financial Reporting

       The accompanying unaudited interim financial statements have
  been prepared pursuant to the rules and regulations for reporting
  on Form 10-QSB.  Accordingly, certain information and footnotes
  required by generally accepted accounting principles have been
  condensed or omitted.  These interim statements should be read in
  conjunction with the financial statements and the notes thereto,
  included in the Company's Annual Report on Form 10-KSB for the year
  ended December 31, 1998.


  Note 3 - Net Loss Per Share.

       The Company has adopted Statement of Financial Accounting
  Standards (SFAS) No. 128, Earning per Share for all periods
  presented.  The adoption of SFAS No. 128 had no impact on
  previously reported loss per share for the three months ended June
  30, 1998.  In accordance with SFAS No. 128, primary earnings (loss)
  per share has been replaced with basic earnings (loss) per share,
  and fully diluted earnings (loss) per share has been replaced with
  diluted earnings (loss) per share which includes potentially
  dilutive securities such as outstanding options and convertible
  securities, using the treasury stock method. The assumed exercise
  of options and warrants and assumed conversion of convertible
  securities have not been included in the calculation of diluted
  loss per share as the effect would be anti-dilutive.

  Note 4 - The "Year 2000 Problem", dates following December 31, 1999
  and beyond:

       Many existing computer systems and applications, and other
  devices, use only two digits to identify a year in the date field,
  without considering the impact of the upcoming change in the
  century. Such systems and applications could fail or create
  erroneous results unless corrected. The Company relies on its
  internal financial systems and external systems of business
  enterprises such as customers, suppliers, creditors, and financial
  organizations both domestically and globally, directly and
  indirectly for accurate exchange of data.  The Company has
  evaluated such systems and believe the cost of addressing the "Year
  2000 Problem" will not have a material adverse affect on the result
  of operations of financial position of the Company. However, even
  though the internal systems of the Company are not materially
  affected by the Year 2000 issue the Company could be affected
  through disruption in the operation of the enterprises with which
  the Company interacts.

  Note 5 - Notes Payable

       Between May 1997 and August 1998, the Company borrowed an
  aggregate of $400,000 of which $300,000 was from shareholders of
  the Company, payable with interest at 9.5% per annum and $100,000
  from an unrelated party payable with interest at 9.5% per annum. In
  January 1999, $35,000 was paid to the unrelated party with the
  remaining balance of $65,000 due on March 1, 1999.  In December,
  1998, the Company converted $165,000 of shareholder debt including
  accrued interest of $11,657 into 368,035 shares of Class A Common
  Stock with a balance of $135,000 due to shareholders. On January
  22, 1999, the Company converted $484,430 due to a major supplier
  from accounts payable to notes payable. The Note bears 12% interest
  per annum and is secured by agreement granting this vendor a first
  priority interest in the assets of the Company excluding patents
  and trade marks. The Note is to be paid at $65,000 per month and
  the balance as of June 30, 1999 was $339,598.

       The notes payable that were due on March 1, 1999, are now past
  due. Terms for repayment and extension are being negotiated.

  Note 6 - Bridge Notes Payable

       On August 19, 1998, the Company completed a debt-refinancing
  transaction whereby the Company borrowed $550,000 from Mr. K.
  Charles Janac pursuant to a Convertible Secured Promissory Note
  issued by the Company (the "Note") in the principal amount of
  $550,000 and bearing interest at the rate of 9.75% per annum. The
  Note is convertible into shares of Class A Common Stock at the
  option of Mr. Janac at any time before December 15, 1998 by
  converting the principal balance and any unpaid interest due under
  the Note into Class A Common Stock at the rate of $0.46875 per
  share. In addition, as further consideration for the loan of funds
  to the Company, the Company issued to Mr. Janac a warrant ,
  exercisable at any time on or before August 18, 2003, to purchase
  up to 234,667 shares of Class A Common Stock at $.46875 per share
  (the "Warrants").  As security for the Note, the Company entered
  into a Security Agreement granting Mr. Janac a first priority
  security interest in the property, tangible and intangible, of the
  Company, as well as a Patent and Trademark Mortgage granting Mr.
  Janac a security interest in all the patents and trademarks of the
  Company. The Company used the funds loaned by Mr. Janac to retire
  $532,242 of existing debt and accrued interest incurred by the
  Company in connection with a certain bridge financing undertaken by
  the Company in October of 1997, to pay legal fees and costs of the
  transaction, and approximately $7,000 was utilized for working
  capital.

       On December 8, 1998, the Company paid $200,000 to Mr. Janac as
  a partial payment of the Note. Mr. Janac also agreed to convert the
  remaining balance of $366,308 of the Note in principal and accrued
  interest into Class A Common Stock at $0.46875 per share. In
  consideration of the conversion the Company issued 781,457 of
  Common A Shares to Mr. Janac. At the same time the UCC filing
  granting Mr. Janac security interest in the Company's assets was
  removed. In addition, the Company converted an additional $10,000
  of Bridge Debt principal and $1,186 in accrued interest into 23,304
  shares of Class A Common Stock.

  Note 7 - Convertible Preferred Stock

       On September 1, 1998, the Company sold 175,439 Shares of
  Series A Preferred Stock.

       All of the shares of Series A Preferred Stock were sold to
  Anchor Products Limited of Hamilton, New Zealand ("Anchor"). The
  acquisition of Series Preferred Stock by Anchor was consummated in
  connection with the execution of a Commercial License Agreement
  between the Company and Anchor, whereby the Company licensed Anchor
  a technology that isolates proteins from whey, a low value cheese
  by-product. The shares of Series A Preferred Stock were sold for
  cash in the aggregate amount of $500,000 ($2.85 per share). There
  were no underwriting discounts or commissions paid in connection
  with the transaction.

       The shares of Series A Preferred Stock were sold pursuant to
  exemptions from registration under section 4(2) and regulation S
  under the Securities Act of 1933, in a transaction that was not
  publicly offered. Anchor is a New Zealand corporation.

       The Company's Series A Preferred Stock provides for both a 7%
  dividend and liquidation preferences. The dividend is payable from
  time to time at the election of the Board of Directors of the
  Company subject to the Company retaining sufficient earnings and
  profits. The Preferred Stock is also convertible on or before
  September 30, 2000 into Class A Common Stock, at the conversion
  rate of $2.86 per share. On any voluntary or involuntary
  liquidation, dissolution or winding-up of the Company, the holders
  of series A Preferred Shares shall receive, out of the assets of
  the Company, the sum of $2.86 per Series A Preferred Share, plus an
  amount equal to any dividends accrued and unpaid on those Series A
  Preferred Shares, before any payment shall be made or any assets
  distributed to the holders of Common Stock. The Series A Preferred
  Shares shall be redeemable at the option of the holders of the
  Series A Preferred Shares commencing September 30, 2003 and
  expiring December 31, 2008, at the cash price of $2.86 per share,
  plus any accrued and unpaid dividends on the Series A Preferred
  Shares which are redeemed. In addition, each share of Series A
  Preferred Stock shall be automatically converted into one (1) share
  of Class A Common Stock, if not previously redeemed, on January 1,
  2009, or at any time the closing bid price per share of the
  Company's Class A Common Stock shall average at least $3.86 per
  share over ninety (90) consecutive trading days prior to January 1,
  2004. The conversion ratio for the Series A Preferred Stock shall
  be adjusted in the event of recapitalization, stock dividend, or
  any similar event effecting the Class A Common Stock.

       Anchor may require the Company to immediately redeem the
  preferred shares in the event of certain covenant breaches of the
  license agreement by the Company. The Company is currently in
  compliance with all such covenants and does not anticipate any
  breaches in the future.

  Note 8 - Class A Common Stock:

       On December 15, 1998, the Company issued to Charles Janac
  781,457 shares of Class A Common stock and warrants to purchase
  234,667 shares of Class A Common Stock at $0.46875 per share
  (expiring August 19, 2003) in exchange for the conversion of
  $366,308 of notes and accrued interest held by Mr. Janac. The
  shares of Class A Common Stock and warrants were sold pursuant to
  exemptions from registration under sections 3(a)(11),4(2) and 4(6)
  and regulation D under the Securities Act of 1933, in a transaction
  that was not publicly offered.

       On December 15, 1998, the Company issued to Eliezer Sternheim
  520,833 shares of Class A Common stock and warrants to purchase
  52,083 shares of Class A Common Stock at $0.48 per share (expiring
  December 15, 2003) in exchange for $250,000 cash. The shares of
  Class A Common Stock and warrants were sold pursuant to exemption s
  from registration under sections 3(a)(11), 4(2) and 4(6) under the
  Securities Act of 1933, in a transaction that was not publicly
  offered.

       On December 15, 1998, the Company issued to Armin Ramel, a
  director of the Company. 59,946 shares of Class A Common Stock and
  Warrants to purchase 5,995 shares of Class A Common Stock at $0.48
  per share (expiring December 15, 2003) in exchange for the
  conversion of $28,774 of notes and accrued interest held by Mr.
  Ramel. The shares of Class A Common Stock and warrants were sold
  pursuant to exemption from registration under sections 3(a)(11),
  4(2) and 4(6) under the Securities Act of 1933, in a transaction
  that was not publicly offered.

       On December 15, 1998, the Company issued to Henry Edmunds, a
  director of the Company, 127,471 shares of Class A Common stock and
  warrants to purchase 12,747 shares of Class A Common Stock at $0.48
  per share (expiring December 15, 2003) in exchange for $50,000 cash
  and the conversion of $11,186 of notes and accrued interest held by
  Mr. Edmunds. The shares of Class A Common stock and warrants were
  sold pursuant to exemptions from registration under sections
  3(a)(11),4(2) and 4(6) under the Securities Act of 1933, in a
  transaction that was not publicly offered.

       On December 15, 1998, the Company issued to Marcel Raedts
  104,167 shares of Class A Common stock and Warrants to purchase
  10,417 shares of Class A Common Stock at $0.48 per share (expiring
  December 15, 2003) in exchange for the conversion of $50,000 in
  amounts owed to Mr. Raedts for services rendered. The shares of
  Class A Common Stock and warrants were sold pursuant to exemptions
  from registration under sections 3(a)(11) and 4(2) and under the
  Securities Act of 1933, in a transaction that was not publicly
  offered.

       On December 15, 1998, the Company issued to Michael Schneider,
  principal and director of Romic Technologies Corp., 275,614 shares
  of Class A Common Stock and Warrants to purchase 27,561 shares of
  Class A Common Stock at $0.48 per share (expiring December 15,
  2003) in exchange for the conversion of $132,294 of notes and
  accrued interest held by Mr. Schneider. The shares of Class A
  Common Stock and warrants were sold pursuant to exemptions from
  registration under sections 3(a)(11),4(2) and 4(6) under the
  Securities Act of 1933, in a transaction that was not publicly
  offered.

       On December 15, 1998, the Company issued to Robert Leach. a
  former director of the Company, 32,475 shares of Class A Common
  Stock and warrants to purchase 3,248 shares of Class a Common Stock
  at $0.48 per share (expiring December 15, 2003) in exchange for the
  conversion of $15,588 of notes and accrued interest held by Mr.
  Leach. The shares of Class A Common Stock and warrants were sold
  pursuant to exemption from registration under section 3(a)(11),4(2)
  and 4(6) under the Securities Act of 1933, in a transaction that
  was not publicly offered.


  Item 2. Management's Discussion and Analysis.

  First six months of 1999 compared to first six months of 1998.

       On August 6, 1999, Sepragen announced the beginning of
  commercial production utilizing its patented Sepralac process at
  Anchor Products, Ltd. of New Zealand. The commercial facility
  commissioned by Anchor Products, Ltd. has the capacity to extract
  several hundred kilograms of purified proteins from several hundred
  thousand liters of cheese whey each day. The Company is working on
  commissioning the production installation at Carbery Milk Products.
  While significant in strategic and long term sense, these plants
  are not expected to generate meaningful royalty income until in the
  year 2000. In the meanwhile, the Company's major revenue source
  will continue to be from sales to its biotechnology customers.

       Net sales increased by $40,000 or 5% from $844,000 in the
  first half of 1998 to $884,000 for the comparable period in 1999.
  The increase in net sales is primarily in the QuantaSep product
  line. The sales increase is attributable to the second quarter of
  1999. Despite the increase in net sales, the Company continues to
  be hampered by cash shortage that has adversely affected the
  manufacture and shipment of goods. Management is working on
  securing external financing (see Liquidity and Capital Resources ).

       Gross Margin increased by $27,000 or 8% from $334,000 in the
  first half of 1998 to $361,000 in the first half of 1999. As a
  percentage of sales, gross margin improved by 1% from 40% in the
  first half of 1998 to 41% for the comparable period in 1999. The
  slight improvement was essentially due to product mix.

       Selling, general and administrative expenses decreased by
  $177,000 from $606,000 in the first half of 1998 to $429,000 in the
  first half of 1999. The decrease was primarily due to the Company's
  choosing to sell its biotech products through external channels as
  opposed to making direct sales and the continuing measures
  undertaken by the Company to conserve cash.

       Research and development expenses decreased by $117,000 from
  $405,000 in the first half of 1998 to $288,000 in the first half of
  1999. The decrease was due to reduction in some overhead associated
  with Research and development department and the completion of
  certain research projects.

       Interest expense decreased by $91,000 in the first half of
  1999 compared to the first half of 1998 due to the payment of the
  bridge notes and conversion of some of the notes payable to equity
  in December 1998.

       Net loss decreased by more than half from $785,000 in the
  first half of 1998 to $373,000 for the comparable period in 1999.
  The Company's plan is to continue to keep expenses down and
  minimize losses while building up the revenue and profit
  contribution from the dairy/juice business. The ability of the
  Company to be profitable is dependent for now upon the biotech
  sector, which is being hampered by cash shortage which limits
  procurement of goods for sale. Management is currently pursuing
  several alternatives to raise additional capital and restructured
  debt which the Company hopes will materialize in the near future.

  Second quarter 1999 compared to second quarter 1998.

       Net sales increased by $118,800 or 56% from $211,400 in the
  second quarter of 1998 to $330,200 for the second quarter of 1999.
  The increase was primarily in the QuantaSep product line.

       Gross margin increased by $63,400 from $84,700 in the second
  quarter of 1998 to $148,100 for the comparable period in 1999. As a
  percentage of sales gross margin increased by 5% from 40% to 45%.
  The increase in gross margin was primarily due to product mix.

       Selling, general and administrative expenses decreased by
  $113,600 mainly due to the Company's choice to sell its products
  through distributors as opposed to making direct sales and the
  continuing belt tightening measures undertaken by the Company.

       Research and development expenses decreased by $59,500 or 31%
  from $191,400 in the second quarter of 1998 to $131,900. The
  decrease was primarily due to completion of some research programs
  and the reduction in overhead associated with research and
  development expenses.

  Inflation.

       The Company believes that the impact of inflation on its
  operations since its inception has not been material.

  Liquidity and Capital Resources:

       The Company used cash of $284,800 and $89,500 for operations
  during the first half of 1999 and 1998, respectively. Cash used in
  operations in the first half of 1999 was the result of net loss
  incurred for the six months of $373,500, offset by net non-cash
  expense of $59,100, the net change in operating assets and
  liabilities resulting in cash provided of $29,600. Cash used in
  operation in the first half of 1998 was the result of net loss
  incurred for the first half of $785,300, offset by net non-cash
  expenses of $138,000, the net change in operating assets and
  liabilities resulting in source of cash of $557,800.

       Investing activities used cash of $6,300 in the acquisition of
  fixed assets.

       Financing activities provided cash of $304,600 and $58,000
  during the first half of 1999 and 1998, respectively. The cash
  provided in the first half of 1999 was due to conversion of
  $339,600 in accounts payable to notes payable partially offset by
  $35,000 paid notes payable. The cash provided in the first quarter
  of 1998 resulted from the issuance of $58,000 in notes payable.

       At June 30, 1999 the Company had cash and cash equivalents of
  $54,600 as compared with $41,100 on December 31, 1998.  At June 30,
  1999, the Company had working capital deficit of $811,500, as
  compared to working capital deficit of $490,800 at December 31,
  1998.  The increase in cash in the first half of 1999 is a result
  of the aforementioned increase or decrease in cash from operating ,
  investing and financing activities noted above. The decrease in
  working capital for the first half of the year is primarily a
  result of the net loss incurred offset by non-cash charges.

       This negative cash out flow from operations must be reversed
  and working capital increased significantly in order for the
  Company to fund its existing activities and to extend the use of
  its technology to new applications in the food and dairy and juice
  industries, and to attract the interest of strategic partners in
  one or more of these markets.

       Based on the Company's current operating plan, the Company
  believes that it will only be able to fund the Company's operations
  through September 30, 1999.  Accordingly, the Company will have to
  either turn profitable or obtain additional funds to support its
  operations.  The Company is currently pursuing several avenues
  including increasing revenues and reducing costs in order to turn
  profitable, secure funds through additional strategic partnerships
  and secure either debt or equity financing.

       Following this strategy, on August 25, 1998, Sepragen
  announced the signing of a license agreement with Anchor Products.
  Under this agreement, Anchor Products will have exclusive
  manufacturing rights to the Sepralac(R) process in Australia and
  New Zealand and non-exclusive worldwide marketing rights to
  products produced by the Sepralac(R) Process. In return, Sepragen
  has received $700,000 from Anchor Products, comprised of a license
  fee of $200,000 and an equity investment of $500,000 for the
  purchase of 175,439 redeemable, cumulative, preferred stock at
  $2.85 per share. The preferred stock is convertible into common
  stock (on share for share basis) at any time within the next 2
  years and extendible for a further one year at Sepragen's option.

       On October 15, 1998 the Company announced a licensing
  agreement for the Sepralac(R) Process with Carbery Milk Products of
  Ballineen, County Cork, Ireland. Under the agreement, Carbery will
  have manufacturing and marketing rights to certain products
  produced from the Sepralac(R) Process. In return the Company will
  receive a license fee of $350,000, of which, $200,000 was received
  in 1998 with the balance over three years at $50,000 per year.

       In addition to Mr. Janac's conversion of debt to equity (see
  Note 6 to the financial statements), in December, 1998 the Company
  converted $604,151 of its debt and accrued expenses in to Class A
  Common stock. It also sold 625,000 shares of Class A Common Stock
  in a private transactions, exempt from securities registration
  under the Securities Act of 1993, as amended, and raised $300,000
  of proceeds. In all, a total of $904,151 (including Mr. Janac's)
  was either invested or converted in to stock. In consideration of
  the above, 1,901,962 shares of Class A Common Stock and 346,718
  Warrants to purchase Common Stock were issued.

       The Company currently has no credit facility with a bank or
  other financial institution.  Further, the Company's stock is
  traded over-the-counter and as such, there is limited liquidity in
  the Company's stock which makes financing difficult.  The Company
  is seeking to enter into strategic alliances with corporate
  partners in the industries comprising its primary target markets
  (biopharmaceutical, food, dairy and juice).  The Company's ability
  to further develop and market its Sepralac(R) Process for whey
  separation and other potential food and juice products and
  processes will be substantially dependent upon its ability to
  negotiate partnerships, joint ventures or alliances with
  established companies in each market.  In particular, the Company
  will be reliant on such joint venture partners or allied companies
  for both market introduction, operational assistance and financial
  assistance.  The Company believes that development, manufacturing
  and market introduction of products in these industries, will cost
  millions of dollars and require operational capabilities in excess
  of those currently available to the Company.  No assurance can be
  given, however, that the terms of any additional alliances will be
  successfully negotiated or that such alliance will be successful in
  generating the revenue required to make the Company profitable.

  Other Events:

       Dr. Kris Venkat resigned from the Board of Directors of
  Sepragen Corporation, no replacement has been elected.


  Cautionary Statement for Purposes of the "Safe Harbor" Provisions
  of the Private Securities Litigation Reform Act of 1995.

       This report contains or incorporates by reference forward-
  looking statements within the meaning of the Private Securities
  Litigation Reform Act of 1995.  Where any such forward-looking
  statement includes a statement of the assumptions or bases
  underlying such forward-looking statement, the Company cautions
  that, while such assumptions or bases are believed to be reasonable
  and are made in good faith, assumed facts or bases almost always
  vary from the actual results, and the differences between assumed
  facts or bases and actual results can be material, depending upon
  the circumstances.  Where, in any forward-looking statement, the
  Company or its management expresses an expectation or belief as to
  future results, such expectation or belief is expressed in good
  faith and is believed to have a reasonable basis, but there can be
  no assurance that the statement of expectation or belief will
  result or be achieved or accomplished.  The words "believe,"
  "estimate," "anticipate," and similar expressions may identify
  forward-looking statements.

       Taking into account the foregoing, the following are
  identified as some but not all of the important factors that could
  cause actual results to differ materially from those expressed in
  any forward-looking statement made by, or on behalf of the Company:

       Inability to Secure Additional Capital.  The Company has
  incurred operating losses each fiscal year since its inception. The
  Company must secure additional financing through either the sale of
  additional securities or debt financing to continue operations past
  September 30, 1999.  Although the Company is attempting to secure
  such financing, there can be no assurance that such financing will
  be available to the Company on reasonable terms.  The Company has
  been delisted from the Nasdaq SmallCap Market and the Pacific Stock
  Exchange.  See Item 2 "Management's Discussion and Analysis-
  Liquidity and Capital Resources."

       Competition.  In both its biopharmaceutical industry market
  and in the market for its process systems for food, beverage, dairy
  and environmental industries, the Company faces intense competition
  from better capitalized competitors.

       Dependence on Joint Ventures and Strategic Partnerships.  The
  Company's entry into the food, dairy and beverage market for its
  process systems will be substantially dependent upon its ability to
  enter into strategic partnerships, joint ventures or similar
  collaborative alliance with established companies in each market.
  As of the date of this report, two licensing agreements have been
  signed but there can be no assurance that the terms of any such
  alliance will produce profits for the Company nor can there be
  assurance that additional joint ventures or alliances will be
  signed.


                           OTHER INFORMATION

  Item 1.   Legal Proceedings
                      Not Applicable

  Item 2.   Changes in Securities
                      Not Applicable

  Item 3.   Defaults Upon Senior Securities
                      Not Applicable

  Item 4.   Submission of Matters to a vote of Security Holders
                      Not Applicable

  Item 5.   Other Information
                      Not Applicable






                               SIGNATURES

       In accordance with the requirements of the Exchange Act, the
  Registrant caused this report to be signed on its behalf by the
  undersigned thereunto duly authorized.

                                SEPRAGEN CORPORATION

  DATE:  September 8, 1999      By: /s/ Vinit Saxena
                                Vinit Saxena
                                Chief Executive Officer, President
                                and Principal Financial and Chief
                                Accounting Officer