<PAGE>
================================================================================

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

                                   FORM 10-QSB
(MARK ONE )
/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 No. _______________.

                            IMX PHARMACEUTICALS, INC.
                -------------------------------------------------
                 (Name of Small Business Issuer in its Charter)

             Utah                                           87-0394290
--------------------------------                    ---------------------------
(State or Other Jurisdiction of                         (I.R.S. Employer
Incorporation or Organization)                        Identification Number)

2295 Corporate Boulevard, Suite 131, Boca Raton, Florida             33431
--------------------------------------------------------           ---------
(Address of Principal Executive Offices)                           (Zip Code)

561.998.5660
---------------------------
(Issuer's Telephone Number)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934
during the preceding 12 months (or such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days:  Yes /X/  No / /

Indicate the number of shares outstanding of each of the issuers classes of
common stock, as of the latest practicable date.

At May 4, 2000 there were 5,628,096 shares of common stock, par value $.001 per
share outstanding.

Transitional Small Business Disclosure Format (check one): Yes / / No /X/

================================================================================
<PAGE>

                   IMX PHARMACEUTICALS, INC. AND SUBSIDIARIES
                                      INDEX

                                                                     Page Number
Part I.  Financial Information
         Item 1    Financial Statements                                  1-2
                   Consolidated Balance Sheets as of December 31,
                   1999 (audited) and March 31, 2000 (unaudited)           3
                   Consolidated Statements of Operations for the
                   Three Months Ended March 31, 1999 (unaudited)
                   and March 31, 2000 (unaudited)                          4
                   Consolidated Statements of Changes In Stockholders'
                   Equity                                                  5
                   Consolidated Statements of Cash Flows for the
                   Three Months Ended March 31, 1999 (unaudited)
                   and March 31, 2000 (unaudited)                       6-23
                   Notes to Consolidated Financial Statements
                   (unaudited)                                         24-26

         Item 2.   Management's Discussion and Analysis or Plan
                   of Operation                                           26

Part II. Other Information                                                27

Signatures
<PAGE>
                            IMX PHARMACEUTICALS, INC.
                                AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                     December 31,            March 31,
                                                                         1999                  2000
                                                                   ------------------    ------------------
                                                                                            (Unaudited)
<S>                                                                <C>                   <C>
ASSETS

CURRENT ASSETS:
  Cash and cash equivalents                                              $ 2,497,791           $ 1,219,267
  Securities available for sale                                               30,463                28,269
  Accounts receivable (net of allowance for
    doubtful accounts of  $1,600 and $27,494)                                110,525                96,430
  Other receivable                                                                 0               281,060
  Loan receivable - related party                                             31,153                29,567
  Inventories                                                                557,593               710,628
  Refundable deposit                                                               0               400,000
  Vendor deposits                                                             50,000                     0
  Prepaid expenses and other                                                  46,731                64,777
                                                                   ------------------    ------------------

Total Current Assets                                                       3,324,256             2,829,998
                                                                   ------------------    ------------------




PROPERTY AND EQUIPMENT:

  Property and equipment (net of accumulated
    depreciation of $197,436 and $179,216)                                   105,913               104,085
                                                                   ------------------    ------------------



OTHER ASSETS:

  Deposits and other                                                          67,646                77,646
                                                                   ------------------    ------------------

Total Other Assets                                                            67,646                77,646
                                                                   ------------------    ------------------

TOTAL ASSETS                                                             $ 3,497,815           $ 3,011,729
                                                                   ==================    ==================
</TABLE>

                                                                               1
<PAGE>

                            IMX PHARMACEUTICALS, INC.
                                AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                     December 31,            March 31,
                                                                         1999                  2000
                                                                   ------------------    ------------------
                                                                                            (Unaudited)
<S>                                                                <C>                   <C>
LIABILITIES AND STOCKHOLDERS EQUITY

CURRENT LIABILITIES:

  Accounts payable                                                       $   436,398           $   312,362
  Accrued expenses and other current
    liabilities                                                               49,700               127,870
  Capital lease payable, current portion                                       2,896                 2,896
                                                                   ------------------    ------------------

Total Current Liabilities                                                    488,994               443,128
                                                                   ------------------    ------------------


LONG-TERM LIABILITIES:

  Capital lease payable, non-current portion                                   4,896                 4,097
                                                                   ------------------    ------------------


STOCKHOLDERS'  EQUITY:

  Common stock, $.001 par value, 50,000,000 shares
    authorized, 9,634,707 and 9,634,707 shares issued,
    5,802,461 and 5,802,461 shares outstanding                                 9,635                 9,635
  Additional paid-in capital                                               7,943,050             7,943,050
  Retained earnings (deficit)                                             (4,348,955)           (4,786,182)
  Treasury stock, at cost - 3,832,246 and
    3,832,246 shares                                                        (578,054)             (578,054)
  Accumulated other comprehensive loss                                       (21,751)              (23,945)
                                                                   ------------------    ------------------

Total Stockholders' Equity                                                 3,003,925             2,564,504
                                                                   ------------------    ------------------

TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY                                                     $ 3,497,815           $ 3,011,729
                                                                   ==================    ==================
</TABLE>

                                                                               2
<PAGE>
                            IMX PHARMACEUTICALS, INC.
                                AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                                                 (Unaudited)
                                                                              Three Months Ended
                                                                                  March 31,
                                                                         1999                 2000
                                                                  -------------------   ------------------
<S>                                                               <C>                   <C>
NET SALES                                                                 $      367           $  231,346

COST OF SALES                                                                    145               81,501
                                                                  -------------------   ------------------

GROSS PROFIT                                                                     222              149,845
                                                                  -------------------   ------------------

OPERATING EXPENSES:

  Selling                                                                    215,353              392,304
  Advertising                                                                 49,212               32,530
  General and administrative                                                 377,143              389,637
  Depreciation and amortization                                               13,000               18,094
                                                                  -------------------   ------------------

Total Operating Expenses                                                     654,708              832,565
                                                                  -------------------   ------------------

LOSS FROM OPERATIONS                                                        (654,486)            (682,720)


OTHER INCOME (EXPENSES):

  Other income                                                                58,592              245,493
                                                                  -------------------   ------------------

Income (Loss)
  Before Income Taxes                                                       (595,894)            (437,227)

Provision for Income Taxes                                                         0                    0
                                                                  -------------------   ------------------

Net income (loss) available to
  common stockholders                                                     $ (595,894)          $ (437,227)
                                                                  ===================   ==================


----------------------------------------------------------------------------------------------------------
Weighted average number of shares of common stock outstanding:
    Basic                                                                  5,033,038            4,998,508
    Diluted                                                                5,033,038            5,329,256

----------------------------------------------------------------------------------------------------------
Net income (loss) per common share:
    Basic                                                                    $ (0.12)             $ (0.09)
    Diluted                                                                  $ (0.12)             $ (0.08)

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

                                                                               3
<PAGE>
                                                   IMX PHARMACEUTICALS, INC.
                                                       AND SUBSIDIARIES
                                                  CONSOLIDATED STATEMENTS OF
                                                CHANGES IN STOCKHOLDERS' EQUITY

<TABLE>
<CAPTION>
                                                  PREFFERED STOCK               COMMON STOCK
                                             -------------------------    ------------------------     ADDITIONAL
                                                NUMBER                       NUMBER                     PAID-IN
                                              OF SHARES        AMOUNT       OF SHARES     AMOUNT        CAPITAL         (DEFICIT)
                                             ------------    ---------    -----------    ---------    ------------    --------------
<S>                                          <C>             <C>          <C>            <C>          <C>             <C>
Balance - December 31, 1998                        86,424    $      86      8,728,108      $ 8,728     $ 7,780,988     $ (4,883,487)


Comprehensive Income:
  Net income                                                                                                                577,932
  Change in other comprehensive income

Total comprehensive income
Preferred stock dividend declared                   1,736            2                                      43,398          (43,400)
Compensation - fair value of common
  stock options issued to non-employees                                                                     44,483
Conversion of preferred stock to
  common stock                                    (88,160)         (88)       881,600          882            (794)
Exercise of common stock options                                                5,000            5           4,995
Transfer of redeemed common stock to
  treasury stock                                                               19,999           20          69,980
Conversion of loan receivable to
  treasury stock
Purchase of treasury stock
                                             ------------    ---------    -----------    ---------    ------------    --------------

Balance - December 31, 1999                             0            0      9,634,707        9,635       7,943,050       (4,348,955)

Comprehensive Income:
  Net income                                                                                                               (437,227)
  Change in other comprehensive income

Total comprehensive income
                                             ------------    ---------    -----------    ---------    ------------    --------------

Balance - March  31, 2000                               0            0      9,634,707      $ 9,635     $ 7,943,050     $ (4,786,182)
                                             ============    =========    ===========    =========    ============    ==============

<CAPTION>
                                                   TREASURY STOCK             ACCUMULATED
                                             ---------------------------         OTHER           TOTAL
                                                NUMBER                       COMPREHENSIVE    STOCKHOLDERS'
                                               OF SHARES        AMOUNT          INCOME           EQUITY
                                             ------------    -----------    ---------------   -------------
<S>                                          <C>             <C>            <C>               <C>
Balance - December 31, 1998                     3,724,757     $ (357,657)       $ 11,000       $ 2,559,658
                                                                                              ------------

Comprehensive Income:
  Net income                                                                                       577,932
  Change in other comprehensive income                                           (32,751)          (32,751)
                                                                                              ------------
Total comprehensive income                                                                         545,181
Preferred stock dividend declared                                                                        0
Compensation - fair value of common
  stock options issued to non-employees                                                             44,483
Conversion of preferred stock to
  common stock                                                                                           0
Exercise of common stock options                                                                     5,000
Transfer of redeemed common stock to
  treasury stock                                   19,999        (70,000)                                0
Conversion of loan receivable to
  treasury stock                                   76,000       (125,400)                         (125,400)
Purchase of treasury stock                         11,490        (24,997)                          (24,997)
                                             ------------    -----------    ------------      -------------

Balance - December 31, 1999                     3,832,246       (578,054)        (21,751)        3,003,925

Comprehensive Income:
  Net income                                                                                      (437,227)
  Change in other comprehensive income                                            (2,194)           (2,194)
                                                                                              ------------
Total comprehensive income                                                                        (439,421)
                                             ------------    -----------    ------------      ------------

Balance - March  31, 2000                       3,832,246     $ (578,054)      $ (23,945)     $  2,564,504
                                             ============    ===========    ============      ============
</TABLE>

                                                                               4
<PAGE>
                            IMX PHARMACEUTICALS, INC.
                                AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                                                                    (Unaudited)
                                                                                                                Three Months Ended
                                                                                                                     March 31,
                                                                                             1999                      2000
                                                                                     ----------------------    ---------------------
<S>                                                                                  <C>                       <C>
OPERATING ACTIVITIES:

  Net income (loss)                                                                             $ (595,894)             $ (437,227)
  Adjustments to reconcile  net income (loss)
    to net cash (used) provided by operating activities:
    Depreciation and amortization                                                                   13,000                  18,094
    Provision for doubtful accounts                                                                 (5,534)                (25,894)
      (Increase) decrease in accounts receivable                                                  (228,320)               (241,071)
      Decrease (increase) in inventories                                                          (261,812)               (153,035)
      (Increase) in prepaid expenses                                                               (20,752)                (18,046)
      Decrease (increase) in deposits                                                                    -                (350,000)
      Decrease (increase) in other assets                                                          (35,623)                (10,000)
      (Decrease) increase in accounts payable
         and accrued expenses                                                                      (94,248)                (45,740)
                                                                                     ----------------------    --------------------

Net cash (used) provided by operating activities                                                (1,229,183)             (1,262,919)
                                                                                     ----------------------    --------------------


Investing Activities:

  Purchase of furniture and equipment                                                               (1,158)                (16,391)
  Loan repayment from (advance to) related party                                                      (352)                  1,586
  Decrease in investment in and advances to
    unconsolidated subsidiary                                                                      339,194                       0
                                                                                     ----------------------    --------------------

Net cash (used) provided by investing activities                                                   337,684                 (14,805)
                                                                                     ----------------------    --------------------
Financing Activities:

  Net proceeds (repayments) of notes payable                                                         9,390                    (799)
  Purchase of securities available for sale                                                      1,689,200                       -
  Purchase of treasury stock                                                                       (69,997)                      0
                                                                                     ----------------------    --------------------

Net cash (used) provided by financing activities                                                 1,628,593                    (799)
                                                                                     ----------------------    --------------------

Net increase (decrease) in cash and cash equivalents                                               737,094              (1,278,523)

Cash and cash equivalents - beginning of year                                                      623,860               2,497,790
                                                                                     ----------------------    --------------------

Cash and cash equivalents - end of year                                                        $ 1,360,954             $ 1,219,267
                                                                                     ======================    ====================



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

SUPPLEMENTAL SCHEDULE OF CASH FLOW INFORMATION
----------------------------------------------

  Cash paid for interest                                                                          $ 12,122                     $ 0
  Cash paid for income taxes                                                          $                  0                     $ 0

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


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

SUPPLEMENTAL SCHEDULE OF NON CASH ACTIVITIES
--------------------------------------------

  Dividends on preferred stock:
  Preferred stock issued in lieu of cash for dividends payable
    on preferred stock                                                                              43,400                     $ 0
  Conversion of preferred stock to common stock                                                        882                     $ 0

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

                                                                               5
<PAGE>

                   IMX PHARMACEUTICALS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

            (Information as of March 31, 2000 and for the three month
              periods ended March 31, 1999 and 2000 are unaudited)

NOTE 1 -          NATURE OF BUSINESS

                  IMX Pharmaceuticals, Inc. (the "Company"), formerly IMX
                  Corporation, was organized under the laws of the State of Utah
                  on June 2, 1982. The Company changed its name to IMX
                  Pharmaceuticals, Inc. on June 30, 1997. The consolidated
                  financial statements include the accounts of the Company and
                  its subsidiaries. All significant intercompany balances and
                  transactions have been eliminated in consolidation.

                  In 1995, the Company entered into an acquisition agreement
                  (the "Agreement'), with Interderm, Ltd., ("Interderm") for the
                  assignment of the exclusive marketing and distribution rights
                  in the United States for certain pharmaceutical products
                  manufactured by Meyer-Zall Laboratories of South Africa
                  ("Meyer-Zall"). The products included Exorex, an
                  over-the-counter psoriasis medication.

                  In connection with the Agreement, the Company also acquired
                  the right of first refusal for distribution rights in the
                  United States for new pharmaceutical products developed or
                  manufactured by Meyer-Zall.

                  During 1996 and 1997, the Company began to market and
                  distribute Exorex and other related products in the retail
                  market using capital raised from private placements.

                  Effective June 24, 1998, the Company entered into an agreement
                  (the "Joint Venture Agreement") with various affiliates of
                  Medicis Pharmaceutical Corporation ("Medicis") to form a joint
                  venture Medicis Consumer Products Company, LLC ("LLC") to
                  develop and market skin care products.

                  Under the terms of the Joint Venture Agreement, Medicis
                  contributed cash of $4,000,000 to the joint venture in return
                  for a 51% interest in the LLC. The Company contributed all of
                  the assets, property and associated rights in connection with
                  the Exorex product line, with an unamortized cost of
                  approximately $5,200 in return for a 49% interest in the LLC.

                  Effective June 30, 1999, the Company entered a Sale and
                  Transfer Agreement ("Sale Agreement") with Medicis, whereby
                  the Company sold its 49% interest in the LLC to Medicis in
                  return for $3,600,000.

                                                                               6
<PAGE>

                   IMX PHARMACEUTICALS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

            (Information as of March 31, 2000 and for the three month
              periods ended March 31, 1999 and 2000 are unaudited)

NOTE 2 -          SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

                  Interim Financial Statements

                  The accompanying unaudited consolidated financial statements
                  as of March 31, 2000 and for the three month periods ended
                  March 31, 1999 and 2000 have been prepared in accordance with
                  generally accepted accounting principles for interim financial
                  information. In the opinion of management, all adjustments
                  consisting of normal recurring accruals considered necessary
                  for a fair presentation have been included. Operating results
                  for the three-month period ended March 31, 2000 are not
                  necessarily indicative of the results that may be expected for
                  the year ending December 31, 2000.

                  Cash and Cash Equivalents

                  For purposes of reporting cash flows, the Company considers
                  all highly liquid investments purchased with an original
                  maturity of three months or less to be cash equivalents.

                  Securities Available for Sale

                  Securities available for sale are carried at estimated market
                  value. Unrealized holding gains and losses on securities
                  available for sale are reported as a net amount in a separate
                  component of stockholders' equity until realized. Gains and
                  losses realized from the sale of investment securities are
                  computed using the specific-identification method.

                  Inventories

                  Inventories are stated at the lower of cost or market value.
                  Cost is determined using the first-in, first-out method.

                  Property and Equipment

                  Property and equipment are recorded at cost. Depreciation and
                  amortization are computed using methods that approximate the
                  straight-line method over the assets' estimated useful lives.

                                                                               7
<PAGE>

                   IMX PHARMACEUTICALS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

            (Information as of March 31, 2000 and for the three month
              periods ended March 31, 1999 and 2000 are unaudited)

NOTE 2 -          SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT'D)

                  Revenue Recognition

                  Sales are generally recorded upon shipment of goods to
                  customers.

                  Production Development Costs

                  Costs incurred for the development of new product lines are
                  expensed as incurred as specified by SOP 98-5 issued by the
                  American Institute of Certified Public Accountants (Note 3).

                  Stock-Based Compensation

                  The Company accounts for stock based compensation as set forth
                  in Accounting Principles Board ("APB") Opinion 25, "Accounting
                  for Stock Issued to Employees," and discloses the proforma
                  effect on net income (loss) and income (loss) per share of
                  adopting the full provisions of Statement of Financial
                  Accounting Standards ("SFAS") No. 123 "Accounting for
                  Stock-Based Compensation". Accordingly, the Company has
                  elected to continue using APB Opinion 25 and has disclosed in
                  the footnotes proforma income (loss) and income (loss) per
                  share information as if the fair value method had been
                  applied.

                  Income Taxes

                  The Company files consolidated Federal and State of Florida
                  income tax returns. Income taxes are calculated using the
                  liability method specified by SFAS No. 109, "Accounting for
                  Income Taxes".

                  Net Income (Loss) Per Common Share

                  Net income (loss) per common share is calculated according to
                  Accounting SFAS No.128, "Earnings Per Share" which requires
                  companies to present basic and diluted earnings per share. Net
                  income (loss) per common share-- basic is based

                                                                               8
<PAGE>

                   IMX PHARMACEUTICALS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

            (Information as of March 31, 2000 and for the three month
              periods ended March 31, 1999 and 2000 are unaudited)

NOTE 2 -          SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT'D)

                  Net Income (Loss) Per Common Share (Cont'd)

                  on the weighted average number of common shares outstanding
                  during the year. Net income (loss) per common share -- diluted
                  is based on the weighted average number of common shares and
                  dilutive potential common shares outstanding during the year.

                  Convertible preferred stock, certain common stock options and
                  common stock warrants were excluded from the computations of
                  net loss per share for the three month periods ended March 31,
                  1999 and 2000 and because the effect of their inclusion would
                  be anti-dilutive.


                  Fair Value of Financial Instruments

                  SFAS No. 107 requires the disclosure of the fair value of
                  financial instruments. The estimated fair value amounts have
                  been determined by the Company's management using available
                  market information and other valuation methods. However,
                  considerable judgment is required to interpret market data in
                  developing the estimates of fair value. Accordingly, the
                  estimates presented herein are not necessarily indicative of
                  the amounts the Company could realize in a current market
                  exchange.

                  The following methods and assumptions were used in estimating
                  the fair value disclosure for financial instruments:

                  Cash and Cash Equivalents, Accounts and Loan Receivable,
                  Accounts Payable, Accrued Expenses and Notes Payable - the
                  carrying amounts reported in the consolidated balance sheets
                  approximate fair value because of the short maturity of those
                  instruments.

                  Securities Available for Sale - the fair values are based on
                  quoted market prices at the reporting date of those or similar
                  investments (Note 5).

                                                                               9
<PAGE>

                   IMX PHARMACEUTICALS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

            (Information as of March 31, 2000 and for the three month
              periods ended March 31, 1999 and 2000 are unaudited)

NOTE 2 -          SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT'D)

                  Accounting Estimates

                  The preparation of financial statements in conformity with
                  generally accepted accounting principles requires management
                  to make certain 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.

NOTE 3 -          RECENT ACCOUNTING

                  In June, 1997, the Financial Accounting Standards Board (the
                  Pronouncements "FASB") issued SFAS No. 130, "Reporting
                  Comprehensive Income" which became effective in 1998. SFAS No.
                  130 establishes standards for reporting and presentation of
                  comprehensive income and its components in a full set of
                  general-purpose financial statements. The Company adopted SFAS
                  No.130 on January 1, 1998.

                  In June, 1997 the FASB issued SFAS No. 131, "Disclosure about
                  Segments of an Enterprise and Related Information" which
                  became effective in 1998. SFAS No. 131 establishes standards
                  for the way public enterprises are to report operating
                  segments in annual financial statements and requires reporting
                  of selected information about operating segments in interim
                  reports. The Company's adoption of SFAS No. 131 did not affect
                  the Company's consolidated financial statements.

                  In April,1998, the American Institute of Certified Public
                  Accountants issued Statement of Position No. 98-5, "Reporting
                  for the Costs of Start-Up Activities", ("SOP 98-5"). The
                  Company is required to expense all start-up costs related to
                  new operations as incurred. In addition, all start-up costs
                  that were capitalized in the past must be written off when SOP
                  98-5 is adopted. The Company's adoption of SOP 98-5 did not
                  have a material impact on its financial position or results of
                  operations.

                  In June 1998, the FASB issued SFAS No. 133, "Accounting for
                  Derivative Instruments and Hedging Activities". The Company is
                  required to adopt SFAS

                                                                              10
<PAGE>

                   IMX PHARMACEUTICALS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

            (Information as of March 31, 2000 and for the three month
              periods ended March 31, 1999 and 2000 are unaudited)

NOTE 3 -          RECENT ACCOUNTING (CONT"D)

                  133, as amended by SFAS 137, for the year ending December 31,
                  2001. SFAS 133 establishes methods of accounting for
                  derivative financial instruments and hedging activities
                  related to those instruments as well as other hedging
                  activities. Because the Company currently holds no derivative
                  financial instruments and does not currently engage in hedging
                  activities, adoption of SFAS 133 is expected to have no
                  material impact on the Company's financial condition or
                  results of operations.

NOTE 4 -          SECURITIES AVAILABLE FOR SALE

                  Securities available for sale consist of 69,630 shares of
                  common stock in Hydron Technologies, Inc. At December 31,1999
                  and March 31 2000, the cost basis of $52,214 of the common
                  stock in Hydron Tech, Inc. exceeded the market value by
                  $21,751 and $23,945 respectively.

NOTE 5 -          INVENTORIES

                  Inventories consisted of the following:

                                           December 31,   March 31,
                                                1999        2000
                                                ----        ----

                  Finished goods             $ 237,195    $ 392,913
                  Work in process               16,969       15,498
                  Packaging supplies           303,429      302,217
                                             ---------    ---------

                  Total                      $ 557,593    $ 710,628
                                             =========    =========

                                                                              11
<PAGE>

                   IMX PHARMACEUTICALS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

            (Information as of March 31, 2000 and for the three month
              periods ended March 31, 1999 and 2000 are unaudited)

NOTE 6 -          PROPERTY AND EQUIPMENT

                  Property and equipment consisted of the following:

                                                December 31,           March 31,
                                                    1999                 2000
                                                    ----                 ----

Computers and office equipment                    $ 193,997           $ 198,734
Furniture, fixtures and improvements                 91,132             102,787
                                                  ---------           ---------

                                                    285,129             301,521
Less: accumulated depreciation and
             amortization                          (179,216)           (197,436)
                                                  ---------           ---------

Property and equipment net of
  accumulated depreciation                        $ 105,913           $ 104,085
                                                  =========           =========

NOTE 7 -          INCOME TAXES

                  The provision for income taxes in the consolidated statements
                  of operations is as follows:

                                  December 31,    March 31,
                                     1999           2000
                                     ----           ----

                  Current:
                    Federal          $   0          $   0
                    State                0              0
                                     -----          -----
                                     $   0          $   0
                                     -----          -----

                  Deferred:
                  Federal            $   0          $   0
                  State                  0              0
                                     -----          -----
                                     $   0          $   0
                                     -----          -----

                                                                              12
<PAGE>

                   IMX PHARMACEUTICALS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

            (Information as of March 31, 2000 and for the three month
              periods ended March 31, 1999 and 2000 are unaudited)

NOTE 7 - INCOME TAXES (CONT'D)

                  Applicable incomes taxes for financial reporting purposes
                  differ from the amounts computed by applying the statutory
                  federal and state income tax rates as follows:

                                                   December 31,       March 31,
                                                      1999               2000
                                                      ----               ----


Tax (benefit) at statutory rate                     $ 185,800         $ 137,500
Increase (decrease) in tax
  resulting from:
State income tax, net of federal tax benefit           31,500            23,200
Other                                                       0                 0
Increase (decrease) in
  valuation allowance                                (217,300)         (160,700)
                                                    ---------         ---------

Income taxes                                        $       0         $       0
                                                    =========         =========

                  The approximate tax effects of temporary differences that give
                  rise to the deferred tax assets and deferred tax (liabilities)
                  are as follows:

                                              December 31,           March 31,
                                                  1999                  2000
                                                  ----                  ----

Fair value of common stock options and
  warrants                                     $   130,889          $   130,889
Start-up costs                                     139,100              139,100
Depreciation and amortization                      (71,700)             (71,700)
Other                                               12,000               12,000
Net operating loss carry forwards                  641,700            1,069,382
                                               -----------          -----------

                                                   851,989            1,279,671
Less: valuation allowance                         (851,989)          (1,279,671)
                                               -----------          -----------

Total net deferred tax asset                   $         0          $         0
                                               ===========          ===========

                                                                              13
<PAGE>

                   IMX PHARMACEUTICALS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

            (Information as of March 31, 2000 and for the three month
              periods ended March 31, 1999 and 2000 are unaudited)

NOTE 7 - INCOME TAXES (CONT'D)

                  At December 31, 1999, the Company had net operating loss
                  carryforwards of approximately $1,700,000 for income tax
                  purposes. Those losses are available for carryforward for
                  periods ranging from fifteen to twenty years, and will expire
                  beginning in 2011. Any future significant changes in ownership
                  of the Company may limit the annual utilization of the tax net
                  operating loss carryforwards.

NOTE 8 -          CAPITAL STOCK

                  Common stock

                  Common stock has one vote per share for the election of
                  directors. All other matters are submitted to a vote of
                  stockholders. Shares of common stock do not have cumulative
                  voting, preemptive, redemption or conversion rights.

                  At December 31, 1999 and March 31, 2000, the Company had
                  reserved 3,538,216 and 3,538,216 shares of Common stock
                  respectively for issuance relating to unexpired options and
                  warrants.

NOTE 9 -          STOCK OPTIONS

                  On January 21, 1996, the Company adopted a stock option plan
                  with 2,000,000 shares of Common stock reserved for the grant
                  of options to key employees, non-employees, officers and
                  directors of the Company. On September 9, 1998, the Company
                  adopted a stock option plan with 1,200,000 shares of common
                  stock reserved for grant of options to key employees,
                  non-employees, officers and directors of the Company. Options
                  under these plans are exercisable over a period of ten years
                  with various vesting terms. All shares granted are subject to
                  significant restrictions as to disposition by the optionee.

                                                                              14
<PAGE>

                   IMX PHARMACEUTICALS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

            (Information as of March 31, 2000 and for the three month
              periods ended March 31, 1999 and 2000 are unaudited)

NOTE 9 -          STOCK OPTIONS (CONT'D)

                  A summary of the Company's stock option activity is as
                  follows:

                                   Year ended           Three months ended
                                December 31, 1999         March 31, 2000
                             ------------------------------------------------
                                            Weighted                 Weighted
                                             Average                 Average
                                            Exercise                 Exercise
                                Shares        Price      Shares        Price
-----------------------------------------------------------------------------

Options outstanding,
   beginning of period       1,350,000     $ 2.71     1,485,000     $ 2.46
Granted                        234,500       1.73             0          -
Exercised                       (5,000)      1.75             0          -
Forfeited/canceled             (94,500)      4.31             0          -
-----------------------------------------------------------------------------

Outstanding at end of
  period                     1,485,000     $ 2.46     1,485,000     $ 2.46
-----------------------------------------------------------------------------

-----------------------------------------------------------------------------
Exercisable at end of
  period                     1,560,100     $ 2.55     1,560,100     $ 2.55

-----------------------------------------------------------------------------
Weighted average fair
  market  value of
  options granted
  period                                   $ 0.85                   $ 0.85
-----------------------------------------------------------------------------

                                                                              15
<PAGE>

                   IMX PHARMACEUTICALS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

            (Information as of March 31, 2000 and for the three month
              periods ended March 31, 1999 and 2000 are unaudited)

NOTE 9 -          STOCK OPTIONS (CONT'D)

                  A summary of the Company's fixed stock options outstanding is
                  as follows:
<TABLE>
<CAPTION>
                                        Weighted
                                        Average
                                        Remaining          Weighted                            Weighted
Range of                 Options       Contractual         Average          Options            Average
Exercise Price         Outstanding    Life in Years     Exercise Price     Exercisable     Exercise Price
---------------------------------------------------------------------------------------------------------
December 31, 1999
---------------------------------------------------------------------------------------------------------
<S>                    <C>            <C>               <C>               <C>              <C>
    $0.75 - 0.99           20,000        9.75             $ 0.75               20,000         $ 0.75
    $1.00 - 3.00        1,175,500        7.24               1.64            1,021,750           1.62
     3.87 - 4.00          270,000        7.99               4.00              270,000           4.00
     4.78 - 6.50          256,475        7.56               5.03              248,350           4.97
---------------------------------------------------------------------------------------------------------

    $0.75 - 6.50        1,721,975        7.43               2.49            1,560,100           2.55
---------------------------------------------------------------------------------------------------------

March 31, 2000
---------------------------------------------------------------------------------------------------------
    $0.75 - 0.99           20,000        9.50             $ 0.75               20,000         $ 0.75
    $1.00 - 3.00        1,175,500        6.89               1.64            1,021,750           1.62
     3.87 - 4.00          270,000        7.92               4.00              270,000           4.00
     4.78 - 6.50          256,475        8.12               5.03              248,350           4.97
---------------------------------------------------------------------------------------------------------

    $0.75 - 6.50        1,721,975        7.27               2.49            1,560,100           2.55
---------------------------------------------------------------------------------------------------------
</TABLE>

                  SFAS No. 123, "Accounting for Stock-Based Compensation",
                  requires the Company to provide pro forma information
                  regarding net income (loss) and income (loss) per share as if
                  compensation cost for the Company's employee stock option
                  plans had been determined in accordance with the fair value
                  based method prescribed in SFAS No. 123. The Company estimates
                  the fair value of each option at the grant date by using the
                  Black-Scholes option pricing model with the following
                  weighted-average assumptions used for grants in 1998 and 1999,
                  expected volatility ranging from 45% to 46%; risk-free
                  interest rates ranging from 4.35% to 6% and expected lives
                  ranging from 2 to 10 years.

                                                                              16
<PAGE>

                   IMX PHARMACEUTICALS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

            (Information as of March 31, 2000 and for the three month
              periods ended March 31, 1999 and 2000 are unaudited)

NOTE 9 -          STOCK OPTIONS (CONT'D)

                  Under the accounting provisions of SFAS 123, the Company's net
                  income (loss) and income (loss) per share would have changed
                  to the pro forma amounts indicated below:

                                              Year Ended           Three Months
                                             December 31,        Ended March 31,
                                                 1999                  2000
                                                 ----                  ----

Net income (loss) applicable to
  common stockholders
   As reported                                $ (595,894)          $ (437,227)
   Pro forma                                  $ (595,894)          $ (707,260)
Income (loss) per  share - basic
   As reported                                $    (0.12)          $    (0.09)
   Pro forma                                  $    (0.12)          $    (0.14)
Income (loss) per  share - diluted
   As reported                                $    (0.12)          $    (0.08)
   Pro forma                                  $    (0.12)          $    (0.13)


                  Three executive officers of IMX Pharmaceuticals, Inc. received
                  a total of 24,000 options to purchase shares of common stock
                  of Medicis Corporation. The options were granted in connection
                  with the formation of The Exorex Company LLC. The options vest
                  over a five year period; twenty per cent becoming vested each
                  year. The original purchase price was $24.67. Twenty per cent
                  has been exercised. The remainder of the options are held by
                  the officers for the benefit of IMX Pharmaceuticals, Inc.

NOTE 10 -         STOCK WARRANTS

                  In connection with a 1996 private placement offering of common
                  stock, the Company issued 580,000 warrants, each redeemable
                  for one share of common stock, at any time during a period of
                  three years, commencing on July 9, 1996 for $5.00 per share.
                  The warrants may be redeemed by the Company with 30 days prior
                  notice at a price of ten cents per warrant at any time during
                  the warrant exercise period, under certain conditions (as
                  defined). During July 1999, the Company extended the exercise
                  period one year to July 9, 2000.

                  In addition, 58,000 warrants, each to purchase one share of
                  common stock for $3.00 per share, and exercisable for the
                  three year period ending July 9, 1999, were issued to
                  placement agents in connection with the 1996 Private
                  Placement. During July 1997, in connection with a financial
                  advisory agreement with the

                                                                              17
<PAGE>

                   IMX PHARMACEUTICALS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

            (Information as of March 31, 2000 and for the three month
              periods ended March 31, 1999 and 2000 are unaudited)

NOTE 10 -         STOCK WARRANTS (CONT'D)

                  placement agents, the exercise price of the 58,000 warrants
                  was reduced to $2.50 per share, and the exercise period was
                  extended to February 9, 2001. The Company recorded
                  approximately $71,000 as deferred consulting expense for the
                  estimated fair value of warrants which is being amortized over
                  the two year term of the agreement.

                  On March 31, 1999, in connection with the Company's 1997
                  Private Placement of convertible preferred stock (Note 13),
                  88,160 (76,750 original shares, plus 11,410 shares issued in
                  lieu of cash as preferred stock dividends) shares outstanding
                  at March 31, 1999 were converted into ten shares of common
                  stock and warrants to purchase ten shares of common stock at
                  any time during the period ending July 2002 for $6.50 per
                  share. As of December 31, 1999 no warrants to purchase common
                  stock have been exercised.

                  In addition to warrants issued to investors in the February
                  1997 Private Placement, warrants to purchase 7,586.25 shares
                  of Convertible Preferred Stock were issued to placement and
                  selling agents with an exercise price of $30 per share, and
                  are exercisable for the five year period ending July 2002.
                  Each share of preferred stock is convertible into 10 shares of
                  common stock at $3.50 per share and 10 warrants, each warrant
                  to purchase one share of common stock at $6.50 per share.
                  Prior to the March 31, 1999 conversion, no warrants to
                  purchase preferred stock had been exercised.

                  During July, 1997, in connection with an agreement with a
                  financial advisor, the Company issued warrants to purchase
                  50,000 shares of common stock at $4.75 per share, exercisable
                  for the period ending July 2002. The Company recorded
                  approximately $67,000 as deferred consulting expense for the
                  estimated fair value of the warrants, which is being amortized
                  over the two year term of the agreement.

                  In connection with notes payable issued during 1997 (Note 12),
                  as of December 31, 1998, warrants to purchase 85,120 shares of
                  common stock have been issued. Also, in connection with
                  February, 1998 closing of the October 1997 Private Placement,
                  warrants to purchase 20,180 shares of common stock were issued
                  to placement and selling agents. Each of the warrants
                  mentioned above has an exercise price of $3.50 per share, and
                  expires five years from the date of issuance. As of December
                  31, 1998 and 1999, no warrants have been exercised.

                                                                              18
<PAGE>

                   IMX PHARMACEUTICALS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

            (Information as of March 31, 2000 and for the three month
              periods ended March 31, 1999 and 2000 are unaudited)

NOTE 10 -         STOCK WARRANTS (CONT'D)

                  The aggregate number of common shares reserved for issuance
                  upon the exercise of warrants is 1,816,241 as of December 31,
                  1999. The expiration date and exercise prices of the
                  outstanding warrants are as follows:

                  Outstanding       Expiration       Exercise
                    Warrants            Date           Price
                    --------            ----           -----

                    580,000             2000        $       5.00
                     58,000             2001                2.50
                  1,007,463             2002           3.00-6.50
                    170,778             2003                3.50

NOTE 11 -         NET INCOME (LOSS) PER COMMON SHARE

                  The following table sets forth the computation of basic and
                  diluted net income (loss) per common share:

                                               Year Ended         Three Months
                                              December 31,       Ended March 31,
                                              ------------       ---------------
                                                  1999                2000
                                                  ----                ----

Net income (loss) applicable to
  common stockholders
    As reported                                $ (595,894)          $ (437,227)
    Pro forma                                  $ (595,894)          $ (707,260)
Income (loss) per  share - basic
    As reported                                $    (0.12)          $    (0.09)
    Pro forma                                  $    (0.12)          $    (0.14)
Income (loss) per  share - diluted
    As reported                                $    (0.12)          $    (0.08)
    Pro forma                                  $    (0.12)          $    (0.13)


                                                                              19
<PAGE>

                   IMX PHARMACEUTICALS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

            (Information as of March 31, 2000 and for the three month
              periods ended March 31, 1999 and 2000 are unaudited)

NOTE 11 -         NET INCOME (LOSS) PER COMMON SHARE (CONT'D)


                  Net income (loss) per common share is calculated by dividing
                  the net income (loss) by the weighted-average shares of common
                  stock and common stock equivalents outstanding during the
                  period. Excluded from the computation of net loss per common
                  share - diluted at December 31, 1998 and 1999, were
                  convertible preferred stock of 864,240 and 0, outstanding
                  options of 1,586,975 and 1,679,475, and warrants to purchase
                  1,798,881 and 1,816,241 shares of common stock respectively,
                  at exercise prices ranging from $1.00 to $6.50, and from $2.50
                  to $6.50, because to do so would be anti-dilutive.

NOTE 12 -         RELATED PARTY TRANSACTIONS

                  During 1999, the Company made advances to a company affiliated
                  to the President. The balance due the Company at December 31,
                  1999 and March 31, 2000 totaled $31,153 and $29,567
                  respectively. These advances together with interest at the
                  rate of ten (10%) percent is due and payable prior to December
                  31, 2000.

NOTE 13 -         COMMITMENTS AND CONTINGENCIES

                  The Company leases its facilities and certain equipment under
                  non-cancelable operating leases. The Company has a sublease
                  agreement for certain facilities and equipment. The future
                  minimum rental payments required under these operating leases
                  that have initial or remaining non-cancelable lease terms in
                  excess of one year, and the future minimum rental receipts
                  required under non-cancelable sub-leases of December 31, 1999
                  are approximately as follows:

                                                 Future
                                                Minimum
                                                 Rental
                          Year                  Payments
                          ----                  --------

                          2000                 $ 128,000
                          2001                    54,000
                          2002                    36,000
                          2003                    19,000

                                                                              20
<PAGE>

                   IMX PHARMACEUTICALS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

            (Information as of March 31, 2000 and for the three month
              periods ended March 31, 1999 and 2000 are unaudited)

NOTE 13 -         COMMITMENTS AND CONTINGENCIES (CONT'D)

                  Total rent expense for all non-cancelable operating leases
                  having a term of more than one year was approximately $91,000
                  for the year ended December 31, 1999 and $5,000 for the three
                  month period ended March 31, 2000, respectively.

                  On July 1, 1998, the Company entered into an employment
                  agreement for a period of three years with William Forster,
                  the Company's Chairman of the Board, President and Chief
                  Executive Officer. Mr. Forster is entitled to receive an
                  annual salary of $225,000 and a bonus based on a percentage of
                  the Company's sales (as defined).

                  Effective July 1, and August 1, 1998, the Company entered into
                  employment agreements with two officers for annual salaries
                  totaling approximately $205,000, plus discretionary bonuses,
                  and bonuses upon the sale of the Company's interest in the LLC
                  (as defined). The term of each agreement is three years.

                  The Company has entered into a series of product development
                  agreements with a consultant that provide for compensation to
                  the consultant in the form of cash, options to purchase shares
                  of the Company's common stock which vest as products are
                  developed, royalties based upon net sales of products, a
                  royalty based upon the sale of the rights to the products
                  developed, and an interest in any patents granted on products
                  developed by the consultant to the Company.

                  In November 1999, Bioglan Pharma PLC and Bioglan Pharma, Inc.
                  (collectively, "Bioglan") commenced an arbitration action
                  against the Company, Medicis and the LLC, in which Bioglan
                  claims damages for breach of various contractual obligations
                  arising out of the sale of the LLC and the Exorex product line
                  to Bioglan.

                  Specifically, Bioglan claims that Medicis, the LLC and the
                  Company breached an Asset Purchase Agreement by transferring
                  inventories to Bioglan that had a remaining shelf life less
                  than 12 months and was otherwise unmarketable. The Asset
                  Purchase Agreement specified that Bioglan was to take title to
                  all inventories having a shelf life greater than 12 months,
                  and the Company was to take title to inventories having a
                  shelf life of 12 months or less. The products were warehoused
                  together. Management believes that Medicis, under an interim
                  management agreement with Bioglan, filled Bioglan orders with
                  the Company's inventories. In addition, the Company has filed
                  a counterclaim in the arbitration against Bioglan for damages
                  relating to the conversion of this property.

                                                                              21
<PAGE>

                   IMX PHARMACEUTICALS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

            (Information as of March 31, 2000 and for the three month
              periods ended March 31, 1999 and 2000 are unaudited)

NOTE 13 -         COMMITMENTS AND CONTINGENCIES (CONT'D)

                  In the second claim, Bioglan seeks unspecified damages from
                  the Company, Medicis and the LLC because it claims that the
                  inventories that it received had not been properly stored and
                  therefore was unmarketable. Management believes that this
                  claim does not have any merit since it was never advised by
                  the manufacturer, Meyer-Zall, of any requirement for cold
                  storage for the product. The Company intends to vigorously
                  defend this matter. However, management cannot assess the
                  likelihood of an unfavorable outcome, or the range of
                  potential loss, if any, which might result from this claim.

NOTE 14 -         CAPITAL LEASE PAYABLE

                  The Company is a lessee under a capital lease of equipment
                  from an unrelated third party. The lease agreement calls for
                  36 equal monthly payments of $241 with a final fixed purchase
                  price of $1 at the end of the lease. The asset and liability
                  under this capital lease is valued at a fair market value of
                  approximately $8,000. The asset is being depreciated over its
                  estimated useful life of 5 years.

                           Total capital lease payable                $ 6,993
                           Less: Current portion                        2,896
                                                                      -------

                           Total capital lease
                             payable - non current                    $ 4,097
                                                                      =======

NOTE 15 -          REFUNDABLE DEPOSIT

                  An initial refundable deposit of $400,000 has been paid to
                  Dri-Kleen, Inc. d/b/a Enviro-Tech International
                  ("Enviro-Tech"), a multi-level marketing company, for the
                  purchase of Enviro-Tech's network sales and marketing division
                  for the United Sates and Canada only for all current products.
                  The market will be worldwide for any new products. The Company
                  executed a letter of intent with Dri-Kleen, Inc. on May 2,
                  2000. The proposed transaction is subject to approval by the
                  Board of Directors of each company and the execution of a
                  definitive agreement.

                                                                              22
<PAGE>

                   IMX PHARMACEUTICALS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

            (Information as of March 31, 2000 and for the three month
              periods ended March 31, 1999 and 2000 are unaudited)

NOTE 16 -         The Company maintains its cash balances at financial
                  institutions located in South Florida. The balances at these
                  institutions are insured by the Federal Deposit Insurance
                  Corporation up to $100,000 per account. Uninsured balances as
                  of December 31, 1999 and March 31, 2000 were approximately
                  $160,200 and $67,000 respectively.

                                                                              23
<PAGE>

Item 2.  Management's Discussion and Analysis or Plan of Operation.

         General

         The Company is engaged in the development of lines of health and beauty
products which the Company believes will offer superior benefits to consumers.
In the second quarter of fiscal 1999, the Company launched its Mother 2 Be(R)
line of products, and recently launched two (2) additional product lines,
Proctozone(TM) and Podiatrx(TM), in the first quarter of fiscal year 2000.
Another product line, Deep(TM), is to be launched in the second half of fiscal
year 2000.

         On May 2, 2000, the Company executed a letter of intent with Dri-Kleen,
Inc., d/b/a Enviro-Tech International ("Enviro-Tech"), a multi level marketing
company, for the purchase of Enviro-Tech's network sales and marketing division
for the United States and Canada only for all current products. The market will
be worldwide for any new products. An initial refundable deposit of $400,000 has
been paid. The proposed transaction is subject to approval by the Board of
Directors of each company and the execution of a definitive agreement.

         In addition, the Company is actively seeking to acquire one or more
product lines or businesses. No assurances can be given that any such
acquisitions will be consummated, or if consummated, that they will be
profitable.

         Results of Operations

         For the three months ended March 31, 2000, consolidated net sales were
approximately $231,000, as compared to approximately $367 for the three months
ended March 31, 1999. The three months ended March 31, 2000 reflect sales from
Mother 2 Be line as well as Podiatrx and Proctozone lines, which were launched
during the first quarter of fiscal 2000. In June 1998, the Company completed the
formation of a joint venture, the Exorex Company, LLC (the "LLC") with Medicis
Pharmaceutical Corporation of Phoenix, Arizona ("Medicis"). The LLC, in which
the Company had received a 49% interest, acquired from all of the Company's
rights to market its Exorex product line. As the owner of a 49% interest in the
LLC, the Company did not record any sales made by the LLC during the first
quarter of 1999. In June 1999, the Company sold its interest in the LLC in
return for approximately $3.6 million in cash and other consideration.

         Management is of the belief that the market experienced intense
competition for over-the-counter drugs in general, and psoriasis medication in
competition with the Exorex line in particular. The Company competed against
established pharmaceutical and consumer product companies, which market numerous
prescription and non prescription drugs with equivalent or functionally similar
ingredients, and which have national or regional brand name recognition, from
which consumers may choose.

                                                                              24
<PAGE>

         Management initially believed that aligning the Company with Medicis, a
substantially larger pharmaceutical concern, would assist the Company in
bringing its products to market, building brand recognition and gaining
widespread commercial acceptance. Accordingly, in June 1998 the Company acquired
its interest in the LLC. However, management's expectations for the marketing of
the Exorex line by the LLC and Medicis were not met during the first year of the
LLC's operations, and therefore, the Company sold its interest in the LLC.

         Gross profit margin increased to 65% of net sales for the three months
ended March 31, 2000, as compared to 60% of net sales in 1999. Gross profit
margins fluctuated with the changes in the Company's product mix.

         Total operating expenses incurred by the Company increased to
approximately $830,000 for the three months ended March 31, 2000 from $655,000
for the three months ended March 31, 1999. The increase from 1999 to 2000
reflects the expenses associated with the introduction of two new product lines,
Podiatrx and Proctozone.

         For the months ended March 31, 2000, net loss was approximately
$(437,000), as compared to net loss of approximately $(596,000) for the three
months ended March 31, 2000.

         As the Company anticipates developing additional product lines, it will
necessarily incur additional expenses normally associated with the start-up of
new lines. Further, substantial time may be necessary to build brand awareness
and sales. Accordingly, the likelihood of the success of the Company's
operations must be considered in light of the problems, expenses, difficulties,
complications and delays frequently encountered in connection with the formation
and development of a new business, the commencement and expansion of operations
and the regulatory and competitive environment in which the Company will
operate. As a result of the foregoing, operating losses are anticipated for the
balance of fiscal 2000.

         Liquidity and Capital Resources

         At March 31, 2000, the Company's financial condition included working
capital of approximately $2.4 million, as compared to approximately $2.8 million
at December 31, 1999. In June 1999, the Company sold its interest in the LLC in
return for approximately $3.6 million in cash and other consideration. The cash
received from the sale of the Company's interest in the LLC is being used in
connection with development of the Company's proprietary brands, acquisition of
drug delivery technologies, and/or undermarketed established brands. In
addition, $400,000 was tendered as a refundable deposit in connection with the
potential purchase of Enviro-Tech's network sales and marketing division.

         For the short term, the Company's capital requirements are expected to
be met by available cash. For the three months ended March 31, 2000, operating
activities used cash

                                                                              25
<PAGE>

of approximately $1.26 million. A significant part of this was due to the launch
of the Company's two new product lines- Podiatrx and Proctozone. Purchase of
inventory accounted for approximately $500,000. However, in the absence of a
substantial increase in sales, the Company may need to raise additional
financing.

         In addition, the Company intends to develop and market through various
channels, its proprietary over-the-counter drugs and health and beauty products.
However, management recognizes that the Company does not have the financial
resources to sustain a major national advertising campaign to market its
products to conventional retail outlets. Accordingly, the Company may need to
raise additional financing.

         However, no assurances can be given that the Company will be able to
raise sufficient capital should the need arise. In the absence of such
additional financing, there can be no assurance that the Company will be able to
achieve widespread commercial acceptance of any of the Company's products.

         Inflation

         Inflation rates in the United States have not had a significant impact
on operating results for the periods presented.

         Cautionary Statement Regarding Forward-Looking Statements

         Certain statements contained in this item and elsewhere in this report
regarding matters that are not historical facts are forward-looking statements
(as such term is defined in the Private Securities Litigation Reform Act of
1995). Because such forward-looking statements include risks and uncertainties,
actual results may differ materially from those expressed or implied by such
forward-looking statements. All statements which address operating performance,
events or developments that management expects or anticipates to incur in the
future, including statements relating to sales and earnings growth or statements
expressing general optimism about future operating results, are forward-looking
statements. The forward-looking statements are based on management's current
views and assumptions regarding future events and operating performance. Many
factors could cause actual results to differ materially from estimates contained
in management's forward-looking statements. The differences may be caused by a
variety of factors, including but not limited to adverse economic conditions,
competitive pressures, inadequate capital, unexpected costs, lower revenues and
net incomes and forecasts, the possibility of fluctuation and volatility of the
Company's operating results and financial condition, inability to carry out
marketing and sales plans, and loss of key executives, among other things.

Part II.          Other Information
                  Items 1,2,3,4,5, and 6 are omitted as they are either not
                  applicable or have been included in Part I.

                                                                              26
<PAGE>

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized on the 16th day of May 2000.


                                  IMX PHARMACEUTICALS, INC.


                                  By: /s/ Leonard F. Kaplan
                                      ------------------------------------------
                                      Leonard F. Kaplan, Chief Financial Officer

                                                                              27