SECURITIES AND EXCHANGE COMMISSION
                      Washington, DC 20549

                           FORM 10-KSB
    ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
                      EXCHANGE ACT OF 1934

For the year ended December 31, 1999
Commission File No. 000-28095





                     MCCARTHY GRENACHE, INC.
     (Exact name of registrant as specified in its charter)




Nevada                                            88-0412635
(State of organization) (I.R.S. Employer Identification No.)

3651 Lindell Road, Suite A, Las Vegas, NV 89103
(Address of principal executive offices)

Registrant's telephone number, including area code (702) 873-7404

Securities registered under Section 12(g) of the Exchange Act:
                                   Common stock, $0.001 par value
                                   per share

Check whether the issuer (1) filed all reports required to be
file by Section 13 or 15(d) of the Exchange Act during the past
12 months and (2) has been subject to such filing requirements
for the past 90 days.  Yes X

Check if there is no disclosure of delinquent filers in response
to Item 405 of Regulation S-B 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
amendments to this Form 10-KSB.                        [ X ]

Issuer's Revenue during the year ended December 31, 1999:   $0

Aggregate market value of the voting and non-voting common equity
held by non-affiliates based on the price of N/A per share (the
selling or average bid and asked price) as of September 20, 2000:
N/A

              DOCUMENTS INCORPORATED BY REFERENCE:

The  Company's Form 10-SB/A, filed on February 29, 2000, and  the
exhibits attached thereto, are incorporated by reference.

                             PART I

ITEM 1.   DESCRIPTION OF BUSINESS

                           Background

McCarthy   Grenache,  Inc.,  (the  "Issuer"  or  "Company")   was
incorporated  under the laws of the State of Nevada  on  December
19, 1997, as McCarthy Grenache, Inc. McCarthy Grenache, Inc., was
initially  wholly  owned by Gregorian Surgical Instruments,  Inc.
("Gregorian").  Gregorian, a corporation formed under the laws of
the Province of British Columbia, Canada in November of 1995, was
the   predecessor  parent  company.  In  December  of  1997,  the
shareholders  of Gregorian exchanged all the shares of  Gregorian
on  a one for one basis for shares of Common Stock of the Company
and  the  resulting  successor corporation is McCarthy  Grenache,
Inc. The Company has no subsidiaries and no affiliated companies.

The  Company  is  a  development stage  company  which  does  not
currently  have supply contracts and, therefore,  does  not  have
revenues from operations for the last two fiscal years.

                       Business of Issuer

The  Company  is  engaged  in the development  of  a  principally
wholesale  medical supplies, surgical instruments, and  equipment
supply  service.  The  Company's products  are  intended  to  be:
bathroom  safety bars for the infirm, canes, colostomy  supplies,
crutches,  gloves,  stethoscopes,  nebulizers,  oxygen  supplies,
walkers,  wheel chairs, and wheelchair van modification kits  for
the disabled. The Company's products will be marketed to the aged
and  the  infirm. Management of the Company believes there  is  a
demand for these products due to the rapid increase in the age of
the  population in the US due to better medical care and the baby
boom  population  reaching  retirement  age.  Management  further
believes  that  the rapid expansion of the Las  Vegas  area  will
create a shortage of the types of products the Company intends to
market.

The Company intends to lease a suitable office/warehouse and will
wholesale  products  directly to retailers, medical  and  nursing
home   facilities   through  mail  order,  Internet   order   and
advertising  in  the press and various other media.  The  Company
anticipates  being  able  to  broker  orders  through   utilizing
attainable  contacts  within the medical  supplies  industry  and
matching  vendors  with  end-users via wholesaling.  The  Company
intends to generate revenue in the future by being listed in  the
yellow  pages and by developing its web-site for Internet  orders
and  inquiries.  At  this time, the Company  does  not  have  any
principal business suppliers.

The  Company's  competition  varies  among  its  business  lines.
Competition in these products and services is primarily  centered
on styling, quality, price, brand recognition and service with an
emphasis  on  the  latter.  In  order  for  the  Company  to   be
competitive  in these marketplaces, the Company must  effectively
maintain and promote the quality of its services and its products
among consumers and establish strong marketing relationships with
manufacturers  and  distributors of products which  enhance  that
quality  image. While the Company believes that it  will  compete
effectively,  the Company competes with a number of manufacturers
and  marketers  of  medical  supplies and  equipment  which  have
substantially  greater resources than the  Company  and  many  of
which  have well-recognized brand name contracts and broader  and
more  established distribution networks. The Company  anticipates
being  able to utilize its smaller size to attract those  seeking
more  personalized service and to maintain its ability  to  adapt
with   technological  changes  over  the  Internet  and  in   the
marketplace. Further, the Company expects to utilize the Internet
to  further  attract  customers via various search  engines  upon
completion of various web pages. Specific organizations with whom
the Company intends to compete are A to Z Medical Supply, Medical
Mart and Mobility Plus, all located in Las Vegas, Nevada.  As the
Company has not started marketing products, it presently  has  no
share of this market.

ITEM 2.   DESCRIPTION OF PROPERTY.

The  Company's principal executive and administrative offices are
located  in  Nevada at 3651 Lindell Road, Suite A, Las  Vegas  NV
89103  in leased premises under an agreement for a term scheduled
to  expire June 1, 2000, at which time the Company will renew the
lease for another 12 month term unless the Company has made other
plans  or  found suitable office/warehouse space.  The  Company's
right  to renew its lease for another term is guaranteed  at  the
Company's  option,  with  thirty days'  notice.  The  Company  is
obligated  to  pay  $1,200 in rent per year on  a  shared  office
basis.  The rent for the next 12 month term, if leased,  will  be
$1,260  per  year. The new lease term will only be executed,   if
necessary,  for economic reasons until the Company  has  adequate
financing  to develop its business and requires other space.  The
Company considers its executive and administrative offices to  be
adequate and suitable for its current needs. The Company does not
own or lease any other real estate.

ITEM 3.   LEGAL PROCEEDINGS

The  Company  is  not  a  party  to any  material  pending  legal
proceedings and, to the best of its knowledge, no such action  by
or against the Company has been threatened.

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

No  such matters were submitted during the fourth quarter of  the
Company's fiscal year ending December 31, 2000.

                             PART II

ITEM 5.   MARKET   FOR  COMMON  EQUITY  AND  RELATED  STOCKHOLDER
          MATTERS.

The  Company's common stock is not currently quoted on the  over-
the-counter.  There is no market for the Company's stock  at  the
present time.

The  Company's common stock is considered a "penny  stock"  under
the Commission rules.

Effective August 11, 1993, the Securities and Exchange Commission
adopted Rule 15g-9, which established the definition of a  "penny
stock,"  for  purposes  relevant to the Company,  as  any  equity
security that has a market price of less than $5.00 per share  or
with  an exercise price of less than $5.00 per share, subject  to
certain exceptions. For any transaction involving a penny  stock,
unless  exempt,  the rules require: (i) that a broker  or  dealer
approve a person's account for transactions in penny stocks;  and
(ii)  the  broker or dealer receive from the investor  a  written
agreement  to  the  transaction, setting forth the  identity  and
quantity of the penny stock to be purchased. In order to  approve
a  person's account for transactions in penny stocks, the  broker
or  dealer  must (i) obtain financial information and  investment
experience  and  objectives  of  the  person;  and  (ii)  make  a
reasonable  determination that the transactions in  penny  stocks
are  suitable  for  that  person and that person  has  sufficient
knowledge  and experience in financial matters to be  capable  of
evaluating the risks of transactions in penny stocks. The  broker
or  dealer must also deliver, prior to any transaction in a penny
stock,  a disclosure schedule prepared by the Commission relating
to  the  penny stock market, which, in highlight form,  (i)  sets
forth  the  basis  on  which  the  broker  or  dealer  made   the
suitability  determination; and (ii) that the  broker  or  dealer
received  a signed, written agreement from the investor prior  to
the  transaction. Disclosure also has to be made about the  risks
of  investing  in  penny stocks in both public offerings  and  in
secondary  trading,  and about commissions payable  to  both  the
broker-dealer   and   the   registered  representative,   current
quotations  for  the  securities  and  the  rights  and  remedies
available  to  an  investor in cases  of  fraud  in  penny  stock
transactions.  Finally,  monthly  statements  have  to  be   sent
disclosing recent price information for the penny stock  held  in
the  account  and  information on the  limited  market  in  penny
stocks.

The   National  Association  of  Securities  Dealers,  Inc.  (the
"NASD"),  which administers NASDAQ, has recently made changes  in
the  criteria for initial listing on the NASDAQ Small Cap  market
and  for  continued listing. For initial listing, a company  must
have net tangible assets of $4 million, market capitalization  of
$50  million  or  net  income of $750,000 in  the  most  recently
completed  fiscal year or in two of the last three fiscal  years.
For  initial listing, the common stock must also have  a  minimum
bid price of $4 per share. In order to continue to be included on
NASDAQ, a company must maintain $2,000,000 in net tangible assets
and  a $1,000,000 market value of its publicly-traded securities.
In addition, continued inclusion requires two market-makers and a
minimum bid price of $1.00 per share.

                             Holders

As of September 20, 2000, there were 51 shareholders of record of
the Company's common stock.

                            Dividends

The  Registrant has not paid any dividends to date,  and  has  no
plans to do so in the immediate future.

  In December 1997, the Company issued 4,942,000 shares of Common
Stock  in  connection  with the reorganization  and  exchange  of
shares  only  with the shareholders of Gregorian, the predecessor
company,  on  a  share  for share basis with  no  cash  or  other
consideration,  pursuant to an exemption from registration  under
Section  4(2)  of the Securities Act of 1933, as  amended.  These
shares were valued at the par value of $.001 per share. Following
the exchange of shares, the value of the shares of the subsidiary
was  written  off  in  the  period in which  the  subsidiary  was
liquidated.  The Company recognized a loss of $4,942 pursuant  to
this transaction.

  In  December 1997, the Company issued 40,000 shares  of  Common
Stock  for  cash  proceeds of $4,000 in  a  private  transaction,
pursuant to an exemption from registration under Section 4(2)  of
the Securities Act of 1933, as amended.

  In  February 1998, the Company issued 60,000 shares  of  Common
Stock  for  cash  proceeds of $6,000 in  a  private  transaction,
pursuant to an exemption from registration under Section 4(2)  of
the Securities Act of 1933, as amended.

  In  September 1999, the Company issued 80,000 shares of  Common
Stock  for  cash  proceeds of $20,000 in a  private  transaction,
pursuant to an exemption from registration under Section 4(2)  of
the Securities Act of 1933, as amended.

 All of the above issuances of securities were issued in reliance
on  Section 4(2) of the Securities Act of 1933, as amended, which
provides  an  exemption from registration  for  transactions  not
involving any public offering. Each distribution above  was  very
small  for  nominal  amounts,  was  made  to  close  friends  and
associates  and  was consistent with normal  growth  of  a  small
company. Management of the Company believes that Section 4(2)  of
the  Securities  Act of 1933, as amended, was  enacted  with  the
intent to exempt such small business offerings from registration.

ITEM 6.   MANAGEMENT'S PLAN OF OPERATION

NOTE REGARDING PROJECTIONS AND FORWARD LOOKING STATEMENTS

This registration statement contains statements that are forward-
looking  statements within the meaning of the federal  securities
laws.  These include statements about our expectations,  beliefs,
intentions  or  strategies for the future, which we  indicate  by
words  or  phrases  such  as  "anticipate,"  "expect,"  "intend,"
"plan,"  "will," "believe" and similar language. These statements
involve  known and unknown risks, including those resulting  from
economic  and  market conditions, the regulatory  environment  in
which  we  operate,  competitive activities, and  other  business
conditions, and are subject to uncertainties and assumptions  set
forth  elsewhere  in  this  registration  statement.  Our  actual
results  may differ materially from results anticipated in  these
forward-looking   statements.   We   base   our   forward-looking
statements  on  information currently available  to  us,  and  we
assume no obligation to update these statements.

                        Plan of Operation

The Company is organizing to wholesale medical supplies, surgical
instruments and equipment specializing in ambulatory aids for the
aged.  Additional  funding  through  private  placement  will  be
necessary  to  enable  the  Company to lease  a  suitable  office
warehouse  facility  in Las Vegas and to enable  the  Company  to
complete its Web Page and to secure contracts with suppliers  and
users.

The Company intends to raise adequate funds from interested local
parties to provide adequate working capital of up to $750,000 for
the next 12 months. When the Company seeks to actually raise such
funds, it is anticipated it will do so by undertaking an offering
of  securities pursuant to Regulation D, Rule 505 or  506,  which
provides an exemption from registration under the Securities  Act
of  1933, as amended. Management will select the exemption at the
time  it makes such an offering based upon advice of counsel.  At
this  time, management has not commenced any such offering.  Such
raised  funds  would  be used to develop Internet  business,  pay
professionals and for advertising in the Yellow Pages and  media.
No  product  research or development is considered necessary;  no
new equipment or plant is required, nor is there expected to be a
significant  change in the number of employees over the  next  12
months.

The  Company  plans  to market and promote its wholesale  medical
supplies  starting  in  Nevada.  The  Company  has  reserved  the
Internet site "www.mccarthymedical.com" which is currently  under
development and is expected to be operational by March  15,  2000
or  shortly thereafter. Since public interest in health is at  an
all  time  high and growing, our presence on the Internet,  along
with increased information on the Internet, and the aging of  the
baby  boom  generation, should result in  the  development  of  a
vastly  improved  medical supply industry.  Many  items  such  as
wheelchairs,  walkers, and mobility equipment for  the  aged  and
infirm  are  automatically  approved by  most  medical  insurance
programs.  There  is a shortage of ambulatory  equipment  in  the
United States today due to the increasing age of the population.

                     Website and E-Commerce

The  Company is in the process of developing an Internet  Website
located  on  the  World Wide Web at www.mccarthymedical.com.  The
Website  is  in  the  process of being constructed.  The  Company
anticipates  that  the  Website, once  it  is  constructed,  will
promote the Company's medical supplies and equipment.

                            Marketing

The  Company  intends to acquire and market medical supplies  and
equipment  for  the  aged  direct  to  the  retailers  from   the
manufacturers.  The Company intends to rely on a  marketing  team
and  for  the prospects of e-commerce to implement the  Company's
marketing objectives. The Company also intends to utilize  direct
mailing, and e-mail to solicit manufacturers and retailers.

The   Company's  marketing  and  licensing  strategy  is  to  (i)
establish  and  expand the sales of the Company's products;  (ii)
selectively  establish licensed product lines to be marketed  and
promoted on the Company's offline developed website; (iii) expand
the  number  of representatives; and, (iv) acquire  or  establish
relationships  with  major manufacturers  businesses,  companies,
properties or technologies.

The  Company  will purchase most of its inventory  from  existing
manufacturers principally in North America and Asia.  To date, no
contracts  have been executed and the Company does not anticipate
entering into any contracts due to lack of funding. Upon funding,
letters of credit may be sought.

The Company does not anticipate being dependent on one major or a
few  major  customers. The Company intends  to  supply  to  large
nursing  facilities and hospitals as well as to major drug  store
chains  and emergency clinics. However, at this time, the Company
does  not  have any contracts with any such organizations.  Also,
management of the Company expects that the proliferation  of  web
pages  throughout  various search engines on  the  Internet  will
attract  customers.  However, there  is  no  guarantee  that  the
Company's  web-site, when completed, will have a positive  impact
on the Company's business.

                            Employees

The  Company's  only  employees  at  the  present  time  are  its
president  and  the  5 members of the Advisory  Board,  who  will
devote  as  much  time  as  the Board of Directors  determine  is
necessary to carry out the affairs of the Company.

ITEM 7.   FINANCIAL STATEMENTS.

          Reports  of  Independent Accountant, David  E.  Coffey,
            C.P.A. dated February 21, 2000.

          Balance Sheet as of December 31, 1999 and December  31,
            1998

          Statement  of Operations for the years then  ended  and
            for the period from December 19, 1997 (inception)  to
            December 31, 1999

          Statement  of  Stockholders' Equity for the years  then
            ended  and  for  the  period from December  19,  1997
            (inception) to December 31, 1999

          Statement  of Cash Flows for the years then  ended  and
            for the period from December 19, 1997 (inception)  to
            December 31, 1999

          Notes to Consolidated Financial Statements

                 INDEPENDENT ACCOUNTANT'S REPORT

To the Board of Directors and Stockholders
of McCarthy Grenache, Inc.
Las Vegas, Nevada

     I  have audited the accompanyingn balance sheets of McCarthy
Grenache,  Inc. (a development stage company) as of December  31,
1999,  and  December  31,  1998, and the  related  statements  of
operations, cash flows, and changes in stockholders'  equity  for
the  period  from  December  19, 1997,  (date  of  inception)  to
December  31,  1999. These statements are the  responsibility  of
McCarthy  Grenache,  Inc.'s management. My responsibility  is  to
express  an  opinion on these financial statements  based  on  my
audit.

     I  conducted my audit in accordance with generally  accepted
auditing  standards.  Those standards require  that  I  plan  and
perform  the  audit to obtain reasonable assurance about  whether
the  financial  statements are free of material misstatement.  An
audit  includes  examining, on a test basis, evidence  supporting
the amounts and disclosures in the financial statements. An audit
also  includes  assessing  the accountingn  principles  used  and
significant  estimates made by management, as well as  evaluating
the  overall financial statement presentation. I believe that  my
audit provides a reasonable basis for my opinion.

     In my opinion, the accompanying financial statements presetn
fairly,  in  all  material respects, the  financial  position  of
McCarthy Grenache, Inc. as of December 31, 1999, and December 31,
1998,  and the results of operations, cash flows, and changes  in
stockholders'  equity for the years then ended, as  well  as  the
cumulative  period  from December 19, 1997,  in  conformity  with
generally accepted accounting principles.

     /s/ David Coffey, C.P.A.
     David Coffey, C.P.A.
     Las Vegas, Nevada
     February 21, 2000

McCARTHY GRENACHE, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS
<TABLE>
<S>                                        <C>          <C>


                                            December     December
                                               31,          31,
                                              1999         1998
                                           -----------  -----------
                                                -            -
ASSETS

Cash                                        $  18,815     $   1,417
                                            ---------     ---------
                                                    -
Total Assets                                $  18,815      $  1,417
                                             ========      ========

LIABILITIES AND STOCKHOLDERS' EQUITY

Accounts payable                              $   400       $   400
                                            ---------     ---------
                                                    -
Total Liabilities                                 400           400

Stockholders' Equity
Comon stock, authorized 25,000,000
shares at $.001 par value, issued and
outstanding 5,122,000 shares and
5,042,000 shares, respectively                  5,122         5,042
Additional paid-in capital                     26,820         6,900
Deficit accumulated during the
development stage                            (13,527)      (10,925)
                                            ---------    ----------
                                                    -
Total Stockholders' Equity                     18,415         1,017


TOTAL LIABILITIES AND STOCKHOLDERS'         $  18,415      $  1,417
EQUITY
                                             ========       =======
</TABLE>

The accompanying notes are an integral part of these financial
statements.

                               -2-

McCARTHY GRENACHE, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS AND DEFICIT ACCUMULATED DURING THE
DEVELOPMENT STAGE
(With Cumulative Figures From Inception)
<TABLE>
<S>                        <C>            <C>            <C>


                                                         From Inception
                           Jan. 1, 1999,  Jan. 1, 1998,  Jan. 19, 1997,
                                to              to             to
                           Dec. 31, 1999  Dec. 31, 1998   Dec. 31, 1999
                           ------------    -------------   -------------
                                      -
Income                             $  0             $  0            $  0

Expenses
Organizational expense                0              400             400
Rent                                500            5,100           5,600
Professional fees                 1,250                0           1,250
Loss on investment in                 0                0           4,942
subsidiary
Office expenses                     852              483           1,335
                           ------------    -------------   -------------
                                     --
Total expenses                    2,602            5,983          13,527

Net loss                        (2,602)          (5,983)     $  (13,527)
                                                               =========

Retained earnings,
beginning of period            (10,925)          (4,942)
                             ----------       ----------
Deficit accumulated
during
the development stage       $  (13,527)      $  (10,925)
                             ==========       ==========

Earnings (loss) per share
assuming dilution:
Net loss                        $  0.00          $  0.00         $  0.00
                             ==========       ==========       =========
Weighted average shares
outstanding                   5,068,667        5,037,000       5,050,000
                             ==========       ==========       =========
</TABLE>

The accompanying notes are an integral part of these financial
statements.

                               -3-

McCARTHY GRENACHE, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
FOR THE PERIOD FROM DECEMBER 19, 1997, (Date of Inception) TO
DECEMBER 31, 1999
<TABLE>
<S>                         <C>        <C>        <C>          <C>


                                Common Stock      Additional     Total
                             Shares     Amount      paid-in
                                                    Capital
                             -------   --------   ----------   ---------
                                         $           $            $
Balance,                       -----       -----        -----       -----
December 19, 1997

Issuance of common stock
for cash
December 24, 1997             40,000          40        3,960       4,000

Exchange of stock (Page 6,
Note D)
December 26, 1997            4,942,0       4,942            0       4,942
                                  00

Less net loss                      0           0            0     (4,942)
                             -------   ---------   ----------    --------
                                  --
Balance,
December 31, 1997            4,982,0       4,982        3,960       4,000
                                  00

Issuance of common stock
for cash
February, 1998                60,000          60        5,940       6,000

Less offering costs                0           0      (3,000)     (3,000)

Less net loss                      0           0            0     (5,983)
                             -------   ---------    ---------   ---------
                                  --
Balance,
December 31, 1998            5,042,0       5,042        6,900       1,017
                                  00

Issuance of common stock
for cash
September 30, 1999            80,000          80       19,920      20,000

Less net loss                      0           0            0     (2,602)
                             -------   ---------   ----------   ---------
                                  --
Balance,
December 31, 1999            5,122,0    $  5,122   $   26,820           $
                                  00                               18,415
                             =======    ========     ========    ========
                                   =
</TABLE>

The accompanying notes are an integral part of these financial
statements.

                               -4-

McCARTHY GRENACHE, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS
(With Cumulative Figures From Inception)
<TABLE>
<S>                          <C>             <C>            <C>


                                                            From
                                                            Inception,
                             Jan. 1, 1999,   Jan. 1, 1998,  Dec. 19,
                             to              to             1997, to
                             Dec. 31, 1999   Dec. 31, 1998  Dec. 31, 1999
                             -------------    -------------   ------------
                                         -
CASH FLOWS PROVIDED BY
OPERATING ACTIVITIES
Net Loss                        $  (2,602)       $  (5,983)  $    (13,527)
Non-cash items included in               0                0              0
net loss
Adjustments to reconcile
net loss to
cash used by operating
activity
Prepaid expenses                                        400
Accounts payable                         0                0            400
                                ----------       ----------  -------------
                                                                         -
NET CASH PROVIDED BY
OPERATING ACTIVITIES               (2,602)          (5,583)       (13,127)

CASH FLOWS USED BY
INVESTING ACTIVITIES                     0                0              0
                                ----------       ----------  -------------
                                                                         -
NET CASH USED BY
INVESTING ACTIVITIES                     0                0              0

CASH FLOWS FROM FINANCING
ACTIVITIES
Sale of common stock                    80               60          5,122
Paid-in capital                     19,920            5,940         29,820
Less offering costs                      0          (3,000)        (3,000)

NET CASH PROVIDED BY
FINANCING ACTIVITIES                20,000            3,000         31,942
                                ----------       ----------     ----------
NET INCREASE IN CASH                17,398          (2,583)    $    18,815
                                                                 =========
CASH AT BEGINNING OF PERIOD          1,417            4,000
CASH AT END OF PERIOD          $    18,815         $  1,417
                                 =========        =========
</TABLE>

The accompanying notes are an integral part of these financial
statements.

                               -5-

McCARTHY GRENACHE, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31, 1999, AND DECEMBER 31, 1998

NOTE A    SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES

          The  Company  was  incorporated on December  19,  1997,
          under  the  laws of the State of Nevada.  The  business
          purpose   of   the  Company  is  to  produce   surgical
          instruments.

          The   Company   will  adopt  accounting  policies   and
          procedures   based   upon   the   nature   of    future
          transactions.

NOTE B    OFFERING COSTS

          Offering  costs  are  reported as a  reduction  in  the
          amount  of  paid-in capital received for  sale  of  the
          shares.

NOTE C    EARNINGS (LOSS) PER SHARE

          Basic EPS is determined using net income divided by the
          weighted average shares outstanding during the  period.
          Diluted EPS is computed by dividing net income  by  the
          weighted  average  shares  outstanding,  assumuing  all
          dilutive potential common shares were issued. Since the
          Company  has  no  common shares  that  are  potentially
          issuable, such as stock options, convertible securities
          or warrants, basic and diluted EPS are the same.

NOTE D    RELATED PARTY TRANSACTIONS - STOCK EXCHANGE

          In   December  of  1997,  the  Company  was  formed  by
          Gregorian  Surgical  Instruments, Inc.,  with  McCarthy
          Grenache,   Inc.  as  a  wholly-owned  subsidiary.   On
          December   26,  1997,  the  stockholders  of  Gregorian
          Surgical Instruments, Inc. approved an exchange of  all
          of   the   outstanding  stock  in  Gregorian   Surgical
          Instruments,  Inc.  for an equal number  of  shares  of
          McCarthy Grenache, Inc. common stock at a par value  of
          $.001  per  share for a total of $4,942. The excess  of
          par value over the value of assets acquired was $4,942.
          This transaction was accounted for as a reverse merger.

          McCARTHY GRENACHE, INC.

(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31, 1999, AND DECEMBER 31, 1998
(continued)

NOTE D    RELATED PARTY TRANSACTIONS - STOCK EXCHANGE (continued)

          Upon  the  completion of the stock exchange,  Gregorian
          Surgical   Instruments,  Inc.  became  a   wholly-owned
          subsidiary  of  McCarthy Grenache, Inc.  The  Board  of
          Directors   approved  the  dissolution   of   Gregorian
          Surgical Instruments, Inc. in December of 1997.

NOTE E    COMMON STOCK

          In  December of 1997, the Company sold 40,000 shares of
          its  common  stock at $.10 per share, for  a  total  of
          $4,000.  In February of 1998, the Company sold  another
          60,000 shares of its common stock at $.10 per share for
          a  total  of  $6,000. Then in September  of  1999,  the
          Company sold 80,000 shares of its common stock at  $.25
          per share for a total of $20,000. The proceeds were  to
          be used for the production of surgical instruments.

ITEM 8.   CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS

There  have  been  no changes in accountants or disagreements  on
accounting and financial disclosure matters.

                            PART III

ITEM 9.   DIRECTORS,  EXECUTIVE OFFICERS, PROMOTERS, AND  CONTROL
          PERSONS

The  members of the Board of Directors of the Company serve until
the  next  annual  meeting of the stockholders,  or  until  their
successors have been elected. The officers serve at the  pleasure
of the Board of Directors.

There are no agreements for any officer or director to resign  at
the  request  of  any other person, and none of the  officers  or
directors  named  below  are acting  on  behalf  of,  or  at  the
direction of, any other person.

Information  as  to the directors and executive officers  of  the
Company is as follows:

   <TABLE>

   <S>                      <C>    <C>





   Name/Address             Age    Position
   Sean McCarthy            46     President/Secretary/Treasu
   3651 Lindell Rd., Suite         rer/
   A                               Director
   Las Vegas, NV  89103
   </TABLE>

The  biography  of  Mr.  McCarthy is included  in  the  Company's
Amended Form 10-SB, and is incorporated by reference to Item 5 of
that document.

ITEM 10.  EXECUTIVE COMPENSATION

There has been no executive compensation in any form to date due
to the lack of working capital in the company.

ITEM 11.  SECURITY  OWNERSHIP  OF CERTAIN BENEFICIAL  OWNERS  AND
          MANAGEMENT.

There  are  no persons known to the Company, as of September  11,
2000,  to be a beneficial owner of five percent (5%) or  more  of
the Company's common stock, and none of the directors or officers
own any of the Company's common stock.

ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The   shareholders  of  Gregorian  Surgical  Instruments,   Inc.,
exchanged  an aggregate of 4,942,000 shares of Gregorian  for  an
aggregate  of 4,942,000 shares of McCarthy Grenache,  Inc.  on  a
share  for  share basis pursuant to the exchange agreement  dated
December 26, 1997. The aggregate value of the shares was  $4,942,
or  $.001  per share, which accounted for a loss of $4,942  as  a
result of the exchange.

There have been no material transactions in the past two years or
proposed  transactions  to  which the  Company  has  been  or  is
proposed  to  be a party in which any officer, director,  nominee
for  officer or director, or security holder of more than  5%  of
the Company's outstanding securities is involved.

The  Company  has  no  promoters other than  its  sole  executive
officer and director. There have been no transactions which  have
benefited or will benefit its sole executive officer and director
either directly or indirectly.

ITEM 13.  FINANCIAL STATEMENTS AND EXHIBITS.

EXHIBITS

  3.1  The  exhibits,  consisting of the  Company's  Articles  of
  Incorporation  are attached to the Company's Amended  Form  10-
  SB,  filed on May 10, 1999. These exhibits are incorporated  by
  reference to that Form.

  3.2  The  exhibits,  consisting of  the  Company's  Bylaws  are
  attached to the Company's Amended Form 10-SB, filed on May  10,
  1999.  These  exhibits are incorporated by  reference  to  that
  Form.

  27  Financial Data Schedule

                           SIGNATURES

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



                           McCarthy Grenache, Inc.



                           By: /s/ Sean McCarthy
                              Sean McCarthy,
                              President/Secretary/Treasurer



                           Date: September 20, 2000