**U.
      S. SECURITIES AND EXCHANGE COMMISSION**


**WASHINGTON,
      D.C. 20549**





**FORM
      10-KSB**


(Mark
      One)





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




For
      the
      fiscal year ended **December
      31, 2006**





[
                ]
                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: **0-32917**





**PROTOKINETIX,
      INC.**


**Formerly
      known as RJV Networks, Inc.**


(Name
      of
      small business issuer as specified in its charter)





**Nevada**
            **94-3355026**(State
                or other jurisdiction of
              incorporation
                or organization)
            (I.R.S.
                Employer
              Identification
                No.)**Suite
                1500-885 West Georgia Street**
              **Vancouver,
                British Columbia Canada V6C 3E8**
              **________________________________________________________________________**
              (Address
                of principal executive offices, including zip
                code)




Registrant’s
      telephone number, including area code:  **(604)
      687-9887**


Securities
      registered pursuant to Section 12(b) of the Act:  **None**


Securities
      registered pursuant to Section 12(g) of the Act:  **$.001
      par value common stock**


Check
      whether the issuer (1) filed all reports required to be filed by
      Section 13 or 15(d) of the Exchange Act of 1934 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 ___





Check
      if
      disclosure of delinquent filers pursuant to Item 405 of Regulation S-B is not
      contained in this form, and no disclosure will be contained, to the best of
      registrant’s knowledge, in definitive proxy or information statements
      incorporated by reference in Part III of this Form 10-KSB or any amendment
      to
      this Form 10-KSB. [ ]





The
      issuer’s revenues for the most recent fiscal year were USD $0





The
      aggregate market value of the voting and non-voting common equity held by
      non-affiliates of the registrant was approximately $12,002,713 based upon the
      closing price of our common stock which was $0.33 on April 13, 2007. Shares
      of
      common stock held by each officer and director and by each person or group
      who
      owns 10% or more of them outstanding common stock amounting to 8,218,780 shares
      have been excluded in that such persons or groups may be deemed to be
      affiliates. This determination of affiliate status is not necessarily a
      conclusive determination for other purposes.




As
      of
      April 16, 2007, there were 44,590,639shares of our common stock were issued
      and
      outstanding.





Documents
      Incorporated by Reference: None.





Transitional
      Small Business Disclosure Format: No.


























**INTRODUCTION**





The
      following discussion should be read in conjunction with our audited financial
      statements and notes thereto. Because we desire to take advantage of, the "safe
      harbor" provisions of the Private Securities Litigation Reform Act of 1995,
      we
      caution readers regarding certain forward looking statements in the following
      discussion and elsewhere in this report and in any other statement made by,
      or
      on our behalf, whether or not in future filings with the Securities and Exchange
      Commission. Forward looking statements are statements not based on historical
      information and which relate to future operations, strategies, financial results
      or other developments. Forward looking statements are necessarily based upon
      estimates and assumptions that are inherently subject to significant business,
      economic and competitive uncertainties and contingencies, many of which are
      beyond our control and many of which, with respect to future business decisions,
      are subject to change. These uncertainties and contingencies can affect actual
      results and could cause actual results to differ materially from those expressed
      in any forward looking statements made by, or our behalf. We disclaim any
      obligation to update forward looking statements.





Forward
      looking statements involve known and unknown risks, uncertainties and other
      factors that may cause our actual results, levels of activity, performance,
      or
      achievements to be materially different from any future results, levels of
      activity, performance, or achievement expressed or implied by such
      forward-looking statements. In some cases, you can identify forward-looking
      statements by terminology such as "may," "will," "should," "could," "intend,"
      "expects," "plan," "anticipates," "believes," "estimates," "predicts,"
      "potential," or "continue" or the negative of such terms or other comparable
      terminology. Although we believe that the expectations reflected in the
      forward-looking statements are reasonable, we cannot guarantee future results,
      levels of activity, performance, or achievements. Moreover, neither we nor
      any
      other person assumes responsibility for the accuracy and completeness of such
      statements.





WE
      ARE A
      DEVELOPMENT STAGE BUSINESS AND AN INVESTMENT IN OUR COMPANY IS ***EXTREMELY*** RISKY.



















**TABLE
      OF CONTENTS**


**FORM
      10-KSB ANNUAL REPORT**


**_________________________**





**PROTOKINETIX,
      INC**.





Section
            Heading
            PagePart
                IItem
                1
            Description
                of Business
            4Item
                2
            Description
                of Property
            11Item
                3
            Legal
                Proceedings
            11Item
                4
            Submission
                of Matters to a Vote of Security Holders
            12Part
                IIItem
                5
            Market
                for the Registrant's Common Equity and Related Stockholder
                Matters
            12Item
                6
            Management's
                Discussion and Analysis of Financial Condition and Results of Operations
                or Plan of Operation
            16Item
                6A
            Quantitative
                and Qualitative Disclosures About Market Risk
            18Item
                7
            Financial
                Statements
            18Item
                8
            Changes
                in and Disagreements on Accounting and Financial
                Disclosure
            18Item
                8A
            Controls
                and Procedures
            18Item
                8B
            Other
                Information
            19Part
                IIIItem
                9
            Directors,
                Executive Officers, Promoters and Control Persons, Compliance with
                Section
                16(a) of the Exchange Act
            19Item
                10
            Executive
                Compensation
            20Item
                11
            Security
                Ownership of Certain Beneficial Owners and Management and Related
                Stockholder Matters
            21Item
                12
            Certain
                Relationships and Related Transactions
            22Part
                IVItem
                13
            Exhibits
                and Reports on Form 8-K
            22Item
                14
            Principal
                Accountant Fees and Services
            23Certifications
                and Signatures
            23
















**PART
      I**





**ITEM
      1.**  **DESCRIPTION
      OF BUSINESS**





*Important
      Disclosures and Disclaimers* .





*Please
      note that ProtoKinetix, Inc. (the "Company") is a development stage company
      that
      has not yet sold or marketed any products. The Company had $0 in revenues for
      the year ended December 31, 2006.*





*It
      is
      important to understand that although the Company (as is discussed below) is
      focused on various promising scientific efforts, to date, Protokinetix Inc.
      has
      not yet marketed a product.The research on the two amoino acid and the three
      amino acid AAGPTM molecules has demonstrated that they hold significant promise
      in the field of medicine in preserving cells, tissue and organs. The antiaging
      properties and the protective effect of AAGPTM also is of significant interest to
      the cosmetic and skin care industries. Research has confirmed that the AAGPTM
molecules improve the harvest of cells from cryopreservation by greater than
      30%. There is a market for AAGPTM to preserve cells, but we will not be marketing
      these until we have completed our scale up manufacturing of the
      molecule.*





**Overview**





We
      are a
      biotechnical company headquartered in Vancouver, British Columbia that owns
      the
      world-wide rights to a family of synthetic anti-freeze glycoproteins
      (trademarked by us as AAGPTM). We are dedicated to the commercial development of
      AAGPTM for use in human and veterinary medicine, food additives and supplements,
      and the biotechnology and cosmetic industry. We are making meaningful progress
      in this domain by coordinating a team of world recognized intellectual talent
      in
      a networked environment. As of December 31, 2006 research has been conducted
      at
      three Universities in Europe as well as three universities in North America.
      There is also work being conducted by one European and three American
      corporations as well as by one research institute in Australia. Discussions
      are
      underway with additional universities and research facilities to conduct
      research.





Our
      business plan is based primarily on the furtherance of certain intellectual
      property rights obtained by way of "sub-licenses" of technology from other
      companies. At present, we have engaged the patent law firm of Cabinet-Moutard
      of
      Versaille, France, and have filed a number of international patent applications.
      These patent applications include:




WO
      2004/014928 A2 (19 February 2004)


PCT
      Int.
      Appl. (2006), 87 pp. WO2006059227 A1 20060608 AN 2006:538719


Patent
      application: Fr 03 May 2006, 06 03952





Consistent
      with our agreements with the licensors of various technologies we license,
      we
      have developed two finished commercial products which improve the preservation
      of cells. The products for the preservation of cells do not require regulatory
      approval. We are continuing to conduct research to develop additional products.
      The chemical process by which the AAGPTM is manufactured is covered by a world
      wide patent that is issued to INSA. We have purchased the exclusive rights
      to
      use this process to manufacture AAGPTM. Final patents have not been issued for
      AAGP(TN), but we are protected by PCT Int. Appl.(2006),87 pp. WO2006059227
      A1
      20060608 AN 2006:538719 and the patent application Fr. 03 May 2006, 06 03952.
      There have been no final patents awarded to cover the AAGPTM molecules as of this
      date, nor have we achieved regulatory approval for any product. We are focused
      on the research and development of one primary compound known as AFGP, which
      we
      have filed a trademark application for.





The
      Company operates with a skeletal management team headed by John Todd, M.D.
      In
      addition to Dr. Todd, the Company receives advice and counsel from its
      Scientific Advisory Board. A short biography of Dr. Todd may be found within
      this Form 10-KSB, and the biographies of other members of the ProtoKinetix
      Scientific Advisory Board may be found within the "About Us" section of the
      Company's website located at www.protokinetix.com .
      The
      company employs one secretary, two full time Ph.D. researchers as well as two
      contract researchers and two laboratory technicians.





**AFGP
      Project Overview**





We
      currently focus on the research, development and testing of the synthetic
      glycoproteins (AFGP) which have been trademarked, AAGPTM. We have entered into
      agreements which give us the exclusive right to develop products derived from
      patent pending technologies related to synthetic AFGPs. Our intellectual
      property rights were developed by Dr. Geraldine Castelot-Deliencourt. As of
      the
      date of this report, the Company's development agents, including the parties
      the
      Company has licensed AFGP technologies from, have received world wide patents
      on
      the process by which the synthetic AFGP is manufactured, and we have patents
      pending on the 3 to 5 amino acid AAGP molecules. The 2 amino acid molecule
      AAGP
      has a patent application which was filed on May 03, 2006.





**AFGP
      Compound**





One
      of
      the many accomplishments from pioneering research of the U.S. Antarctic Program
      was the discovery, in the early sixties, that fish living year-long in subzero
      temperature are extremely resistant to freezing. The substances that prevent
      these fish from freezing were isolated, characterized and designated as
      antifreeze glycoproteins or AFGP. Various kinds of AFGP were isolated from
      many
      species of fishes, and in some amphibians, plants and insects. All of the AFGPs
      share a common characteristic that prevents ice crystals from growing and
      connecting to each other. Research has also confirmed a membrane stabilizing
      characteristics of native AFGP.





A
      review
      of the scientific literature will confirm that there has been a great deal
      of
      interest around the world in these natural antifreeze glycoproteins which are
      able to protect a great many creatures subjected to freezing temperatures.
      A
      further review will also confirm that the natural antifreeze is able to preserve
      mammalian cells tissue and organs. The metabolic rate in living cells is reduced
      as the temperature is lowered. Keeping cells and tissue at a low temperature
      enables their preservation for a longer time than cells can be preserved for
      at
      a higher temperature. Yet, when cells are exposed to sub zero temperatures,
      they
      are destroyed by the formation of ice crystals which disrupts the cell membrane
      (this effect is not seen with AAGPTM.)





Scientists
      have conducted many experiments in which they extracted naturally occurring
      AFGP
      from a variety of fish and then used these naturally occurring antifreeze
      glycoproteins to reduce the temperature at which ice crystals are formed. It
      has
      been determined in experiments by many scientists that mammalian cells in a
      solution containing natural AFGP could be successfully preserved at temperatures
      several degrees below zero Celsius. At this temperature the metabolic rate
      of
      the cells is very low, and these cells can be preserved for a longer period
      of
      time at sub zero temperatures as long as the cells are not destroyed by the
      formation of ice crystals. However, until today, applications of AFGP were
      limited since researchers were unable to produce sufficient quantities or stable
      enough copies of these antifreeze glycoproteins for commercial applications,
      and
      the use of naturally occurring compounds extracted from fish is too labor and
      cost-intensive to be practical.





The
      native antifreeze glycoproteins are very large molecules that are often made
      up
      of a repeating series of smaller molecules, glycoproteins. Glycoproteins are
      often very biologically active, but they are inherently quite unstable. The
      oxygen-glycosidic link is readily cleaved by glycosidases, resulting in a low
      bio-availability of these glycoconjugate based molecules. Dr. Geraldine
      Castelot-Deliencourt, along with Dr. Jean-Charles Quirion at the Research
      Institute of Organic Chemistry in Rouen, France, developed a patented process
      to
      stabilize the oxygen-glycosidic bond in these sugar based molecules. This
      patented process replaces the weaker oxygen bond with a C-F2 mimetic. The
      resultant molecules are biologically active and stable over a pH range of 2
      to
      13. They are not broken down by glycosidases. It is by using this patented
      process that the active repeating segment of native antifreeze glycoproteins
      has
      been synthesized to produce the synthetic antifreeze glycoprotein molecules
      (AAGPTM). Protokinetix Inc. has produced and tested a variety of the molecules
      from the family of AAGPTM molecules. The experimental work which we have
      conducted confirms the following:





·
            The
                molecules are stable over a pH of 1.8 to
                13


·
            Toxicity
                trials have been conducted by 3 separate researchers. There is no
                toxicity
                until a concentration of 50 milligrams per milliliter of the AAGPTM. This
                is a concentration ten times the dose that we anticipate using for
                medical
                applications and for cell preservation.


·
            There
                is excellent preservative effect upon cells, protecting them from
                harsh
                environmental stimuli. This was confirmed using Ultraviolet C radiation
                and 1 molar solution of Hydrogen
                Peroxide


·
            There
                is no interference with cell growth
                rate


·
            Cells
                appear morphologically normal in the presence of
                AAGPTM


·
            Cells
                function normally in the presence of
                AAGPTM


·
            There
                is a reduced COX-2 induction following an inflammatory stimulus
                (Interleukin 1-B). The IL1-B/COX2 pathway is a well known pathway
                involved
                in many pathologies.


·
            There
                is strong evidence to show that AAGPTM is involved in cellular repair at
                the molecular level


·
            AAGPTM
                has been shown to enhance cell viability during
                cryopreservation


·
            Cells
                live significantly longer in the presence of AAGPTM over a temperature
                range of minus 3 degrees C to plus 37 degrees
                C


·
            AAGP
                enables the preservation of Platelets at minus 3 degrees
                C


·
            The
                AAGPTM has no thermal hysteresis activity. This is expected given its small
                size.





We
      are
      continuing our research to determine additional characteristics of AAGPTM as well
      as the mechanism of action of this very interesting and valuable family of
      molecules. The work is being conducted not only through our contracted
      researchers but also through a number of universities and research facilities.
      The results of our work to date suggest that AAGPTM may have a very large market
      in the following areas:





1.
            Skin
                Care


a.
            Anti-aging


b.
            Reparative


c.
            Protective


d.
            Solar
                Block





2.
            Cell
                culture protection


a.
            Short
                term preservation


b.
            Cryopreservation





3.
            Organ
                Preservation for Transplantation


a.
            Cells
                - Islet cell transplantation


b.
            Solid
                organ





4.
            Tissue
                preservation


a.
            Cardioplegic
                solution additive


b.
            Tissue
                damage reduction following CVA and
                MI


c.
            Tissue
                protection following trauma and ischemia secondary to
                edema





5.
            Blood
                and blood product preservation


a.
            Platelet
                storage


b. Long term storage of packed red cells





6. An anti-inflammatory agent




**Intellectual
      Property**





As
      of the
      date of this Report, our development agents, including the parties we have
      licensed AFGP technologies from, have applied to receive patents for
      technologies we have licensed and continue to primarily base our research
      efforts on. At present, we have engaged the patent law firm of Cabinet-Moutard
      of Versaille, France, and have filed a number of international patent
      applications. These patent applications include:




WO
      2004/014928 A2 (19 February 2004)


PCT
      Int.
      Appl. (2006), 87 pp. WO2006059227 A1 20060608 AN 2006:538719


Patent
      application: Fr 03 May 2006, 06 03952





Consistent
      with our agreements with the licensors of various technologies we license,
      we
      have no finished commercial product or products, and have received no final
      patents awards or FDA approvals for any product or diagnostic procedures. We
      are
      focused on the research and development of one primary compound known as AAGPTM,
      which we have filed a trademark application for.





Subject
      to our available financial resources, our intellectual property strategy is:
      (1)
      to pursue licenses, trade secrets, and know-how within our primary research
      areas, and (2) to develop and acquire proprietary positions to reagents and
      new
      platforms for the development of products related to these technologies.





**Trade
      Secrets and Know-How**





We
      believe that even if our intellectual property position is ultimately diminished
      as a result of our development agents and licensors receiving patent protection
      for the licenses ProtoKinetix has contracted to access, we have developed a
      substantial body of trade secrets and know-how relating to the development
      of
      AAGPTM, including but not limited to the optimization of materials for efforts,
      and how to maximize sensitivity, speed-to-result, specificity, stability and
      reproducibility.





**Competition**





The
      markets that we are attempted to enter are multi-billion dollar international
      industries. They are intensely competitive. Many of our competitors (from every
      perspective) are substantially larger and have greater financial, research,
      manufacturing, and marketing resources.





Industry
      competition in general is based on the following:





·
            Scientific
                and technological capability;


·
            Proprietary
                know-how;


·
            The
                ability to develop and market products and
                processes;


·
            The
                ability to obtain FDA or other required regulatory
                approvals;


·
            The
                ability to manufacture products that meet applicable FDA requirements,
                (i.e. FDA’s Quality System Regulations) see Governmental Regulation
                section;


·
            Access
                to adequate capital;


·
            The
                ability to attract and retain qualified personnel;
                and


·
            The
                availability of patent protection.





We
      believe our scientific and technological capabilities are significant. Some
      of
      the results of our research are available at our website located at
      www.protokinetix.com.





Our
      ability to develop our research is in large measure dependent on our having
      additional resources and/or collaborative relationships, particularly where
      we
      can have our product development efforts funded on a project or milestone basis.
      We believe that our know-how with our AFGP project, in spite of not yet
      receiving any patent protected rights, has been instrumental in our obtaining
      the collaborations we have developed.





Although
      there is no such immediate need to make any regulatory filing in the United
      States or abroad, one should know that we have limited experience with regard
      to
      obtaining FDA or other required regulatory approvals, and no experience with
      obtaining pre-marketing approval of a biologic product. (See "Governmental
      Regulation" for definition of pre-marketing approval.) For this reason, should
      our research efforts continue to show promise, we will need to hire consultants
      to assist the Company with such governmental regulations.





Our
      access to capital is more challenging, relative to most of our competitors.
      This
      is a competitive disadvantage. We believe however that our access to capital
      may
      increase as we get closer to the development of a commercially viable
      product.





To
      date,
      we believe our research has enabled us to attract and retain qualified
      consultants. Because of the greater financial resources of many of our
      competitors, we may not be able to complete effectively for the same individuals
      to the extent that a competitor uses its substantial resources to attract any
      such individuals.





As
      is
      discussed above, with respect to the availability of patent protection, we
      do
      not have our own portfolio of patents or the financial resources to develop
      and/or acquire a portfolio of patents similar to those of our larger
      competitors. We have been able to obtain access to patent-pending technology
      by
      entering into licensing arrangements. However, there can be no certainty that
      any of the patent-pending technologies we have licensed will ever receive final
      approval by any patent office.





**Super
      Antibody and Catalytic Antibody Platform Technologies**





The
      Company continues to own the rights to both the Super Antibody and the catalytic
      antibody platform technologies. The Company will continue to search for a
      patentable receptor site that exists only on cancer cells.





**Governmental
      Regulation**





As
      was
      discussed above, the Company has developed a commercially viable product which
      does not require any government regulatory approval.. This is the use of AAGPTM
to improve the cell yield during cryopreservation. (See web site www.protokinetix.com and look
      under the Research Data section to view the scientific reports.)





The
      Company continues to conduct an active research program to confirm the medical
      application of AAGPTM. We are also conducting work in the fields of Veterinary
      medicine, and skin care applications. As we confirm the commercial application
      of AAGPTM in each of these fields we will then take the necessary steps to obtain
      regulatory approval for these applications.





The
      following discussion relates to factors that may come into play ***when
      and if*** the
      Company has a commercially viable product in an area which requires regulatory
      approval. These products may be regulated by the European regulatory agencies,
      FDA, U.S. Department of Agriculture, certain state and local agencies, and/or
      comparable regulatory bodies in other countries (collectively, these agencies
      shall be referred to as the "Agencies"). Government regulation affects almost
      all aspects of development, production, and marketing, including product
      testing, authorizations to market, labeling, promotion, manufacturing, and
      record keeping. The FDA and U.S. Department of Agriculture regulated products
      require some form of action by that agency before they can be marketed in the
      United States, and, after approval or clearance, the products must continue
      to
      comply with other FDA requirements applicable to marketed products. Both before
      and after approval or clearance, failure to comply with the FDA’s requirements
      can lead to significant penalties. The Company's proposed AAGPTM products will
      require government regulatory approval as a biologic agent. Such regulatory
      approval will be granted only after the appropriate preclinical and clinical
      studies are conducted to confirm efficacy and safety.





The
      Company's ***proposed*** AAGPTM
products may be considered by FDA to be biologic and will therefore be submitted
      to the biologics division of the FDA, the Center for Biologics Evaluation and
      Research.





Every
      company that manufactures biologic products or medical devices distributed
      in
      the United States must comply with the FDA’s Quality System Regulations. These
      regulations govern the manufacturing process, including design, manufacture,
      testing, release, packaging, distribution, documentation, and purchasing.
      Compliance with the Quality System Regulations is required before the FDA will
      approve an application. These requirements also apply to marketed products.
      Companies are also subject to other post-market and general requirements,
      including compliance with restrictions imposed on marketed products, compliance
      with promotional standards, record keeping, and reporting of certain adverse
      reactions or events. The FDA regularly inspects companies to determine
      compliance with the Quality System Regulations and other post-approval
      requirements. Failure to comply with statutory requirements and the FDA’s
      regulations can lead to substantial penalties, including monetary penalties,
      injunctions, product recalls, seizure of products, and criminal
      prosecution.





The
      Clinical Laboratory Improvement Act of 1988 prohibits laboratories from
      performing in vitro tests for the purpose of providing information for the
      diagnosis, prevention or treatment of any disease or impairment of, or the
      assessment of, the health of human beings unless there is in effect for such
      laboratories a certificate issued by the U.S. Department of Health and Human
      Services applicable to the category of examination or procedure performed.
      Although a certificate is not required for ProtoKinetix, ProtoKinetix considers
      the applicability of the requirements of the Clinical Laboratory Improvement
      Act
      in the potential design and development of its products.





In
      addition, the FDA regulates the export of medical devices that have not been
      approved for marketing in the United States. The Federal Food, Drug and Cosmetic
      Act contains general requirements for any medical device that may not be sold
      in
      the United States and is intended for export. Specifically, a medical device
      intended for export is not deemed to be adulterated or misbranded if the
      product: (1) accords to the specifications of the foreign purchaser; (2) is
      not
      in conflict with the laws of the county to which it is intended for export;
      (3)
      is labeled on the outside of the shipping package that it is intended for
      export; and (4) is not sold or offered for sale in the United States. Some
      medical devices face additional statutory requirements before they can be
      exported. If an unapproved device does not comply with an applicable performance
      standard or premarket approval requirement, is exempt from either such
      requirement because it is an investigational device, or is a banned device,
      the
      device may be deemed to be adulterated or misbranded unless the FDA has
      determined that exportation of the device is not contrary to the public health
      and safety and has the approval of the country to which it is intended for
      export. However, the Federal Food, Drug and Cosmetic Act does permit the export
      of devices to any country in the world, if the device complies with the laws
      of
      the importing country and has valid marketing authorization in one of several
      "listed" countries under the theory that these listed countries have
      sophisticated mechanisms for the review of medical devices for safety and
      effectiveness.





ProtoKinetix
      is also subject to regulations in foreign countries governing products, human
      clinical trials and marketing, and may need to obtain approval or evaluations
      by
      international public health agencies, such as the World Health Organization,
      in
      order to sell products in certain countries. Approval processes vary from
      country to country, and the length of time required for approval or to obtain
      other clearances may in some cases be longer than that required for U.S.
      governmental approvals. The extent of potentially adverse governmental
      regulation affecting ProtoKinetix that might arise from future legislative
      or
      administrative action cannot be predicted.





**Environmental
      Laws**





To
      date,
      we have not encountered any costs relating to compliance with any environmental
      laws.





**ITEM
      2.**  **DESCRIPTION
      OF PROPERTY**





The
      Company does not own any real property. The Company is currently paying a rental
      fee where it is located.





**ITEM
      3.**  **LEGAL
      PROCEEDINGS**





There
      are
      currently no legal matters pending.





**ITEM
      4.**  **SUBMISSION
      OF MATTERS TO A VOTE OF SECURITY HOLDERS**





A
      shareholder meeting was not held during fiscal year 2006.














**PART
      II**





**ITEM
      5.**  **MARKET
      FOR THE REGISTRANT'S COMMON EQUITY AND** **RELATED
      STOCKHOLDER MATTERS**





Trades
      of
      our common stock are subject to Rule 15g-9 of the Securities and Exchange
      Commission, known as the Penny Stock Rule. This rule imposes requirements on
      broker/dealers who sell securities subject to the rule to persons other than
      established customers and accredited investors. For transactions covered by
      the
      rule, brokers/dealers must make a special suitability determination for
      purchasers of the securities and receive the purchaser’s written agreement to
      the transaction prior to sale. The Securities and Exchange Commission also
      has
      rules that regulate broker/dealer practices in connection with transactions
      in
      "penny stocks." Penny stocks generally are equity securities with a price of
      less than $5.00 (other than securities registered on certain national securities
      exchanges or quoted on the NASDAQ system, provided that current price and volume
      information with respect to transactions in that security is provided by the
      exchange or system). The Penny Stock Rules requires a broker/ dealer, prior
      to a
      transaction in a penny stock not otherwise exempt from the rules, to deliver
      a
      standardized risk disclosure document prepared by the Commission that provides
      information about penny stocks and the nature and level of risks in the penny
      stock market. The broker/dealer also must provide the customer with current
      bid
      and offer quotations for the penny stock, the compensation of the broker/dealer
      and its salesperson in the transaction, and monthly account statements showing
      the market value of each penny stock held in the customer’s account. The bid and
      offer quotations, and the broker/dealer and salesperson compensation
      information, must be given to the customer orally or in writing prior to
      effecting the transaction and must be given to the customer in writing before
      or
      with the customer’s confirmation. These disclosure requirements have the effect
      of reducing the level of trading activity in the secondary market for our common
      stock. As a result of these rules, investors may find it difficult to sell
      their
      shares.





The
      Company's Common Stock is quoted on the over-the-counter market and quoted
      on
      the National Association of Securities Dealers Electronic Bulletin Board ("OTC
      Bulletin Board") under the symbol "PKTX". The high and low bid prices for the
      Common Stock, as reported by the National Quotation Bureau, Inc., are indicated
      for the periods described below. Such prices are inter-dealer prices without
      retail markups, markdowns or commissions, and may not necessarily represent
      actual transactions.





**2005**
            **Low**
            **High**As
                of March 31, 2005
            $.45
            $.55As
                of June 30, 2005
            .87
            .94As
                of September 30, 2005
            .52
            .58As
                of December 31, 2005
            .60
            .63**2006**
            **Low**
            **High**As
                of March 31, 2006
            $.65
            $.68As
                of June 30, 2006
            .62
            .65As
                of September 30, 2006
            .51
            .57As
                of December 31, 2006
            .40
            .46







**Dividends**




We
      have
      never paid cash dividends and have no plans to do so in the foreseeable future.
      Our future dividend policy will be determined by our board of directors and
      will
      depend upon a number of factors, including our financial condition and
      performance, our cash needs and expansion plans, income tax consequences, and
      the restrictions that applicable laws, our current preferred stock instruments,
      and our future credit arrangements may then impose.




Currently
      under Nevada law, a dividend may not be made by a corporation if, after giving
      it effect:




·
            the
                corporation would not be able to pay its debts as they become due
                in the
                usual course of business; or


·
            except
                as otherwise specifically allowed by the corporation’s articles of
                incorporation, the corporation’s total assets would be less than the sum
                of its total liabilities plus the amount that would be needed, if
                the
                corporation were to be dissolved at the time of distribution, to
                satisfy
                the preferential rights upon dissolution of stockholders whose
                preferential rights are superior to those receiving the
                distribution.




**Holders**





As
      of
      April 16, 2007, there were approximately 59 shareholders of record of the
      company's Common Stock. As of April 16, 2007, the Company had 44,590,639 shares
      issued and outstanding. During the year ended December 31, 2006, the Company
      issued 4,895,956 new common shares. From January 1, 2006 through April 16,
      2007
      the Company issued 323,486 common shares.





**Recent
      Sales of Unregistered Securities; Use of Proceeds From Registered
      Securities**





Below
      is
      a table showing the number of newly issued shares by quarter:








**Period**
            **Number
                of Newly Issued Common Shares**First
                Quarter
            166,359Second
                Quarter
            2,722,613Third
                Quarter
            1,669,984Fourth
                Quarter
            107,000**Total**
            **4,665,956**








There
      have been no sales of unregistered securities during calendar 2006 which would
      be required to be disclosed pursuant to Item 701 of Regulation S-B, except
      for
      the following:





On
      March
      17, 2006 we issued a total of 166,359 common shares pursuant to three consulting
      agreements. These issuances were made in lieu of cash payments for services
      rendered and were considered exempt transactions under Section 4(2) of the
      Securities Act of 1933, as amended.





On
      May
      10, 2006 we issued a total of 529,279 common shares to Thunderbird Global
      Corporation in consideration of the conversion of $158,783.60 of the outstanding
      debentures Thunderbird Global Corporation held. These issuances were considered
      exempt transactions under Section 4(2) of the Securities Act of 1933, as
      amended.





On
      May
      25, 2006 we issued a total of 1,266,278 common shares pursuant to seven
      consulting agreements. These issuances were made in lieu of cash payments for
      services rendered and were considered exempt transactions under Section 4(2)
      of
      the Securities Act of 1933, as amended.





On
      June
      5, 2006 we issued a total of 27,056 common shares pursuant to a consulting
      agreement. These issuances were made in lieu of cash payments for services
      rendered and were considered exempt transactions under Section 4(2) of the
      Securities Act of 1933, as amended.





On
      June
      15, 2006 we issued a total of 900,000 common shares for cash. These issuances
      were considered exempt transactions under Section 4(2) of the Securities Act
      of
      1933, as amended.





On
      July
      27, 2006, we issued 1,200,000 common shares to consultants of the Company in
      connection with consulting agreements. These issuances were made in lieu of
      cash
      payments for services rendered and were considered exempt transactions under
      Section 4(2) of the Securities Act of 1933, as amended.





On
      August
      11, 2006, we issued 100,000 common shares to an outside consultant in connection
      with a consulting agreement. These issuances were made in lieu of cash payments
      for services rendered and were considered exempt transactions under Section
      4(2)
      of the Securities Act of 1933, as amended.




On
      September 8, 2006, we issued 69,231 common shares to outside consultant in
      connection with consulting agreements. These issuances were made in lieu of
      cash
      payments for services rendered and were considered exempt transactions under
      Section 4(2) of the Securities Act of 1933, as amended.




On
      September 21, 2006, we issued 186,406 common shares to three consultants in
      connection with consulting agreements. These issuances were made in lieu of
      cash
      payments for services rendered and were considered exempt transactions under
      Section 4(2) of the Securities Act of 1933, as amended.





On
      September 22, 2006, we issued 114,347 common shares to two consultants in
      connection with consulting agreements. These issuances were made in lieu of
      cash
      payments for services rendered and were considered exempt transactions under
      Section 4(2) of the Securities Act of 1933, as amended.





On
      November 15, 2006, we issued 100,000 common shares to consultants in connection
      with consulting agreements. These issuances were made in lieu of cash payments
      for services rendered and were considered exempt transactions under Section
      4(2)
      of the Securities Act of 1933, as amended.





On
      December 8, 2006, we issued 7,000 common shares to a consultant in connection
      with a consulting agreement. These issuances were made in lieu of cash payments
      for services rendered and were considered exempt transactions under Section
      4(2)
      of the Securities Act of 1933, as amended.





**Warrants**





During
      2006, in lieu of payment for advisory services rendered to the Company, the
      Company issued the following parties warrants to purchase common shares of
      the
      Company's stock:








No.
                of shares
            
            Exercise
              Price
            
            Date
              Exercised
            
            Date
                Expired563929
                Alberta Ltd.
            
            100,000
            
            0.50
            
            Not
                Exercised(1)
            
            8/1/07Centrum
                Bank AG
              Fbo
                Asset Protection Fund
            
            100,000
            
            0.50
            
            Not
                Exercised(1)
            
            8/1/07Dr.
                S. Jane Goundrey
            
            100,000
            
            0.50
            
            Not
                Exercised(1)
            
            8/1/07Jem
                Resources
            
            50,000
            
            0.50
            
            Not
                Exercised(1)
            
            8/1/07Malita
                Investments
            
            100,000
            
            0.50
            
            Not
                Exercised(1)
            
            8/1/07Simon
                Shah
            
            50,000
            
            0.60
            
            Not
                Exercised(1)
            
            12/1/06Simon
                Shah
            
            50,000
            
            0.58
            
            Not
                Exercised(1)
            
            3/1/07Simon
                Shah
            
            50,000
            
            0.67
            
            Not
                Exercised(1)
            
            6/1/06Simon
                Shah
            
            50,000
            
            0.62
            
            Not
                Exercised(1)
            
            9/1/07Chardan
                Capital Markets, LLC
            
            50,000
            
            0.60
            
            Not
                Exercised(1)
            
            12/1/06Chardan
                Capital Markets, LLC
            
            50,000
            
            0.58
            
            Not
                Exercised(1)
            
            3/1/07Chardan
                Capital Markets, LLC
            
            50,000
            
            0.67
            
            Not
                Exercised(1)
            
            6/1/06Chardan
                Capital Markets, LLC
            
            50,000
            
            0.62
            
            Not
                Exercised(1)
            
            9/1/07Ravi
                Chiruvola
            
            100,000
            
            0.50
            
            Not
                Exercised(1)
            
            3/1/07Ravi
                Chiruvola
            
            100,000
            
            0.67
            
            Not
                Exercised(1)
            
            6/1/07Ravi
                Chiruvola
            
            100,000
            
            0.62
            
            Not
                Exercised(1)
            
            9/1/07Total
            
            1,150,000





(1)  As
      of
      April 16, 2007 these warrants have not been exercised.




**Disclosure
      Related to Form S-8 Issuances**





Prior
      to
      issuing any common shares under Form S-8, the Company requests and receives
      an
      executed verification from all issuees stating that the issuee is a natural
      person and that: (a) the shares being issued are not being provided to create
      or
      sustain a market for the Company's securities, and (b) that the shares are
      not
      being issued as a part of a capital raising transaction. All consultants to
      the
      Company are required to provide work product as a part of and condition to
      their
      relationship with the Company. Consultant work product is delivered in
      accordance with the terms and conditions of each respective Consultant’s
      agreement.





**ITEM
      6.**  **MANAGEMENT'S
      DISCUSSION AND ANALYSIS OR PLAN OF** **OPERATION**





This
      discussion and analysis should be read in conjunction with the accompanying
      Consolidated Financial Statements and related notes. Our discussion and analysis
      of our financial condition and results of operations are based upon our
      consolidated financial statements, which have been prepared in accordance with
      accounting principles generally accepted in the United States. The preparation
      of financial statements in conformity with accounting principles generally
      accepted in the United States of America requires us to make estimates and
      assumptions that affect the reported amounts of assets and liabilities,
      disclosure of any contingent liabilities at the financial statement date and
      reported amounts of revenue and expenses during the reporting period. On an
      on-going basis we review our estimates and assumptions. Our estimates were
      based
      on our historical experience and other assumptions that we believe to be
      reasonable under the circumstances. Actual results are likely to differ from
      those estimates under different assumptions or conditions, but we do not believe
      such differences will materially affect our financial position or results of
      operations. Our critical accounting policies, the policies we believe are most
      important to the presentation of our financial statements and require the most
      difficult, subjective and complex judgments, are outlined below in "Critical
      Accounting Policies," and have not changed significantly.





In
      addition, certain statements made in this report may constitute "forward-looking
      statements." These forward-looking statements involve known or unknown risks,
      uncertainties and other factors that may cause the actual results, performance,
      or achievements of the Company to be materially different from any future
      results, performance or achievements expressed or implied by the forward-looking
      statements. Specifically, 1) our ability to obtain necessary regulatory
      approvals for our products; and 2) our ability to increase revenues and
      operating income, is dependent upon our ability to develop and sell our
      products, general economic conditions, and other factors. You can identify
      forward-looking statements by terminology such as "may," "will," "should,"
      "expects," "intends," "plans," "anticipates," "believes," "estimates,"
      "predicts," "potential," "continues" or the negative of these terms or other
      comparable terminology. Although we believe that the expectations reflected-in
      the forward-looking statements are reasonable, we cannot guarantee future
      results, levels of activity, performance or achievements.





**Critical
      Accounting Policies**





Our
      critical and significant accounting policies, including the assumptions and
      judgments underlying them, are disclosed in the Notes to the Financial
      Statements. These policies have been consistently applied in all material
      respects and address such matters as revenue recognition and depreciation
      methods. The preparation of the financial statements in conformity with
      generally accepted accounting principles in the United States requires
      management to make estimates and assumptions that affect the reported amounts
      of
      assets and liabilities and disclosure of contingent assets and liabilities
      at
      the date of the financial statements and the reported amounts of revenues and
      expenses during the reported period. Actual results could differ from those
      estimates. The accounting treatment of a particular transaction is specifically
      dictated by accounting principles, generally accepted in the United States
      of
      America, with no need for management’s judgment in their application. There are
      also areas in which management’s judgment in selecting any viable alternative
      would not produce a materially different result. See our audited financial
      statements and notes thereto which contain accounting policies and other
      disclosures required by accounting principles, generally accepted in the United
      States of America.





**Expenses**





Our
      expenses in 2006 were $1,967,633which consisted of $386,095 in professional
      legal and accounting expenses. We operate the company by hiring outside
      consultants to assist us with management, strategic planning, organization
      and
      daily operations. These professional consulting fees amounted to $1,196,124.
      These professional consulting services related to marketing, product and market
      research and development and investment banking services including financing,
      capitalization and merger opportunities.





**Plan
      of Operation**





Our
      current operations are centered around the Company's relationships with various
      research and development consultants who are conducting research on behalf
      of
      the company at discrete and established laboratories in various parts of the
      world. The Company intends to continue these efforts throughout
      2007.





**Sales
      and Marketing**





The
      Company is currently not selling or marketing any products.





**Liquidity
      and Capital Resources**





At
      December 31, 2006, we had $166,115 in cash and $612,506 in total current assets.
      As of the date of this report, we require additional capital investments or
      borrowed funds to meet cash flow projections and carry forward our business
      objectives. There can be no assurance that we will be able to raise capital
      from
      outside sources in sufficient amounts to fund our new business.





The
      failure to secure adequate outside funding would have an adverse affect on
      our
      plan of operation and results therefrom and a corresponding negative impact
      on
      shareholder liquidity.





**Inflation**





Although
      management expects that our operations will be influenced by general economic
      conditions, we do not believe that inflation had a material effect on our
      results of operations during the year ending December 31, 2006.





**Going
      Concern**





The
      accompanying financial statements have been prepared in conformity with
      generally accepted accounting principles, which contemplate continuation of
      the
      Company as a going concern. The history of losses and the inability for the
      Company to make a profit from selling a good or service has raised substantial
      doubt about our ability to continue as a going concern.





In
      spite
      of the fact that the current cash obligations of the Company are relatively
      minimal, given the cash position of the Company, we have very little cash to
      operate.





We
      intend
      to fund the Company and attempt to meet corporate obligations by selling common
      stock. However the Company's common stock is at a low price and is not actively
      traded.





**Results
      of Operations for the Year Ended December 31, 2006.**





We
      had $0
      in net revenues.





We
      had a
      $1,967,633 net loss from operations for 2006.





Operating
      expenses were $1,967,633 in 2006. These expenses were primarily incurred for
      professional fees, consulting services related to the operations of the
      Company's business, specifically, research and development related expenses,
      and
      other general and administrative expenses.




**ITEM
      6A**  **QUANTITATIVE
      AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK**





We
      face
      exposure to fluctuations in the price of our common stock due to the very
      limited cash resources we have. For example, the Company has very limited
      resources to pay legal and accounting professionals. If we are unable to pay
      a
      legal or accounting professional in order to perform various professional
      services for the company, it may be difficult, if not impossible, for the
      Company to maintain its reporting status under the '34 Exchange Act. If the
      Company felt that it was likely that it would not be able to maintain its
      reporting status, it would make a disclosure by filing a Form 8-K with the
      SEC.
      In any case, if the Company was not able to maintain its reporting status,
      it
      would become "delisted" and this would potentially cause an investor or an
      existing shareholder to lose all or part of his investment.





**ITEM
      7.**  **FINANCIAL
      STATEMENTS**





The
      Consolidated Financial Statements and schedules that constitute Item 7 are
      attached at the end of this Annual Report on Form 10-KSB on the "F"
      pages.





**ITEM
      8.**  **CHANGES
      IN AND DISAGREEMENTS WITH ACCOUNTANTS ON** **ACCOUNTING
      AND FINANCIAL DISCLOSURE**





Not
      applicable.





**ITEM
      8A.**  **CONTROLS
      AND PROCEDURES**





Under
      the
      supervision and with the participation of our Chief Executive Officer and Chief
      Financial Officer, we have evaluated the effectiveness of the design and
      operation of our disclosure controls and procedures as of the end of the period
      covered by this annual report, and based on their evaluation, our Chief
      Executive Officer and Chief Financial Officer have concluded that these
      disclosure controls and procedures are effective in timely alerting them to
      material information relating to the Company required to be included in the
      Company’s periodic SEC filings. There were no significant changes in our
      internal control over financial reporting that could significantly affect this
      control since our last fiscal quarter.




Disclosure
      controls and procedures are the controls and other procedures that are designed
      to ensure that information required to be disclosed by us in the reports we
      file
      or submit under the Exchange Act is recorded, processed, summarized, and
      reported, within the time periods specified in the Securities and Exchange
      Commission’s rules and forms. Disclosure controls and procedures include,
      without limitation, controls and procedures designed to ensure that information
      required to be disclosed by us in the reports that we file under the Exchange
      Act is accumulated and communicated to our management, including our Chief
      Executive Officer and Chief Financial Officer, as appropriate, to allow timely
      decisions regarding required disclosure.





**ITEM
      8B.**  **OTHER
      INFORMATION**





Not
      applicable.














**PART
      III**





**ITEM
      9.**  **DIRECTORS,
      EXECUTIVE OFFICERS, PROMOTERS AND** **CONTROL
      PERSONS; COMPLIANCE WITH SECTION 16(A) OF** **THE
      EXCHANGE ACT**





As
      of
      April 16, 2007, the Company's current officers and directors consist of the
      following persons:





**Name**
            **Age**
            **Office**
            **Since**Dr.
                John Todd
            61
            Chairman
                of the Board, President, CEO and CFO
            InceptionMr.
                C. Fred Whittaker
            63
            Director
            2005





Dr.
      John Todd





Dr.
      John
      Todd has held the position of Chairman and President of ProtoKinetix, Inc since
      July 2003. From 1999 to 2003 Dr. Todd is a practicing general surgeon in White
      Rock, British Columbia. He went into a part time practice in July of 2005,
      sharing a practice with another general surgeon so that he can spend more time
      conducting the work on Protokinetix, Inc. Dr. Todd received his Doctor of
      Medicine Degree from the University of Calgary in 1974.





C.
      Fred Whittaker





Mr.
      C.
      Fred Whittaker was elected to our Board of Directors in 2005. Mr. Whittaker
      has
      been in the accounting profession for over 40 years. Mr. Whittaker received
      his
      Chartered Accounting designation in 1967, and has worked for various accounting
      firms, including KPMG, as well as for himself at different times in the past.
      For the last 15 years, he has worked exclusively for Whittaker & Associates,
      a regional accounting firm which he founded located in Vancouver, British
      Columbia. Currently, Mr. Whittaker is a senior partner at the accounting firm
      of
      Whittaker & Associates and has been for the past 30 years.





**Section
      16(a) Beneficial Ownership Reporting Compliances**





Section
      16(a) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
      requires the Company’s directors, executive officers and holders of more than
      10% of the Company’s common stock to file with the Securities and Exchange
      Commission initial reports of ownership and reports of changes in ownership
      of
      common stock and other equity securities of the Company. The Company believes
      that during the year ended December 31, 2006, its officers, directors and
      holders of more than 10% of the Company’s common stock complied with all Section
      16(a) filing requirements.





**Code
      of Ethics**





Effective
      March 31, 2006, our board of directors adopted the ProtoKinetix, Inc. Code
      of
      Business Conduct and Ethics. The board of directors believes that our Code
      of
      Business Conduct and Ethics provides standards that are reasonably designed
      to
      deter wrongdoing and to promote the following: (1)
      honest and ethical conduct, including the ethical handling of actual or apparent
      conflicts of interest between personal and professional relationships; (2)
      full,
      fair, accurate, timely, and understandable disclosure in reports and documents
      that we file with, or submits to, the Securities and Exchange
      Commission ;
      (3)
      compliance with applicable governmental laws, rules and regulations; the
      prompt internal reporting of violations of the Code of Business Conduct and
      Ethics to an appropriate person or persons; and (4)
      accountability for adherence to the Code of Business Conduct and Ethics.





**Identification
      of Audit Committee; Audit Committee Financial Expert**





The
      Company currently does not have an audit committee and has not made a
      determination of whether there is a financial expert. The Company plans to
      establish an audit committee during the third quarter of the current fiscal
      year.




**ITEM
      10.**  **EXECUTIVE
      COMPENSATION**





The
      following table summarizes the annual compensation paid to ProtoKinetix’s named
      executive officers for the two years ended December 31, 2006, and
      2005:





**Annual
                Compensation**
            
            **Long-Term
                Compensation****Common
                Shares****Underlying**
            
            **All****Restricted**
            
            **Options**
            
            **Other****Other
                Annual**
            
            **Stock**
            
            **Granted**
            
            **Compen****Name
                and Position**
            
            **Year**
            
            **Salary**
            
            **Bonus**
            
            **Compensation**
            
            **Awards
                ($)**
            
            **(#
                Shares)**
            
            **-sation**Dr.
                John Todd
            
            2006
            
            $0
            
            -0-
            
            -0-
            
            -0-
            
            ------
            
            -0-*President,
                Chief*
            
            2005
            
            0
            
            -0-
            
            -0-
            
            -0-
            
            ------
            
            -0-*Executive
                Officer**and
                Director*Mr.
                C. Fred Whittaker
            
            2006
            
            $0
            
            -0-
            
            -0-
            
            -0-
            
            ------
            
            -0-*Director*
            
            2005
            
            0
            
            -0-
            
            -0-
            
            -0-
            
            ------
            
            -0-*And
                Director*





**Options/SAR
      Grants in the Last Fiscal Year**





N/A





**Employment
      Agreements**





None





**Chief
      Executives Officer’s compensation**





During
      fiscal year 2006, Dr. John Todd did not draw a salary nor did the Company accrue
      a salary for any obligation.





**Compensation
      of Directors**





Directors
      receive no remuneration for their services as directors at this time. The
      Company has adopted no retirement, pension, profit sharing or other similar
      programs.





**ITEM
      11.**  **SECURITY
      OWNERSHIP OF CERTAIN BENEFICIAL OWNERS** **AND
      MANAGEMENT AND RELATED STOCKHOLDER** **MATTERS**





The
      following table sets forth certain information regarding the beneficial
      ownership of the Company’s Common Stock as of December 31, 2006 based on
      information available to the Company by (i) each person who is known by the
      Company to own more than 5% of the outstanding Common Stock based upon reports
      filed by such persons within the Securities and Exchange Commission; (ii) each
      of the Company’s directors; (iii) each of the Named Executive Officers; and (iv)
      all officers and directors of the Company as a group.





**Name
                and Address**
            **Shares
                Beneficially Owned**
            **Percent
                of Class**Dr.
                John Todd(1)
            3,130,000(4)
            7
                %Mr.
                C. Fred Whittaker(2)
            120,000
            Less
                than 1%Centrum
                Bank AG(3)
            4,868,780
            10.9%**TOTAL**
            8,118,780
            18.2%







(1)  The
      address is 1500-885 Georgia Street, Vancouver, BC V6C 3E8 Canada




(2)  The
      address is 1500-885 Georgia Street, Vancouver, BC V6C 3E8 Canada




(3)  The
      address is Kirchstrasse 3, 9490 Vaduz Liechtenstein




(4)  This
      amount includes 400,000 shares beneficially owned J.D. Todd Medical
      Inc




A
      person
      is deemed to be the beneficial owner of securities that can be acquired by
      such
      person within 60 days from the date of the registration statement upon the
      exercise of options or warrants. Each beneficial owner's percentage ownership
      is
      determined by assuming that options or warrants that are held by such person
      and
      which are exercisable within 60 days of the date of this registration statement
      have been exercised. Unless otherwise indicated, the company believes that
      all
      persons named in the table have voting and investment power with respect to
      all
      shares of common stock beneficially owned by them.




**ITEM
      12.**  **CERTAIN
      RELATIONSHIPS AND RELATED TRANSACTIONS**





N/A





**ITEM
      13.**  **EXHIBITS
      AND REPORTS ON FORM 8-K**





(a)
      Exhibits.





Exhibit
                #
            
            Description3.1(i)
            
            Certificate
                of Incorporation filed as an exhibit to the Company's registration
                statement on Form 10-SB/A filed on July 24, 2001 and incorporated
                herein
                by reference.3.1(ii)
            
            By-Laws
                filed as an exhibit to the Company's registration statement on Form
                10-SB/A filed on July 24, 2001 and incorporated herein by
                reference.10.1
            
            February
                1, 2006 Consulting Agreement between Jansa Overseas, Inc. and
                Protokinetix, Inc.10.2
            
            February
                1, 2006 Consulting Agreement between Amirem, Inc. and Protokinetix,
                Inc.14.1
            
            ProtoKinetix,
                Inc. Code of Ethics filed as an exhibit to the Company's Form 10-KSB
                filed
                on April 13, 2006 and incorporated herein by reference.23.1
            
            Consent
                of Experts31.1
            
            Rule
                13a-12(a)/15d-14(a) Certification32.1
            
            Section
                1350 Certification attached.







**ITEM
      14.**  **PRINCIPAL
      ACCOUNTANT FEES AND SERVICES**




**Audit
      Fees**





For
      the
      years ended December 31, 2006 and December 31, 2005, Peterson Sullivan PLLC,
      the
      Company’s principal accountants, billed the Company $40,000 and $30,292,
      respectively, for fees for the audit of the Company’s annual financial
      statements and review of financial statements included in the Company’s Forms
      10-QSB.





**Audit-Related
      Fees**





For
      the
      years ended December 31, 2005 and December 31, 2004, Peterson Sullivan PLLC
      did
      not provide the Company with any assurances or related services reasonably
      related to the performance of the audit or review of the Company’s financial
      statements and are not reported above under "Audit Fees."





**Tax
      Fees**





For
      the
      years ended December 31, 2005 and December 31, 2004, Peterson Sullivan PLLC
      did
      not bill for professional services for tax compliance, tax advice, and tax
      planning.





**All
      Other Fees**





For
      the
      years ended December 31, 2005 and December 31, 2004, Peterson Sullivan PLLC
      did
      not bill the Company for fees associated with the preparation and filing of
      the
      Company’s registration statements, the creation of pro forma financial
      statements and other related matters.





**Audit
      Committee Pre-Approval Policies**





The
      Company currently does not have an audit committee. The Company’ Board of
      Directors currently approves in advance all audit and non-audit related services
      performed by the Company’s principal accountants.


















**SIGNATURES**




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




**PROTOKINETIX,
                INC.**Date:  April
                17, 2007
            
            By:
            
            /s/
                Dr. John ToddDr.
                John Todd*President,
                CEO and CFO*







In
      accordance with the requirements of the Exchange Act, this report has been
      signed below by the following persons on behalf of the registrant and in the
      capacities and on the dates indicated.





Signatures
            Title
            Date/s/Dr.
                John Todd
              Dr.
                John Todd
            Chief
                Executive Officer, President, Chief Financial Officer and Chairman
                Of The
                Board
            April
                17, 2007












































**PROTOKINETIX,
                INCORPORATED**
              **(A
                Development Stage Company)**
              
              
              FINANCIAL
                REPORT
              
              
              DECEMBER
                31, 2006















































**C
      O N T E N T S**







**REPORT
      OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**




**FINANCIAL
      STATEMENTS**






BALANCE
      SHEET




STATEMENTS
      OF OPERATIONS




STATEMENTS
      OF STOCKHOLDERS' EQUITY




STATEMENTS
      OF CASH FLOWS




NOTES
      TO
      FINANCIAL STATEMENTS
































**REPORT
      OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**











To
      the
      Board of Directors and Shareholders


ProtoKinetix,
      Incorporated











We
      have
      audited the accompanying balance sheet of ProtoKinetix, Incorporated (a
      development stage company) as of December 31, 2006, and the related
      statements of operations, stockholders' equity, and cash flows for the years
      ended December 31, 2006 and 2005, and for the period from December 23, 1999
      (date of inception) through December 31, 2006. These financial statements
      are the responsibility of the Company's management. Our responsibility is to
      express an opinion on these financial statements based on our
      audits.





We
      conducted our audits in accordance with the standards of the Public Company
      Accounting Oversight Board (United States). Those standards require that we
      plan
      and perform the audit to obtain reasonable assurance about whether the financial
      statements are free of material misstatement. The Company has determined that
      it
      is not required to have, nor were we engaged to perform, an audit of its
      internal control over financial reporting. Our audit included consideration
      of
      internal control over financial reporting as a basis for designing audit
      procedures that are appropriate in the circumstances, but not for the purpose
      of
      expressing an opinion on the effectiveness of the Company's internal control
      over financial reporting. Accordingly, we express no such opinion. An audit
      includes examining, on a test basis, evidence supporting the amounts and
      disclosures in the financial statements. An audit also includes assessing the
      accounting principles used and significant estimates made by management, as
      well
      as evaluating the overall financial statement presentation. We believe that
      our
      audits provide a reasonable basis for our opinion.





In
      our
      opinion, the financial statements referred to above present fairly, in all
      material respects, the financial position of ProtoKinetix, Incorporated (a
      development stage company) as of December 31, 2006, and the results of its
      operations and its cash flows for the years ended December 31, 2006 and
      2005, and for the period from December 23, 1999 (date of inception) through
      December 31, 2006, in conformity with accounting principles generally
      accepted in the United States.





The
      accompanying financial statements have been prepared assuming the Company will
      continue as a going concern. As discussed in Note 1 to the financial statements,
      the Company has not generated revenues or positive cash flows from operations
      and has an accumulated deficit at December 31, 2006. These conditions raise
      substantial doubt about the Company's ability to continue as a going concern.
      Management's plan regarding those matters is also described in Note 1. The
      financial statements do not include any adjustments that might result from
      the
      outcome of this uncertainty.








/S/
      PETERSON SULLIVAN PLLC








Seattle,
      Washington


April
      12,
      2007

















1





**PROTOKINETIX** **,
      INCORPORATED**


(A
      Development Stage Company)




BALANCE
      SHEET




December
      31, 2006


ASSETSCurrent
                AssetsCash
            
            
            $
                166,115Accounts
                receivable
            
            6,391Prepaid
                expenses
            
            440,000Total
                current assets
            
            612,506Computer
                Equipment, net of accumulated depreciation of $1,944
            
            1,444$
                613,950LIABILITIES
                AND STOCKHOLDERS' EQUITYCurrent
                LiabilitiesDue
                to outside management consultants
            
            $
                306,892Accounts
                payable
            
            107,809Total
                current liabilities
            
            414,701Stockholders'
                EquityCommon
                stock, $.0000053 par value; 100,000,000 commonshares
                authorized; 44,267,153 shares issued and outstanding
            
            240Common
                stock issuable; 400,000 shares
            
            5Additional
                paid-in capital
            
            17,055,767Deficit
                accumulated during the development stage
            
            (16,856,763)199,249$
                613,950














**PROTOKINETIX** **,
      INCORPORATED**


(A
      Development Stage Company)




STATEMENTS
      OF OPERATIONS




For
      the
      Years Ended December 31, 2006 and 2005, and for the


Period
      from December 23, 1999 (Date of Inception) to December 31,
      2006


CumulativeDuring
                theDevelopment2006
            
            2005
            
            StageRevenues
            $
                -
            
            $
                2,000
            
            $
                2,000ExpensesLicenses
            
            
            
            
            3,379,756Professional
                fees
            386,095
            
            333,186
            
            2,812,788Consulting
                fees
            1,196,124
            
            3,915,676
            
            9,233,803Research
                and development
            180,709
            
            410,650
            
            800,891General
                and administrative
            192,836
            
            155,835
            
            539,897Interest
            11,869
            
            13,193
            
            48,1621,967,633
            
            4,828,540
            
            (16,813,297)Loss
                from continuing operations
            (1,967,633)
            
            (4,826,540)
            
            (16,813,297)Discontinued
                OperationsLoss
                from operations of the discontinuedsegment
            
            
            
            
            (43,466)Net
                loss
            $
                (1,967,633)
            
            $(4,826,540)
            
            $(16,856,763)Net
                Loss per Common Share (basic andfully
                diluted)
            $
                (0.05)
            
            $
                (0.13)Weighted
                average number of commonshares
                outstanding
            43,233,617
            
            38,598,215

















**PROTOKINETIX** **,
      INCORPORATED**


(A
      Development Stage Company)




STATEMENTS
      OF STOCKHOLDERS' EQUITY




For
      the
      Years Ended December 31, 2006 and 2005, and for the


Period
      from December 23, 1999 (Date of Inception) to December 31, 2006


DeficitAccumulatedCommon
                Stock
            
            Additional
            
            Stock
            
            During
                theCommon
                Stock
            
            Issuable
            
            Paid-in
            
            Subscriptions
            
            DevelopmentShares
            
            Amount
            
            Shares
            
            Amount
            
            Capital
            
            Receivable
            
            Stage
            
            TotalIssuance
                of common stock, December 1999
            9,375,000
            
            $
                50
            
            -
            
            $
                -
            
            $
                4,950
            
            $
                -
            
            $
                -
            
            $
                5,000Net
                loss for the year
            
            
            
            
            
            
            
            
            
            
            
            
            (35)
            
            (35)Balance,
                December 31, 2000
            9,375,000
            
            50
            
            -
            
            -
            
            4,950
            
            
            
            (35)
            
            4,965Issuance
                of common stock, April 2001
            5,718,750
            
            30
            
            
            
            
            
            15,220
            
            
            
            
            
            15,250Net
                loss for the year
            
            
            
            
            
            
            
            
            
            
            
            
            (16,902)
            
            (16,902)Balance,
                December 31, 2001
            15,093,750
            
            80
            
            -
            
            -
            
            20,170
            
            
            
            (16,937)
            
            3,313Net
                loss for the year
            
            
            
            
            
            
            
            
            
            
            
            
            (14,878)
            
            (14,878)Balance,
                December 31, 2002
            15,093,750
            
            80
            
            -
            
            -
            
            20,170
            
            
            
            (31,815)
            
            (11,565)Issuance
                of common stock for services:July
                2003
            2,125,000
            
            11
            
            
            
            
            
            424,989
            
            
            
            
            
            425,000August
                2003
            300,000
            
            2
            
            
            
            
            
            14,998
            
            
            
            
            
            15,000September
                2003
            1,000,000
            
            5
            
            
            
            
            
            49,995
            
            
            
            
            
            50,000October
                2003
            1,550,000
            
            8
            
            
            
            
            
            619,992
            
            
            
            
            
            620,000Issuance
                of common stock for licensing rights
            14,000,000
            
            74
            
            
            
            
            
            2,099,926
            
            
            
            
            
            2,100,000Common
                stock issuable for licensing rights
            
            
            
            
            2,000,000
            
            11
            
            299,989
            
            
            
            
            
            300,000Shares
                cancelled on September 30, 2003
            (9,325,000)
            
            (49)
            
            
            
            
            
            49
            
            
            
            
            
            -Net
                loss for the year
            
            
            
            
            
            
            
            
            
            
            
            
            (3,662,745)
            
            (3,662,745)Balance,
                December 31, 2003
            24,743,750
            
            131
            
            2,000,000
            
            11
            
            3,530,108
            
            -
            
            (3,694,560)
            
            (164,310)Issuance
                of common stock for services:March
                2004
            1,652,300
            
            9
            
            
            
            
            
            991,371
            
            
            
            
            
            991,380May
                2004
            500,000
            
            3
            
            
            
            
            
            514,997
            
            
            
            
            
            515,000July
                2004
            159,756
            
            1
            
            
            
            
            
            119,694
            
            
            
            
            
            119,695August
                2004
            100,000
            
            1
            
            
            
            
            
            70,999
            
            
            
            
            
            71,000October
                2004
            732,400
            
            4
            
            
            
            
            
            479,996
            
            
            
            
            
            480,000November
                2004
            650,000
            
            4
            
            
            
            
            
            454,996
            
            
            
            
            
            455,000December
                2004
            255,000
            
            1
            
            
            
            
            
            164,425
            
            
            
            
            
            164,426Common
                stock issuable for AFGP license
            
            
            
            
            1,000,000
            
            5
            
            709,995
            
            
            
            
            
            710,000Common
                stock issuable for Recaf license
            
            
            
            
            400,000
            
            2
            
            223,998
            
            
            
            
            
            224,000Warrants
                granted (for 3,450,000 shares) for services,October
                2004
            
            
            
            
            
            
            
            
            1,716,253
            
            
            
            
            
            1,716,253Options
                granted (for 400,000 shares) for services,October
                2004
            
            
            
            
            
            
            
            
            212,734
            
            
            
            
            
            212,734Stock
                subscriptions receivable
            
            
            
            
            1,800,000
            
            10
            
            329,990
            
            (330,000)
            
            
            
            -Warrants
                exercised:
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            -August
                2004
            
            
            
            
            50,000
            
            
            
            15,000
            
            
            
            
            
            15,000October
                2004
            
            
            
            
            600,000
            
            3
            
            134,997
            
            
            
            
            
            135,000December
                2004
            
            
            
            
            1,000,000
            
            5
            
            224,995
            
            
            
            
            
            225,000Options
                exercised, December 2004
            
            
            
            
            100,000
            
            1
            
            29,999
            
            
            
            
            
            30,000Net
                loss for the year
            
            
            
            
            
            
            
            
            
            
            -
            
            (6,368,030)
            
            (6,368,030)Balance,
                December 31, 2004
            28,793,206
            
            $
                154
            
            6,950,000
            
            $
                37
            
            $
                9,924,547
            
            $
                (330,000)
            
            $(10,062,590)
            
            $
                (467,852)











**PROTOKINETIX** **,
      INCORPORATED**


(A
      Development Stage Company)




STATEMENTS
      OF STOCKHOLDERS' EQUITY




(Continued)


For
      the
      Years Ended December 31, 2006 and 2005, and for the


Period
      from December 23, 1999 (Date of Inception) to December 31, 2006


DeficitAccumulatedCommon
                Stock
            
            Additional
            
            Stock
            
            During
                theCommon
                Stock
            
            Issuable
            
            Paid-in
            
            Subscriptions
            
            DevelopmentShares
            
            Amount
            
            Shares
            
            Amount
            
            Capital
            
            Receivable
            
            Stage
            
            TotalBalance,
                December 31, 2004
            28,793,206
            
            $
                154
            
            6,950,000
            
            $
                37
            
            $
                9,924,547
            
            $
                (330,000)
            
            $
                (10,062,590)
            
            $
                (467,852)Issuance
                of common stock for stock subscriptions received
            
            
            
            
            
            
            
            
            
            240,000
            
            
            
            240,000Issuance
                of common stock for common stock issuable
            2,000,000
            
            11
            
            (2,000,000)
            
            (11)
            
            
            
            
            
            
            
            -Issuance
                of common stock for common stock issuable
            2,050,000
            
            10
            
            (2,050,000)
            
            (10)
            
            
            
            
            
            
            
            -Options
                exercised,
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            -February
                2005
            
            
            
            
            35,000
            
            1
            
            10,499
            
            
            
            
            
            10,500May
                2005
            200,000
            
            1
            
            
            
            
            
            59,999
            
            
            
            
            
            60,000Issuance
                of common stock for note payable conversionFebruary
                2005
            285,832
            
            1
            
            
            
            
            
            85,749
            
            
            
            
            
            85,750May
                2005
            353,090
            
            2
            
            
            
            
            
            105,925
            
            
            
            
            
            105,927Issuance
                of common stock for common stock issuable
            2,535,000
            
            13
            
            (2,535,000)
            
            (13)
            
            
            
            90,000
            
            
            
            90,000Issuance
                of common stock for services and common stock issuableApril
                2005
            30,000
            
            1
            
            
            
            
            
            14,999
            
            
            
            
            
            15,000May
                2005
            3,075,000
            
            15
            
            
            
            
            
            3,320,985
            
            
            
            
            
            3,321,000June
                2005
            50,000
            
            1
            
            
            
            
            
            50,499
            
            
            
            
            
            50,500August
                2005
            111,111
            
            1
            
            (92,593)
            
            (1)
            
            15,000
            
            
            
            
            
            15,000October
                2005
            36,233
            
            1
            
            (36,233)
            
            (1)
            
            
            
            
            
            
            
            -November
                2005
            311,725
            
            2
            
            (245,000)
            
            (1)
            
            36,249
            
            
            
            
            
            36,250December
                2005
            1,220,000
            
            8
            
            
            
            
            
            756,392
            
            
            
            
            
            756,400Common
                stock canceled; August 2005
            (250,000)
            
            (1)
            
            
            
            
            
            (257,499)
            
            
            
            
            
            (257,500)Common
                stock issuable for servicesJune
                2005
            
            
            
            
            200,000
            
            1
            
            149,999
            
            
            
            
            
            150,000August
                2005
            
            
            
            
            36,233
            
            1
            
            21,739
            
            
            
            
            
            21,740September
                2005
            
            
            
            
            125,000
            
            1
            
            74,999
            
            
            
            
            
            75,000September
                2005 (Proteocell)
            
            
            
            
            100,000
            
            1
            
            57,999
            
            
            
            
            
            58,000December
                2005
            
            
            
            
            120,968
            
            1
            
            74,999
            
            
            
            
            
            75,000Net
                loss for the year
            
            
            
            
            
            
            
            
            
            
            
            
            (4,826,540)
            
            (4,826,540)Balance,
                December 31, 2005
            40,801,197
            
            $
                220
            
            608,375
            
            $
                6
            
            $
                14,503,079
            
            $
                -
            
            $
                (14,889,130)
            
            $
                (385,825)

















**PROTOKINETIX** **,
      INCORPORATED**


(A
      Development Stage Company)




STATEMENTS
      OF STOCKHOLDERS' EQUITY




(Continued)


For
      the
      Years Ended December 31, 2006 and 2005, and for the


Period
      from December 23, 1999 (Date of Inception) to December 31, 2006


DeficitAccumulatedCommon
                Stock
            
            Additional
            
            Stock
            
            During
                theCommon
                Stock
            
            Issuable
            
            Paid-in
            
            Subscriptions
            
            DevelopmentShares
            
            Amount
            
            Shares
            
            Amount
            
            Capital
            
            Receivable
            
            Stage
            
            TotalBalance,
                December 31, 2005
            40,801,197
            
            $
                220
            
            608,375
            
            $
                6
            
            $
                14,503,079
            
            $
                -
            
            $
                (14,889,130)
            
            $
                (385,825)Issuance
                of common stock and warrants for $450,000 in cash (June
                2006)Common
                stock
            900,000
            
            5
            
            
            
            
            
            352,142
            
            
            
            
            
            352,147Warrants
                granted (for 450,000 shares)
            
            
            
            
            
            
            
            
            97,853
            
            
            
            
            
            97,853Issuance
                of common stock for note payable conversion including
              accumulated
                interest (June 2006)
            529,279
            
            3
            
            
            
            
            
            158,780
            
            
            
            
            
            158,783Issuance
                of common stock and common stock issuable for servicesFebruary
                2006
            
            
            
            
            20,000
            
            1
            
            10,499
            
            
            
            
            
            10,500March
                2006
            166,359
            
            1
            
            (108,375)
            
            (1)
            
            36,750
            
            
            
            
            
            36,750May
                2006
            1,266,278
            
            7
            
            (70,000)
            
            (1)
            
            792,750
            
            
            
            
            
            792,756June
                2006
            27,056
            
            1
            
            1,200,000
            
            5
            
            718,244
            
            
            
            
            
            718,250July
                2006
            1,200,000
            
            6
            
            (1,200,000)
            
            (6)
            
            
            
            
            
            
            
            -August
                2006
            100,000
            
            1
            
            
            
            
            
            64,999
            
            
            
            
            
            65,000September
                2006
            369,984
            
            1
            
            (50,000)
            
            1
            
            209,998
            
            
            
            
            
            210,000November
                2006
            100,000
            
            1
            
            
            
            
            
            48,999
            
            
            
            
            
            49,000December
                2006
            7,000
            
            
            
            
            
            
            
            3,010
            
            
            
            
            
            3,010Warrants
                issued (for 700,000 shares) for services
            
            
            
            
            
            
            
            
            58,658
            
            
            
            
            
            58,658Cancellation
                of shares, April 2006
            (1,200,000)
            
            (6)
            
            
            
            
            
            6
            
            
            
            
            
            -Net
                loss for the year
            
            
            
            
            
            
            
            
            
            
            
            
            (1,967,633)
            
            (1,967,633)Balance,
                December 31, 2006
            44,267,153
            
            $
                240
            
            400,000
            
            $
                5
            
            $
                17,055,767
            
            $
                -
            
            $
                (16,856,763)
            
            $
                199,249



















**PROTOKINETIX** **,
      INCORPORATED**


(A
      Development Stage Company)




STATEMENTS
      OF CASH FLOWS




For
      the
      Years Ended December 31, 2006 and 2005, and for the


Period
      from December 23, 1999 (Date of Inception) to December 31, 2006





CumulativeDuring
                theDevelopment2006
            
            2005
            
            StageCash
                Flows from Operating ActivitiesNet
                loss for the period
            $
                (1,967,633)
            
            $
                (4,826,540)
            
            $
                (16,856,763)Adjustments
                to reconcile net loss to net cashused
                in operating activitiesDepreciation
                expense
            1,017
            
            674
            
            1,944Issuance
                of common stock for servicesand
                expenses
            1,885,266
            
            4,316,390
            
            13,442,157Warrants
                issued for consulting services
            58,658
            
            
            
            1,774,911Stock
                options issued for consulting services
            
            
            
            
            212,734Changes
                in operating assets and liabilitiesAccounts
                receivable
            148
            
            (6,539)
            
            (6,391)Prepaid
                expenses
            (433,800)
            
            (6,200)
            
            (440,000)Due
                to outside management consultants
            
            
            (86,958)
            
            306,892Accounts
                payable
            75,888
            
            10,199
            
            106,975Accrued
                interest payable
            
            
            13,194
            
            36,294Net
                cash used in operating activities
            (380,456)
            
            (585,780)
            
            (1,421,247)Cash
                Flows from Investing ActivitiesPurchase
                of computer equipment
            
            
            (1,705)
            
            (3,388)Net
                cash used in investing activities
            
            
            (1,705)
            
            (3,388)Cash
                Flows from Financing ActivitiesWarrants
                exercised
            
            
            330,000
            
            705,000Stock
                options exercised
            
            
            70,500
            
            100,500Issuance
                of common stock and warrants for cash
            450,000
            
            
            
            470,250Proceeds
                from convertible note
            
            
            
            
            315,000Net
                cash flows provided by financing activities
            450,000
            
            400,500
            
            1,590,750Net
                change in cash
            69,544
            
            (186,985)
            
            166,115Cash,
                beginning of year
            96,571
            
            283,556Cash,
                end of year
            $
                166,115
            
            $
                96,571
            
            $
                166,115Cash
                paid for interest
            $
                -
            
            $
                -
            
            $
                -Cash
                paid for income taxes
            $
                -
            
            $
                -
            
            $
                -Supplementary
                Information - Non-cash Transactions:Stock
                subscriptions received
            $
                -
            
            $
                330,000
            
            $
                330,000Note
                payable converted to common stock
            158,783
            
            191,677
            
            350,460















**NOTES
      TO FINANCIAL STATEMENTS**











**Note
      1. The Company and Significant Accounting Policies**





**Organization**





ProtoKinetix,
      Incorporated (the "Company"), a development stage company, was incorporated
      under the laws of the State of Nevada on December 23, 1999. The Company is
      a
      medical research company whose mission is the advancement of human health care.





In
      2003,
      the Company entered into an assignment of license agreement (the "Agreement")
      with BioKinetix, Inc., an Alberta, Canada, corporation. The Agreement provided
      the Company with an exclusive assignment of all of the rights (the "Rights")
      that BioKinetix possessed relating to proprietary technologies that are being
      developed for the creation and commercialization of "superantibodies," an
      enhancement of antibody technology that makes ordinary antibodies much more
      lethal. In consideration, the Company's Board of Directors authorized the
      Company to issue 16,000,000 shares of its common stock to the shareholders
      of
      BioKinetix.





The
      Company is also currently researching the benefits and feasibility of
      proprietary synthesized Antifreeze Glycoproteins ("AFGP"). In preliminary
      studies, AFGP has demonstrated an ability to protect and preserve human cells
      at
      temperatures below freezing.





**Going
      Concern**





The
      Company's financial statements are prepared consistent with accounting
      principles generally accepted in the Unites States applicable to a going
      concern, which contemplates the realization of assets and liquidation of
      liabilities in the normal course of business.





As
      shown
      in the financial statements, the Company has not developed a commercially viable
      product, has not generated any significant revenue to date, and has incurred
      losses since inception, resulting in a net accumulated deficit at December
      31,
      2006. These factors raise substantial doubt about the Company's ability to
      continue as a going concern and may result in discontinuance of
      operations.





The
      Company anticipates that its existing capital resources will not enable it
      to
      continue operations through December 31, 2007, if the Company does not
      raise additional capital through various financing options; however, the Company
      does not have any financing commitments at this date. There can be no assurance
      that financing will be available on favorable terms or at all. If the Company
      raises additional capital through the sale of equity or convertible debt
      securities, the issuance of such securities may result in dilution to existing
      stockholders.





The
      financial statements do not include any adjustments relating to the
      recoverability and classification of recorded asset amounts and classification
      of liabilities that might be necessary should the Company have to curtail
      operations or be unable to continue in existence.




**Cash**





Cash
      consists of funds held in checking accounts. Cash balances may exceed federally
      insured limits from time to time.





**Accounts
      Receivable**





Receivables
      consist of cost advances and an amount due from a veterinary center that
      purchased the Company's AFGP product for research.





**Prepaid
      Expenses**





Prepaid
      expenses consist of shares issued for services yet to be performed.





**Computer
      Equipment**





Computer
      equipment is stated at cost and is depreciated using straight-line methods
      over
      the estimated useful lives.





**Due
      to Outside Management Consultants**





The
      Company's offices are currently provided by outside management consultants
      and
      costs are allocated to the Company on a month-to-month basis. The amounts due
      are unsecured, bear no interest and are due on demand.





**Convertible
      Note Payable**





On
      February 1, 2004, the Company executed a subscription agreement under which
      the Company issued to a corporation an 8% secured convertible note in exchange
      for $315,000. The note was due February 1, 2006, and was convertible into
      shares of the Company's common stock at the lower of $.30 per share or 70%
      of
      the average of the three lowest trading prices for the 30 days prior to the
      conversion date. No beneficial conversion feature was applicable to this
      convertible note.





In
      April
      2005, 285,832 common shares, in May 2005, 353,090 common shares and in May
      2006,
      529,279 common shares were issued in accordance with the note terms of
      conversion in lieu of payment on this note and accumulated unpaid interest.
      The
      May 2006 conversion into common stock repaid the balance owing on the note
      and
      all related interest. All conversions were exercised at a $0.30 per share
      conversion price.





**Warrants**





The
      Company estimates the value of warrants using a Black-Scholes pricing model
      based on management's assumptions regarding the warrant lives, expected
      volatility, and risk free interest rates.




**Fair
      Value of Financial Instruments**





Financial
      instruments consist of cash, accounts receivable, due to outside management
      consultants, and accounts payable. The fair value of these financial instruments
      approximates the carrying amounts due to the short-term nature.





**Revenue
      Recognition**





The
      Company recognizes revenue when a sale is made, the fee is fixed or
      determinable, collectibility is probable and no significant Company obligations
      remain.





**Income
      Taxes**





The
      Company accounts for income taxes under an asset and liability approach that
      requires the recognition of deferred tax assets and liabilities for expected
      future tax consequences of events that have been recognized in the Company's
      financial statements or tax returns. In estimating future tax consequences,
      the
      Company generally considers all expected future events other than enactments
      of
      changes in the tax laws or rates.





**Research
      and Development Costs**





Research
      and development costs are expensed as incurred.





**Earnings
      per Share and Potentially Dilutive Securities**





Basic
      loss per share is computed by dividing the net loss available to common
      stockholders by the weighted average number of common shares outstanding in
      the
      period. Diluted loss per share takes into consideration common shares
      outstanding (computed under basic earnings per share) and any potentially
      dilutive securities. The effect of debt convertible into common shares and
      outstanding warrants were not included in the computation of diluted earnings
      per share for all periods presented because they were anti-dilutive due to
      the
      Company's losses. No convertible debt remained outstanding as of
      December 31, 2006. Common stock issuable is
      considered outstanding as of the original approval date for purposes of earnings
      per share computations.




**Share-Based
      Compensation**





The
      Company has a stock-based equity incentive plan, which is described more fully
      in Note 4. Prior to January 1, 2006, the Company had accounted for the plan
      under the recognition and measurement principles of APB Opinion No. 25,
      "Accounting for Stock Issued to Employees," and related interpretations as
      permitted by SFAS No. 123, "Accounting for Stock-Based Compensation." No
      stock-based employee compensation cost is reflected in the net loss when options
      granted under the plan have an exercise price equal to or greater than the
      market value of the underlining common stock on the date of grant. No options
      have been granted to employees under the plan; therefore, no reconciliation
      is
      provided of the effects on net loss in applying the fair value recognition
      provisions of SFAS No. 123. On January 1, 2006, the Company adopted SFAS
      No. 123(R), "Share-Based Payment" using the modified-prospective transition
      method. Under that transition method, compensation cost recognized for the
      year
      ended December 31, 2006, would include compensation cost for all
      share-based payments made subsequent to January 1, 2006, based on the
      grant-date fair value estimated in accordance with the provisions of SFAS No.
      123(R). Adoption of SFAS No. 123(R) did not have any effect on the financial
      statements because no share-based payments were made to employees in
      2006.





**Commitments**





The
      Company leases office space on a month-to-month basis. Rent expense incurred
      was
      $32,484 for 2006, $30,106 for 2005, and $108,092 for the cumulative period
      during the development stage.





**Estimates**





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





**Recent
      Accounting Pronouncements**





In
      June
      2006, the Financial Accounting Standards Board ("FASB") issued FASB
      Interpretation No. 48, *Accounting
      for Uncertainties in Income Taxes* ,
      ("FIN
      48"). FIN 48 clarifies the accounting for uncertainty in income taxes and
      prescribes a recognition threshold and measurement attribute for the financial
      statement recognition and measurement of a tax position taken or expected to
      be
      taken in a tax return. FIN
      48 is
      effective for financial statements as of January 1, 2007. The Company has not
      yet determined the impact of applying FIN 48.





In
      September 2006, the FASB issued Statement of Financial Accounting Standards
      No.
      157, *Fair
      Value Measurements* ("FAS
      157"). FAS 157 defines fair value, establishes a framework for measuring fair
      value and expands disclosures about fair value measurements but does not require
      any new fair value measurements. FAS 157 is effective for financial statements
      issued for fiscal years beginning after November 15, 2007, and interim periods
      within those fiscal years. The Company has not yet determined the impact of
      applying FAS 157.




In
      September 2006, the FASB issued Statement of Financial Accounting Standards
      No.
      158, *Employers'
      Accounting for Defined Benefit Pension and Other Postretirement
      Plans* ,
      ("FAS
      158"). FAS 158 requires an employer to recognize the overfunded or underfunded
      status of a defined benefit postretirement plan (other than a multiemployer
      plan) as an asset or liability in its statement of financial position and to
      recognize changes in that funded status in the year in which the changes occur
      through comprehensive income. FAS 158 is effective for financial statements
      as
      of December 31, 2006. The Company does not expect any material impact from
      applying FAS 158.





In
      February 2007, the FASB issued Statement of Financial Accounting Standards
      No.
      159, *The
      Fair Value Option for Financial Assets and Financial
      Liabilities* ,
      ("FAS
      159"). FAS 159 permits entities to choose to measure many financial instruments
      and certain other items at fair value. The objective is to improve financial
      reporting by providing entities with the opportunity to mitigate volatility
      in
      reported earnings caused by measuring related assets and liabilities differently
      without having to apply complex hedge accounting provisions. FAS 159 is
      effective for financial statements issued for fiscal years beginning after
      November 15, 2007. The Company has not yet determined the impact of adopting
      FAS
      159 on the Company's financial position.




**Note
      2. Income Taxes**





The
      Company is liable for taxes in the United States. As of December 31, 2006,
      the Company did not have any income for tax purposes and therefore, no tax
      liability or expense has been recorded in these financial
      statements.





The
      Company has tax losses of approximately $16,800,000 available to reduce future
      taxable income. The tax loss expires in years between 2022 and
      2024.





The
      deferred tax asset associated with the tax loss carry forward is approximately
      $5,728,000. The Company has provided a full valuation allowance against the
      deferred tax asset. The valuation allowance increased by $574,000 and $1,731,000
      for 2006 and 2005, respectively.




**Note
      3. Discontinued Operations**





In
      2003,
      the Company signed the licensing agreement described in Note 1. This agreement
      changed the Company's business plan to that of a medical research company.
      Accordingly, the operating results related to the internet-based real estate
      listing segment have been presented as discontinued operations in these
      financial statements for all periods presented. There were no revenues for
      the
      years presented in losses from discontinued operations.




**Note
      4. Share-Based Compensation**





In
      2003,
      the Company adopted its 2003 and 2004 Stock Incentive Plans. Each plan provides
      for the issuance of incentive and non-qualified shares of the Company's stock
      to
      officers, directors, employees and non-employees. The Board of Directors
      determines the terms of the shares or options to be granted, including the
      number of shares or options, the exercise price, and the vesting schedule,
      if
      applicable. In 2006 and 2005, the Company issued common shares from both plans
      to non-employee consultants for services rendered as follows:





2006
            
            Number
              of
                Shares
            
            Value
              per
                ShareFebruary
            
            20,000
            
            $0.53March
            
            57,984
            
            0.61May
            
            1,196,278
            
            0.66June
            
            27,056
            
            0.59August
            
            100,000
            
            0.65September
            
            319,984
            
            0.66November
            
            100,000
            
            0.49December
            
            7,000
            
            0.43Total
                2006
            
            1,828,302





2005
            
            Number
              of
                Shares
            
            Value
              per
                ShareApril
            
            30,000
            
            $0.50May
            
            3,075,000
            
            1.08June
            
            50,000
            
            1.01August
            
            18,518
            
            0.81November
            
            66,725
            
            0.54December
            
            1,220,000
            
            0.62Total
                2005
            
            4,460,243





A
      summary
      of the Company's outstanding stock options is as follows:





Number
              of
                Options
            
            Weighted
                Average
              Exercise
                PriceOutstanding
                at December 31, 2004
            
            300,000
            
            $0.30Granted
            
            -Exercised
            
            (235,000)
            
            0.30Forfeited
            
            (65,000)
            
            0.30Outstanding
                at December 31, 2005 and 2006
            
            -Options
                exercisable at December 31, 2005 and 2006
            
            -





**Note
      5. Equity**





In
      June
      2006, the Company issued (for $450,000) 900,000 shares of common stock which
      included warrants to purchase an additional 450,000 shares of common stock.
      Proceeds from the issuance were allocated to the shares and warrants based
      on
      their relative fair values. The fair value of the warrants was determined using
      the Black-Scholes option pricing model with the following assumptions: expected
      volatility of 74%, risk-free interest rate of 5%, 1-year expected life, and
      a 0%
      dividend yield.





In
      November 2006, the Company issued warrants to purchase 700,000 shares for
      services, the cost of which has been expensed in 2006 as compensation. The
      warrants were valued using the Black-Scholes option model with the following
      assumptions: expected volatility of 64%, risk-free interest rate of 8.25%,
      weighted average expected lives of 7 months, and a 0% dividend
      yield.








**Note
      6. Subsequent Event**





In
      2007,
      the Company extended the exercise period by six months to August 1, 2007 for
      the
      450,000 outstanding warrants which were issued in connection with 900,000 shares
      in June 2006 (see Note 5).