FORM 10-KSB

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

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

                    For the fiscal year ended: March 31, 2007

                                       OR

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

             For the transition period from ________ to ____________

                        Commission file number: 2-87052-D
                                                ---------

                           COGENCO INTERNATIONAL, INC.
                           ---------------------------
                 (Name of small business issuer in its charter)

         Colorado                                               84-091475
-------------------------------                             ---------------
(State or other jurisdiction of                            (I.R.S. Employer
incorporation or organization)                            Identification No.)

                  Suite 1840, 6400 South Fiddler's Green Circle
                  Greenwood Village, Colorado             80111
                -------------------------------------------------
               (Address of principal executive offices) (Zip Code)

                    Issuer's telephone number: (303) 221-3680

       Securities registered under Section 12(b) of the Exchange Act: None
       Securities registered under Section 12(g) of the Exchange Act: None

     Check whether the issuer is not required to file reports pursuant to
Section 13 or 15(d) of the Exchange Act. [ ]

     Indicate by check mark whether the issuer (1) filed all reports required to
be filed by Section 13 or 15(d) of the Exchange Act 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 at least 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 in this form, 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 ]


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     Indicate by check mark whether the registrant is a shell company (as
defined in Rule 12b-2 of the Exchange Act). Yes [ x ]   No [   ]

     Issuer's revenues for its most recent fiscal year: $39,481.

     Aggregate market value of voting stock held by non-affiliates as of May 31,
2007: $ -0-. There is currently no trading market for the Registrant's
securities.

     Number of shares of Common Stock, $.0l par value, outstanding as of May 31,
2007: 2,656,256.

     Documents incorporated by reference: None.

     Transitional Small Business Disclosure Format (check one):

     Yes [ ] No [ x ]


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                           COGENCO INTERNATIONAL, INC.

                                   FORM 10-KSB

                                     PART I

Statements that we make in this Form 10-KSB that are not historical or current
facts are "forward-looking statements" made pursuant to the safe harbor
provisions in the federal securities laws and judicial interpretations thereof.
These statements often can be identified by the use of terms such as "may,"
"will," "expect," "anticipate," "estimate," or "continue," or the negative
thereof. Such forward-looking statements speak only as of the date made. Any
forward-looking statements represent management's best judgment as to what may
occur in the future. However, forward-looking statements are subject to risks,
uncertainties and important facts beyond the control of Cogenco that could cause
actual results and events to differ materially from historical results of
operations and events and those presently anticipated or projected. We disclaim
any obligation to revise any forward-looking statements to reflect events or
circumstances after the date of such statement or to reflect the occurrence of
anticipated or unanticipated events.

Item l.  Description of Business.
         -----------------------

(a)      Business Development.

         Cogenco International, Inc., was organized under the laws of the State
of Colorado on June 27, 1983, for the purpose of engaging in the cogeneration
business, which is the simultaneous production of power, either mechanical or
electrical, and useful thermal energy, such as steam, so that the waste heat
which is a by-product of one process becomes the energy source for the other.
Cogenco commenced active business operations after it completed its initial
public offering of securities in February 1985, pursuant to which Cogenco
realized total net proceeds of approximately $1,000,000. Cogenco eventually
depleted its financial resources and was not able to secure additional capital
to continue active business operations. Cogenco ceased active business
operations in early 1988. Cogenco has been attempting to locate a business
opportunity since that time, has maintained itself as a validly existing
Colorado corporation, and has continued to make filings required under the
Securities Exchange Act of 1934. Except for a series of equity financings in
2005, 2006, and 2007 and the activities described below under "DMI BioSciences,"
Cogenco has not engaged in any business operations for more than the past five
years. Cogenco has not received any revenues from operations for more than the
past ten years.

         During our 2004 fiscal year, we entered into a letter of intent and
then an agreement with DMI BioSciences, Inc. ("DMI") by which we agreed to
participate in the development of a drug for the treatment of asthma in humans.
The letter of intent also included the parties' agreement to attempt to
negotiate a business combination between DMI and Cogenco. Although Cogenco
provided DMI $3,250,000 in financing, Cogenco did not provide any further
financing to DMI as contemplated by that agreement and the business combination
contemplated between DMI and Cogenco did not occur. Although Cogenco and DMI
amended those agreements in February 2006, ultimately Cogenco did not provide
the financing contemplated by the amended agreements. Cogenco converted the
$3,250,000 investment into 1,000,000 shares of DMI common stock in accordance
with the pre-existing agreements. We have subsequently entered into certain
stock purchase agreements with DMI (discussed further below) under which the
Company has purchased a total of 401,429 shares at a purchase price of a total
of $330,000 and which enable the Company to purchase up to an additional
$670,000 of DMI common stock at prices up to $1.00 per share. If Cogenco
completes that purchase by December 31, 2007, it will acquire a warrant to
purchase another 1,000,000 shares of DMI common stock exercisable for one year
at $1.00 per share.

         Since our 2005 fiscal year, we have raised approximately $4.7 million
in equity financing from private investors. These funds allowed us to meet some

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(but not all) of our payments to DMI contemplated by the amended agreements.
Cogenco did not have the funds necessary to make these payments to DMI and to
continue to finance our general and administrative and other expenses.

         We do not have any subsidiary corporations. The address of our
principal executive offices and our telephone and facsimile numbers at that
address are:

                           Cogenco International, Inc.
                           Suite 1840, 6400 South Fiddler's Green Circle
                           Greenwood Village, CO 80111
                           Telephone No.: (303) 221-3680
                           Facsimile No.: (303) 759-3553

(b)      Business of Issuer.

General Information.

         Since the time Cogenco ceased active business operations in 1988, we
have been actively seeking potential business opportunities. Although we have
had discussions with several potential candidates, these discussions have not
resulted in any agreements or business combinations except as described below
under "DMI BioSciences." We believe that there are many companies in our
position which are seeking business opportunities. In an effort to meet the
competition, we have maintained Cogenco's status as a corporation in good
standing under Colorado law and we have further filed all required reports with
the Securities and Exchange Commission. We will need a significant amount of
additional financing in order to identify and complete a business acquisition.

         To the extent that Cogenco does become involved in business, Cogenco
will compete with others in that industry and may be subject to a significant
amount of government regulation. The nature of the competition and the amount of
regulation will depend on the industry in which Cogenco becomes engaged. We have
no patents, patent applications, or other material interest in intellectual
property except through DMI. We do not produce any products or offer any
services, and therefore Cogenco is not dependent on any material customer
relationships. We do not conduct any research and development except through
DMI. Since we do not own any real property or engage in any business operations,
environmental compliance is not material to us.

         Mr. David Brenman is currently Cogenco's only employee pursuant to an
employment agreement that became effective on September 30, 2005, as described
in Item 10 below. Mr. Brenman is the only person who is actively involved in day
to day operations of Cogenco, although Mr. Brenman is also actively involved in
other businesses as well. We anticipate that additional employees and/or
consultants will be retained as may be necessary to operate Cogenco in the
future, whether in connection with a business combination or otherwise. We
believe that our current arrangement is adequate to meet our needs during our
current process of pursuing business opportunities.

Risks That Cogenco Will Not Be Able to Meet Its Financial Obligations.

         As proven by Cogenco's inability to make the payments to DMI
contemplated under the amended agreements in the past, there is a significant
risk that Cogenco will not be able to meet future financial obligations. To the
extent Cogenco pursues other opportunities that it may develop in addition to,
or in lieu of, DMI, substantial additional financing will likely be required,
and Cogenco cannot offer any assurance that it will be able to obtain that
financing when necessary, in the amounts needed, or (if any financing is
available) on terms reasonably acceptable to Cogenco.

Possible Application of the Investment Company Act.

In March 2007, we acquired 400,000 shares of Helix Biopharma Corporation (traded
on the Toronto Stock Exchange as HBP.TO, and referred to herein as "Helix") and
100,000 shares of DMI common stock. Since March 2007, we have acquired
additional shares of DMI common stock. As a result of these transactions,


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Cogenco is a minority shareholder of both Helix and DMI and Cogenco may be
considered to be an investment company for the purposes of the Investment
Company Act of 1940. The intention of the Investment Company Act is to require
the registration of companies whose goal is to engage in the business of
investing, reinvesting, owning, holding, or trading in securities where the
company's outstanding securities are held by more than 100 persons. Absent an
exemption from registration, ss. 8(a) of the Investment Company Act requires
that an investment company register with the SEC and then comply with the
numerous substantive requirements of that act. The Investment Company Act
imposes many requirements on investment companies that are subject to its
requirements. These are designed to ensure that the investment companies use
capital prudently and not simply to enrich the promoters. For example:

     o    Investment companies are required to have a board of directors with an
          independent majority of directors.

     o    Transactions with affiliates are strictly regulated.

     o    The investment company must also file detailed reports with the SEC
          and give most of that information to shareholders.

         The SEC has adopted an important exception to the definition of
"investment company" which protects companies that find themselves becoming,
inadvertently, subject to investment company regulation. Rule 3a-2 provides that
"transient investment companies" are not subject to Investment Company Act
regulation where:

     1.   The company does not intend to be engaged in the business of investing
          or reinvesting in securities notwithstanding the fact that it may meet
          the investment company definition at the present time because of the
          large amount of cash it has available or for other reasons;

     2.   The board of directors adopts an appropriate resolution, disclaiming
          investment company intent; and

     3.   The time period for investing its assets into an operating business,
          thereby removing the company from the definition of an investment
          company, is one year.

         No company may rely on this exemption for transient investment
companies more than once in any three-year period.

         At this time, we believe that if Cogenco is an investment company, it
is a transient investment company meeting the exception from registration under
the Investment Company Act set forth in Rule 3a-2. Cogenco does not, and does
not intend to, primarily engage in the business of investing, reinvesting, or
trading in securities, or holding investment securities.

         However, as described in the Risk Factors section below, the SEC may
disagree with our interpretation. At the present time, it is management's goal
to build up Cogenco's assets so that its minority investments in Helix and DMI
do not exceed the 40% test by March 2008. In addition, Cogenco expects to
dispose of its shares of Helix during the next six to ten month period in
routine market transactions. If, however, Cogenco remains within the definition
of "investment company" beyond the availability of the transient investment
company exception provided by Rule 3a-2 and if, at that time, no other exception
or exemption is applicable, we may be required to register under the Investment
Company Act. This would result in considerable expense to Cogenco, and a
significant change in Cogenco's management and operations.

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DMI BioSciences

Cogenco's Relationship with DMI

         Cogenco has developed various relationships with DMI since entering
into a letter agreement in August 2004. Cogenco modified that agreement in
November 2004 and, pursuant to the modification, Cogenco paid DMI $100,000 and
entered into an agreement for the development of a drug for the treatment of
asthma in humans (the "Old CODA"). Under the terms of the Old CODA and its
amendments, Cogenco paid DMI $3,250,000. Under the Old CODA, Cogenco had an
opportunity to provide further funding to DMI, which Cogenco did not complete.

         Because Cogenco was not able to complete its funding contemplated under
the Old CODA, in February 2006, Cogenco and DMI negotiated a restated letter of
intent (the "New LOI") and entered into the New CODA for the development of a
drug for the treatment of multiple sclerosis. Cogenco and DMI signed the New
CODA on February 20, 2006 and terminated the Old CODA at the same time (although
the payments that Cogenco made were credited to Cogenco's funding contemplated
under the New CODA). Cogenco made no further payments to DMI under the New CODA
due to a lack of funds. The New LOI contemplated that Cogenco and DMI would
negotiate and complete a business combination by October 30, 2006, but that also
did not occur because of Cogenco's lack of funding.

         On June 22, 2007, Cogenco converted its $3,250,000 investment into
1,000,000 shares of DMI common stock.

         In March 2007, Cogenco purchased 100,000 shares of DMI common stock for
an investment of $100,000. Based on subsequent negotiations, in April 2007
Cogenco purchased an additional 301,429 shares from DMI at a prices from $0.70
to $0.80 per share. In July 2007, Cogenco entered into a securities purchase
agreement with DMI by which Cogenco has the right to invest an additional
$670,000 to purchase shares of DMI common stock at prices ranging from $0.85 per
share to $1.00 per share. If Cogenco completes these purchases by December 31,
2007, DMI will issue to Cogenco a one-year warrant to purchase an additional
1,000,000 shares of DMI common stock for an exercise price of $1.00 per share.

         As a result of these transactions, Cogenco owns (as of the filing date
of this report) 1,401,429 shares of DMI common stock (approximately 12% of the
total number of DMI shares then outstanding, or about 6% on a fully-diluted
basis). Because of our minority ownership position in DMI, we have no ability to
control DMI's business or operations. No person associated with Cogenco is
either an officer or director of DMI.

General Company Information (DMI)

         DMI is a privately-owned, development stage biopharmaceutical company
engaged in the business of developing new drugs and diagnostics for inflammation
in immunologic, vascular, proliferative and central nervous system diseases.
DMI's research focuses on the role of proteins, peptides and other biomolecules
in key pathways of inflammation in diseases that affect millions of individuals.
DMI's principal objective is to develop new, proprietary therapeutic products
that treat inflammatory processes at their root causes rather than treating only
their symptoms.

         DMI uses separation technologies, mass spectrometry and proprietary
techniques to identify, measure and characterize the concentration, activity and
interaction of these biomolecules in cells, tissues, and other biosamples such
as blood, urine, and saliva. Using these methods, DMI has discovered and is
patenting several classes of compounds. These compounds include synthetic
peptides and small molecules with the potential to treat a broad spectrum of
acute and chronic inflammatory diseases and conditions. Currently, DMI has ten
compounds in various stages of development, from discovery to Phase II human
clinical trials.

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         DMI's business plan is to enter into co-development agreements, such as
the New CODA entered into with Cogenco, so that third parties will bear the
expenses of research, development, testing, and regulatory approval. In the
past, DMI has entered into co-development agreements with various companies
related to the development of drugs to treat the following:

              o         Premature Ejaculation
              o         Periodontal Disease
              o         Atopic Dermatitis
              o         Asthma
              o         Multiple Sclerosis

At the present time, DMI is not a party to any co-development agreement related
to the development of drugs.

Drugs in Clinical Development.

         Clinical trials in humans are the last and most expensive part of the
drug development process. Because drug candidates generally increase in value
with the successful completion of each step in the development process,
clinical-trial-stage projects, particularly those in Phase II or Phase III, are
the most valuable assets of any biotech company and are an important indicator
of DMI's value and prospects. Currently, DMI has two drugs in human clinical
trials. These drugs relate to Premature Ejaculation and Periodontal Disease.

Drugs in Preclinical Development

         After a drug candidate is discovered, it undergoes preclinical
development in which it is tested in the laboratory and in animals to predict
whether it is likely to be safe and effective in humans. Upon completion of
preclinical testing, the data gathered in the laboratory and in animals is
submitted to the FDA as a prelude to testing in humans. DMI has three drug
candidates in preclinical testing. These drugs relate to Multiple Sclerosis
(MS), Acute Coronary Syndrome (ACS) and Ischemic Stroke and Macular
Degeneration/ Neovascularization.

Drug Discovery Programs

         During drug discovery DMI's researchers first identify diseases for
which there are no therapeutic treatments or that are underserved by available
therapeutic alternatives (whose shortcomings may include limited efficacy, side
effects or method of delivery) and then search for and identify promising
chemical entities capable of curing or treating those diseases. DMI's drug
discovery programs are focused (a) proliferative and fibrotic diseases, such as
cancer and pulmonary fibrosis; and (b) neurodegenerative diseases, such as
Alzheimer's disease.

Diagnostics Developed with Partners or Licensees

         DMI has also entered into partnership agreements or license agreements
with various companies relating to the development of the following:

     o    Diagnosis of Inflammation. This relates to the development of an
          immunoassay for the diagnosis of inflammation in a variety of
          conditions, including cardiovascular and cerebrovascular conditions,
          based on the detection of cysteinylated albumin (cys-albumin), a
          biomarker that is elevated in blood during inflammation.

     o    Diagnosis of Cardiovascular Conditions. This relates to the licensing
          of DMI's biomarker candidates that will contribute to the diagnosis,
          monitoring and assessment of cardiovascular, cerebrovascular and
          lung-respiratory diseases.


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     o    YeasTest - Diagnosis of Vaginal Yeast Infections. DMI's YeasTest is a
          rapid, point-of-care test for use by professionals to diagnose vaginal
          yeast infections. In March 2004, DMI sold the YeasTest to BiOracle,
          Ltd., a U.K. based diagnostic marketing company, which is currently
          commercializing it in Europe and the Unites States through marketing
          and distribution partners. If BiOracle is successful, DMI will receive
          milestone payments and royalties.

     o    AppyTest - Diagnosis of Appendicitis. DMI's AppyTest(R) is a rapid
          color test to aid in the diagnosis of patients with abdominal pain who
          are suspected of having appendicitis. In March 2004, DMI granted
          BiOracle, Ld. an exclusive, worldwide license to the AppyTest(R).
          BiOracle is currently arranging marketing and distribution of this
          product in Europe and the United States while preparing to seek FDA
          clearance to sell the AppyTest(R) in the U.S. and CE Mark approval to
          market the test in Europe. If BiOracle is successful, DMI will receive
          milestone payments and royalties.

Patents and Intellectual Property

         As of December 31, 2004, DMI owned 11 patents and more than 60 pending
patent applications in the United States and throughout the rest of the world
that cover the wide variety of therapeutic and diagnostic inventions that have
been developed by DMI, including compositions of matter, methods of use,
manufacturing methods, novel diagnostic assays and medical devices. The
development and protection of trademarks covering corporate and product names,
logos, trade dress, etc. is an important aspect of DMI's intellectual property
efforts.

Corporate Information (DMI)

         DMI currently has eleven full-time equivalent employees, three of whom
hold M.D. or Ph.D. degrees. Seven of our full time employees work in research
and development. None of DMI's employees is represented by a collective
bargaining agreement and DMI has never experienced a work stoppage.

         DMI retains scientific and clinical consultants and advisors from time
to time as required. DMI's Scientific and Clinical Advisory Boards bring
expertise in fields related to our scientific and clinical focus that assists
DMI's research and product development efforts. These Boards are expected to
meet at least annually with DMI's scientific staff and management to discuss
research and development programs and long-term scientific strategy.

         DMI leases approximately 14,500 square feet of laboratory and office
space from the Fitzsimons Redevelopment Authority. This facility is located in
the Colorado Bioscience Park Aurora in Aurora, Colorado. The lease, which
commenced July 1, 2006, is for a term of 62 months. DMI believes this facility
will be adequate to meet its needs during that term. DMI, through its Founder,
Chairman and Chief Scientific Officer, David Bar-Or, M.D., has an arrangement
with Swedish Medical Center, Englewood, Colorado, for use of an additional 3,500
square feet of laboratory and support facility in the Trauma Research Department
on the Swedish campus in Englewood.

         DMI's principal place of business is 1999 North Fitzsimons Parkway,
Suite 100, Aurora, Colorado 80045-7503, telephone 303-418-1000. DMI's website is
www.dmibio.com. DMI is a private company and does not file reports under the
Securities Exchange Act of 1934.

         The following is a discussion of DMI's business, requirements for
governmental approval, and associated risks.


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         Risks of Regulatory Approval for Pharmaceuticals. DMI must comply with
extensive government regulations in order to obtain and maintain marketing
approval for its products in the United States and abroad. DMI must obtain
regulatory approvals for its ongoing development activities and before marketing
or selling any product. DMI may not receive regulatory approvals to conduct
clinical trials of its products or to manufacture or market its products. In
particular, DMI may not receive regulatory approval from the FDA or any other
regulatory authority to market Zertane(TM), DMI's most advanced drug candidate.
In addition, regulatory agencies may not grant such approvals on a timely basis
or may revoke previously granted approvals.

         The process of obtaining FDA and other required regulatory approvals,
including approvals in other countries, is lengthy and expensive. The time
required for FDA and other clearances or approvals is uncertain and typically
takes a number of years, depending on the complexity and novelty of the product.
Any delay in obtaining or failure to obtain required clearance or approvals
could materially adversely affect DMI's ability to generate revenues from the
affected product. DMI has only limited experience in filing and prosecuting
applications necessary to gain regulatory approvals.

         Certain of the products that are likely to result from DMI's research
and development programs may be based on new technologies and new therapeutic
approaches that have not been extensively tested in humans. One example of such
a technology is protein therapy. The regulatory requirements governing these
types of products may be more rigorous than for conventional products. As a
result, DMI may experience a longer regulatory process in connection with any
products that it develops based on these new technologies or new therapeutic
approaches.

         DMI's analysis of data obtained from preclinical and clinical
activities is subject to confirmation and interpretation by regulatory
authorities, which could delay, limit or prevent regulatory approval. Any
regulatory approval to market a product may be subject to limitations on the
indicated uses for which DMI may market the product. These limitations may limit
the size of the market for the product.

         DMI is also subject to numerous and varying foreign regulatory
requirements governing the design and conduct of clinical trials and the
manufacturing and marketing of its future products. The approval procedure
varies among countries. The time required to obtain foreign approvals often
differs from that required to obtain FDA approval. Approval by the FDA does not
ensure approval by regulatory authorities in other countries.

         All of these regulatory risks also are applicable to development,
manufacturing and marketing undertaken by DMI's strategic partners or other
collaborators.

         DMI's product candidates will be subject to extensive and rigorous
domestic and foreign government regulation. The FDA regulates, among other
things, the development, testing, manufacture, safety, efficacy, record-keeping,
labeling, storage, approval, advertising, promotion, sale, and distribution of
pharmaceutical products. If DMI's product candidates are marketed outside the
United States, they will also be subject to similar extensive regulation by
foreign governments. DMI must provide the FDA and foreign regulatory
authorities, if applicable, with clinical data that appropriately demonstrate
the product candidate's safety and efficacy in humans before they can be
approved for the targeted indications. We cannot predict whether regulatory
approval will be obtained for any product candidate that DMI is developing or
plans to develop. The regulatory review and approval process can take many
years, is dependent upon the type, complexity, and novelty of the product,
requires the expenditure of substantial resources, involves post-marketing
surveillance, and may involve ongoing requirements for post-marketing studies.
In addition, we may encounter delays or rejections based upon additional
governmental regulation resulting from future legislative or administrative
action or changes in FDA policy or interpretation during the period of product
development. Delays or failures in obtaining regulatory approvals may:

     o    adversely affect the commercialization of any product candidates that
          DMI develops;

     o    diminish any competitive advantages that such product candidates may
          have or attain; and

     o    adversely affect revenues or receipt of royalties from the sale of the
          products.


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         Furthermore, any required regulatory approvals, if granted, may be
withdrawn. If DMI fails to comply with applicable FDA and other regulatory
requirements at any stage during the regulatory process, it may be subject to
restrictions, including:

     o    delays in clinical trials or commercialization;

     o    refusal by the FDA to review pending applications or supplements to
          approved applications;

     o    product recalls or seizures;

     o    suspension of manufacturing;

     o    withdrawals of previously approved marketing applications; and

     o    fines, civil penalties, and criminal prosecutions.

         The ability to market a product outside of the United States is
contingent upon receiving a marketing authorization from the appropriate
regulatory authorities. Foreign regulatory approval processes typically involve
similar risks to those associated with obtaining FDA approval and may include
additional risks. In addition, the requirements governing the conduct of
clinical trials and marketing authorizations, and the time required to obtain
requisite approvals, may vary widely from country to country and differ from
that required for FDA approval.

         Under European Union regulatory systems, marketing authorizations may
be submitted either under a centralized or decentralized procedure. The
centralized procedure provides for the grant of a single marketing authorization
that is valid for all European Union member states. Under the decentralized
procedure, the holder of a national marketing authorization may submit an
application to the remaining member states. Within 90 days of receiving the
applications and assessment report, each member state must decide whether to
recognize approval. The mutual recognition process results in separate national
marketing authorizations in the reference member state and each concerned member
state. The chosen regulatory strategy may not secure regulatory approvals or
approvals of the chosen product indications. In addition, these approvals, if
obtained, may take longer than anticipated. We cannot assure you that any of
DMI's product candidates will prove to be safe or effective, will receive
regulatory approvals, or will be successfully commercialized.

         Even if a product candidate receives regulatory approval, the approval
is typically limited to specific clinical indications. Further, even after
regulatory approval is obtained, subsequent discovery of previously unknown
problems with a product may result in restrictions on its use or even complete
withdrawal of the product from the market. Any FDA-approved products
manufactured or distributed by us are subject to continuing regulation by the
FDA, including record-keeping requirements and reporting of adverse events or
experiences. Further, drug manufacturers and their subcontractors are required
to register their establishments with the FDA and state agencies, and are
subject to periodic inspections by the FDA and state agencies for compliance
with current Good Manufacturing Processes ("cGMP"), which impose rigorous
procedural and documentation requirements upon us and our contract
manufacturers. We cannot be certain that we, or our present or future contract
manufacturers or suppliers, will be able to comply with cGMP regulations and
other FDA regulatory requirements. Failure to comply with these requirements may
result in, among other things, total or partial suspension of production
activities, failure of the FDA to grant approval for marketing, and withdrawal,
suspension, or revocation of marketing approvals.


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         If the FDA approves one or more of DMI's product candidates, DMI and
their contract manufacturers must provide certain updated safety and efficacy
information. Product changes, as well as certain changes in the manufacturing
process or facilities where the manufacturing occurs or other post-approval
changes may necessitate additional FDA review and approval. The labeling,
advertising, promotion, marketing and distribution of a drug or biologic product
also must be in compliance with FDA and Federal Trade Commission ("FTC")
requirements which include, among others, standards and regulations for
direct-to-consumer advertising, off-label promotion, industry sponsored
scientific and educational activities, and promotional activities involving the
Internet. The FDA and FTC have very broad enforcement authority, and failure to
abide by these regulations can result in penalties, including the issuance of a
warning letter directing DMI to correct deviations from regulatory standards and
enforcement actions that can include seizures, fines, injunctions and criminal
prosecution.

         The manufacturer of products for which DMI obtains marketing approval
and the manufacturing facilities used to make such products will be subject to
continual review and periodic inspections by the FDA. The subsequent discovery
of previously unknown problems with the product, manufacturer or facility may
result in restrictions on the product or manufacturer, including withdrawal of
the product from the market.

         If DMI fails to comply with applicable regulatory requirements, it may
be subject to fines, suspension or withdrawal of regulatory approvals, product
recalls, seizure of products, operating restrictions and criminal prosecutions.

         The FDA's policies may change and additional government regulations may
be enacted which could prevent or delay regulatory approval of our product
candidates. Moreover, increased attention to the containment of health care
costs in the United States and in foreign markets could result in new government
regulations that could have a material adverse effect on our business.

         Risks Associated with DMI's Intellectual Property. Cogenco owns no
intellectual property. However, through our ownership of DMI common stock, we
may indirectly benefit from or have an interest in intellectual property owned
by, or being developed by, DMI.

         DMI has advised us that it generally seeks United States and foreign
patent protection for the protein, peptide, and small-molecule drugs that it
discovers, as well as therapeutic and diagnostic products and processes, and
other inventions. DMI also has advised us that it seeks patent protection or
relies upon trade secret rights to protect certain other technologies which may
be used to discover and characterize proteins, peptides and small-molecules and
which may be used to develop novel therapeutic and diagnostic products and
processes.

         However, the patent positions of companies like DMI involve complex
legal and factual questions and, therefore, their enforceability cannot be
predicted with any certainty. DMI's issued patents, those licensed to DMI, and
those that may be issued to DMI in the future may be challenged, invalidated or
circumvented, and the rights granted thereunder may not provide DMI with
proprietary protection or competitive advantages against competitors with
similar technology. Furthermore, DMI's competitors may independently develop
similar technologies or duplicate any technology developed by DMI. Because of
the extensive time required for development, testing, and regulatory review of a
potential product, it is possible that, before any of DMI's product candidates
can be approved for sale and commercialized, DMI's relevant patent rights may
expire or remain in force for only a short period following commercialization.
Expiration of patents DMI owns or licenses could adversely affect our ability to
protect future product development and, consequently, our operating results and
financial position.

         DMI will be able to protect its proprietary intellectual property
rights from unauthorized use by third parties only to the extent that their
proprietary rights are covered by valid and enforceable patents or are

                                       11

<PAGE>


effectively maintained as trade secrets. The patent position of
biopharmaceutical companies involves complete legal and factual questions, and,
therefore, we cannot predict with certainty whether DMI will be able to
ultimately enforce its patents or proprietary rights. Any patents that DMI owns
or licenses may be challenged, invalidated, or circumvented and may not provide
us with the protection against competitors. The laws of certain foreign
countries do not protect intellectual property rights to the same extent as do
the laws of the United States. Accordingly, DMI may be forced to engage in
costly and time consuming litigation in order to protect their intellectual
property rights.

         DMI's pending patent applications, or those it may file or license from
third parties in the future, may not result in patents being issued. Until a
patent is issued, the claims covered by the patent may be narrowed or removed
entirely and therefore DMI may not obtain adequate patent protection. As a
result, DMI may face unanticipated competition, or conclude that without patent
rights the risk of bringing product candidates to the market is too great, thus
adversely affecting their operating results and our profitability.

         Patent expiration could adversely affect DMI's ability to protect
future product development and, consequently, DMI's operating results and
financial position. Because of the extensive time required for the development,
testing, and regulatory review of a product candidate, it is possible that
before any of DMI's product candidates can be approved for sale and
commercialized, their relevant patent rights may expire or remain in force for
only a short period following commercialization.

         In addition to patents, DMI advises us that it relies on trade secrets
and proprietary know-how. DMI seeks protection, in part, through confidentiality
and nondisclosure agreements. These agreements may not provide meaningful
protection or adequate remedies in the event of unauthorized use or disclosure
of confidential and proprietary information. Failure to protect DMI's trade
secrets and proprietary know-how could seriously impair DMI's competitive
position and harm their business. DMI may become involved in costly litigation
in order to enforce trade secrets or know-how that DMI owns or licenses.

         DMI's commercial success depends in part on their ability to operate
without infringing the patents and other proprietary rights of third parties.
The biotechnology and pharmaceutical industries are characterized by extensive
litigation regarding patents and other intellectual property rights. The defense
and prosecution of intellectual property claims, United States Patent and
Trademark Office interference proceedings and related legal and administrative
proceedings in the United States and internationally involve complete legal and
factual questions. As a result, such proceedings are lengthy, costly and
time-consuming and their outcome is uncertain. DMI may become involved in
litigation in order to determine the enforceability, scope and validity of the
proprietary rights of others. If a third party claims that DMI is infringing on
its intellectual property rights, DMI could incur significant litigation or
licensing expenses, or be prevented from further developing or commercializing
their products.

         While DMI has advised us that it believes it is aware of the scientific
research that is being conducted in the areas in which DMI has focused its
research and development efforts, patent applications in the United States are,
in most cases, maintained in secrecy until the patent is issued. The publication
of discoveries in the scientific or patent literature frequently occurs
substantially later than the date on which the underlying discoveries were made.
Therefore, patent applications relating to products similar to DMI's product
candidates may have already been filed by others without their knowledge. In the
event an infringement claim is brought against DMI, DMI may be required to pay
substantial legal and other expenses to defend such a claim and, if they are
unsuccessful in defending the claim, DMI may be prevented from pursuing related
product development and commercialization and may be subject to damage awards.

         If DMI becomes involved in any patent litigation, interference or other
administrative proceedings, they will incur substantial expense and the efforts
of their technical and management personnel will be significantly diverted. A
detrimental outcome of such litigation or proceedings may expose DMI to loss of
their proprietary position or to significant liabilities, or require them to
seek licenses that may not be available from third parties on commercially
acceptable terms, if at all. DMI may be restricted or prevented from developing,
manufacturing and selling their product candidates in the event of an adverse
determination in a judicial or administrative proceeding or if they fail to
obtain necessary licenses.


                                       12

<PAGE>


         DMI's current and future product candidates may be covered by
third-party patents or other intellectual property rights, in which case DMI
would need to obtain a license or sublicense to these rights in order to develop
or commercialize them. Any required licenses may not be available to DMI on
acceptable terms, if at all. If DMI does not obtain any required licenses or
sublicenses, DMI could encounter delays in development or it could be prevented
from manufacturing and commercializing our products. If it is determined that
DMI has infringed on an issued patent, DMI could be compelled to pay significant
damages, including punitive damages. In cases where DMI has licensed
intellectual property, their failure to comply with the terms and conditions of
such agreements could harm our business.

         The validity and permissible scope of patent claims in the
pharmaceutical and biotechnology fields involve important unresolved legal
principles. For example, there is significant uncertainty both in the United
States and abroad regarding the scope of patent protection available for
full-length proteins and partial protein sequences. Moreover, certain groups
have made certain protein sequences available in publicly accessible databases.
These and other disclosures may adversely affect DMI's ability to obtain patent
protection for protein and peptide sequences claimed by DMI in patent
applications filed subsequent to such disclosures. There is also some
uncertainty as to whether human clinical data will be required for issuance of
patents for human therapeutics. If such data is required, DMI's ability to
obtain patent protection could be delayed or otherwise adversely affected.

         DMI's collaborators have certain rights to publish data and information
in which DMI has rights. While DMI believes that the limitations on publication
of data developed by its collaborators pursuant to its collaboration agreements
will be sufficient to permit DMI to apply for patent protection, there is
considerable pressure to publish discoveries. Such publication could affect
DMI's ability to obtain patent protection for some inventions in which it may
have an interest.

         If another party claims the same subject matter or subject matter
overlapping with subject matter that DMI has claimed in a United States patent
application or patent, DMI may decide or be required to participate in
interference proceedings in the United States Patent and Trademark Office in
order to determine priority of invention. Loss of such an interference
proceeding would deprive DMI of patent protection sought or previously obtained.
Participation in such proceedings could result in substantial costs, whether or
not the eventual outcome is favorable. Similarly, patents or applications that
DMI has licensed could become the subject of interference proceedings in the
United States Patent and Trademark Office, and loss of such an interference
proceeding would deprive DMI of licensed rights under patent protection sought
or previously obtained.

         In many foreign countries, other parties could oppose the issuance of
DMI patents, and DMI may be required to participate in opposition proceedings in
those countries in order to determine if DMI's inventions are patentable. Loss
of such an opposition proceeding would deprive DMI of patent protection sought
or previously obtained. Participation in such proceedings could result in
substantial costs, whether or not the eventual outcome is favorable. Similarly,
patent applications that DMI has licensed could become the subject of opposition
proceedings in foreign countries, and loss of such opposition proceedings would
deprive DMI of licensed patent rights.

         DMI may need to obtain rights under certain patents or applications in
the United States and abroad related to DMI's proposed products, processes or
technologies which are owned or controlled by third parties. Therefore, in some
cases, in order to develop, manufacture, sell, or import certain of DMI's
proposed products, processes or technologies, DMI or its strategic partners may
choose to seek or be required to seek licenses under third party patents issued
in the United States and abroad or those which might issue from United States
and foreign patent applications. If licenses are not available to DMI on
acceptable terms, DMI or its strategic partners may not be able to develop,
manufacture, sell or import these products, processes or technologies.


                                       13

<PAGE>


         Risks of Competition in the Biotechnology Industry. The biotechnology
industry is highly competitive and subject to rapid technological changes. As a
result DMI may be unable to compete successfully or develop innovative products,
which could jeopardize the value of our investment in DMI.

         The biotechnology and pharmaceutical industries are highly competitive
and subject to significant and rapid technological change as researchers learn
more about diseases and develop new technologies and treatments. Significant
competitive factors in our industry include, among others, product efficacy and
safety; the quality and breadth of an organization's technology; the skill of an
organization's employees and its ability to recruit and retain key employees;
the timing and scope of regulatory approvals; the government reimbursement rates
for and the average selling price of products; the availability of raw materials
and qualified manufacturing capacity; manufacturing costs; intellectual property
and patent rights and their protection; and sales and marketing capabilities.
DMI's current and potential competitors generally include, among others, major
multinational pharmaceutical companies, biotechnology firms, universities and
other research institutions. Some of these companies and institutions, either
alone or together with their collaborators, have substantially greater financial
resources and larger research and development staffs than we do. In addition,
many of these competitors, either alone or together with their collaborators,
have significantly greater experience than DMI does in discovering, developing,
manufacturing, and marketing products. As a result, we may face competitive
disadvantages relative to these organizations should they develop or
commercialize a competitive product. Therefore, we cannot assure you that any of
our product candidates, if approved for sale, will compete successfully and that
another organization will not succeed in developing and commercializing products
that render our technology or product candidates non-competitive or obsolete.

         DMI faces, and will continue to face, intense competition from other
companies for collaborative arrangements with pharmaceutical and biotechnology
companies, for establishing relationships with academic and research
institutions, for attracting investors and sites capable of conducting our
clinical trials, and for licenses of proprietary technology. These competitors,
either alone or with their collaborators, may succeed in developing technologies
or products that are more effective, less expensive or easier to administer than
DMI's. Accordingly, DMI's competitors may succeed in obtaining FDA or other
regulatory approvals for their product candidates more rapidly than DMI can.
Companies that complete clinical trials, obtain required regulatory approvals,
and commercialize their drugs before DMI may achieve a significant competitive
advantage, including certain patent and FDA marketing exclusivity rights, which
could delay the ability of competitors to market certain products. We cannot
assure you that product candidates resulting from DMI's research and development
efforts, or from joint efforts with collaborators, will be able to compete
successfully with DMI's competitors' existing products or products under
development.

         DMI's management believes that the quality and breadth of DMI's
technology platform, the skill of DMI's employees and DMI's ability to recruit
and retain skilled employees, DMI's aggressive program of seeking patent
protection for DMI's discoveries and DMI's capabilities for early stage research
and drug discovery are competitive strengths. Many large pharmaceutical and
biotechnology companies have significantly larger intellectual property estates
and greater capabilities than DMI in preclinical and clinical development,
sales, marketing, manufacturing, and regulatory affairs.

         If DMI's future products do not gain meaningful acceptance in their
intended markets, we are not likely to generate significant revenues or become
profitable.

         Even if DMI successfully develops their product candidates and obtains
the requisite regulatory approvals to sell them in the future, they may not gain
market acceptance or utilization among physicians and patients and reimbursement
and support from third-party payors. The degree of market acceptance for any
product that we commercialize will depend on a number of factors, including:


                                       14
<PAGE>


          -    the product's potential advantages over existing or alternative
               therapies;

          -    the actual or perceived safety of similar classes of products;

          -    the effectiveness of our sales, marketing, and distribution
               capabilities; and

          -    the scope of the product label approved by the FDA.

         There can be no assurance that hospitals or physicians will choose to
administer DMI's products to the entire intended market, if at all. If DMI's
products do not achieve meaningful market acceptance or if the market for DMI's
products proves to be smaller than anticipated, we are not likely to generate
significant revenues or become profitable.

         Many of DMI's competitors are substantially larger and have
substantially greater capital resources, research and development staffs, and
facilities than DMI, even with the funds to be provided by Cogenco (assuming,
without assurance, that Cogenco will be able to provide the required funds).
Furthermore, many competitors are more experienced in drug discovery,
development and commercialization, obtaining regulatory approvals, and product
manufacturing and marketing. As a result, DMI's competitors may identify
proteins associated with diseases or discover, develop, and commercialize
products based on such proteins before DMI. In addition, competitors may
discover, develop, and commercialize products which render non-competitive or
obsolete the products that DMI or its strategic partners are seeking to develop
and commercialize.

         Under the Orphan Drug Act, a sponsor of an application to the FDA may
seek to obtain a seven-year period of marketing exclusivity for a drug intended
to treat a rare disease or condition, which is defined as a disease or condition
that occurs in fewer than 200,000 patients. In the event that a competitor
receives orphan drug designation and obtains the FDA marketing exclusivity for a
drug intended to treat the same rare disease or condition before DMI obtains
such approval, DMI would not be permitted by the FDA to market its product in
the United States for the same use during the exclusivity period. If DMI
receives an orphan drug designation, it may be very expensive to assert its
rights under the Orphan Drug Act. In addition, if DMI receives seven-year
marketing exclusivity, the FDA may rescind the period of exclusivity under
certain circumstances, including DMI's failure to assure a sufficient quantity
of the drug.

         Risks of Product Liability. There is a risk that the products developed
by DMI may result in exposure to product liability claims. Such claims could
materially and adversely affect Cogenco by reducing the value of its investment
in DMI. The manufacture and sale of any product for human consumption raises the
risk of product liability claims if a customer has an adverse reaction after
using the product. These claims may derive from the product itself or a
contaminant found in the product from the manufacturing, packaging, or sales
process. While these risks can be protected in part through product liability
insurance, DMI advises us that it does not have any such insurance at the
present time. DMI advises us that it will not seek to obtain any such insurance
until, if ever, DMI has a product to market. Even then, we cannot offer any
assurance that such insurance will be available at a reasonable price or with
sufficient coverage. Furthermore, even if DMI is able to obtain product
liability insurance, there will be a risk that insurance will not cover
completely or would fail to cover a claim, in which case DMI may not have the
financial resources to satisfy such claims, and the payment of claims would
require DMI to use funds that are otherwise needed to conduct its business and
make its products. If a product liability claim is successfully brought for
uninsured liabilities or exceeding DMI's insurance coverage, DMI could be forced
to pay substantial damage awards which may significantly reduce the value of our
investment in DMI.

         We also understand that DMI's research and manufacturing activities
involve the controlled use of certain hazardous materials, medical waste, and
various radioactive materials. As a result, DMI may become subject to the risks
of accidental contamination or injury from those materials, or an accidental
environmental discharge or exposure. If the use of hazardous materials results
in contamination or injury, our investment in DMI may be at risk.


                                       15

<PAGE>


         Risks of Clinical Trials. There are significant uncertainties and
complexities present in development stage biopharmaceutical companies. In order
to receive regulatory approval for the products developed by DMI, or any other
business, the person developing the product must conduct extensive clinical
trials to demonstrate any developed product's safety and efficiency. Clinical
testing is expensive and can take many years to complete, and its outcome is
uncertain. Delays or clinical setbacks may occur at any time. If the clinical
trials for product candidates are unsuccessful or delayed, we could be delayed
or precluded from further developing or selling the product candidates.

         In addition, clinical trials are dependent on the willingness of people
to participate. If the enrollment of patients in clinical trials is delayed or
proceeds at a slower pace than expected, the clinical trials will take longer
and cost more to complete. Patient enrollment is a function of many factors,
including the size of the patient population, the nature of the protocol, the
availability of alternative treatments, the proximity of patients to clinical
sites, and the eligibility criteria for the study. Delays in planned patient
enrollment may result in increased costs and program delays.

         Furthermore, a purpose of clinical trials is to identify risks and
shortcomings in the product. The results of preclinical studies and early
clinical trials of the product candidates may not predict the results of
later-stage clinical trials. Product candidates in later stages of clinical
trials may fail to show the desired safety and efficacy traits despite having
progressed through initial clinical testing. The data collected from clinical
trials of product candidates may not be sufficient to support the submission of
a new drug application ("NDA") or to obtain regulatory approval in the United
States or elsewhere.

         DMI has limited experience in conducting and managing large clinical
trials. To date, we understand that all of DMI's clinical trials have been
conducted by third parties under contract, and we understand that this is a
standard procedure for smaller biotechnology companies. If third-party vendors
do not perform or fail to comply with strict regulations, the clinical trials
for product candidates may be delayed or unsuccessful.

         New Legislation. Domestic and foreign governments continue to propose
and pass legislation designed to reduce the cost of healthcare, including drugs.
In some foreign markets, governments control prescription pharmaceuticals'
pricing and profitability. In the United States, we expect that there will
continue to be federal and state proposals to implement similar governmental
control. In addition, increasing emphasis on managed care in the United States
will continue to put pressure on the pricing of pharmaceutical products. Cost
control initiatives could decrease the price that we receive for any products in
the future, which would limit our revenues and profitability. Legislation and
regulations affecting the pricing of pharmaceutical products may change before
our product candidates are approved for sale, which could further limit or
eliminate reimbursement rates for our products. We cannot predict the
likelihood, nature, or extent of adverse governmental regulation that might
arise from future legislative or administrative action, either in the United
States or abroad.

DMI's Directors and Executive Officers.

         DMI's directors serve one year terms or until their successors are
elected. DMI does not have audit, nominating or compensation committees of the
Board of Directors or committees performing similar functions. All such
applicable functions have been by the Board of Directors as a whole. The most
recent DMI shareholders' meeting was held on June 28, 2000. There are no family
relationships among any of our executive officers or directors. The following
table identifies the directors and executive officers of DMI.


                                       16

<PAGE>


                                                                  Beginning of
Name                 Age     Positions Held                     Term of Service
-----------------    ---     --------------------------------   ----------------

David Bar-Or, M.D.   58      Chairman of the Board of Directors;       1990
                             Chief Scientific Officer

Bruce G. Miller      62      President; Chief Executive Officer,       1992
                             Member of the Board

Daniel Navot, M.D.   58      Member of the Board                       2002

Edward Lau, Ph.D.    57      Member of the Board                       1992


         David Bar-Or, M.D., has over twenty-five years experience in
biochemical research, is board certified in emergency medicine, and has been in
clinical practice for twenty years, including five years as director of
emergency medicine at an accredited trauma center. Dr. Bar-Or is presently
Director of Trauma Research for Swedish Medical Center. Dr. Bar-Or received his
MD from Hebrew University Medical School, Jerusalem, Israel, and was the first
to complete a fellowship in emergency medicine research at Denver General
Hospital, a program recognized nationally as a leader in emergency medicine. Dr.
Bar-Or has received numerous awards for outstanding clinical and scientific
research, published over 40 scientific articles, holds over 15 patents, and has
filed more than 10 additional patent applications. Dr. Bar-Or owns more than 23%
of the outstanding DMI common stock which he purchased at prices substantially
less than is being paid by Cogenco. Dr. Bar-Or controls DMI through his stock
ownership, as chief scientific officer, and as chairman of the board of
directors.

         Bruce G. Miller was a practicing attorney for over 24 years with
experience in business start-ups, acquisitions, and commercial law. He received
his J.D. from the University of Denver and his B.A. from Duke University. Mr.
Miller owns more than 14% of the outstanding DMI common stock which he purchased
at prices substantially less than is being paid by Cogenco.

         Daniel Navot, M.D. is a reproductive endocrinologist. Dr. Navot is a
graduate of the Hadassah School at Hebrew University in Jerusalem, and is board
certified in Obstetrics, Gynecology, Reproductive Endocrinology and Infertility.
Dr. Navot is the former Director of the IVF Program at Mount Sinai Medical
Center in New York and is Professor of Obstetrics & Gynecology,
Director-Division of Reproductive Endocrinology and Infertility at New York
Medical College. Since 1994 Dr. Navot has served as Medical Director of the
Fertility Institute of New Jersey and New York and Chief, Reproductive
endocrinology at Pascack Valley Hospital. Dr. Navot owns less than 5% of the
outstanding DMI common stock which he purchased at prices substantially less
than is being paid by Cogenco.

         Edward Lau, Ph.D. joined DMI following ten years in laboratory research
and management with Amgen, Inc., a leading U.S. biotechnology company. He spent
the majority of his time in hands-on research, and participated in projects
leading to Amgen's blockbuster drugs Epogen(R) and Neupogen(R). He also spent
five years working in Amgen's diagnostic program until it was divested. Dr. Lau
received a Ph.D. in Biochemistry from the University of Wyoming, an M.S. and
B.S. from Central Washington University, and completed a three-year
post-doctoral fellowship at the University of Colorado. Dr. Lau owns less than
5% of the outstanding DMI common stock which he purchased at prices
substantially less than is being paid by Cogenco.

         DMI advises us that none of its officers, directors, or significant
shareholders have been, during more than the past five years, involved in:

          1.   Any bankruptcy petition filed by or against any business of which
               such person was a general partner or executive officer either at
               the time of the bankruptcy or within two years prior to that
               time;

          2.   Any conviction in a criminal proceeding or being subject to a
               pending criminal proceeding (excluding traffic violations and
               other minor offenses) ;

          3.   Being subject to any order, judgment, or decree, not subsequently
               reversed, suspended or vacated, of any court of competent
               jurisdiction, permanently or temporarily enjoining, barring,
               suspending or otherwise limiting his involvement in any type of
               business, securities or banking activities; and


                                       17

<PAGE>


          4.   Being found by a court of competent jurisdiction (in a civil
               action), the Commission or the Commodity Futures Trading
               Commission to have violated a federal or state securities or
               commodities law, and the judgment has not been reversed,
               suspended, or vacated.

         DMI has not made available to Cogenco information about the
compensation paid to and payable to its executive officers and directors.

DMI's Financial Condition, Discussion and Analysis.

         DMI is dependent upon third parties for financing its activities. It
does not have sufficient working capital to finance the significant costs of
product development and regulatory approval.

         DMI has had nominal resources and working capital shortages for more
than the past year. DMI is dependent, in part, on Cogenco's continuing ability
to finance DMI's working capital shortages; there can be no assurance that
Cogenco will be able to complete financing as contemplated under the stock
purchase agreement discussed above any more successfully than Cogenco was able
to make all the payments contemplated under the past agreements with DMI.
Notably the stock purchase agreement does not require that Cogenco provide any
specific amount of financing; it merely provides Cogenco an incentive to
purchase shares by offering a lower price for purchases made before October 1,
2007, and a warrant to purchase additional shares at $1.00 per share.


Item 2.  Description of Property.
         -----------------------

         Cogenco currently maintains its offices at Suite 1840, 6400 South
Fiddler's Green Circle, Greenwood Village, CO 80111. Rent is paid to the
unaffiliated landlord at $5,350 per month. Cogenco's office space includes
approximately 3,210 square feet and is subject to a lease that expires December
30, 2008. Cogenco shares the leased premises with certain companies related to
Mr. David Brenman who reimburse Cogenco for a portion of the rent. See Item 12 -
"Certain Relationships and Related Transactions." Management believes that this
arrangement will be suitable for its needs for the immediate future.

         Cogenco owns no real property and no material personal property.


Item 3.  Legal Proceedings.
         -----------------

         Cogenco is not a party to any legal proceedings and no such proceedings
are known to be contemplated.


Item 4.  Submission of Matters to a Vote of Security Holders.
         ---------------------------------------------------

         None.


PART II

Item 5.  Market for Common Equity and Related Stockholder Matters.
         --------------------------------------------------------

(a)      Market Information.

         Our common stock is not eligible for listing on the NASDAQ system.
Trading, if any, has been strictly limited to the over-the-counter market. In
the past, the Common Stock has been quoted from time to time in the "Pink


                                       18

<PAGE>


Sheets" maintained by the National Quotation Bureau, Inc. Since 1988, we do not
believe that any established trading market has existed for our common stock. We
are not aware of any public sales of our common stock for more than the past two
years, and consequently we are unable to report any market information.

(b)      Holders.

         The approximate number of record holders of our $.0l par value common
stock as of May 31, 2007, was 763. This figure does not reflect an
indeterminable number of shareholders whose shares may be held in "street name."

(c)      Dividends.

         Cogenco has not paid a dividend with respect to its common stock since
its incorporation. We do not expect to pay a dividend on our common stock in the
foreseeable future.

         Our ability to pay dividends is restricted by provisions of the
Colorado Business Corporation Act which provides that a Colorado corporation may
only pay dividends if, after giving effect to the dividend, the corporation
would be able to pay its debts as they become due in the usual course of
business, or the corporation's total assets would be less than its total
liabilities plus the amount that would be needed (if dissolution were to occur
at the time of the dividend) to satisfy the preferential rights upon dissolution
of shareholders whose preferential rights are superior to those receiving the
dividend. At the present time, there are no shareholders who have any
preferential rights.

(d)      Securities Authorized for Issuance under Equity Compensation Plans

         At the present time, we have no securities authorized for issuance
under any equity compensation plan.

(e)      Sales of Unregistered Securities (Item 701 information).

         On October 27, 2006, we received subscriptions from an offshore, St.
Vincent and the Grenadines accredited investor in exchange for a total
investment of $25,000. The following sets forth the information required by Item
701 in connection with that transaction:

         (a) The transaction was completed effective October 27, 2006. We issued
2,500 shares of our common stock to Genesis Investment Funds Limited, an
accredited investor. Genesis Investment Funds Limited is controlled by Genesis
Capital Management Limited, a company controlled by Herald A.M.A. Janssen and
Peter H. Jacobs. Mr. Janssen and Mr. Jacobs co-founded Genesis Investment Funds
Limited and Genesis Capital Management Limited, and appointed Genesis Capital
Management as the investment advisor for Genesis Investment Funds Limited.
Pursuant to a discretionary investment management agreement, Genesis Capital
Management has discretionary investment and voting control over the assets of
Genesis Capital Management Limited, including the shares of Cogenco common stock
that Genesis Investment Funds Limited owns.

         (b) There was no placement agent or underwriter for the transaction. We
accrued a finder's fee of 7 1/2% of the total amount raised (a total of $1,875)
to a Liechtenstein-based asset manager, MJM. The asset manager paid or will pay
one-third of the finder's fee to David W. Brenman, president of Cogenco, in
accordance with an oral agreement between them. Pursuant to that oral agreement,
Mr. Brenman will be entitled to receive one-quarter of the fund manager's
profits (if any) from making the investment in Cogenco.

         (c) The total offering price was $25,000. No underwriting discounts or
commissions were paid. We paid a finder's fee as described above.


                                       19
<PAGE>


         (d) We relied on the exemption from registration provided by Sections
4(2) and 4(6) under the Securities Act of 1933 for this transaction, as well as
Regulation D and Regulation S. We did not engage in any public advertising or
general solicitation in connection with this transaction. We provided the
accredited investor with disclosure of all aspects of our business, including
providing the accredited investor with our reports filed with the Securities and
Exchange Commission, our press releases, access to our auditors, and other
financial, business, and corporate information. Based on our investigation, we
believe that the accredited investor obtained all information regarding Cogenco
it requested, received answers to all questions it posed, and otherwise
understood the risks of accepting our securities for investment purposes.

         (e) The common stock issued is not exercisable, exchangeable, or
convertible. We have no registration obligation relating to the shares of common
stock.

         (f) We used all of the proceeds received to meet our minimal operating
expenses.

         On March 6, 2007, we entered into a Share Purchase Agreement with
Genesis, an offshore, St. Vincent and the Grenadines accredited investor for the
purchase of 75,000 shares of our common stock. Genesis paid us for the shares on
March 22, 2007. The following sets forth the information required by Item 701 in
connection with that transaction:

         (a) On March 22, 2007, we issued 75,000 shares of our common stock to
Genesis. Genesis is an accredited investor and a non-U.S. Person as that term is
defined in Regulation S and, as outlined above, is a principal shareholder of
Cogenco.

         (b) No underwriter, placement agent, or finder was involved in the
transaction. As described above, the shares were sold to Genesis, an accredited
investor and a principal shareholder of Cogenco, and the transaction occurred as
an Offshore Transaction (as that term is defined in Regulation S).

         (c) Genesis purchased the shares of our common stock at $10 per share
and tendered us 400,000 shares of Helix Biopharma Corporation common stock and
paid us $150,000 in cash. Should the net proceeds from our sale of Helix common
stock average less than $1.50 per share, Genesis has agreed that that until
March 5, 2008 it will tender us additional Helix shares (or shares of another
publicly traded company) upon our written request.

         (d) We relied on the exemption from registration provided by Sections
4(2) and 4(6) under the Securities Act of 1933 for this transaction, as well as
Regulation D and Regulation S. We did not engage in any public advertising or
general solicitation in connection with this transaction, and we provided the
accredited investor with disclosure of all aspects of our business, including
providing the accredited investor with our reports filed with the Securities and
Exchange Commission, our press releases, access to our auditors, and other
financial, business, and corporate information. Based on our investigation, we
believe that the accredited investor obtained all information regarding Cogenco
it requested, received answers to all questions it (and its advisors) posed, and
otherwise understood the risks of accepting our securities for investment
purposes.

         (e) The total offering price was $750,000. The common stock issued in
this transaction is not convertible or exchangeable.

         (f) We have used $330,000 of the cash proceeds to purchase shares of
DMI as described above and we plan to use the remainder of the proceeds for
other corporate purposes, including working capital, and general and
administrative expenses.

(f) Purchases of Equity Securities by Cogenco and its Affiliates (Item 703
information).


                                       20
<PAGE>


         Not applicable since Cogenco's common stock is not registered under
Section 12 of the Securities Exchange Act of 1934.

Item 6.  Management's Discussion and Analysis or Plan of Operation.
         ---------------------------------------------------------

Going Concern Qualification

         Because of our lack of revenues, lack of working capital, our inability
to meet certain of our contractual obligations, and lack of any assured
financing sources, our financial statements raise doubt about our ability to
continue as a going concern because of our financial condition, and substantial
losses. The opinion of our auditors for the year ended March 31, 2007, expresses
the following concerns about our ability to continue as a going concern if we do
not receive the Minimum proceeds of this offering:

         "...the Company has suffered recurring losses from operations that
         raises substantial doubt about its ability to continue as a going
         concern."

(the "Going Concern Qualification"). This condition has continued since those
financial statements, and we expect that these conditions will continue for the
foreseeable future unless we are able to raise a substantial amount of
additional financing. In view of the matters described herein and in Note 1 to
our financial statements, our ability to continue to pursue our plan of
operations as described herein is dependent upon our ability to raise the
capital necessary to meet our financial requirements on a continuing basis.

Summary

         As stated above, Cogenco has been essentially inactive since early 1988
until the 2005 fiscal year. During this time we investigated investment
alternatives in the oil and gas and biotechnology industries but, to date, we
have been unsuccessful in completing any such transaction.

         Commencing in our fiscal 2005, we entered into agreements with DMI, as
described above, which required a significant amount of financing, but did not
require any substantial activities on the part of Cogenco. As described above,
we were unable to make all payments contemplated under the DMI agreement;
however, we are continuing to explore other activities and the availability of
financing for those activities. Consequently, we have still not engaged in any
business operations or received revenues for more than the past ten years.

Results of Operations

Years Ended March 31, 2007 and 2006.

         We recognized net losses of $(442,140) for the fiscal year ended March
31, 2007, as compared to $(3,237,630) for the fiscal year ended March 31, 2006.
Our losses in 2007 were significantly less than our losses in 2006 primarily
because we reduced our research and development expenses paid to DMI for
research and development purposes from $3,052,473 during 2006 to approximately
$197,527 during our 2007 fiscal year.

         We anticipate that we will continue to incur significant net losses as
we continue to pursue business opportunities with DMI and perhaps with other
entities. We will pursue these business opportunities to the extent that our
management has identified opportunities that it believes are worth pursuing and
to the extent that Cogenco has sufficient funds to do so. At the present time,
Cogenco has no source of revenues from operations, and Cogenco can provide no
assurance that it will generate a source of revenues from operations, either as
a result of a merger or acquisition transaction, or as a result of developing
such a source from within.


                                       21

<PAGE>


Liquidity and Capital Resources

         Cogenco has been without adequate funds since 1987 through the 2007
fiscal year and subsequently. At the time we ceased active business operations,
Cogenco was essentially out of money. We did not raise any substantial amounts
of money for Cogenco until the 2005 fiscal year during which we raised $240,000
and the 2006 fiscal during which we raised $3,700,000, these funds were invested
by accredited and offshore (non-U.S.) investors. As described above, we also
raised $775,000 in 2007, these funds were also invested by accredited and
offshore (non-U.S.) investors.

         At March 31, 2007, Cogenco had current assets of $700,356 and working
capital of $580,937, as compared to current assets of $183,318 and working
capital of $179,641 at March 31, 2006. The increase in our current assets during
the 2007 fiscal year is primarily due to our acquisition of 400,000 shares of
Helix common stock (discussed above) valued at $1.38 per share at the time those
shares were acquired and $1.43 per share at March 31, 2007. As discussed in the
risk factors section below, the shares of Helix common stock are highly volatile
and subject to changes in valuation on a daily basis. Therefore, our working
capital and current assets will also be subject to changes in valuation. We
anticipate that the sale of Helix shares will be a source for our working
capital needs during our fiscal 2008.

         Cogenco does not have any capital obligations during fiscal 2007. We do
have the right, but not the obligation, to invest $630,000 to purchase shares of
DMI common stock.

         As stated above under "Going Concern Qualification" and in the Risk
Factors, below, we do not believe that the working capital currently available
is sufficient to maintain our activities for more than several months, at best.
If we were to hold a shareholders' meeting, actively pursue a business
opportunity, or engage in business operations, we will be required to raise a
significant amount of additional capital to pay for these activities. There can
be no assurance that we will be able to raise any such capital, or that the
terms on which we can raise any capital will be commercially reasonable.

Plan of Operations

         Cogenco is not engaged in any business operations at the present time.
Although we receive proposals for business opportunities from third parties and
we seek out business opportunities with others, we have not actively pursued any
such business opportunity in more than the past two years except for the
business transactions with DMI that were discussed above. We will continue
reviewing other opportunities in the biotechnology industry and in other
industries as we become aware of appropriate opportunities, and we will continue
to pursue a business combination with DMI.

         We will not be able to pursue any business opportunity without a
substantial amount of additional funding provided from third parties.
Consequently, we cannot offer any assurance that we will be able to obtain the
funds necessary to invest in other business opportunities. We plan to sell the
400,000 shares of Helix that we acquired in March 2007, in routine market
transactions during the next six to ten months to help pay for our routine legal
and administrative expenses.

         We also plan to continue to invest funds (to the extent available) in
DMI. Management believes that the investment in DMI has a potential for a
significant return, but such return is subject to many risks as described above.
Based on the due diligence conducted by the officer and directors of Cogenco and
also on the risk adjusted net present value of the compounds under development,
as reported to us by DMI, we have concluded that it is a good business decision
for the Company to continue to invest in DMI.


                                       22

<PAGE>


Off Balance Sheet Arrangements

         We have no off balance sheet arrangements and thus no disclosure is
required. However, as described above, Cogenco has an obligation to pay rent
under an office lease through December 2008 at the rate of $5,350 per month.
This obligation is not reflected on Cogenco's balance sheet, although our rent
expense is recognized on our Statement of Operations.

Risk Factors

         An investment in and ownership of our common stock is one of high risk.
You should carefully consider the risks described below in connection with any
decision whether to acquire, hold or sell our securities. If any of the
contingencies discussed in the following paragraphs or other materially adverse
events actually occurs, the business, financial condition and results of
operations could be materially and adversely affected. In such case, the trading
price of our common stock could decline, and you could lose all or part of your
investment.

We have no business operations, and only limited prospects for business
operations.

         We currently are not engaged in any business operations. Although we
have reviewed several possibilities for business operations during the past
several years, we have not found an opportunity for a business combination that
was attractive to management other than the opportunity to participate in a
co-development agreement with DMI. As reported above, however, we were unable to
complete a business combination with DMI and our previous investments in DMI
were converted into shares of common stock in DMI. The New CODA was terminated
as a result of the conversion. We cannot offer any assurances that we will ever
find another business opportunity that management determines to be worth
pursuing, or that if we do, we are able to complete the business combination on
commercially-reasonable terms in a manner that could be advantageous to our
shareholders.

We have had little working capital available for any operations.

         We have had little working capital for more than the past five years.
Although we raised $240,000 during our fiscal 2005, $3,700,000 during our fiscal
2006, and $775,000 during our fiscal 2007, our payments to DMI, as discussed
above, have resulted in significantly greater expenses. We may be required by
lack of funds to reduce our operations to our previous level of only nominal
operations to minimize our corporate general and administrative expenses.

         Our available working capital is not sufficient for us to engage in any
business operations, or to complete a merger, acquisition, or other business
combination. We cannot offer any assurance that we will be able to obtain the
necessary working capital on commercially-reasonable terms, if at all, should
circumstances arise requiring us to have additional working capital available.

Our financial statements reflect a "going concern" qualification.

         Because of our lack of revenues, lack of working capital, our inability
to meet certain of our contractual obligations, and lack of any assured
financing sources, our financial statements raise doubt about our ability to
continue as a going concern because of our financial condition, and substantial
losses. The opinion of our auditors for the year ended March 31, 2007, expresses
the following concerns about our ability to continue as a going concern if we do
not receive the Minimum proceeds of this offering:

         "...the Company has suffered recurring losses from operations that
         raises substantial doubt about its ability to continue as a going
         concern."


                                       23
<PAGE>


(the "Going Concern Qualification"). This condition has continued since those
financial statements, and we expect that these conditions will continue for the
foreseeable future unless we are able to raise a substantial amount of
additional financing. In view of the matters described herein and in Note 1 to
our financial statements, our ability to continue to pursue our plan of
operations as described herein is dependent upon our ability to raise the
capital necessary to meet our financial requirements on a continuing basis.

We lost our opportunity to participate in the development of drugs for the
treatment of multiple sclerosis, for which we paid $3,250,000 and we are now a
minority shareholder of DMI.

         For the reasons set forth under "Going Concern Qualification," above,
we were unable to complete our payments contemplated to DMI under the New CODA.
As a result, our interest in the New CODA was terminated and on June 22, 2007,
our payments were converted into 1,000,000 shares of DMI common stock,
representing a minority interest in DMI (along with our other investment in
DMI). We have also entered into a securities purchase agreement (described
above) with DMI under which the Company may invest an additional $670,000 to
purchase shares of DMI common stock at prices ranging from $.85 to $1.00,
subject to certain terms and conditions. If we complete that purchase by
December 31, 2007, DMI will issue to us a warrant to purchase an additional
1,000,000 shares at $1.00 per share.

         At this time and for the foreseeable future, we have little opportunity
to influence DMI's operations or business, and we are dependent on DMI for any
return on our investment. As disclosed above, DMI is dependent upon third
parties for financing its activities. It does not have sufficient working
capital to finance the significant costs of product development and regulatory
approval. Moreover, DMI has had nominal resources and working capital shortages
for more than the past year.

         Consequently, the value of our investment in DMI is wholly outside of
our control, and we cannot give any assurance that our ownership of DMI common
stock will provide for a return of any amount. The value of our investment in
DMI is wholly-dependent on the success of DMI's business operations, and because
of the numerous risks stated herein, we cannot offer any assurance that DMI will
be successful.

As a result of our acquisition of common shares of DMI and Helix (described in
detail above), Cogenco may be considered to be an investment company for
purposes of the Investment Company Act of 1940, regulation that will impose
significant responsibilities and restrictions on our ability to do business.

         As a result of (a) our March 2007 acquisition of 100,000 shares of DMI
common stock; (b) the conversion of our investment under the New CODA into
1,000,000 shares of DMI common stock; (c) the payments made to date and those
contemplated in the future under the Company's securities purchase agreement
with DMI; and (d) our acquisition of 400,000 shares of Helix common stock
(described in detail above), Cogenco may be considered to be an investment
company for purposes of the Investment Company Act of 1940. As described above,
Cogenco believes that if it is an investment company, it is a transient
investment company meeting the exception from registration under the Investment
Company Act set forth in Rule 3a-2 under the Investment Company Act. However,
the SEC may disagree with our interpretation of this rule or we may not meet any
exemption from the requirements of the Investment Company Act at a later date.

         Although Cogenco will attempt to take actions during its fiscal year
ending March 31, 2008, to avoid being an investment company in March 2008, we
cannot offer any assurance that our actions to do so will be successful. If
Cogenco is an investment company after the one year exception for transient
investment companies expires, we will be subject to a significant amount of
additional regulation, significant restrictions in our ability to do business,
and significant restrictions on any relationship with affiliates. We will also
be subject to more detailed SEC scrutiny and subject to the registration and
reporting requirements of the Company Act in addition to the reporting
requirements of the 1934 Act. Compliance with these new obligations will
restrict Cogenco's opportunities to conduct its business as it has heretofore
done, and will result in significantly greater regulatory compliance expenses.


                                       24
<PAGE>


Since our primary asset is DMI common stock, the success of Cogenco is tied to
DMI's business operations, the success of which cannot be assured.

         The proteomics industry is new and evolving rapidly. Although DMI has
entered into partnerships and license agreements with other companies, some of
which relate to biomarker candidates owned by DMI, those partnerships and
license agreements have not produced any revenues to DMI. Moreover, most of the
products related to those agreements have not received regulatory approval in
the United States or Europe.

         In addition, relatively few products based on protein discoveries have
been developed and commercialized by others. Rapid technological development by
DMI or by others may result in compounds, products or processes becoming
obsolete before DMI recovers its development expenses.

         In many cases, there is a significant amount of work that needs to be
accomplished before we will know whether we have a product that merits testing.
Even if the testing is successful and we are able to obtain regulatory approval
for any product in the United States or elsewhere, we cannot offer any assurance
that we will be able to market the product successfully or profitably.

         Furthermore, DMI has insufficient working capital to accomplish its
business plan and is dependent upon third parties for financing, governmental
regulatory approval, and protection of its intellectual property, all as
discussed above. Furthermore, there are many companies competing with DMI for
the development of drugs to treat various human illnesses, and most of these
companies are significantly better financed than is DMI. We cannot offer any
assurance that DMI will be able to compete successfully with these other
companies. Finally, in any drug for human use there are significant risks of
liability from side effects and reactions that cannot be predicted as a result
of the testing process. Any such liability would likely bankrupt DMI.

We have a history of losses and have never engaged in the profitable operation
of our business.

         We have had a history of operating losses and cash flow deficits, and
our financial statements reflect a Going Concern Qualification as described
above. We have never engaged in the profitable operation of a business, and
there can be no assurance that we will ever be able to do so.

         Cogenco has not been involved in active business operations since 1988.
To date, we have not implemented a successful business plan. Although we have
been reviewing several possibilities for business operations during the past
several years, they have not found an opportunity for a business combination
that was attractive to us and we were unsuccessful in completing the proposed
business combination with DMI.

Our primary assets consist of securities in Helix and DMI which are volatile or
unmarketable.

         Our most valuable asset consists of shares of common stock in Helix.
Our balance sheet for the fiscal year ended March 31, 2007, reported a value of
$572,000 for those securities. The Company believes that it has correctly
identified these securities as a current asset on its balance sheet pursuant to
SFAS No. 115, but the value of the Helix common stock is subject to significant
fluctuation. The price of each share of common stock in Helix is historically
volatile and subject to significant changes in value depending upon company
performance. Therefore, although our balance sheet has reflected an accurate
valuation of those securities as of March 31, 2007, this valuation could change
significantly in upcoming weeks and months. In addition, there is not an
established trading market for shares of Helix common stock and when the Company
desires to sell its shares of Helix, it may be unable to do so on short notice
or at all.

         As of March 31, 2007, the Company owned 1,100,000 shares of common
stock in DMI for which it has invested $3,350,000 but which has a carrying value
on Cogenco's financial statements of $100,000 as of March 31, 2007. Cogenco
purchased additional shares after March 31, 2007, and has the right to purchase


                                       25
<PAGE>


additional shares of DMI common stock. DMI is a privately held company and there
is no market for any shares of DMI common stock. We do not anticipate that a
market will develop for any of the shares of DMI common stock in the foreseeable
future, if at all. The Company must be prepared to hold the shares of DMI common
stock for an indefinite period of time.

It is likely that any efforts we may make to raise capital will result in
substantial additional dilution to our shareholders.

         It is likely that if we raise capital for any operations in the future,
such action will require the issuance of equity or debt securities which will
result in substantial dilution to our existing shareholders. Although we will
attempt to minimize the dilutive impact of any future capital-raising
activities, we cannot offer any assurance that we will be able to do so because
of the lack of any historical operations or profitability, as well as the lack
of any trading market for our publicly-held securities. If we are successful in
raising additional working capital, we will likely have to issue additional
shares of our common stock and common stock purchase warrants at prices that may
be a discount from the then-current market price of our common stock.

Because we are dependent upon our key personnel for our future success, if we
fail to retain or attract key personnel, our business will be adversely
affected.

         David W. Brenman is the only person who has devoted a substantial
amount of time to our business during the past five years, and his father has
acted as legal counsel. If we are to succeed in any activity (which cannot be
assured), it will be as a result of the efforts of Messrs. Brenman. Albert
Brenman does not have any employment agreement or any obligation to continue
providing services to Cogenco, and there can be no assurance that he will
continue to do so. David Brenman's employment Agreement with Cogenco became
effective on September 30, 2005. We paid Mr. Brenman his salary as due under
this employment agreement through August 15, 2006, but we have since been unable
to make any subsequent payments to him as required under his employment
agreement. In addition, we anticipate that we will continue to be unable to make
any payments under this employment agreement for the foreseeable future. Mr.
Brenman has agreed to defer the compensation due to him under his employment
agreement (without interest) until such time as the Company has adequate
resources to be able to make such payments. As described above under "Going
Concern Qualification," we cannot offer any assurance that we will be able to
raise such funds when necessary.

We are controlled by only a few officers and directors and, consequently,
purchasers of our shares will have very little ability to elect or control our
management.

         Our directors and officers beneficially own approximately 36% of the
outstanding shares of Common Stock as of May 31, 2007 and, accordingly, may have
the ability to elect a majority of our directors of Cogenco and otherwise to
control Cogenco. As a result, such persons, acting together, will have the
ability to substantially influence all matters submitted to stockholders for
approval, including the election and removal of directors and any merger,
consolidation or sale of substantially all of our assets, and to control our
management and affairs. Such concentration of ownership may have the effect of
delaying, deferring or preventing a change in control, impeding a merger,
consolidation or takeover or other business combination involving us or
discouraging a potential acquirer from making a tender offer or otherwise
attempting to obtain control of our business, even if such a transaction would
be beneficial to other stockholders.

No market exists for our common stock; should a market develop, our common stock
will likely be vulnerable to pricing and purchasing actions that are beyond our
control and, therefore, persons acquiring our shares may be unable to resell
their shares at a profit as a result of this volatility.

         At the present time, no market exists for our common stock, and we
cannot offer any assurance that any market will develop. Occasional trades are
reported on the "pink sheets," but as a result, the trading price of our
securities can be impacted by very low sales volumes, general market conditions,


                                       26
<PAGE>


and other events and factors. In addition, the realization of any of the risks
described in these "Risk Factors" could have a significant and adverse impact on
such market prices.

SEC penny stock regulations limit the ability to trade our securities.

         Our common stock is subject to additional disclosure requirements for
penny stocks mandated by the Securities Enforcement Remedies and Penny Stock
Reform Act of 1990. The SEC Regulations generally define a penny stock to be an
equity security that is not traded on the Nasdaq Stock Market and has a market
price of less than $5.00 per share. We are included within the SEC Rule 3a-51
definition of a penny stock. As a "penny stock", trading in our stock is covered
by Rule 15g-9 promulgated under the Securities Exchange Act of 1934, for
non-Nasdaq and non-national securities exchange listed securities.

         Under this rule, broker-dealers who recommend such securities to
persons other than established customers and accredited investors must make a
special written disclosure to, and suitability determination for, the purchaser
and receive the purchaser's written agreement to a transaction prior to sale.
The regulations on penny stocks limit the ability of broker-dealers to sell our
common stock and thus the ability of purchasers of our common stock to sell
their securities in the secondary market and adversely impact the willingness of
investors to purchase our common stock on either a private or open market basis.

Future sales of our common stock may cause our stock price to decline.

         Our stock price may decline by future sales of our shares or the
perception that such sales may occur. As of June 30, 2007, all of the shares of
Common Stock held by our officers, directors, and our principal stockholder
constitute "restricted shares" or "control shares" as defined in Rule 144 under
the Securities Act. The restricted shares may only be sold if they are
registered under the Securities Act, or sold under Rule 144, or another
exemption from registration under the Securities Act.

         All of the restricted shares of our Common Stock are either eligible
for sale pursuant to Rule 144 or have been registered under the Securities Act
for resale by the holders. We are unable to estimate the amount, timing, or
nature of future sales of outstanding common stock. Sales of substantial amounts
of our Common Stock in the public market may cause the stock's market price to
decline if such a market should develop in the future. See "Shares Available for
Future Sale."

Provisions in our charter documents could prevent or delay a change in control,
which could delay or prevent a takeover.

         Our articles of incorporation authorize the issuance of "blank check"
preferred stock with such designations, rights, and preferences, as may be
determined by our Board of Directors. Accordingly, the Board of Directors may,
without shareholder approval, issue shares of preferred stock with dividend,
liquidation, conversion, voting, or other rights that could adversely affect the
voting power or other rights of the holders of our common stock. Preferred stock
could also be issued to discourage, delay, or prevent a change in our control,
although we do not currently intend to issue any additional series of our
preferred stock.

         Provisions in our bylaws provide for indemnification of officers and
directors to the full extent permitted by Colorado law, which could require us
to direct funds away from our business and products.

We do not expect to pay dividends in the foreseeable future.

            We have never paid cash dividends on our common stock. We do not
expect to pay cash dividends on our common stock at any time in the foreseeable
future. The future payment of dividends directly depends upon our future
earnings, capital requirements, financial requirements and other factors that


                                       27

<PAGE>


our board of directors will consider. Since we do not anticipate paying cash
dividends on our common stock, return on your investment, if any, will depend
solely on an increase, if any, in the market value of our common stock.

Our prior sale of unregistered securities may create certain risks.

         We cannot offer any assurance that our prior sales of unregistered
securities were in compliance with the law. To the extent that our prior sales
were not strictly in compliance with all legal requirements, we may have some
contingent liabilities of which we are unaware. The availability of an exemption
from registration is conditional upon numerous facts and circumstances over
which we have no control, including the investment intent of the purchasers, the
accuracy of the purchasers' representations that they were accredited investors,
and whether others involved in the transaction utilized any form of general
solicitation. To the extent that any securities were offered or sold at a time
when there was no exemption from registration available and a person makes a
claim for rescission, we may have a liability which has not been included in our
financial statements.

Indemnification of officers and directors may result in unanticipated expenses.

         Colorado Revised Statutes and our articles of incorporation and bylaws
provide for the indemnification of our directors, officers, employees, and
agents, under certain circumstances, against attorney's fees and other expenses
incurred by them in any litigation to which they become a party arising from
their association with us or activities on our behalf. We also will bear the
expenses of such litigation for any of their directors, officers, employees, or
agents, upon such person's promise to repay them if it is ultimately determined
that any such person shall not have been entitled to indemnification. This
indemnification policy could result in substantial expenditures by us that we
may be unable to recoup and could direct funds away from our business and
products (if any).

Our president, Mr. David Brenman, is involved in other ongoing business
opportunities.

         The board of directors by resolution dated May 5, 2005, agreed to
permit Mr. David Brenman to pursue a business opportunity with respect to
certain imaging devices that are being developed by members of the Edwin L.
Adair family individually and through a family corporation, Micro-Imaging
Solutions, Inc. ("MIS"). MIS is involved in the research and development of
small scale high resolution medical devices.

         The board of directors by resolution dated April 3, 2006, also agreed
to permit Mr. Brenman to pursue a business opportunity in the oil and gas
industry with respect to Western Pacific Energy, LLC, in which he has invested
and participates as a manager ("WPE").

         Mr. Brenman's activities with respect to MIS and WPE could cause time
conflicts and other various conflicts of interest with respect to his duties and
obligations to Cogenco. In addition, Mr. Brenman's association with MIS and WPE
could diminish his ability to obtain additional financing on behalf of Cogenco
if he is also providing such assistance to MIS and/or WPE.

We have significant obligations under the Securities Act of 1934.

         Because we are a public company filing reports under the Securities
Exchange Act of 1934, as amended, we are subject to increased regulatory
scrutiny and extensive and complex regulation. The Securities and Exchange
Commission has the right to review the accuracy and completeness of our reports,
press releases, and other public documents. In addition, we are subject to


                                       28

<PAGE>


extensive requirements to institute and maintain financial accounting controls
and for the accuracy and completeness of their books and records. Normally these
activities are overseen by an audit committee consisting of qualified
independent directors. We have not appointed any independent directors.
Consequently, the protections normally provided to shareholders by independent
directors are not available. Although we hope to appoint qualified independent
directors in the future, we cannot offer any assurance that we will locate any
person willing to serve in that capacity, or that we will be able to acquire the
directors' and officers' liability insurance that will be a pre-condition to any
such person's willingness to serve.

Forward-looking statements may prove to be inaccurate.

         In our effort to make the information in this report more meaningful,
this report contains both historical and forward-looking statements. All
statements other than statements of historical fact are forward-looking
statements within the meanings of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. Forward-looking statements
in this report are not based on historical facts, but rather reflect the current
expectations of our management concerning future results and events. It should
be noted that because we are a "penny stock," the protections provided by
Section 27A of the Securities Act of 1933, and Section 21E of the Securities
Exchange Act of 1934 do not apply to us. We have attempted to qualify our
forward-looking statements with appropriate cautionary language to take
advantage of the judicially-created doctrine of "bespeaks caution" and other
protections.

         The forward-looking statements generally can be identified by the use
of terms such as "believe," "expect," "anticipate," "intend," "plan," "foresee,"
"likely," "will" or other similar words or phrases. Furthermore, statements that
describe our objectives, plans, or goals are, or may be, forward-looking
statements.

         Forward-looking statements involve known and unknown risks,
uncertainties and other factors which may cause our actual results, performance
and achievements to be different from any future results, performance and
achievements expressed or implied by these statements.

         These factors are not necessarily all of the important factors that
could cause actual results to differ materially from those expressed in the
forward-looking statements in this prospectus. Other unknown or unpredictable
factors also could have material adverse effects on our future results.

Item 7.  Financial Statements.
         --------------------

The following financial statements are filed as a part of this Form 10-KSB
immediately following the signature page:
                                                                       Page No.
                                                                       -------

         Report of Independent Certified Public
           Accountants                                                   F-1

         Balance Sheet - March 31, 2007 and 2006                         F-2

         Statement of Operations - For the Years Ended
           March 31, 2007 and 2006 and Cumulative Amounts
           from Inception of the Development Stage (July
           26, 1990) through March 31, 2007                              F-3

         Statement of Stockholders' Equity
         For the Period from Inception of the Development
         Stage (July 26, 1990) through March 31, 2007                 F-4 - F-7

         Statement of Cash Flows - For the Years
           Ended March 31, 2007 and 2006 and
           Cumulative Amounts from Inception of
           the Development Stage (July 26, 1990) through
           March 31, 2007                                                F-8

         Notes to Financial Statements
           March 31, 2007 and 2006                                    F-9 - F-20


                                       29
<PAGE>


Item 8.  Changes in and Disagreements with Accountants on Accounting and
         Financial Disclosure.
         ---------------------------------------------------------------

         Since inception, Cogenco has not filed a Form 8-K reporting a change of
accountants, nor has there been any material disagreement with its accountants
on any matter regarding accounting or financial disclosure.

Item 8A. Controls and Procedures.
         -----------------------

(a)      Evaluation of Disclosure Controls and Procedures.

         As required by Rule 13a-15 under the Securities Exchange Act of 1934,
as of the end of the period covered in this report, we carried out an evaluation
of the effectiveness of the design and operation of our disclosure controls and
procedures. This evaluation was carried out under the supervision and with the
participation of our principal executive officer (who also serves as our
principal financial officer), who concluded, based on the evaluation of these
controls and procedures, that our disclosure controls and procedures are
effective.

         Disclosure controls and procedures are controls and other procedures
that are designed to ensure that information required to be disclosed in our
reports filed or submitted under the Securities Exchange Act is recorded,
processed, summarized and reported, within the time periods specified in the
Securities and Exchange Commission's rules and forms. Disclosure controls and
procedures include, without limitation, controls and procedures designed to
ensure that information required to be disclosed in our reports filed under the
Exchange Act is accumulated and communicated to management, including our
principal executive officer and our principal financial officer, as appropriate,
to allow timely decisions regarding required disclosure.

(b)      Changes in Internal Controls.

         Our president, chief executive officer, and chief financial officer
(David W. Brenman) is responsible for establishing and maintaining adequate
internal controls over financial reporting for Cogenco. In evaluating internal
controls, Mr. Brenman considered the amount of Cogenco's financial activities
and resources. Cogenco has for the past several years retained a part-time
bookkeeper to assist Mr. Brenman in completing the financial reporting process,
but ultimately Mr. Brenman is responsible not only for controls, but also for
all other aspects of Cogenco's general ledger, disbursements and receipts, and
financial statement preparation.

         There were no changes in our internal controls or in other factors that
could significantly affect these internal controls subsequent to the date of
their evaluation.

Item 8B. Other Information.
         -----------------

         On March 5, 2007 we filed Restated Articles of Incorporation with the
Colorado Secretary of State. The Restated Articles did not amend our Articles of
Incorporation, but instead were filed so that our Articles of Incorporation are
more readily available and understandable to our shareholders. After filing the
Restated Articles we discovered the Restated Articles included an obsolete
provision regarding the par value of our common stock. Accordingly, on March 13,
2007 we filed a Statement of Correction with the Colorado Secretary of State in
which the obsolete provision was deleted from the Restated Articles.


                                       30

<PAGE>


PART III

Item 9.  Directors, Executive Officers, Promoters and Control Persons;
           Compliance With Section 16(a) of the Exchange Act.
         -------------------------------------------------------------

(a)      Identification of Directors and Executive Officers.

         The directors of Cogenco are elected to hold office until the next
annual meeting of shareholders and until their respective successors have been
elected and qualified. Officers of Cogenco are elected by the Board of Directors
and hold office until their successors are elected and qualified.

         The current officer and directors of Cogenco are:

Name                    Age                       Position
----                    ---                       --------

David W. Brenman        51     Director, President, Secretary and Treasurer
                               since 1985

Albert Brenman          81     Director, since 2004

Robert A. Melnick       51     Director, since 2004

         None of the existing directors is "independent" as that term is used in
the securities laws. See Item 9(c) - Family Relationships, below.

         The Board of Directors has not established an audit committee,
compensation committee, nominating committee, or any other committee.

         Cogenco has not held a shareholders' meeting for more than the past ten
years, and has no plans to hold a shareholders' meeting in the current fiscal
year. Consequently, the existing members of the board are expected to serve as
directors indefinitely.

         David W. Brenman has been since 1988 engaged as an independent
financial consultant and beginning in September 2005, Mr. Brenman is now an
employee of Cogenco. From 1984 until the present Mr. Brenman has served as
President and Director of Cogenco and also serves as Treasurer and Secretary of
Cogenco. From 1987 to 1988, Mr. Brenman was a Vice President of Lloyds
International Corporation, the merchant banking subsidiary of Lloyds Bank Plc.
From 1979 until 1984, Mr. Brenman was an associate with the law firm of Brenman
Raskin & Friedlob, P.C. of Denver, Colorado, where he specialized in the fields
of taxation and securities law. Mr. Brenman received a B.A. degree from the
University of Washington in accounting, a J.D. degree from the University of
Denver, College of Law, and an L.L.M. in taxation from New York University.
Since 1994 and until March 2003, he served as President of Taltos S.p.A., a
Company engaged in the production of light-weight stone products. As described
below under "Certain Relationships and Related Party Transactions," Mr. Brenman
is also engaged in business through Micro-Imaging, Inc. and Western Pacific
Energy, LLC.

         Mr. Brenman and his wife were named as a defendant in litigation
brought in Arapahoe County, Colorado, state court, which alleged corporate
malfeasance by him in connection with certain activities related to corporations
owned by his wife and her siblings. Mr. Brenman and his wife filed an answer in
that court in January 2005 denying all material allegations against them and
alleging seventeen counterclaims against the plaintiffs. This litigation was
resolved by settlement in December 2006.


                                       31
<PAGE>


         Albert Brenman, father of David W. Brenman, has been a Director of
Cogenco since March 10, 2004. He and the law firms with which he was associated
have represented Cogenco since its inception in June of 1983. Mr. Brenman
graduated from the University of Denver where he received a BSBA with a major in
accounting and the University of Denver College of Law, receiving a J.D. degree.
Mr. Brenman has practiced law in Denver, Colorado with various law firms from
1953 until his retirement in August of 2001. Mr. Brenman's law specialty is
corporate, business and securities law. Mr. Brenman will devote such time as may
be necessary to the affairs of Cogenco.

         Robert A. Melnick, David Brenman's brother-in-law, has been engaged in
the field of automotive finance since 1995. Mr. Melnick served in the capacity
as Finance Director for Chesrown Automotive, which was acquired by AutoNation in
1997. Mr. Melnick continued to serve in that capacity for AutoNation until
January 2004. Since January 2004, Mr. Melnick has been an independent consultant
in the financial services area of the automotive industry. Since August, 2004,
Mr. Melnick has served as Business Manager for Prestige Imports, Inc., Lakewood,
Colorado. Mr. Melnick received his B.A. from Drake University and M.S. from
Carnegie-Mellon University.

(b)      Significant Employees.

         Other than Mr. David Brenman, we have no significant employees at the
present time.

(c)      Family Relationships.

         Mr. Albert Brenman is the father of David W. Brenman and Robert A.
Melnick's father-in-law.

(d)      Involvement in Certain Legal Proceedings.

         During the past five years, no director, executive officer, promoter or
control person has:

(1) Had any bankruptcy petition filed by or against any business of which such
person was a general partner or executive officer either at the time of the
bankruptcy or within two years prior to that date;

(2) Been convicted in a criminal proceeding or been subject to a pending
criminal proceeding (excluding traffic violations and other minor offenses);

(3) Been subject to any order, judgment, or decree, not subsequently reversed,
suspended or vacated, of any court of competent jurisdiction, permanently or
temporarily enjoining, barring, suspending or otherwise limiting his involvement
in any type of business, securities or banking activities; or

(4) Been found by a court of competent jurisdiction (in a civil action), the
Commission or the Commodity Futures Trading Commission to have violated a
federal or state securities or commodities law, where the judgment has not been
reversed, suspended, or vacated.

(e)-(f) No Audit Committee or Audit Committee Financial Expert or Compensation
Committee

         Our board of directors has not appointed a separately designated
standing audit committee in accordance with section 3(a)(58)(A) of the Exchange
Act. Instead, the entire board is acting as the Company's audit committee. The
board does not have an audit committee financial expert.

         We do not have a compensation committee due to the limited number of
persons employed by us. Rather, the full board of directors participates in
deliberations concerning executive compensation and establishes the compensation
and benefit plans and programs of the Company. The board of directors does not
utilize a compensation committee charter when performing the functions of such
committee. Mr. Brenman is our only employee (although we have not paid his
salary since August 2006) and he is also a member of the board. Mr. Brenman did
not participate in any deliberations of the board concerning his own
compensation.


                                       32
<PAGE>


(g)      Material Changes to Nomination Procedures

         We have not held a meeting of Cogenco's shareholders for more than the
past ten years. Shareholders may recommend nominees to the board of directors by
addressing correspondence to the President.

(h)      Section 16(a) Beneficial Reporting Compliance

         Section 16(a) of the Securities Exchange Act of 1934 (the "1934 Act")
requires all directors, executive officers and persons who own more than 10% of
a registered class of securities, to file with the SEC initial reports of
ownership and reports of changes in ownership of Common Stock and other equity
securities of Cogenco. Officers, directors and greater than ten percent
shareholders are required by SEC regulation to furnish us with copies of all
Section 16(a) forms they file. Since our common stock is not registered pursuant
to Section 12 of the Securities Exchange Act of 1934, our directors, executive
officers, and significant shareholders are not subject to the Section 16 filing
obligations.

(i)      No Code of Ethics

         We have not adopted a code of ethics or a code of conduct that applies
to its principal executive officer, principal financial officer, principal
accounting officer, controller, or to persons performing similar functions. We
have not done so because its board of directors believes that its nominal
activities and nominal financial resources do not merit the expense of
preparing, adopting and administering a code of ethics. The board of directors
intends to adopt a code of ethics or a code of conduct when circumstances
warrant.

Item 10. Executive Compensation.
         ----------------------

Compensation Discussion and Analysis

         Summary. Since we only have a single employee and we have not issued
any options or other derivative securities, our compensation structure is not
complicated. If we are successful in our business plan, we may need to hire
additional employees. In such a case, we believe that the ability to attract and
retain qualified executive officers and other key employees will be essential to
our long term success.

         Compensation Linked to Attainment of Performance Goals. Currently, the
compensation of our only employee, Mr. David Brenman, is not linked to
performance based goals; rather his compensation is a fixed annual salary as set
forth in his employment agreement. However, under Mr. Brenman's employment
agreement, he may receive supplemental or incentive compensation based on the
criteria the board deems appropriate consistent with the Company's strategic
plan. Due to cash shortages, we have been unable to pay this salary as due since
August 2006. If we are in a position to hire additional employees at a later
date (of which we can grant no assurances) we may consider adopting a formal
compensation plan linked to performance based goals in order to attract
qualified employees.

         Named Executive Officers. As discussed above, we only have one named
executive officer, Mr. David Brenman. Mr. Brenman has served as our President,
Secretary and Treasurer since 1985.

         Elements of our Executive Compensation Program. Currently, the only
element of our executive compensation program is the base salary paid to Mr.
David Brenman. Because we have no revenues from operations, we do not provide
any annual bonus opportunity and equity compensation components, and we provide
no other employee benefits, such as retirement plans or medical benefits. The
members of the board serve as the Company's Compensation Committee and
participate in deliberations concerning executive compensation and (at a later
date if our revenues substantially increase) will establish the compensation and
benefit plans and programs of the Company. Mr. David Brenman did not participate
in any deliberations of the board concerning his own compensation. These
deliberations were conducted by Mr. David Brenman's father and brother-in-law.


                                       33
<PAGE>


         In general, the base salary for Mr. Brenman was determined by
evaluating his responsibilities, experience and the competitive marketplace.
More specifically, we considered the following factors in determining Mr.
Brenman's base salary and will also consider these factors if the Company is in
a position to hire additional employees:

     1.   the executive's leadership and operational performance and potential
          to enhance long-term value to the Company's shareholders;
     2.   performance compared to the financial, operational and strategic goals
          established for the Company;
     3.   the nature, scope and level of the executive's responsibilities;
     4.   competitive market compensation paid by other companies for similar
          positions, experience and performance levels; and
     5.   the executive's current salary (if applicable), the appropriate
          balance between incentives for long-term and short-term performance.

         Due to our lack of revenue it is unlikely that Mr. David Brenman will
receive a salary adjustment until we have adopted a successful business plan and
generated significant revenues. As noted above, because of inadequate working
capital, it is unlikely that we will pay Mr. David Brenman his past due salary
until we have adequate funds to do so from sources other than the shares of
Helix common stock that Cogenco owns.

         Retirement and Deferred Compensation Benefits. We do not presently
provide Mr. David Brenman with a defined benefit pension plan or any
supplemental executive retirement plans, nor do we provide Mr. Brenman with
retiree health benefits.

         Perquisites. We do not provide any perquisites to Mr. Brenman.

         Post-Termination/ Change Of Control Compensation. We have no
compensation plan or arrangement with respect to any executive officer which
plan or arrangement results or will result from the resignation, retirement or
any other termination of such individual's employment except as described below
for the employment agreement with David Brenman.

         Tax Implications of Executive Compensation. Our aggregate deduction for
Mr. Brenman's compensation is potentially limited by Section 162(m) of the
Internal Revenue Code to the extent the aggregate amount paid to him exceeds
$1.0 million, unless it is paid under a predetermined objective performance plan
meeting certain requirements, or satisfies one of various other exceptions
specified in the Internal Revenue Code. At Mr. Brenman's 2007 compensation
levels, and considering that we have not paid him any compensation since August
2006, we did not believe that Section 162(m) of the Internal Revenue Code would
be applicable, and accordingly, we did not consider its impact in determining
compensation levels for Mr. Brenman.

         Employment Agreement with our Named Executive Officer. In November
2004, we entered into an employment contract with David Brenman which became
effective on or about September 30, 2005, when we paid DMI $3,250,000 for
participation in the co-development agreement. The employment agreement was
approved by our board of directors, including David Brenman's father and
brother-in-law, by consent to action in lieu of a special meeting dated November
16, 2004. The material terms of David Brenman's employment agreement are as
follows:


                                       34

<PAGE>


     o    Annual salary of $150,000;
     o    Employment for a 5 year term;
     o    The employee is subject to confidentiality/non-competition/protection
          of trade secrets/non-solicitation provisions;
     o    The employment agreement provides for premature termination in certain
          circumstances;
     o    Mr. Brenman has certain rights in the event of a change of control of
          Cogenco including a two year extension of his employment term and a
          requirement that his full salary (through the term of the agreement)
          be paid to him within 30 days of such change of control. Change of
          control can also constitute a basis on which the employee can
          terminate the agreement prematurely; and
     o    The employment agreement did not prohibit David Brenman from receiving
          compensation from MJM.

         We paid Mr. Brenman his salary as due under this employment agreement
through August 15, 2006, but we have since been unable to make any subsequent
payments to him as required under his employment agreement. In addition, we
anticipate that we will continue to be unable to make any payments under this
employment agreement for the foreseeable future. Mr. Brenman has agreed to defer
the compensation due to him under his employment agreement (without interest)
until such time as the Company has adequate resources to be able to make such
payments.

SUMMARY OF COMPENSATION

Disclosure of Compensation

         As previously discussed, our only employee is David Brenman. Under his
employment agreement, Mr. Brenman is entitled to an annual salary of $150,000;
however, due to cash shortages, we have not paid his salary since August 2006.
We paid Mr. David Brenman a total of $56,250 in cash compensation during our
2007 fiscal year, and we paid him no other form of compensation during or for
that period.

         We pay Albert Brenman a retainer of $500 per month ($6,000 per year)
for supervising our accounting and legal matters however, due to cash shortages,
we have not paid his retainer since August 2006. Other than as described above,
we have not paid compensation to any officer or director for services rendered
during the last three fiscal years.

Outstanding Equity Awards at Fiscal Year-End

         There are no outstanding equity awards, including stock option or bonus
plans.

Director Compensation

         We do not pay our directors for their services in that capacity. We do
reimburse our officers and directors for out-of-pocket expenses incurred by them
in connection with our business. Currently, we do not pay any directors fees for
attendance at board meetings.

         We have no other arrangements pursuant to which any of our directors
was compensated during the fiscal year ended March 31, 2007 for services as a
director.


                                       35

<PAGE>


         Item 11. Security Ownership of Certain Beneficial Owners and Management
and Related Stockholder Matters.
--------------------------------------------------------------------------------

(a) (b) Security Ownership of Certain Beneficial Owners and Management.

         The following table sets forth information as of May 31, 2007, as to
the beneficial ownership of shares of our only outstanding class of securities,
our common stock, by each person who, to our knowledge at that date, was a
beneficial owner of 5% or more of the outstanding shares of our common stock, by
each person who is an officer and/or director, and by all of our officers and
directors as a group. The table does not include information regarding shares of
common stock held in the names of certain depositories/clearing agencies as
nominee for various brokers and individuals. No such broker or individual is
believed to hold greater than 5% of our common stock. The percent of class is
based on 2,656,256 shares outstanding as of May 31, 2007.

<TABLE>
<CAPTION>

Name and Address of Beneficial Owner     Amount of Beneficial Ownership                       Percent
                                         (ownership is direct unless otherwise noted)        of Class
--------------------------------------   -------------------------------------------         --------

<S>                                              <C>                                         <C>
David W. Brenman                                    497,042                                     19%
4085 So. Dexter Street
Englewood, CO 80113

Genesis Investment Funds Limited                   1,654,868                                    62%
Pflugstrasse 28, P.O. Box 1143
FL-9490 Vaduz, Liechtenstein
(1, 2, 3, 4, 5, 6)

Albert Brenman                                      367,247                                     14%
4400 East Oxford Place
Englewood, CO 80110

Robert A. Melnick
1074 Bonnie Brae Blvd.                              100,000                                      4%
Denver, CO 80209

Officers and directors
 as a group (three persons)                         964,289                                     36%
</TABLE>


(1) Genesis Investment Funds Limited is controlled by Genesis Capital Management
Limited, a company controlled by Herald A.M.A. Janssen and Peter H. Jacobs. Mr.
Janssen and Mr. Jacobs co-founded Genesis Investment Funds Limited and Genesis
Capital Management Limited, and appointed Genesis Capital Management as the
investment advisor for Genesis Investment Funds Limited. Pursuant to a
discretionary investment management agreement, Genesis Capital Management has
discretionary investment and voting control over the assets of Genesis Capital
Management Limited, including the shares of Cogenco common stock that Genesis
Investment Funds Limited owns. Pursuant to a discretionary investment management
agreement, Genesis Capital Management has discretionary investment and voting
control over the assets of Genesis Capital Management Limited, including the
shares of Cogenco common stock that Genesis Investment Funds Limited owns or
controls directly and indirectly.

(2) During our 2007 fiscal year, certain investors with interests in Cogenco
transferred their shares to Genesis for management purposes, our president David
Brenman transferred 220,000 shares of common stock that he owned to Genesis
(with a commitment by Genesis Capital Management Ltd. to return those shares to
Mr. Brenman in the event of a successful conclusion to the transaction
contemplated with DMI Biosciences (as described above) or other appropriate
business combination), and on October 27, 2006, Genesis purchased an additional
2,500 shares of our common stock in a private offering. As a result of those
transactions, and the purchase of 75,000 shares described herein, Genesis owns
or controls 1,654,868 shares of Cogenco's outstanding common stock
(approximately 62%).


                                       36
<PAGE>


(3) Until January 1, 2007, Mr. Janssen also controlled MJM Asset Management
Company Establishment ("MJM"), a company he founded in 1997. Mr. Janssen no
longer has any direct or indirect interest in MJM. During the period of Mr.
Janssen's ownership, Cogenco paid MJM Asset Management a finders' fee of 7 1/2%
of the $3,900,000 in funds raised by MJM Asset Management for Cogenco. Mr.
Janssen's address is Matschils 23, LI-9495 Triesen, Liechtenstein. In prior
transactions, MJM paid one-third of the finder's fee to David W. Brenman,
president of Cogenco, in accordance with an oral agreement between them. As a
result of Mr. Janssen's sale of MJM, Mr. Brenman is not entitled to receive any
further compensation from MJM's direct or indirect investments in Cogenco.
Cogenco will not pay any third party (related or otherwise) any fee resulting
from the investment of the Helix common stock in exchange for Cogenco common
stock.

(4) Genesis Investment Funds Limited is also controlled by Peter H. Jacobs, a
licensed European property manager who holds a degree in engineering from the
Technical Institute, Heerlen, Netherlands. He is a certified appraiser by the
court in the Netherlands. Mr. Jacobs has been working as an asset manager in
Europe since the 1980's and has from time-to-time worked with Mr. Janssen and
MJM Asset Management. Mr. Jacobs co-founded Genesis Investment Funds Limited
with Mr. Janssen. Mr. Jacob's address is Meierhofstrasse 85, LI-9495 Triesen,
Liechtenstein.

(5) The address set forth above is the Administrator's European representative
office for Genesis Investment Funds Limited. Genesis Investment Funds Limited is
established under the laws of Saint Vincent, and its registered office is Trust
House, 112 Bonadie Street, Kingstown, Saint Vincent.

(6) As a result of their control of Genesis Investment Funds Limited, Mr. Jacobs
and Janssen control the right to vote and to dispose of 62% of Cogenco's common
stock.

(c)      Changes in Control.

         Management is not aware of any arrangements which may result in a
change of control of Cogenco other than the ownership of more than 50% of our
outstanding common stock by Genesis Investment Funds Limited as described above.
Genesis could, in its discretion, call a meeting of the shareholders of Cogenco
and vote its shares to replace all directors and take over control of Cogenco.
Genesis has not advised Cogenco that it has any current plans to do so. Because
Cogenco's common stock is not registered under the Securities Exchange Act of
1934, Genesis does not have any reporting obligations under Sections 13(d) or
16(a) of the Securities Exchange Act.


(d)      Securities Authorized for Issuance under Equity Compensation Plans

         At the present time, we have no securities authorized for issuance
under any equity compensation plan.

Item 12. Certain Relationships and Related Transactions.
         ----------------------------------------------

(a) Transactions with Related Persons

         Compensation Arrangements. We pay Albert Brenman a retainer of $500 per
month ($6,000 per year) for supervising our accounting and legal matters and for
storage of our records.

         In November 2004, our board of directors approved an employment
agreement with our president, David W. Brenman. That employment agreement became
effective on or about September 30, 2005, and contains the terms and conditions
described above.

       In addition, as described in the following paragraphs, we have entered
into transactions which have resulted in compensation being paid to David
Brenman:


                                       37
<PAGE>


     o    On May 13, 2005, we raised $2,000,000, on September 15 and 20, 2005,
          we raised a total of $1,700,000, and again on October 27, 2006, we
          raised a total of $25,000, from offshore private placements using a
          Liechtenstein-based fund manager, MJM, as a finder which have resulted
          in compensation paid by MJM to David W. Brenman, our president. Until
          January 1, 2007, Herald A.M.A. Janssen controlled MJM Asset Management
          Company Establishment, a company he founded in 1997. Mr. Janssen no
          longer has any direct or indirect interest in MJM. As described above,
          Genesis Investment Funds Limited, one of our significant shareholders,
          is controlled by Genesis Capital Management Limited, a company that is
          also partially controlled by Herald A.M.A. Janssen. During the period
          of Mr. Janssen's ownership, Cogenco paid MJM Asset Management a
          finders' fee of 7 1/2% of the $3,900,000 in funds raised by MJM Asset
          Management for Cogenco.

     o    In prior transactions, MJM paid one-third of the finder's fee to David
          W. Brenman, president of Cogenco, in accordance with an oral agreement
          between them. At the time the disinterested directors of Cogenco
          approved the arrangements with MJM, they understood that MJM has an
          obligation to pay one-third of the finder's fee to David W. Brenman,
          president of Cogenco, in accordance with an oral agreement between
          them. As a result of those finder's fee agreements, we paid
          approximately $292,500 to MJM from the funds raised to date. After Mr.
          Janssen's sale of MJM, Mr. Brenman is not entitled to receive any
          further compensation from MJM's direct or indirect investments in
          Cogenco.

         Pursuant to a discretionary investment management agreement, Genesis
Capital Management has discretionary investment and voting control over the
assets of Genesis Capital Management Limited, including the shares of Cogenco
common stock that Genesis Investment Funds Limited owns or controls directly and
indirectly. Recently, certain investors with interests in Cogenco transferred
their shares to Genesis for management purposes, our president David Brenman
transferred 220,000 shares of common stock that he owned to Genesis (with a
commitment by Genesis Capital Management Ltd. to return those shares to Mr.
Brenman in the event of a successful conclusion to the transaction contemplated
with DMI Biosciences or other appropriate business combination), and on October
27, 2006, Genesis purchased an additional 2,500 shares of our common stock in a
private offering. As a result of those transactions, and the purchase of 75,000
shares described herein, Genesis owns or controls 1,654,868 shares of Cogenco's
outstanding common stock (approximately 62%).

         Stock Issuance. The Board of Directors have approved stock issuances to
related parties as described in Item 5(e), above. Because of the significant
stock ownership of the purchasers, these transactions were not negotiated at
arms'-length.

         Approval of Outside Business Activities. The board of directors by
resolution dated May 5, 2005, agreed to permit Mr. David Brenman to pursue a
business opportunity with respect to CMOS imaging devices that are being
developed by members of the Edwin L. Adair family individually and through a
family corporation, MIS. MIS is involved in the research and development of
small scale high resolution medical devices. The Board of Directors determined
that the business opportunity with MIS is not a corporate opportunity of
Cogenco, and that David Brenman is entitled to pursue such opportunity outside
of his employment responsibilities with Cogenco, provided that such activities
do not unreasonably interfere with his employment activities with Cogenco or
compromise any trade secrets or confidential or non-public information relating
to Cogenco.

         The board of directors by resolution dated April 3, 2006, agreed to
permit Mr. David Brenman to pursue a business opportunity in the oil and gas
industry with respect to WPE, in which he wants to invest and participate as a
manager. WPE is in the process (as of May 31, 2007) of attempting to acquire
certain producing properties located in North Dakota. The Board of Directors
determined that the business opportunity with WPE is not a corporate opportunity
of Cogenco, and that David Brenman is entitled to pursue such opportunity
outside of his employment responsibilities with Cogenco, provided that such
activities do not unreasonably interfere with his employment activities with
Cogenco or compromise any trade secrets or confidential or non-public
information relating to Cogenco.


                                       38
<PAGE>


         Office Lease with Related Party. In October 2005, Cogenco entered into
an office lease with an unaffiliated party for approximately 3,210 square feet
at the rate of $5,350 per month over its term of 38 months. Commencing April 1,
2006, Cogenco has subleased a portion of the space (approximately 1,605 square
feet) to another company (Micro-Imaging Solutions, Inc. or "MIS") for $2,675 per
month (Cogenco's cost). MIS will also be responsible for its pro-rata share of
other expenses incurred under the lease. The sublease is on a month-to-month
basis, and Cogenco expects that MIS' use of the office space will continue
during the remaining term of Cogenco's lease, depending on MIS's financial
capabilities. An affiliate of David Brenman has a significant equity interest in
MIS. The lease and sublease was approved by the remaining members of the Cogenco
board of directors, including Mr. David Brenman's father and his brother-in-law.
A certificate of deposit of $81,152 has been pledged as collateral on a letter
of credit in the amount of $70,000 securing the lease.

(b)      Parents

         Not applicable.

(c)      Promoters and Control Persons

         Not applicable.

(d)      Director Independence

         None of the members of the Company's board are "independent" as defined
by Section 121A of the American Stock Exchange Listing Standards. The board
considers all relevant facts and circumstances in its determination of
independence of all members of the board (including any relationships set forth
in this Form 10-KSB under the heading "Certain Related Person Transactions"). As
disclosed above, the entire board performs the role of the audit committee and
the compensation committee; therefore, none of the persons performing the
functions of those committees are independent.

PART IV

Item 13. Exhibits and Reports on Form 8-K.
         --------------------------------

(a) Exhibits required to be filed are listed below and, except where
incorporated by reference, immediately follow the Financial Statements.

Number   Description
------   -----------

3.1      Restated Articles of Incorporation, incorporated by reference from the
         Form 8-K dated March 5, 2007, filed March 8, 2007.

3.2      Bylaws, incorporated by reference from the Annual Report on Form 10-KSB
         for the five fiscal years ended March 31, 1992.

10.1     Employment Agreement with David W. Brenman, incorporated by reference
         from the Form 10-KSB for the year ended March 31, 2006, filed June 29,
         2006.

10.2     Amended letter of intent with DMI BioSciences dated November 5, 2004,
         incorporated by reference from the Form 10-KSB for the year ended March
         31, 2006, filed June 29, 2006.


                                       39

<PAGE>


10.3     Co-development agreement with DMI BioSciences, Inc. dated November 21,
         2004 (confidential treatment requested), incorporated by reference from
         the Form 10-KSB for the year ended March 31, 2006, filed June 29, 2006.

10.4     Extension agreement with DMI BioSciences, Inc. dated January 21, 2005,
         incorporated by reference from the Form 10-KSB for the year ended March
         31, 2006, filed June 29, 2006.

10.5     Second extension agreement with DMI BioSciences, Inc. dated February
         22, 2005, incorporated by reference from the Form 10-KSB for the year
         ended March 31, 2006, filed June 29, 2006.

10.6     Third extension agreement and second amendment to letter of intent with
         DMI BioSciences, Inc. dated June 7, 2005, incorporated by reference
         from the Form 10-KSB for the year ended March 31, 2006, filed June 29,
         2006.

10.7     Co-development agreement with DMI BioSciences, Inc. dated February 20,
         2006 (confidential treatment requested), incorporated by reference from
         the Form 10-KSB for the year ended March 31, 2006, filed June 29, 2006.

10.8*    Amended Share Purchase Agreement with Genesis Investment Funds Ltd.,
         dated March 1, 2007.

10.9*    Securities Purchase Agreement with DMI BioSciences, Inc., dated March
         22, 2007.

10.10*   Securities Purchase Agreement with DMI BioSciences, Inc., dated
         April 18, 2007.

10.11*   Securities Purchase Agreement with DMI BioSciences, Inc., dated May 29,
         2007.

10.12*   Securities Purchase Agreement with DMI BioSciences, Inc.,
         dated June 20, 2007.

10.13*   Securities Purchase Agreement with DMI BioSciences, Inc., dated July 5,
         2007.

10.14*   Warrant Agreement to purchase shares of common stock of DMI
         BioSciences, Inc., dated July 5, 2007.

31*      Certification pursuant to Rule 1h3a-14(a).

32*      Certification pursuant to 18 U.S.C. ss.1350.

----------
*        Filed herewith.

Item 14. Principal Accountant Fees and Services.
         --------------------------------------

(a)      Audit Fees.

         Our principal accountant, Causey, Demgen & Moore, Inc., billed us
aggregate fees in the amount of approximately $11,865 for the fiscal year ended
March 31, 2006 and $12,300 for the fiscal year ended March 31, 2007. These
amounts were billed for professional services that Causey, Demgen & Moore, Inc.
provided for the audit of our annual financial statements, review of the
financial statements included in our report on Form 10-QSB, and other services
typically provided by an accountant in connection with statutory and regulatory
filings or engagements for those fiscal years.

(b)      Audit-Related Fees.

         Causey, Demgen & Moore, Inc. billed us aggregate fees in the amount of
$923 for the fiscal year ended March 31, 2006 and $ 0 for the fiscal year ended
March 31, 2007, for assurance and related services that were reasonably related
to the performance of the audit or review of our financial statements.


                                       40

<PAGE>


(c)      Tax Fees

         Causey, Demgen & Moore, Inc. billed us aggregate fees in the amount of
$695 for the fiscal year ended March 31, 2006 and approximately $723 for the
fiscal year ended March 31, 2007, for tax compliance, tax advice, and tax
planning.

(d)      All Other Fees

         Causey, Demgen & Moore, Inc. billed us aggregate fees in the amount of
$-0- for the fiscal years ended March 31, 2007 and 2006, for other fees.

(e)      Audit Committee's Pre-Approval Practice

         Section 10A(i) of the Securities Exchange Act of 1934 prohibits our
auditors from performing audit services for us as well as any services not
considered to be "audit services" unless such services are pre-approved by the
audit committee of the Board of Directors (or the Board of Directors as a whole
if there is no audit committee appointed), or unless the services meet certain
de minimis standards. Since Cogenco has no audit committee, the Board of
Directors pre-approved the audit services and tax services that Causey, Demgen &
Moore, Inc. performed for Cogenco during the fiscal years ended March 31, 2006
and 2007, and has pre-approved that firm's continuation of those services.

         The percentage of the fees for audit, audit-related, tax and other
services were as set forth in the following table:

                                                 Percentage of total
                                       fees paid to Causey, Demgen & Moore, Inc.
                                       -----------------------------------------
                                         Fiscal Year 2006      Fiscal Year 2007
                                         ----------------      ----------------

          Audit fees                          88%                     94%
          Audit-related fees                   7%                      0%
          Tax fees                             5%                      6%
          All other fees                       0%                      0%

SUPPLEMENTAL INFORMATION TO BE FURNISHED WITH REPORTS FILED PURSUANT TO SECTION
15(d) OF THE EXCHANGE ACT BY REGISTRANTS WHICH HAVE NOT REGISTERED SECURITIES
PURSUANT TO SECTION 12 OF THE EXCHANGE ACT:

         We have not sent to our security holders any annual report or proxy
material during the last fiscal year. If such report or proxy material is
furnished to security holders subsequent to the filing of this Form 10-KSB, we
will furnish copies of such material to the Commission when it is sent to
security holders.


                                       41
<PAGE>


SIGNATURES

         In accordance with Section 13 or 15(d) of the Securities Exchange Act
of 1934, the Registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

Date:    July 11, 2007
                                            COGENGO INTERNATIONAL, INC.


                                            By:  /s/ David W. Brenman
                                                 -------------------------------
                                                 David W. Brenman, President

         In accordance with the Securities Exchange Act of 1934, this report has
been signed below by the following person on behalf of the Registrant and in the
capacities and on the date indicated.

Date:    July 11, 2007
                                 By:  /s/ David W. Brenman
                                      ------------------------------------------
                                      David W. Brenman, President, Principal
                                      Executive Officer, Principal Accounting
                                      Officer, principal Financial Officer and
                                      Director

Date:    July 11, 2007
                                 By: /s/ Albert Brenman
                                     -------------------------------------------
                                     Albert Brenman, Director


Date:    July 11, 2007
                                 By: /s/ Robert A. Melnick
                                     -------------------------------------------
                                     Robert A. Melnick, Director



                                       42

<PAGE>


             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM



The Board of Directors and Shareholders
Cogenco International, Inc.


We have audited the accompanying balance sheets of Cogenco International, Inc.
(a development stage company) as of March 31, 2006 and 2007, and the related
statements of operations, stockholders' equity and cash flows for the years then
ended and for the period from inception of the development stage (July 26, 1990)
through March 31, 2007. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based upon our audits.

We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audits 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 Cogenco International, Inc. as
of March 31, 2006 and 2007, and the results of its operations and its cash flows
for the years then ended and the period from inception of the development stage
(July 26, 1990) through March 31, 2007, in conformity with U.S. generally
accepted accounting principles.

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 1 to the
financial statements, the Company has incurred significant losses from inception
to date and does not have sufficient funds on hand to continue to fund
operations without a capital infusion. These conditions raise substantial doubt
about its ability to continue as a going concern. Management's plans regarding
those matters also are described in Note 1. The financial statements do not
include any adjustments that might result from the outcome of this uncertainty.


Denver, Colorado                                      CAUSEY DEMGEN & MOORE INC.
July 10, 2007


                                       F-1
<PAGE>
<TABLE>
<CAPTION>
                                        COGENCO INTERNATIONAL, INC.
                                       (A Development Stage Company)
                                              BALANCE SHEET
                                          March 31, 2006 and 2007


                                                 ASSETS
                                                 ------

                                                                     2006                    2007
                                                                     ----                    ----

<S>                                                              <C>                     <C>
Current assets:
    Cash ($1,334 in interest bearing accounts)                    $    99,738             $    41,744
    Certificate of deposit (Note 5)                                    78,120                  81,152
    Marketable securities (Note 2)                                       --                   572,000
    Prepaid expense                                                     5,460                   5,460
                                                                  -----------             -----------

       Total current assets                                           183,318                 700,356

Computer equipment, at cost, net of accumulated
    depreciation of $363 (2006) and $1,147 (2007)                       3,137                   2,353
Investment in securities of DMI                                          --                   100,000
Stand still fee and codevelopment payments (Note 6)                   197,527                    --
                                                                  -----------             -----------

Total assets                                                      $   383,982             $   802,709
                                                                  ===========             ===========

                                               LIABILITIES
                                               -----------

Current liabilities:
    Note payable - officer                                        $      --               $     2,500
    Accounts payable                                                    3,677                   8,193
    Accounts payable - related party                                     --                    14,976
    Accrued salary - officer                                             --                    93,750
                                                                  -----------             -----------

Total current liabilities                                               3,677                 119,419

                                          STOCKHOLDERS' EQUITY
                                          --------------------

Preferred stock, $.01 par value; 10,000,000 shares
    authorized, no shares issued and outstanding                         --                      --
Common stock, $.01 par value; 50,000,000 shares
    authorized, 2,578,756 (2006) and 2,656,256 (2007)
    shares issued and outstanding                                      25,788                  26,563
Additional paid-in capital                                          5,693,975               6,466,325
Stock subscription receivable (Note 3)                                   --                   (28,000)
Accumulated deficit (including $4,412,137 deficit
    accumulated during the development stage at
    March 31, 2007)                                                (5,339,458)             (5,781,598)
                                                                  -----------             -----------

Total stockholders' equity                                            380,305                 683,290
                                                                  -----------             -----------

Total liabilities and stockholders' equity                        $   383,982             $   802,709
                                                                  ===========             ===========

                                       See Accompanying Notes

                                                F-2
<PAGE>


                                        COGENCO INTERNATIONAL, INC.
                                       (A Development Stage Company)
                                          STATEMENT OF OPERATIONS
                        For the Years Ended March 31, 2006 and 2007 and Cumulative Amounts
                  from Inception of the Development Stage (July 26, 1990) Through March 31, 2007


                                                                                              Cumulative
                                                                                             amounts from
                                                  2006                   2007                  Inception
                                                  ----                   ----                  ---------

Revenues:
    Rental income                             $      --               $    36,325             $    36,325
    Interest income                                 1,391                   3,156                  46,657
                                              -----------             -----------             -----------

       Total revenues                               1,391                  39,481                  82,982

Costs and expenses:
    Research and development                    3,052,473                 197,527               3,250,000
    Salary - officer                               75,000                 150,000                 225,000
    Legal fees - related party (Note 5)             6,000                   6,000                 208,770
    Legal fees                                     27,448                  18,127                  76,186
    Consulting and travel expenses -
       related party                               16,260                  10,791                 186,127
    Dry hole costs                                   --                      --                   123,086
    General and administration                     33,772                  32,832                 324,888
    Rent and storage expenses                      27,705                  65,560                  96,343
    Depreciation                                      363                     784                   4,719
                                              -----------             -----------             -----------

       Total costs and expenses                 3,239,021                 481,621               4,495,119
                                              -----------             -----------             -----------

          Net loss (Note 4)                   $(3,237,630)            $  (442,140)            $(4,412,137)
                                              ===========             ===========             ===========

Basic and diluted loss per common share       $     (1.31)            $     (0.17)            $     (2.71)
                                              ===========             ===========             ===========

Weighted average number of common
    shares outstanding                          2,476,098               2,581,667               1,630,887
                                              ===========             ===========             ===========


                                              See Accompanying Notes

                                                       F-3
<PAGE>


                                          COGENCO INTERNATIONAL, INC.
                                         (A Development Stage Company)
                                       STATEMENT OF STOCKHOLDERS' EQUITY
                            For the Period from Inception of the Development Stage
                                    (July 26, 1990) through March 31, 2007

                                                        Common stock        Additional      Stock                         Total
                                                     -----------------       paid-in     Subscription    Accumulated   stockholders'
                                                     Shares     Amount       capital      Receivable       deficit       equity
                                                     ------     ------       -------      ----------       -------     -------------

Balance at July 25, 1990                             72,415   $       724   $ 1,358,508   $      --      $(1,369,461)   $   (10,229)

Sale of common stock to employees
    of the related law firm for cash
    ($.50 per share) July 26, 1990                   13,600           136         6,664          --             --            6,800

Sales of common stock to an unrelated
     entity for cash ($.50 per share)
     July 26, 1990                                   12,000           120         5,880          --             --            6,000

Shares of common stock issued in
    settlement of an account payable
    to the related law firm in
    October 1990 ($.50 per share)                     1,985            20           973          --             --              993

Net loss for the period ended
    March 31, 1991                                     --            --            --            --          (11,922)       (11,922)
                                                -----------   -----------   -----------   -----------    -----------    -----------
Balance at March 31, 1991                           100,000         1,000     1,372,025          --       (1,381,383)        (8,358)

Shares of common stock issued in
    settlement of an account payable
    to the related law firm in
    February 1992 ($.50 per share)                   28,756           288        13,975          --             --           14,263

Net loss for the period ended
    March 31, 1992                                     --            --            --            --          (13,545)       (13,545)
                                                -----------   -----------   -----------   -----------    -----------    -----------
Balance at March 31, 1992                           128,756         1,288     1,386,000          --       (1,394,928)        (7,640)

Sale of common stock to two individuals
    for cash and cash payments to the
    Company's president in March 1993
    ($.11 per share) (Note 2)                     1,610,000        16,100       158,900          --             --          175,000


                                          (Continued on following page)

                                              See Accompanying Notes

                                                      F-4
<PAGE>


                                          COGENCO INTERNATIONAL, INC.
                                         (A Development Stage Company)
                                       STATEMENT OF STOCKHOLDERS' EQUITY
                            For the Period from Inception of the Development Stage
                                    (July 26, 1990) through March 31, 2007

                                                        Common stock         Additional      Stock                         Total
                                                     -----------------        paid-in     Subscription    Accumulated  stockholders'
                                                  Shares         Amount       capital      Receivable       deficit        equity
                                                  ------         ------       -------      ----------       -------     ------------

Net loss for the period ended March 31, 1993           --            --            --            --         (100,291)      (100,291)
                                                -----------   -----------   -----------   -----------    -----------    -----------
Balance at March 31, 1993                         1,738,756        17,388     1,544,900          --       (1,495,219)        67,069

Capital contribution of two shareholders
    consisting of cash payments to the
    Company's president in April 1993
    (Note 2)                                           --            --          10,000          --             --           10,000

Sale of stock to an individual for
    cash ($10.00 per share) (Note 2)                 50,000           500       499,500          --             --          500,000

Net loss for the period ended March 31, 1994           --            --            --            --         (368,020)      (368,020)
                                                -----------   -----------   -----------   -----------    -----------    -----------

Balance at March 31, 1994                         1,788,756        17,888     2,054,400          --       (1,863,239)       209,049

Net loss for the period ended March 31, 1995           --            --            --            --          (42,581)       (42,581)
                                                -----------   -----------   -----------   -----------    -----------    -----------
Balance at March 31, 1995                         1,788,756        17,888     2,054,400          --       (1,905,820)       166,468

Net loss for the period ended March 31, 1996           --            --            --            --          (25,813)       (25,813)
                                                -----------   -----------   -----------   -----------    -----------    -----------
Balance at March 31, 1996                         1,788,756        17,888     2,054,400          --       (1,931,633)       140,655

Net loss for the period ended March 31, 1997           --            --            --            --          (12,021)       (12,021)
                                                -----------   -----------   -----------   -----------    -----------    -----------
Balance at March 31, 1997                         1,788,756        17,888     2,054,400          --       (1,943,654)       128,634

Net loss for the period ended March 31, 1998           --            --            --            --           (9,234)        (9,234)
                                                -----------   -----------   -----------   -----------    -----------    -----------
Balance at March 31, 1998                         1,788,756        17,888     2,054,400          --       (1,952,888)       119,400


                                               (Continued on following page)

                                                   See Accompanying Notes

                                                            F-5
<PAGE>


                                          COGENCO INTERNATIONAL, INC.
                                         (A Development Stage Company)
                                       STATEMENT OF STOCKHOLDERS' EQUITY
                            For the Period from Inception of the Development Stage
                                    (July 26, 1990) through March 31, 2007

                                                        Common stock        Additional      Stock                         Total
                                                     -----------------       paid-in     Subscription    Accumulated   stockholders'
                                                  Shares        Amount       capital      Receivable       deficit       equity
                                                  ------        ------       -------      ----------       -------     -------------

Net loss for the period ended March 31, 1999           --            --            --            --          (23,662)       (23,662)
                                                -----------   -----------   -----------   -----------    -----------    -----------
Balance at March 31, 1999                         1,788,756        17,888     2,054,400          --       (1,976,550)        95,738

Net loss for the period ended March 31, 2000           --            --            --            --           (8,177)        (8,177)
                                                -----------   -----------   -----------   -----------    -----------    -----------
Balance at March 31, 2000                         1,788,756        17,888     2,054,400          --       (1,984,727)        87,561

Net loss for the period ended March 31, 2001           --            --            --            --          (13,986)       (13,986)
                                                -----------   -----------   -----------   -----------    -----------    -----------
Balance at March 31, 2001                         1,788,756        17,888     2,054,400          --       (1,998,713)        73,575

Net loss for the period ended March 31, 2002           --            --            --            --          (11,601)       (11,601)
                                                -----------   -----------   -----------   -----------    -----------    -----------
Balance at March 31, 2002                         1,788,756        17,888     2,054,400          --       (2,010,314)        61,974

Net loss for the period ended March 31, 2003           --            --            --            --          (15,745)       (15,745)
                                                -----------   -----------   -----------   -----------    -----------    -----------
Balance at March 31, 2003                         1,788,756        17,888     2,054,400          --       (2,026,059)        46,229

Net loss for the period ended March 31, 2004           --            --            --            --          (16,717)       (16,717)
                                                -----------   -----------   -----------   -----------    -----------    -----------
Balance at March 31, 2004                         1,788,756        17,888     2,054,400          --       (2,042,776)        29,512

Sale of common stock in a private placement         420,000         4,200       220,800          --             --          225,000

Net loss for the period ended March 31, 2005           --            --            --            --          (59,052)       (59,052)
                                                -----------   -----------   -----------   -----------    -----------    -----------
Balance at March 31, 2005                         2,208,756        22,088     2,275,200          --       (2,101,828)       195,460

Sale of common stock in a private placement         370,000         3,700     3,418,775          --             --        3,422,475


                                              (Continued on following page)

                                                 See Accompanying Notes

                                                          F-6

<PAGE>

                                          COGENCO INTERNATIONAL, INC.
                                         (A Development Stage Company)
                                       STATEMENT OF STOCKHOLDERS' EQUITY
                            For the Period from Inception of the Development Stage
                                    (July 26, 1990) through March 31, 2007

                                                     Common stock           Additional      Stock                         Total
                                                  ---------------------       paid-in     Subscription    Accumulated  stockholders'
                                                  Shares        Amount        capital      Receivable       deficit       equity
                                                  ------         ------       -------      ----------       -------    -------------

Net loss for the period ended March 31, 2006           --            --            --            --       (3,237,630)    (3,237,630)
                                                -----------   -----------   -----------   -----------    -----------    -----------
Balance at March 31, 2006                         2,578,756        25,788     5,693,975          --       (5,339,458)       380,305

Sale of common stock in a private placement          77,500           775       772,350       (28,000)          --          745,125

Net loss for the period ended March 31, 2007           --            --            --            --         (442,140)      (442,140)
                                                -----------   -----------   -----------   -----------    -----------    -----------
Balance at March 31, 2007                         2,656,256   $    26,563   $ 6,466,325   $   (28,000)   $(5,781,598)   $   683,290
                                                ===========   ===========   ===========   ===========    ===========    ===========


                                                   See Accompanying Notes

                                                             F-7

<PAGE>


                                            COGENCO INTERNATIONAL, INC.
                                           (A Development Stage Company)
                                              STATEMENT OF CASH FLOWS
                           For the Years Ended March 31, 2006 and 2007 and Cumulative Amounts
                      from Inception of the Development Stage (July 26, 1990) Through March 31, 2007

                                                                                                       Cumulative
                                                                                                      amounts from
                                                                2006                 2007              Inception
                                                                ----                 ----              ---------
Cash flows from operating activities:
    Net loss                                                 $(3,237,630)        $  (442,140)        $(4,412,137)
    Adjustment to reconcile net loss to net
       cash used in operating activities:
          Research and development expenses                    3,052,473             197,527           3,250,000
          Depreciation expense                                       363                 784               4,719
          Consulting fees paid directly by
             common stock purchasers                                --                  --                50,000
          Change in prepaid expense                               (5,460)               --                (5,460)
          Change in accounts payable and
             accrued expenses                                      3,677             113,242             121,916
                                                             -----------         -----------         -----------
          Net cash used in operations                           (186,577)           (130,587)           (990,962)

Cash flows from investing activities:
    Contract payments                                         (3,150,000)               --            (3,250,000)
    Purchase of securities                                          --              (100,000)           (100,000)
    Purchase of certificate of deposit                           (78,120)             (3,032)            (81,152)
    Purchase of computer equipment                                (3,500)               --                (7,072)
                                                             -----------         -----------         -----------
          Net cash used in investing activities               (3,231,620)           (103,032)         (3,438,224)

Cash flows from financing activities:
    Proceeds from sale of common stock                         3,422,475             173,125           4,468,400
    Short-term borrowings                                           --                 2,500             102,500
    Repayments of short-term borrowings                             --                  --              (100,000)
                                                             -----------         -----------         -----------

          Net cash provided by financing
             activities                                        3,422,475             175,625           4,470,900
                                                             -----------         -----------         -----------

Net increase (decrease) in cash                                    4,278             (57,994)             41,714

Cash and cash equivalents at
    beginning of year                                             95,460              99,738                  30
                                                             -----------         -----------         -----------

Cash and cash equivalents at
    end of year                                              $    99,738         $    41,744         $    41,744
                                                             ===========         ===========         ===========

Supplemental disclosure of non-cash financing activities:

    Consulting fees paid directly by
       common stock purchasers                               $      --           $      --           $    50,000
                                                             ===========         ===========         ===========

    Stock issued in settlement of an account
       payable to a related party                            $      --           $      --           $    15,256
                                                             ===========         ===========         ===========

    Stock issued in exchange for marketable
       securities                                            $      --           $   600,000         $   600,000
                                                             ===========         ===========         ===========


                                                     See Accompanying Notes

                                                               F-8
</TABLE>
<PAGE>


                           COGENCO INTERNATIONAL, INC.
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                             March 31, 2006 and 2007

1.   Significant accounting policies
     -------------------------------

     Organization:

     Cogenco International, Inc. (the "Company") was incorporated in the State
     of Colorado on June 27, 1983. Prior to July 26, 1990, the Company was
     engaged in the development of cogeneration of electricity and the sale of
     the electricity to end-users on site or to public utilities. The Company is
     currently considered to be in the development stage as more fully defined
     in the Financial Accounting Standards Board Statement No. 7. The Company
     has engaged in limited activities in the oil and gas business, but has not
     generated significant revenues to date. The Company is currently seeking
     business opportunities.

     In August 2004, Cogenco entered into a letter agreement with DMI
     BioSciences, Inc. ("DMI") for an agreement by which Cogenco would
     participate in the development of a drug for the treatment of asthma in
     humans. The parties modified this agreement in November 2004 and, pursuant
     to the modification, Cogenco paid DMI $100,000 and entered into a
     co-development agreement with DMI for the development of a drug for the
     treatment of asthma in humans (the "Old Development Agreement"). Under the
     terms of the agreements, as amended, Cogenco paid DMI $3,250,000 by
     September 30, 2005. Once Cogenco paid DMI the full $3,250,000 it had the
     right to participate in revenues from sales of the asthma products.

     In February 2006, Cogenco and DMI negotiated a restated letter of intent
     (the "New LOI") which contemplated additional payments of $7,000,000 to DMI
     by November 30, 2006. In addition, the parties negotiated a new
     co-development agreement (the "New Development Agreement") for the
     development of a drug for the treatment of multiple sclerosis. Upon signing
     the New Development Agreement, the Old Development Agreement was terminated
     (although the payments that Cogenco made were credited to the New
     Development Agreement).

     Cogenco did not make any of the payments to DMI contemplated under the New
     Development Agreement. Cogenco did not have the funds necessary to make
     these payments. The New LOI also amended the suggestion in the August 2004
     letter agreement that the parties would attempt to negotiate a business
     combination between DMI and Cogenco (provided that Cogenco becomes
     adequately funded with at least $25,000,000). Since the business
     combination did not occur by October 30, 2006, upon notice from Cogenco,
     the $3,250,000 investment was converted into 1,000,000 shares of DMI common
     stock and Cogenco has become a minority shareholder of DMI. As described in
     Note 8-Subsequent Events, this conversion occurred in June 2007.

     Of the total payments of $3,250,000 made to DMI, we included $3,052,473 and
     $197,527 in research and development costs for the years ended March 31,
     2006 and 2007, respectively. These figures represent the amount of funds
     received by DMI from Cogenco which had been expended by DMI as of March 31,
     2007 on research and development expenses and related expenses.


                                      F-9
<PAGE>


                           COGENCO INTERNATIONAL, INC.
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                             March 31, 2006 and 2007

1.   Significant accounting policies (continued)
     -------------------------------------------

     Basis of presentation:

     The financial statements have been prepared on a going concern basis which
     contemplates the realization of assets and liquidation of liabilities in
     the ordinary course of business. As shown in the accompanying financial
     statements, the Company has incurred significant losses from inception to
     date and does not have sufficient funds on hand to continue to fund
     operations. As a development stage company, the Company continues to rely
     on infusions of equity capital to fund operations. As a result, substantial
     doubt exists about the Company's ability to continue to find future
     operations using its existing resources. The Company continues to seek
     equity investments of which there can be no assurance.

     Use of estimates:

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

     Fair value of financial instruments:

     The carrying amounts of cash, cash equivalents, the certificate of deposit,
     prepaid expenses and accounts payable are assumed to approximate fair value
     because of the short maturities of those instruments. Marketable securities
     are carried at fair value. Fair values are generally based upon quoted
     market prices or appraised value.

     Investments in marketable securities:

     The Company follows SFAS No. 115, "Accounting for Certain Investments in
     Debt and Equity Securities," in accounting for its security investments. In
     accordance with SFAS No. 115, investments in marketable securities have
     been classified as available-for-sale because they are being held for an
     indefinite period of time. Under the available-for-sale classification, the
     marketable securities are recorded as an asset at current market value on
     the balance sheet with an equal amount representing unrealized gains and
     losses recorded as a component of stockholders' equity. The current market
     value is derived from published quotations as of March 31 of each fiscal
     year and does not reflect any discount for price or volume volatility or
     the risk that the Company may not be able to sell the securities at the
     time or for the prices quoted. At the time of sale, a gain or loss is
     recognized in the statement of operations using the cost basis of
     securities sold as determined by specific identification.


                                      F-10
<PAGE>


                           COGENCO INTERNATIONAL, INC.
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                             March 31, 2006 and 2007

1.   Significant accounting policies (continued)
     -------------------------------------------

     Investment in non-marketable securities:

     The Company has invested in the securities of a closely held company whose
     stock is not publicly traded. The investment ownership is less than 20% and
     the Company does not control the entity. Therefore, the investment will be
     accounted for using the cost method of accounting. Under cost accounting,
     the income from the investment is only recognized when distributed. Any
     losses on the investment are recognized if the estimated fair value
     decreases below the carrying value on a permanent basis.

     Loss per share:

     Net loss per common share is based on the weighted average number of shares
     outstanding during each period.

     Income taxes:

     The Company accounts for income taxes using a liability approach under
     which deferred income taxes are provided based upon enacted tax laws and
     rates applicable to the periods in which the taxes become payable.

     Cash flows:

     For purposes of the statement of cash flows, the Company considers all
     highly liquid debt instruments purchased with a maturity of three months or
     less to be cash equivalents.

     Restricted investments:

     At March 31, 2006 and 2007, restricted investments consist of $78,120 and
     $81,152, respectively, in a certificate of deposit set aside to secure a
     letter of credit of $70,000.

     Concentrations of credit risk:

     Financial instruments which potentially subject the Company to
     concentrations of credit risk consist principally of cash and a certificate
     of deposit. The Company places its cash and certificate of deposit with
     high quality financial institutions, which deposits are insured up to
     $100,000 per institution by the Federal Deposit Insurance Corporation
     (FDIC). At various times during the year, the balance at one financial
     institution may exceed FDIC limits.

     Computer equipment:

     Computer equipment is stated at cost. Depreciation is provided by the
     Company on straight-line and accelerated methods over estimated useful
     lives of three to five years.


                                      F-11
<PAGE>


                           COGENCO INTERNATIONAL, INC.
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                             March 31, 2006 and 2007

1.   Significant accounting policies (continued)
     -------------------------------------------

     Research and development:

     The Company expenses research and development costs as incurred.

     Recent accounting pronouncements:

     In December 2004, the Financial Accounting Standards Board ("FASB") issued
     Statement of Financial Accounting Standard ("SFAS") No. 153, "Exchanges of
     Nonmonetary Assets," ("SFAS No. 153") an amendment to Accounting Principles
     Board ("APB") Opinion No. 29 ("Opinion No. 29"), "Accounting for
     Nonmonetary Transactions". Statement No. 153 eliminates certain differences
     in the guidance in Opinion No. 29 as compared to the guidance contained in
     standards issued by the International Accounting Standards Board. The
     amendment to Opinion No. 29 eliminates the fair value exception for
     nonmonetary exchanges of similar productive assets and replaces it with a
     general exception for exchanges of nonmonetary assets that do not have
     commercial substance. Such an exchange has commercial substance if the
     future cash flows of the entity are expected to change significantly as a
     result of the exchange. SFAS No. 153 is effective for nonmonetary asset
     exchanges occurring in periods beginning after June 15, 2005. Earlier
     application is permitted for nonmonetary asset exchanges occurring in
     periods beginning after December 16, 2004. The adoption of SFAS No. 153 did
     not have a material impact on the Company's financial statements.

     In May 2005, the FASB issued SFAS No. 154, "Accounting Changes and Error
     Corrections - a replacement of APB Opinion No. 20 and FASB Statement No.
     3." SFAS No. 154 replaces APB Opinion ("APB") No. 20, "Accounting Changes",
     and SFAS No. 3, "Reporting Accounting Changes in Interim Financial
     Statements," and changes the requirements for the accounting for and
     reporting of a change in accounting principle. SFAS No. 154 will apply to
     all voluntary changes in accounting principle as well as to changes
     required by an accounting pronouncement in the unusual instance that the
     pronouncement does not include specific transition provisions. APB No. 20
     previously required that most voluntary changes in accounting principle be
     recognized by including in net income of the period of the change the
     cumulative effect of changing to the new accounting principle.

     SFAS No. 154 requires retrospective application to prior periods' financial
     statements of changes in accounting principle, unless it is impracticable
     to determine either the period-specific effects or the cumulative effect of
     the change. When it is impracticable to determine the period-specific
     effects of an accounting change on one or more individual prior periods
     presented, SFAS No. 154 requires that the new accounting principle be
     applied to the balances of assets and liabilities as of the beginning of
     the earliest period for which retrospective application is practicable and
     that a corresponding adjustment be made to the opening balance of retained
     earnings (or other appropriate components of equity or net assets in the
     statement of financial position) for that period rather than being reported
     in an income statement. When it is impracticable to determine the
     cumulative effect of applying a change in accounting principle to all prior
     periods, SFAS No. 154 requires that the new accounting principle be applied
     as if it were adopted prospectively from the earliest date practicable.
     SFAS No. 154 carries forward without change the guidance contained in APB
     Opinion No. 20 for reporting the correction of an error in previously
     issued financial statements and a change in accounting estimate, and also


                                      F-12

<PAGE>


                           COGENCO INTERNATIONAL, INC.
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                             March 31, 2006 and 2007


     Recent accounting pronouncements (continued):

     the guidance in APB No. 20 requiring justification of a change in
     accounting principle on the basis of preferability. SFAS No. 154 is
     effective for accounting changes and corrections of errors made in fiscal
     years beginning after December 15, 2005. Early adoption is permitted for
     accounting changes and corrections of errors made in fiscal years beginning
     after the date SFAS No. 154 was issued. The adoption of the provisions of
     SFAS No. 154 did not have a material affect on the Company's financial
     statements.

     In December 2004, the FASB issued SFAS No. 123 (Revised 2004), "Share Based
     Payment," ("SFAS No. 123 (R)") which eliminates the use of APB Opinion No.
     25 and will require the Company to measure the cost of employee services
     received in exchange for an award of equity instruments based on the
     grant-date fair value of the award. That cost will be recognized over the
     period during which an employee is required to provide service in exchange
     for the reward (the requisite service period). No compensation cost is
     recognized for equity instruments for which employees do not render the
     requisite service. The grant-date fair value of director/employee share
     options; share grants and similar instruments will be estimated using
     option-pricing models adjusted for the unique characteristics of those
     instruments. SFAS No. 123 (R) must be applied to all shares and options
     granted or modified after its effective date and also to recognize the cost
     associated with the portion of any share or option awards made before its
     effective date for with the associated service has not been rendered as of
     its effective date.

     The Company adopted SFAS No. 123(R) April 1, 2007 and it had no effect on
     the Company's financial statements.

     In March 2005, the FASB issued FASB Interpretation ("FIN") No. 47,
     "Accounting for Conditional Asset Retirement Obligations" ("FIN No. 47").
     FIN No. 47 clarifies that the term conditional asset retirement obligation
     as used in FASB Statement No. 143, "Accounting for Asset Retirement
     Obligations," refers to a legal obligation to perform an asset retirement
     activity in which the timing and (or) method of settlement are conditional
     on a future event that may or may not be within the control of the entity.
     The obligation to perform the asset retirement activity is unconditional
     even though uncertainty exists about the timing and (or) method of
     settlement. Uncertainty about the timing and/or method of settlement of a
     conditional asset retirement obligation should be factored into the
     measurement of the liability when sufficient information exists. This
     interpretation also clarifies when an entity would have sufficient
     information to reasonably estimate the fair value of an asset retirement
     obligation. Fin No. 47 is effective no later than the end of fiscal years
     ending after December 15, 2005 (December 31, 2005 for calendar-year
     companies). Retrospective application of interim financial information is
     permitted but is not required. The adoption of FIN No. 47 did not have a
     material impact on the Company's financial statements.

     SFAS 155, "Accounting for Certain Hybrid Financial Instruments--an
     amendment of FASB Statements No. 133 and 140" (`SFAS No. 155"). This
     Statement shall be effective for all financial instruments acquired,
     issued, or subject to a remeasurement (new basis) event occurring after the
     beginning of an entity's first fiscal year that begins after September 15,
     2006. The fair value election provided for in paragraph 4(c) of this
     Statement may also be applied upon adoption of this Statement for hybrid
     financial instruments that had been bifurcated under paragraph 12 of
     Statement 133 prior to the adoption of this Statement. Earlier adoption is
     permitted as of the beginning of an entity's fiscal year, provided the
     entity has not yet issued financial statements, including financial


                                      F-13
<PAGE>


                           COGENCO INTERNATIONAL, INC.
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                             March 31, 2006 and 2007

     Recent accounting pronouncements (continued):

     statements for any interim period, for that fiscal year. Management does
     not expect adoption of SFAS No. 155 to have a material impact on the
     Company's financial statements.

     SFAS 157, "Fair Value Measurements", defines fair value, establishes a
     framework for measuring fair value in generally accepted accounting
     principles (GAAP), and expands disclosures about fair value measurements.
     This Statement applies under other accounting pronouncements that require
     or permit fair value measurements, the Board having previously concluded in
     those accounting pronouncements that fair value is the relevant measurement
     attribute. Accordingly, this Statement does not require any new fair value
     measurements. However, for some entities, the application of this Statement
     will change current practice. Management has not evaluated the impact of
     this statement.

     In June 2005, the Emerging Issues Task Force reached a consensus on Issue
     No. 05-6 ("EITF No. 05-6"), "Determining the Amortization Period for
     Leasehold Improvements Purchased after Lease Inception or Acquired in a
     Business Combination." EITF No. 05-6 clarifies that the amortization period
     for leasehold improvements acquired in a business combination or placed in
     service significantly after and not contemplated at or near the beginning
     of the lease term should be amortized over the shorter of the useful life
     of the assets or a term that includes the required lease periods and
     renewals that are reasonably assured of exercise at the time of the
     acquisition. EITF No. 05-6 is to be applied prospectively to leasehold
     improvements purchased or acquired in reporting periods beginning after
     June 29, 2005. The adoption of EITF No. 05-6 did not have a material impact
     on the Company's financial statements.

     In June 2006, the FASB issued FASB Interpretation ("FIN") No. 48,
     "Accounting for Uncertainty in Income Taxes - an Interpretation of FASB
     Statement No. 109" ("FIN No. 48"). FIN No. 48 clarifies the accounting for
     uncertainty in income taxes recognized in an enterprise's financial
     statements in accordance with FASB Statement No. 109, "Accounting for
     Income Taxes". Fin No. 48 is effective for fiscal years beginning after
     December 15, 2005. Management does not expect adoption of FIN No. 48 to
     have a material impact on the Company's financial statements.

     In February 2007, SFAS 159 "The Fair Value Option for Financial Assets and
     Financial Liabilities" was issued. This statement permits entities to
     choose to measure many financial instruments and certain other items at
     fair value. The objective is to improve financial reporting by providing
     entities with the opportunity to mitigate volatility in reported earnings
     caused by measuring related assets and liabilities differently without
     having to apply complex hedge accounting provisions. The adoption of SFAS
     159 is not affected to have a material impact on the Company's financial
     statements SFAS 158 "Employers" Accounting for Defined Benefit Pension and
     Other Postretirement Plans-an amendment of FASB Statements No. 87, 88, 106,
     and 132(R)." This Statement requires an employer to recognize the
     overfunded or underfunded status of a defined benefit postretirement plan
     (other than a multiemployer plan) as an asset or liability in its statement
     of financial position and to recognize changes in that funded status in the
     year in which the changes occur through comprehensive income of a business
     entity or changes in unrestricted net assets of a not-for-profit


                                      F-14
<PAGE>


                           COGENCO INTERNATIONAL, INC.
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                             March 31, 2006 and 2007


     Recent accounting pronouncements (continued):

     organization. This Statement requires an employer to measure the funded
     status of a plan as of the date of its year-end statement of financial
     position, with limited exceptions. The Company does not maintain a defined
     benefit pension plan and offers no other post retirement benefits.

2.   Marketable Securities
     ---------------------

     Marketable securities consist of 400,000 shares of common stock in Helix
     Biopharma Corporation with a quoted market value of $552,000 at the date of
     acquisition. The market value of the stock at March 31, 2007 was $572,000.
     No loss was recognized on the statement of operations for the year ended
     March 31, 2007. Genesis contributed the common stock in exchange for
     Cogenco common stock. The agreement provided that Genesis will deposit
     additional shares of Helix stock if the net proceeds of Cogenco's sale of
     Helix common stock average less than $1.50 per share ($600,000 in the
     aggregate).

3.   Stockholders' equity
     --------------------

     Stock issuances:

     On March 4, 1993, the Company entered into a letter of intent with two
     individuals, previously unrelated to the Company, pursuant to which the
     individuals agreed to provide funding to the Company of $175,000. 1,610,000
     shares of common stock were issued for the $175,000 subscription price
     (approximately $.11 per share). These individuals sold 483,334 shares to
     the Company's president, 40,000 shares to a former director of the Company,
     transferred 543,333 shares to a non affiliated company and transferred
     543,333 shares to the Company's law firm for services performed for one of
     the individuals.

     On July 6, 1993, the Company issued 50,000 shares of its $.01 par value
     common stock to a previously unrelated individual for cash consideration of
     $500,000, in a private offering.

     On July 29, 2004, the Company issued 400,000 shares of its $.01 par value
     common stock to four accredited investors in exchange for their investment
     of $40,000. On November 10, 2004, the Company issued 10,000 shares of its
     $.01 par value common stock to a single, offshore, European accredited
     investor in exchange for its investment of $100,000. On November 22, 2004,
     the Company issued an additional 10,000 shares of its $.01 par value common
     stock to a single, offshore, European accredited investor in exchange for
     its investment of $100,000.


                                      F-15
<PAGE>


                           COGENCO INTERNATIONAL, INC.
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                             March 31, 2006 and 2007

3.   Stockholders' equity (continued)
     -------------------------------

     On May 13, 2005, the Company issued 200,000 shares of its $.01 par value
     common stock to one offshore, European accredited investor in exchange for
     its investment of $2,000,000. On September 14, 2005, the Company issued
     130,000 shares of its $.01 par value common stock to one offshore, European
     accredited investor in exchange for its investment of $1,300,000. On
     September 26, 2005, the Company issued an additional 40,000 shares of its
     $.01 par value common stock to one offshore, European accredited investor
     in exchange for its investment of $400,000.

     On October 27, 2006, the Company issued an additional 2,500 shares of its
     $.01 par value common stock to one offshore, St. Vincent and the Grenadines
     accredited investor in exchange for its investment of $25,000.

     On March 22, 2007, the Company issued 75,000 shares of common stock to a
     St. Vincent and the Grenadines accredited investor at $10 per share for
     400,000 shares of Helix Biopharma Corporation common stock and $150,000 in
     cash. Should the net proceeds from the Company's sale of Helix common stock
     average less than $1.50 per share, the investor has agreed that until March
     5, 2008 it will tender the Company additional Helix shares (or shares of
     another publicly traded company) upon written request. As of March 31,
     2007, the Company has recorded a stock subscription receivable for $28,000.

4.   Income taxes
     ------------

     No provision for income taxes is required for the years ended March 31,
     2006 and 2007 or the period from inception of the development stage (July
     26, 1990) through March 31, 2007 because the Company has incurred net
     operating losses for the periods. The net operating losses generated may be
     carried forward to offset future taxable income. The amount of
     carryforwards from 1993 and prior years that may be used in the future will
     be limited pursuant to Sections 382 and 383 of the Internal Revenue Code of
     1986, as amended. The 1993 and prior aggregate net operating loss
     carryforward for Federal income tax reporting purposes is limited to
     approximately $136,000, of which only $11,800 may be used in any one year.
     If not used to offset future taxable income, the carryforwards will expire
     as follows:


                                      F-16
<PAGE>


                           COGENCO INTERNATIONAL, INC.
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                             March 31, 2006 and 2007

4.   Income taxes (continued)
     ------------------------

                      2008                                $  136,000
                      2009                                    42,000
                      2010                                    26,000
                      2011                                    11,000
                      2012                                    12,000
                      2013                                     9,000
                      2019                                    24,000
                      2020                                     8,000
                      2021                                    14,000
                      2022                                    12,000
                      2023                                    16,000
                      2024                                    16,000
                      2025                                    59,000
                      2026                                   184,000
                      2027                                   245,000
                                                        ------------
                                                        $    814,000
                                                        ============

     As of March 31, 2006 and 2007, total deferred tax assets and valuation
     allowance are as follows:

                                                       2006            2007
                                                   -----------      -----------
     Deferred tax assets resulting from:
        Loss carryforward                          $   212,200      $   303,500
        Future deduction for research
           and development                           1,138,600        1,212,300
        Valuation allowance                         (1,350,800)      (1,515,800)
                                                   -----------      -----------

                                                   $        --      $        --
                                                   ===========      ===========


     A 100% valuation allowance has been established against the deferred tax
     asset as utilization of the loss carryforwards cannot be reasonably
     assured.

                                      F-17
<PAGE>


                           COGENCO INTERNATIONAL, INC.
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                             March 31, 2006 and 2007

5.   Related party transactions
     --------------------------

     For the period from inception of the development stage to March 31, 2007,
     the Company incurred legal costs $88,221, from a law firm which was
     formerly a principal stockholder. A former principal of that law firm is a
     relative of an officer and director of the Company.

     For the years ended March 31, 2006 and 2007 and during the period from
     inception of the development stage, the Company incurred legal costs of
     $6,000, $6,000 and a total of $120,549, respectively, from two law firms in
     which a principal of each law firm is a relative of an officer and director
     of the Company and currently is a director of the Company.

     In November 2004 Cogenco's Board of Directors approved an employment
     agreement with its president, David W. Brenman. The material terms of the
     employment agreement are as follows:

     o    Annual salary shall be $150,000;
     o    Employment is for a 5 year term;
     o    The employee is subject to Confidentiality/non-competition/protection
          of trade secrets/non-solicitation provisions;
     o    The employment agreement provides for premature termination in certain
          circumstances; and
     o    The employee has certain rights in the event of a change of control of
          Cogenco including a two year extension of his employment term and a
          requirement that his full salary (through the term of the agreement)
          be paid to him within 30 days of such change of control. Change of
          control can also constitute a basis on which the employee can
          terminate the agreement prematurely.

     The Employment Agreement commenced September 30, 2005 when Cogenco paid a
     total of $3,250,000 to DMI pursuant to a co-development agreement. The
     employment agreement does not prohibit Mr. D. Brenman from receiving
     compensation from MJM Asset Management Company Establishment "MJM". The
     employment agreement was approved by the remaining members of the Cogenco
     board of directors, including Mr. D. Brenman's father and his
     brother-in-law. Because of Cogenco's cash flow shortages, Cogenco has not
     made any payments to Mr. Brenman pursuant to this employment agreement
     since August 2006.

     During and subsequent to the fiscal years 2006 and 2007, Cogenco has raised
     $3,900,000 from offshore private placements using a Liechtenstein-based
     fund manager, MJM as a finder. MJM and Cogenco have entered into a Finder's
     Agreement containing the following terms: Cogenco agrees to engage MJM on a
     non-exclusive basis; Cogenco shall pay MJM a finder's fee of 7 1/2% of the
     funds raised from MJM's European clients; each party shall be entitled to
     indemnification under certain circumstances; and Cogenco shall reimburse
     MJM for related expenses. As a result, Cogenco has paid MJM a finder's fee
     of $292,500. The fund manager paid one-third of the finder's fee to David
     W. Brenman, president of Cogenco, in accordance with an oral agreement


                                      F-18
<PAGE>


                           COGENCO INTERNATIONAL, INC.
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                             March 31, 2006 and 2007

5.   Related party transactions (continued)
     -------------------------------------

     between them. Pursuant to that oral agreement, Mr. Brenman will be entitled
     to receive one-fifth of the fund manager's profits from making the
     investment in Cogenco. Through January 1, 2007, MJM was owned and operated
     by Harold Janssen, who, through MJM and Genesis Investment Funds Limited,
     is a principal shareholder of Cogenco and has had prior personal
     relationships with Mr. Brenman

     In October 2005, Cogenco entered into an office lease with an unaffiliated
     party for approximately 3,210 square feet at a rate of $5,350 per month
     over its term of 38 months. With the consent of the unaffiliated landlord,
     Cogenco has agreed to sublease a portion of the space (approximately 1,605
     square feet) to another company (Micro-Imaging Solutions, Inc. or "MIS")
     for $2,675 per month (Cogenco's cost). MIS will also be responsible for its
     pro-rata share of other expenses incurred under the lease. An affiliate of
     David Brenman has a significant equity interest in MIS. The lease and
     sublease was approved by the remaining members of the Cogenco board of
     directors, including Mr. David Brenman's father and his brother-in-law. A
     certificate of deposit of $81,152 has been pledged as collateral on a
     letter of credit in the amount of $70,000 securing the lease.

6.   Contract payment
     ----------------

     In August 2004, Cogenco entered into a letter agreement with DMI
     BioSciences, Inc. ("DMI") for an agreement by which Cogenco would
     participate in the development of a drug for the treatment of asthma in
     humans. The parties modified this agreement in November 2004 and, pursuant
     to the modification, Cogenco paid DMI $100,000 and entered into a
     co-development agreement with DMI for the development of a drug for the
     treatment of asthma in humans (the "Old Development Agreement"). Under the
     terms of the agreements, as amended, Cogenco paid DMI $3,250,000 by
     September 30, 2005. Once Cogenco paid DMI the full $3,250,000 it had the
     right to participate in revenues from sales of the asthma products.

     In February 2006, Cogenco and DMI negotiated a restated letter of intent
     (the "New LOI") which contemplated additional payments of $7,000,000 to DMI
     by November 30, 2006. In addition, the parties negotiated a new
     co-development agreement (the "New Development Agreement") for the
     development of a drug for the treatment of multiple sclerosis. Upon signing
     the New Development Agreement, the Old Development Agreement was terminated
     (although the payments that Cogenco has made were credited to the New
     Development Agreement).

     Cogenco has not made any of the payments to DMI contemplated under the New
     Development Agreement. Cogenco did not have the funds necessary to make
     these payments. The New LOI also amended the suggestion in the August 2004
     letter agreement that the parties will attempt to negotiate a business
     combination between DMI and Cogenco (provided that Cogenco becomes
     adequately funded with at least $25,000,000). Since the business
     combination did not occur by October 30, 2006, upon notice from DMI to
     Cogenco, the $3,250,000 investment will be automatically converted into
     1,000,000 shares of DMI common stock and Cogenco will become a minority
     shareholder of DMI. As described in Note 8-Subsequent Events, below, this
     occurred in June 2007.


                                      F-19

<PAGE>


                           COGENCO INTERNATIONAL, INC.
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                             March 31, 2006 and 2007

6.   Contract payment (continued)
     ---------------------------

     Of the total payments of $3,250,000 made to DMI, we included $3,052,473 and
     $197,527 in research and development costs for the years ended March 31,
     2006 and 2007, respectively. These figures represent the amount of funds
     received by DMI from Cogenco which had been expended by DMI as of March 31,
     2007 on research and development expenses and related expenses.

7.   Operating lease
     ---------------

     Cogenco entered into an office lease with an unaffiliated party for
     approximately 3,210 square feet at a rate of $5,350 per month over its term
     of 38 months from November 2005 through December 2008. A certificate of
     deposit of $81,152 has been pledged as collateral on a letter of credit in
     the amount of $70,000 securing the lease. The Company also rents two
     parking spaces on a month to month basis for $110 per month.

     Future minimum lease obligations at March 31, 2007 are as follows:

         For the years ended March 31,
                  2008                                        $    64,200
                  2009                                             48,150
                                                              -----------

                                                              $   112,350
                                                              ===========

8.   Subsequent events
     -----------------

     On June 22, 2007, Cogenco converted its $3,250,000 investment into
     1,000,000 shares of DMI common stock in accordance with the pre-existing
     agreements.

     Commencing in March 2007, we have entered into certain stock purchase
     agreements with DMI under which the Company has purchased a total of
     401,429 shares at a total purchase price of $330,000 and which enable the
     Company to purchase up to an additional $670,000 of DMI common stock at
     prices up to $1.00 per share. If Cogenco completes that purchase by
     December 31, 2007, it will acquire a warrant to purchase another 1,000,000
     shares of DMI common stock exercisable for one year at $1.00 per share.
     Specifically, in March 2007, we purchased 100,000 shares of DMI common
     stock at $1.00 per share; in April 2007, we purchased 21,429 shares of DMI
     common stock at $.70 per share; in May 2007, we purchased 180,000 shares of
     DMI common stock at $.75 per share; and in June 2007, we purchased 100,000
     shares of DMI common stock at $.80 per share.

     As a result of these transactions, Cogenco owns (as of June 30, 2007)
     1,401,429 shares of DMI common stock (approximately 12% of the total number
     of DMI shares then outstanding, or about 6% on a fully-diluted basis).


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