Exhibit 99
                                   ----------

Risk Factors of the Company
---------------------------

         Since its  organization,  Phage  has had  limited  operations  and is a
"start-up" or "development  stage"  company.  As with any company at this stage,
there may be unforeseen costs, expenses,  problems and difficulties of which the
management may not be aware of. A commitment of substantial resources to conduct
time-consuming research and development and clinical studies will be required if
Phage is to complete the  development of any potential  products.  Phage has not
yet begun to market  or  generate  revenues  from the  commercialization  of its
products and expects to incur  further  substantial  losses for the  foreseeable
future.  There  can be no  assurance  that any of  Phage's  products  will  meet
applicable health regulatory standards, obtain required regulatory approvals, be
capable of being  produced in commercial  quantities  at reasonable  costs or be
successfully  marketed,  or that the investment made in such potential  products
will be recouped through product sales to generate  sufficient  revenues to fund
its  continuing  operations.  There  can be no  assurances  that  Phage,  or its
subsidiary,  Phage Therapeutics will achieve profitability in the future, or, if
so, as to the timing or amount thereof.  Phage's  products and  technologies are
currently in the research and  development  stages and there can be no assurance
that these  programs  conducted  by Phage  will  result in  commercially  viable
products.  To obtain  regulatory  approvals for some of Phage's  products and to
achieve  commercial  success,  human clinical trials must  demonstrate  that the
products are safe for human use and that they show efficacy. No assurance can be
given that any  animal or human  tests,  if  undertaken,  will yield  favourable
results. Unsatisfactory results obtained from a particular study relating to one
or more of Phage's products or technologies may cause Phage to reduce or abandon
its commitment to that program.

Regulatory Approvals
--------------------

         The  procedure  involved  in  obtaining  regulatory  approval  from the
competent  authorities to market therapeutic products is long and costly and may
delay product development. The approval to market a product may be applicable to
a limited extent only or it may be refused. Such limitations or refusal could be
detrimental to the sales and profitability of Phage. To date, Phage Therapeutics
has not  submitted  applications  to the FDA for the  marketing of its products.
There can be no assurance that Phage will obtain such  regulatory  approval on a
timely basis or at all.

Patents
-------

         Phage  Therapeutics  has filed  two  patents.  The  first  patent is to
protect Phage Therapeutic's  bacteriophage  compositions of matter,  methods for
their production, strains of bacteria and bacteriophage, the therapeutic uses of
bacteriophage  for  treating  patients,  Staphylococcal  products  and to create
significant barriers to entry by potential competitors.  The second patent is to
protect a proprietary, novel, natural source for Phage Therapeutics's library of
Staphylococcal  bacteriophage  active against both Staphylococcus  aureus and S.
epidermidis.  (For more information about the patent applications,  please refer
back to "Patents, Trademarks & Licenses" on page 6). However, at this time, both
patents  are still  pending  and the  Company is unaware as to when,  or if, the
patents will be accepted or  registered.  Both of these  patents are critical in
protecting Phage Therapeutics' bacteriophage compositions of matter, methods for
their production, strains of bacteria and bacteriophage, the therapeutic uses of
bacteriophage for treating patients,  Staphylococcal products and its library of
Staphylococcal bacteriophage from potential competitors.

         There can be no assurance, however, that the filing of the above patent
applications will prevent or provide meaningful  protection or adequate remedies
for  Phage  Therapeutics's  technology  in  the  event  of  unauthorized  use or
disclosure of such information.

         Competitors or potential  competitors may have filed  applications for,
or may have received  patents and may obtain  additional and proprietary  rights
to,  compounds  or processes  used by or  competitive  with those of Phage.  The
issuance of patents based on such compounds or processes could adversely  affect
the  ability  of Phage or its  subsidiary  to  market  and sell  Phage's  or its
subsidiary's products. If a license is required,  there can be no assurance that
Phage or its  subsidiary  will be able to obtain  such a  license,  or that,  if
obtainable, such a license would be available on reasonable terms.

         Patent litigation is becoming widespread in the biotechnology  industry
and it is not possible to predict how any such litigation will affect Phage's or
Phage  Therapeutics'  efforts to perform  clinical  testing or  manufacture  and
market any products under development.  Further,  there can be no assurance that
Phage's or Phage  Therapeutics'  patents,  if  issued,  would be held valid by a
court of competent jurisdiction.  Phage may also become involved in interference
proceedings in


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connection  with one or more of its patents or patent  applications to determine
priority of invention,  which could result in substantial cost to Phage or Phage
Therapeutics, as well as a possible adverse decision as to priority of invention
of the patent or patent application involved.

Competition
-----------

         The pharmaceutical and biotechnology industries are highly competitive.
Phage competes with other companies,  academic and research  institutions  which
have  substantially  greater  resources to those of Phage.  Other  companies may
succeed  in  developing  products  earlier  than  Phage,   obtaining  regulatory
approvals  for such  products  more  rapidly  than Phage or its  subsidiary,  or
developing  products that are more effective than those proposed to be developed
by Phage.

         While Phage will seek to expand its technological capabilities in order
to remain  competitive,  there can be no assurance that research and development
by others  will not render  Phage's  technology  or  products  obsolete  or non-
competitive or result in treatments or cures  superior to any therapy  developed
by Phage,  or that any  therapy  developed  by Phage  will be  preferred  to any
existing or newly developed technologies.

Manufacturing
-------------

         Phage has not yet manufactured any products for commercial distribution
and in  order  to be  successful,  Phage's  products  must  be  manufactured  in
commercial  quantities  in  compliance  with  regulatory   requirements  and  at
acceptable  costs.  Phage does not have  facilities  for the  production  of its
products under  development  and will initially  obtain the small amounts of its
products it requires for clinical studies from contract manufacturing companies.
In order to manufacture it products in commercial quantities, if it elects to do
so, Phage will need to develop its own manufacturing facilities or contract with
third parties to manufacture its products.  There can be no assurance,  however,
that Phage will be able to develop or otherwise secure access to such facilities
or that Phage or any third parties Phage  contracts with will be able to produce
commercial quantities of Phage's products at reasonable cost, or at all.

Product Liability
-----------------

The sale and use of  products  under  development  by Phage,  and the conduct of
clinical studies involving human subjects, may entail risk of product liability.
Phage does not  currently  have in place  product  liability  insurance  for its
products but expects that,  as Phage  expands,  it will require such  insurance.
There can be no assurance that Phage will be able to obtain  appropriate  levels
of product liability  insurance prior to the sale of its products.  An inability
to obtain  insurance on  economically  feasible  terms or to  otherwise  protect
against  potential  product  liability  claims  could  inhibit  or  prevent  the
commercialization  of products  developed by Phage.  The  obligation  to pay any
product liability claim or recall a product could have a material adverse effect
on the business, financial condition and future prospects of Phage.