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

                                   FORM 10-QSB

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

                  For the quarterly period ended March 31, 2000

                                       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 000-27353


                            SELECT THERAPEUTICS, INC.
        (Exact name of small business issuer as specified in its charter)

        Delaware                                               98-0169105
State or other jurisdiction of                              (I.R.S. Employer
incorporation or organization)                             Identification No.)

124 Mt. Auburn St., Suite 200 North, Cambridge, MA            02138
(Address of principal executive offices)                    Zip Code)

                                 (617) 520-6693
                (Issuer's telephone number, including area code)

                                       N/A
             (Former name, former address and former fiscal year, if
                           changed since last report)

Check  whether the Issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Exchange  Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports),  and (2) has been
subject to such filing requirements for the past 90 days. Yes _X_  No___

The aggregate  number of shares  outstanding of the Issuer's  Common Stock,  its
sole class of common equity, was 11,862,308 as of May 10, 2000.

Transitional Small Business Issuer Disclosure Format: Yes ___ No _X_

                    Page 1 of 10; Exhibit Index is on Page 9



<PAGE>

                        PART I -- FINANCIAL INFORMATION

Item 1. Financial Statements.

SELECT THERAPEUTICS INC.
(A DEVELOPMENT STAGE ENTERPRISE)

Consolidated Balance Sheets
(Stated in U.S. dollars)
(Unaudited)

<TABLE>
<CAPTION>
------------------------------------------------------------------------------------
                                                           March 31,        June 30,
                                                               2000             1999
                                                                           (Audited)
------------------------------------------------------------------------------------
<S>                                                     <C>             <C>
Assets

Cash and cash equivalents                               $    176,667    $    120,881
Restricted cash                                                   --          72,000
Cash held in trust                                         8,695,350              --
Accounts receivable                                               --           7,380
Inventory                                                     22,805          32,130
Prepaid expenses and other assets                             18,780          21,740
Property, plant and equipment                                112,437         104,547
Intangible assets                                            705,769         900,581

------------------------------------------------------------------------------------
                                                        $  9,731,808    $  1,259,259
------------------------------------------------------------------------------------

Liabilities and Shareholders' Equity

Liabilities:
     Accounts payable                                   $    164,536    $     43,309
     Accrued liabilities                                     388,738         655,798
     -------------------------------------------------------------------------------
                                                             553,274         699,107

Shareholders' equity:
     Capital stock:
         Authorized:
              1,000,000 preferred shares
              50,000,000 common shares,
                $0.001 par value
         Issued:
              11,862,308 common shares
                (June 30, 1999 - 5,634,094)                   11,862           5,634
     Contributed surplus                                  15,543,612       5,140,120
     Deficit accumulated during the development stage     (6,376,940)     (4,585,602)
------------------------------------------------------------------------------------
                                                           9,178,534         560,152

------------------------------------------------------------------------------------
                                                        $  9,731,808    $  1,259,259
------------------------------------------------------------------------------------
</TABLE>


See accompanying notes to consolidated financial statements.


                                       F-1
<PAGE>


SELECT THERAPEUTICS INC.
(A DEVELOPMENT STAGE ENTERPRISE)

Consolidated Statements of Operations
(Stated in U.S. dollars)
(Unaudited)

<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------
                                               Nine months ended            Three months ended
                                                   March 31,                    March 31,
----------------------------------------------------------------------------------------------
                                             2000           1999           2000           1999
----------------------------------------------------------------------------------------------

<S>                                   <C>            <C>            <C>            <C>
Revenue                               $   170,590    $   110,750    $    77,465    $   110,750
Cost of revenue                            56,902         77,556         43,191         77,556
----------------------------------------------------------------------------------------------
                                          113,688         33,194         34,274         33,194

Interest income                               524         32,570              8          5,829

Research and development                  595,050      1,103,923        263,426        802,131
Selling, general and administration     1,085,814        714,442        369,684        146,948
Depreciation                               29,874         11,437          9,958          8,825
Amortization                              194,812        108,230         64,937         64,938
----------------------------------------------------------------------------------------------
                                        1,905,550      1,938,032        708,005      1,022,842
----------------------------------------------------------------------------------------------
Loss for the period                   $(1,791,338)   $(1,872,268)   $  (673,723)   $  (983,819)
----------------------------------------------------------------------------------------------

Loss per share                        $     (0.26)   $     (0.36)   $     (0.10)   $     (0.19)

Weighted average number of shares       6,956,082      5,228,791      6,956,082      5,228,791

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

Consolidated Statements of Changes in Shareholders' Equity
(Stated in U.S. dollars)

Nine months ended March 31, 2000
(Unaudited)

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------
                                                                            Deficit
                                                                        accumulated
                                                                         during the
                                    Common shares        Contributed    development
                                Shares         Amount        surplus          stage           Total
---------------------------------------------------------------------------------------------------

<S>                          <C>         <C>            <C>            <C>             <C>
Balance, June 30, 1998       4,981,313   $      4,981   $  3,176,046   $ (2,118,274)   $  1,062,753

Issue of common shares         652,781            653      1,964,074             --       1,964,727

Loss for the period                 --             --             --     (2,467,328)     (2,467,328)
---------------------------------------------------------------------------------------------------

Balance, June 30, 1999       5,634,094          5,634      5,140,120     (4,585,602)        560,152

Issue of common shares       6,228,214          6,228     10,403,492             --      10,409,720

Loss for the period                 --             --             --     (1,791,338)     (1,791,338)

---------------------------------------------------------------------------------------------------
Balance, March 31, 2000     11,862,308   $     11,862   $ 15,543,612   $ (6,376,940)   $  9,178,534
---------------------------------------------------------------------------------------------------
</TABLE>


See accompanying notes to consolidated financial statements.


                                       F-2
<PAGE>


SELECT THERAPEUTICS INC.
(A DEVELOPMENT STAGE ENTERPRISE)

Consolidated Statements of Cash Flows
(Stated in U.S. dollars)
Nine months ended March 31, 2000 and 1999
(Unaudited)

<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------
                                                                     2000            1999
-----------------------------------------------------------------------------------------

Cash provided by (used in):

<S>                                                          <C>             <C>
Operating activities:
     Loss for the period                                     $ (1,791,338)   $ (1,872,268)
     Items not involving cash:
         Depreciation                                              29,874          11,437
         Amortization                                             194,812         108,230
         Issue of common shares for services                      183,600         933,730
     Changes in non-cash operating working capital:
         Accounts receivable                                        7,380         (15,500)
         Inventory                                                  9,325         (18,528)
         Prepaid expenses and other assets                          2,960          21,000
         Accounts payable                                         121,227        (754,659)
         Accrued liabilities                                     (267,060)        396,058
-----------------------------------------------------------------------------------------
                                                               (1,509,220)     (1,190,500)

Financing activities:
     Repayment of loans due to the former shareholders
       of Sierra Diagnostics Inc.                                      --        (285,999)
     Proceeds from issuance of common shares                   10,226,120              --
     Restricted cash                                               72,000         (72,000)
-----------------------------------------------------------------------------------------
                                                               10,298,120        (357,999)

Investing activities:
     Additions to property, plant and equipment                   (37,764)       (118,280)
-----------------------------------------------------------------------------------------
                                                                  (37,764)       (118,280)


Decrease in cash                                                8,751,136      (1,666,779)

Cash and cash equivalents, beginning of period                    120,881       2,070,705

-----------------------------------------------------------------------------------------
Cash and cash equivalents, end of period                     $  8,872,017    $    403,926
-----------------------------------------------------------------------------------------

Supplementary disclosure:
     Non-cash financing and investing activities:
         Issue of common shares to purchase licenses         $         --    $    138,730
         Issue of common shares related to the acquisition
           of Sierra Diagnostics Inc.                                  --         780,997
         Issue of common shares for services                      183,600         795,000

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


See accompanying notes to consolidated financial statements.


                                       F-3
<PAGE>


SELECT THERAPEUTICS INC.
(A DEVELOPMENT STAGE ENTERPRISE)

Notes to Consolidated Financial Statements
(Stated in U.S. dollars)
Nine months ended March 31, 2000 and 1999
(Unaudited)

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


Basis of presentation:


In the opinion of management, the unaudited consolidated financial statements of
Select Therapeutics Inc. (the "Company") included herein have been prepared on a
consistent  basis  with  the  June  30,  1999  audited  consolidated   financial
statements and include all material adjustments,  consisting of normal recurring
adjustments,  necessary to fairly  present the  information  set forth  therein.
These interim  financial  statements should be read in conjunction with the June
30, 1999  audited  consolidated  financial  statements  and notes  thereto.  The
Company's  results of operations for the first three fiscal quarters of 2000 are
not necessarily indicative of future operating results.


The preparation of financial  statements in conformity  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect the amounts  reported in the financial  statements.  Actual results could
differ materially from those estimates.


Cash and cash equivalents


Cash and cash equivalents includes cash, mutual funds, and cash held in trust.


Capital stock


During the nine months ended March 31, 2000 the Company  completed the following
capital stock transactions:

(i)   36,000 common shares were issued in the amount of $90,000 as consideration
      for professional services;

(ii)  In July 1999,  50,000 common shares were issued for gross cash proceeds of
      $125,000.

(iii) In August 1999, the Board of Directors approved the reduction of the April
      1998 private offering common share price from $3.00 per share to $2.00 per
      share and authorized  the issuance of an additional  381,264 common shares
      to the subscribers of the April 1998 private offering.

(iv)  In October  1999,  the Company  completed a private  placement  of 151,000
      common shares and 302,000  redeemable  warrants for gross cash proceeds of
      $188,750.  Each  redeemable  warrant  entitles  the holder to purchase one
      common  share of the  Company  at a price of $1.85  per  share  and has an
      exercise period of three years from the date of issue.

                                      F-4

<PAGE>


SELECT THERAPEUTICS INC.
(A DEVELOPMENT STAGE ENTERPRISE)

Notes to Consolidated Financial Statements (continued)
(Stated in U.S. dollars)
Nine months ended March 31, 2000 and 1999
(Unaudited)

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

(v)   In November 1999,  416,000 common shares and 416,000  redeemable  warrants
      were  issued for gross cash  proceeds  of  $748,000  which  related to the
      November 1999 private  placement.  Each  redeemable  warrant  entitles the
      holder to purchase one common share of the Company at a price of $3.00 per
      share until December 31, 2002.

(vi)  In November 1999, 42,000 common shares and 42,000 redeemable warrants were
      issued  in  the  amount  of  $93,600  as  consideration  for  professional
      services.

(vii) In January,  February and March 2000,  243,750  common  shares and 243,750
      redeemable  warrants were issued for gross cash proceeds of $438,750 which
      related to the November 1999 private  placement.  Each redeemable  warrant
      entitles the holder to purchase one common share of the Company at a price
      of $3.00 per share until December 31, 2002.


(viii)In March 2000, 143,000 common shares and 143,000 redeemable  warrants were
      issued  as  payment  for  services  rendered  valued  at  $257,400.   Each
      redeemable warrant entitles the holder to purchase one common share of the
      Company at a price of $3.00 per share until December 31, 2002. The Company
      also  completed a private  placement of 4,750,000  common shares for gross
      cash proceeds of $9,500,000  and issued to its placement  agent and others
      redeemable  warrants  entitling  the  holders to purchase  466,667  common
      shares of the  Company at a price of $2.00 per share  until  December  31,
      2002.

Share issue costs incurred in the nine months ended March 31, 2000 in the amount
of $1,041,940 (1999 - $Nil) have been netted against contributed surplus.


                                       F-5

<PAGE>

Item 2.  Management's Discussion and Analysis of
         Financial Condition and Results of Operations.

                           FORWARD-LOOKING STATEMENTS

      THIS REPORT, INCLUDING WITHOUT LIMITATION, ITEM 2, MANAGEMENT'S DISCUSSION
AND ANALYSIS OR PLAN OF OPERATION,  CONTAINS STATEMENTS WHICH ARE NOT HISTORICAL
FACTS   AND  ARE   FORWARD-LOOKING   STATEMENTS   WHICH   REFLECT   MANAGEMENT'S
EXPECTATIONS,   ESTIMATES  AND   ASSUMPTIONS.   SUCH  STATEMENTS  ARE  BASED  ON
INFORMATION  AVAILABLE  AT THE TIME THIS FORM  10Q-SB WAS  PREPARED  AND INVOLVE
RISKS  AND  UNCERTAINTIES  THAT  COULD  CAUSE  FUTURE  RESULTS,  PERFORMANCE  OR
ACHIEVEMENTS  OF THE COMPANY TO DIFFER  SIGNIFICANTLY  FROM  PROJECTED  RESULTS.
FACTORS THAT COULD CAUSE ACTUAL RESULTS TO DIFFER  MATERIALLY  INCLUDE,  WITHOUT
LIMITATION,  THE HIGH COST AND  UNCERTAINTY  OF THE RESEARCH AND  DEVELOPMENT OF
PHARMACEUTICAL PRODUCTS, THE UNPREDICTABILITY OF THE DURATION AND RESULTS OF THE
U.S.  FOOD AND  DRUG  ADMINISTRATION'S  REVIEW  OF NEW  DRUG  APPLICATIONS,  THE
COMPANY'S INABILITY TO OBTAIN ADDITIONAL CAPITAL, THE POSSIBLE IMPAIRMENT OF, OR
INABILITY TO OBTAIN, INTELLECTUAL PROPERTY RIGHTS AND THE COST OF OBTAINING SUCH
RIGHTS  FROM THIRD  PARTIES AND THE  COMPANY'S  DEPENDENCE  ON THIRD  PARTIES TO
RESEARCH, DEVELOP, MANUFACTURE AND SELL ITS PRODUCTS, IF ANY.

Overview

      The Company is a development  stage  biopharmaceutical  company  formed to
acquire and develop rights to selected  early-stage  compounds and  technologies
which have potential use as therapeutics or diagnostics.  Since its inception on
December  6,  1996,  substantially  all of the  Company's  resources  have  been
dedicated to research and development and technology  acquisition.  To date, the
Company has not  generated  significant  product  revenues.  Sales of  Gonostat,
launched in January 1999, and potential sales of other  diagnostic  products are
not expected to generate  sufficient  revenues to cover the Company's  operating
costs during the next three years.

      Although the Company  raised gross proceeds of $9.5 million from a private
equity  placement  in March  2000,  the  continuation  of the Company as a going
concern is dependent on additional  equity  financing and on the  development of
economically viable products.  The Company has incurred losses of $1,791,338 and
$1,872,268 in the nine months ended March 31, 2000 and 1999,  respectively,  and
negative cash flow is expected to continue for the Company for at least the next
three  years.  There can be no  assurance  that funding will be available to the
Company  or that the  Company  will be able to develop  an  economically  viable
product.

                                        2

<PAGE>

      The process of developing the Company's  therapeutic products will require
significant  additional  research  and  development,   preclinical  testing  and
clinical trials, as well as regulatory  approvals.  These  activities,  together
with the Company's general and administrative  expenses,  are expected to result
in operating  losses for at least three more years. The Company will not receive
product revenue from  therapeutic  products unless it completes  clinical trials
and successfully  commercializes or arranges for the commercialization of one or
more of its products, as to the success of which no assurance can be given.

      The  Company is subject to risks  common to  biopharmaceutical  companies,
including  risks inherent in its research and  development  efforts and clinical
trials,   reliance  on  collaborative   partners,   enforcement  of  patent  and
proprietary  rights,  the need for future  capital,  potential  competition  and
uncertainty of regulatory approval. In order for a product to be commercialized,
it  will  be  necessary  for  the  Company  and  its  collaborators  to  conduct
preclinical  tests and clinical trials,  demonstrate  efficacy and safety of the
Company's  product  candidates,  obtain  regulatory  clearances  and enter  into
manufacturing,  distribution  and  marketing  arrangements  either  directly  or
through  sublicensees.  There can be no assurance that the Company will generate
revenues or achieve and sustain profitability in the future.

      During the  quarter  which  ended March 31,  2000,  SELECT's  management's
efforts  continued  to be  directed to  obtaining  funds and  repositioning  the
Company.  Product  development  efforts  continued but were  constrained by both
funding and management availability.  In March 2000 the Company closed a private
placement for $9,500,000.  Investors included institutions and individuals.  The
funds from this placement are believed to be sufficient to cover  operations for
the next 18 months.  This placement is a key step in the process of building the
Company and is the first time that institutions have participated in SELECT.

Program Review

      During the quarter ended March 31, 2000,  the Company was able to maintain
and  expand  its  research   collaborations  and  strengthen  its  portfolio  of
intellectual  property.  Academic  research on  applications  of Verotoxin  (VT)
continued in collaborating institutions. However, due to the significant funding
requirements, production of clinically qualified materials was not initiated and
all  clinically  oriented  programs  were  halted  for both  purging  and direct
applications  of the toxin.  In April  2000,  following  the  receipt of the net
proceeds from the $9.5 million  private  placement  completed in March 2000, the
Company  recommenced  these activities and both programs moved forward.  Both of
these

                                        3

<PAGE>

programs  continue to be viewed as promising and  management  believes that with
the Company's recently obtained near-term funding, both can move forward rapidly
since institutional collaborations are in place with clinical investigators.

      The application of VT to present  antigens to dendritic cells continues to
be a promising  approach to the  development of therapeutic  vaccines for cancer
and other diseases which circumvent the immune system's  surveillance.  Research
carried out under the Company's  option  agreement  with the Institut  Curie has
resulted in very promising  findings.  On December 2nd the Company announced the
extension of the option agreement and that a plan for clinical  investigation of
the technology is being  developed in  collaboration  with Dr. Evan Hersh at the
Arizona   Cancer  Center.   As  with   chemotherapeutic   applications   of  VT,
significantly increased levels of expenditure will be required as investigations
move  from the  research  laboratory  setting  to the  clinical  setting.  These
expenses   include  but  are  not  limited  to   development  of  materials  and
formulations  which are compliant with regulatory  requirements and the costs of
patient recruitment and monitoring in trial settings.

      Both the purging  program and the dendritic cell program  involve  ex-vivo
therapies  (i.e.  treatments  that are carried out on patient tissues which have
been removed from the patient). A common  characteristic of ex-vivo therapies is
that, relative to systemic administration,  they are less costly to investigate.
Select's focus is on identification  of opportunities  which combine low cost of
development  with a strong  proprietary  position and potentially  short time to
market.  There can be no  assurance  that viable  products  will result from the
Company's programs.

      The Company owns as a 100% subsidiary Sierra Diagnostics Inc.  ("Sierra"),
a developer and manufacturer of diagnostic products for consideration comprising
stock  and  assumption  of  debts  and  operating  costs.  Sierra  has a base of
proprietary  technology relating to assays for sexually transmitted diseases and
handling of clinical  samples.  It launched  two  products in 1999 both of which
have  significant  revenue  potential.  The  first  product,  Gonostat(TM)  is a
clinical  laboratory test for gonorrhea  which offers unique  advantages in cost
and performance  relative to other technologies  available in the market.  There
can,  however be no assurance of performance  in the market.  The second product
brought to market by Sierra is a sample  preservation and handling product which
eliminates the need for refrigeration of clinical samples intended for molecular
(DNA/RNA based) assays.  This product fits into the general practice of clinical
testing and is expected to find wide  application  due to  elimination of sample
degradation  and thus the need for repeat  testing or  sampling  with  attendant
costs

                                        4

<PAGE>

and  inconvenience.  Sales of products  based on this  technology and efforts to
license  the  technology  to third  parties  are  beginning  but no  significant
revenues had been generated.

      Sierra  Diagnostics has operated within its expense  projections but sales
of   Gonostat(TM),   while   contributing  on  a  gross  margin  basis,   lagged
expectations.  This resulted in a higher than  anticipated  cash requirement for
Sierra.  At the end of October Sierra entered into a distribution  agreement for
sales of its  products  to  within  third  world  countries  and  believes  that
operating results for fiscal 2001 will significantly improve. SELECT has engaged
a sales and marketing  group on a consulting  basis to assist in developing  the
market  for  both   diagnostic   products  and  to  evaluate  other   diagnostic
opportunities for the Company.  To date, the operations of Sierra have generated
losses and there can be no assurance that profitable operations will be achieved
or that, if achieved, they can be maintained.

      SELECT is developing a portfolio of proprietary product  opportunities and
is aggressively  pursuing patents. In addition to licensed patents,  the Company
has  agreements  which  provide for options on related  inventions  arising from
sponsored work.  Together with a strong network of  institutional  investigators
management believes that it has been able to identify and build protection for a
significant base for development of unique products. Competition in the areas of
the  Company's  interests  is intense  and both the  scientific  and  commercial
environments  change rapidly. By focusing on intellectual  property  development
and using external contractors, Select hopes to be able to maintain the required
flexibility  to adapt to changing  circumstances.  The  Company's  key resources
include qualified  subcontractors  and it believes that it can move rapidly into
clinical  investigations  and development of products based on its  intellectual
property  given  adequate  funding.  The funding  required as the Company enters
clinical  trials  significantly  exceeds the  magnitude  of funds  raised by the
Company to date and there can be no assurance  that such funding is available on
acceptable terms if at all.

Financial Condition

      During the quarter the Company's cash position  increased from $371,121 to
$8,872,017,  consisting  of cash and cash  equivalents  and cash  held in trust,
principally  reflecting  the net proceeds of the Company's  $9.5 million  equity
private  placement.  The Company also decreased its accounts payable and accrued
liabilities from $797,597 to $553,274 in the quarter.  Management  believes that
adequate funding for continuation of operations and development of the Company's
technology assets has been obtained but notes that

                                        5

<PAGE>

significantly  greater  resources  will  be  required  in  order  to  bring  its
therapeutic products to market.

Results of Operations

      For the  quarter  ended  March 31,  2000,  SELECT  incurred  a net loss of
$673,723  compared  with a loss of $983,819 for the  corresponding  three months
ended  March 31,  1999.  For the nine  months  ended  March 31, 2000 the Company
incurred losses of $1,791,338 versus $1,872,268 for the corresponding  period in
1999.  The  Company  has  been  unprofitable  from  its  formation  and  has  an
accumulated  deficit of  $6,376,940  through  March 31, 2000.  The net loss is a
result of the routine  operations of the Company in its  development  stage.  We
expect losses to continue and increase for the next several years as the Company
pursues  development  and   commercialization   of  its  intellectual   property
resources.

      Revenue of  $170,590  during the nine  months  ended  March 31,  2000 were
principally from the sale of Gonostat(TM).  During the corresponding  quarter in
1999, there were revenues of $110,750 from sales and interest income was $5,829.
SELECT's sole operating revenues to date arise from sales of diagnostic products
through its wholly  owned  subsidiary,  Sierra  Diagnostics.  The Company has no
other product or license revenues.  Management  anticipates that future revenues
may consist  primarily of product sales either  directly by the Company or, more
likely,  through  collaborative  development and marketing agreements with other
companies in the pharmaceutical  industry.  Sierra's  operations are expected to
achieve  breakeven  during fiscal 2000 and  thereafter be  profitable.  However,
there can be no assurance that such performance will be realized or maintained.

Costs and Expenses

      Operating  expenses  for  the  nine  months  ended  March  31,  2000  were
$1,905,550  compared  to  $1,938,032  in the same  period of 1999.  Expenditures
required to advance the Company's  development  projects,  notably initiation of
manufacturing  of GMP qualified  materials,  were deferred during the period but
recommenced in April 2000.

      All research  and  development  activities  of the Company are expensed as
incurred.   Personnel   costs  including   retained   consultants  and  external
contractors are the largest ongoing cost of operations.  The Company has no long
term employment  contracts or liabilities for severances.  At March 31, 2000 the
Company  employed  seven  people,  mainly at  Sierra  Diagnostics  and  retained
services  of three  key  consultants  who are an  integral  part of the  Company
management.

                                        6

<PAGE>

      Locating and retaining  appropriate  personnel resources is a priority and
the Company  anticipates  that personnel costs will increase if adequate funding
is obtained.  The  percentage  of  expenditures  related to personnel  and other
operations is expected to decline as increasing commitments are made to external
manufacturing and clinical studies.

Capital Expenditures

      There were no significant capital expenditures during the last six months.

      Patent costs are expensed due to the  uncertainties  involved in realizing
value from specific patents.

LIQUIDITY AND CAPITAL RESOURCES

      The Company has financed its operations since inception  primarily through
private  placements  of its Common  Stock.  As of March 31, 2000 the Company had
received  approximately   $9,340,000  net  proceeds  from  the  sale  of  equity
securities during the quarter.

      The Company's limited financial resources forced it to curtail some of its
planned operations through March 2000. Although these activities  recommenced in
April 2000, the Company will require substantial  additional funding in order to
complete its research and  development  activities  and sublicense any potential
products. The Company's future capital requirements will depend on many factors,
including scientific progress in its research and development programs, the size
and  complexity of such programs,  the scope and results of preclinical  studies
and  clinical  trials,  the ability of the  Company to  establish  and  maintain
corporate  partnerships,  the time and costs  involved in  obtaining  regulatory
approvals,  the costs  involved  in filing,  prosecuting  and  enforcing  patent
claims,   competing   technological  and  market   developments,   the  cost  of
manufacturing preclinical and clinical material and other factors not within the
Company's  control.  There can be no  assurance  that the  additional  financing
necessary to meet the Company's short and long-term capital requirements will be
available on acceptable terms or at all.

      Insufficient  funds  may  require  the  Company  to delay,  scale  back or
eliminate  some or all of its research or development  programs,  to lose rights
under  existing  licenses  or to  relinquish  greater  or all  rights to product
candidates at an earlier stage of development  or on less  favorable  terms than
the Company would otherwise choose or may adversely affect the Company's ability
to operate as a going concern. If additional funds are raised by

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issuing equity securities, substantial dilution to existing
stockholders may result.

      The Company  currently has funds sufficient to continue  operations for 18
months,  including  funds  required  to  move  current  projects  into  clinical
investigations.  Management  has been in  discussions  with a number of  parties
regarding  additional  financing  required to maintain and develop the Company's
position and while it is optimistic that such funds may be available there is no
assurance that this will be the case. Sales of Sierra's products to date are not
sufficient to cover operating  costs.  Sierra  Diagnostic's  ongoing  operations
require  compliance with FDA requirements and that a base level of manufacturing
be maintained.

Year 2000

      Year 2000 (Y2K) issues arise because many computer  systems use two rather
than  four  digits to  identify  the year thus  creating  ambiguities  which may
produce  errors before,  on or after January 1, 2000. If not  addressed,  errors
could impact all aspects of operations including financial  reporting,  clinical
and  production  records or controls and  communications.  Errors may range from
minor to  significant  systems  failures and could be imported  from  suppliers'
systems.

      We have assessed,  taken  corrective  actions in light of, and continue to
monitor our vulnerability to Y2K issues in all aspects of our business including
information and computer systems and critical  suppliers and service  providers.
To the best of our knowledge,  systems and equipment  critical to our operations
are Y2K compliant. However, it is not possible to be certain that the systems of
our suppliers,  service  providers or other third parties upon which we rely are
compliant or that they will  unaffected  by problems in their own supply  chain.
Based on the nature of our  operations  and ongoing  assessments we believe that
Select has little direct exposure to Y2K issues.

      We estimate  that our direct  costs of  addressing  the Y2K issue are less
than  $5,000,  which are being  expensed  in the normal  course of our  business
operations.

Summary

      SELECT is a reporting entity under the Securities and Exchange Act of 1934
and believes it now satisfies the financial  requirements for listing its Common
Stock on the NASDAQ-Small Cap Market. The Company has succeeded in obtaining the
funds it required to position the Company for continuing  operations and forming
development partnerships with other companies. We believe

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it has a strong  portfolio of product  opportunities in therapeutics for cancer,
two of which have been  advanced to the stage at which  clinical  investigations
may begin (subject to adequate funding resources).  Sierra sales growth has been
slower than  expected,  but  significant  sales growth is  anticipated in fiscal
2001. We are adding new products and  technology to Sierra as part of an overall
plan to develop a diagnostics business with both sales and earnings.

      Research results from key collaborations continue to be encouraging.  Most
notably the program at the  Institut  Curie,  with  respect to  presentation  of
antigens to dendritic cells, has progressed well and moved significantly towards
clinical  experiments  aimed at  validating  the  potential of this approach for
development of therapeutic vaccines for cancers.


                           PART II - OTHER INFORMATION

Item 2.  Changes in Securities.

      In January,  February and March, 2000, we sold to 16 accredited  investors
18 3/4 units,  each unit  consisting of 13,000  shares of the  Company's  Common
Stock and 13,000  redeemable  warrants,  at a price of $23,400 per unit,  for an
aggregate  price of  $438,750,  in a  private  placement  made  pursuant  to the
exemption from registration  provided by Section 4(2) and 4(6) of the Securities
Act of 1933,  as amended  (the  "Securities  Act") and Rule 506 of  Regulation D
promulgated thereunder.  Each redeemable warrant entitles the holder to purchase
one share of the  Company's  Common  Stock at a price of $3.00  per share  until
December 31, 2002.

      In March 2000, we issued to 9 investors 11 units,  each unit consisting of
13,000 shares of the Company's Common Stock and 13,000 redeemable  warrants,  as
payment for services  rendered  valued at $257,400 in reliance on the  exemption
from  registration  provided by Section 4(2) and 4(6) of the  Securities Act and
Rule  506 of  Regulation  D  promulgated  thereunder.  Each  redeemable  warrant
entitles  the holder to purchase  one share of the  Company's  Common Stock at a
price of $3.00 per share until December 31, 2002.

     In March 2000, we sold to 47 accredited  investors  4,750,000 shares of the
Company's  Common Stock at a price of $2.00 per share, for an aggregate price of
$9,500,000,  in  a  private  placement  made  pursuant  to  the  exemption  from
registration  provided by Section 4(2) and 4(6) of the  Securities  Act and Rule
506 of Regulation D promulgated  under the Securities Act. We also issued to our
placement  agent  and  others  for their  services  in the  offering  redeemable
warrants  entitling  the holders to  purchase  466,667  shares of the  Company's
Common Stock at a price of $2.00 per share until December 31, 2002.

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

      In March  2000,  by written  consent  in lieu of a  meeting,  holders of a
majority  of  the  Company's  stock  approved  an  amendment  to  the  Company's
Certificate  of  Incorporation  (the  "Amendment")   increasing  the  number  of
authorized shares of the Company's Common Stock from ten million (10,000,000) to
fifty million (50,000,000) shares. The Amendment is expected to become effective
on or about June 15,  2000.  The  Company  is in the  process  of  preparing  an
Information  Statement pursuant to Section 14c of the Securities Exchange Act of
1934.


Item 5.  Other Information.

      In April 2000,  Craig A.  Sibley and Dr.  George L.  Spitalny  resigned as
directors of the Company.


Item 6.  Exhibits and Reports on Form 8-K

      (a)   Exhibits

      The following exhibit is filed with this report:            Page
                                                                  ----
      27.   Financial Data Schedule                                11

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                                   SIGNATURES


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


Dated: May 11, 2000                             SELECT THERAPEUTICS, INC.



                                                By: /s/ Robert Bender
                                                    ---------------------------
                                                    Name: Robert Bender
                                                    Title: Chairman of the Board


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