**UNITED      STATES**

**SECURITIES      AND EXCHANGE COMMISSION**

**Washington,      D.C. 20549**

**Form      10-QSB**

|   | þ | QUARTERLY                REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF                1934 |
|--------|--------|-----------------------------------------------------------------------------------------------------------------|

|   | o | TRANSITION                REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF                1934 |
|--------|---|------------------------------------------------------------------------------------------------------------------|

| Idaho                                                                                        |   | 04-3413196                                          |
|----------------------------------------------------------------------------------------------|--------|-----------------------------------------------------|
| (State                or other jurisdiction of incorporation                or organization) |   | (I.R.S.                Employer Identification No.) |

**310      Authority Drive**

**Fitchburg,      MA 01420**

**(978)      696-0020**

| **Title                of class**                           | **Name                of Exchange on Which Registered** |
|-------------------------------------------------------------|---------------------------------------------------------|
|  Common                Stock, par value $.01 per share |  None                                              |
|  2006                Common Stock Purchase Warrants    |  None                                              |

**APPLICABLE      ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDING DURING THE PRECEDING FIVE      YEARS**

**APPLICABLE      ONLY TO CORPORATE ISSUERS**

----

**INTEGRATED      PHARMACEUTICALS, INC.**

**FORM      10-QSB**

**TABLE      OF CONTENTS**

|                                                                                                 | **PAGE** |
|------------------------------------------------------------------------------------------------------|----------|
|                                                                                                 |     |
| **PART                  I. FINANCIAL INFORMATION**                                                   | 2        |
|                                                                                                 |          |
| ITEM                  1 Financial Statements                                                         | 2        |
|                                                                                                 |     |
| ITEM                  2 Management's Discussion and Analysis                                         | 10       |
|                                                                                                 |     |
| ITEM                  3 Controls and Procedures                                                      | 11       |
|                                                                                                 |     |
| **PART                  II. - OTHER INFORMATION**                                                    | 11       |
|                                                                                                 |          |
| ITEM                  1 Legal Proceedings                                                            | 11       |
|                                                                                                 |     |
| ITEM                  2 Unregistered Sales of Equity Securities and Use of                  Proceeds | 11       |
|                                                                                                 |     |
| ITEM                  3 Default Upon Senior Securities                                               | 11       |
|                                                                                                 |     |
| ITEM                  4 Submission of Matters to a Vote of Security Holders                          | 11       |
|                                                                                                 |     |
| ITEM                  5 Other Information                                                            | 12       |
|                                                                                                 |     |
| ITEM                  6 Exhibits and Reports on Form 8-K                                             | 12       |
|                                                                                                 |     |
| **SIGNATURES**                                                                                       | 13       |

**NOTE      REGARDING FORWARD-LOOKING STATEMENTS **

**Except      for statements of historical fact, certain information described in this      document contains “forward-looking statements” that involve substantial risks      and uncertainties. You can identify these statements by forward-looking words      such as "anticipate,"  "believe,"  "could,"  "estimate,"       "expect,"  "intend,"  "may,"  "should,"  "will"      and "would"      or similar words. You should read the statements that contain these words      carefully because these statements discuss our future expectations, contain      projections of our future results of operations or of our financial position      or      state other "forward-looking" information. Integrated Pharmaceuticals, Inc.      believes that it is important to communicate our future expectations to our      investors. However, there may be events in the future that we are not able      to      accurately predict or control. The factors listed below in the section captioned      "Risk Factors," within the section “Description of Business” as well as any      cautionary language in this Form, provide examples of risks, uncertainties      and      events that may cause our actual results and achievements expressed or implied      to differ materially from the expectations we described in our forward-looking      statements. Integrated Pharmaceuticals, Inc. believes that before you invest      in      our common stock, you should be aware that the occurrence of the events      described in these risk factors and elsewhere in this Form could have a material      adverse effect on our business, results of operations and financial      position.**

----

**PART      I**

**ITEM      1.**
**Financial      Statements**

| PAGE   |                                                                                                                                         |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                         |
| 3      | Balance                  Sheets As At September 30, 2005 And December 31, 2004                                                               |
|   |                                                                                                                                         |
| 4      | Statements                  Of Operations And Income For The Nine Months Ended September 30,                  2005 and                  2004 |
|   |                                                                                                                                         |
| 5      | Statements                  Of Cash Flows For The Nine Months Ended September 30, 2005 and                  2004                             |
|   |                                                                                                                                         |
| 6-10   | Notes                  To Financial Statements - September 30,                  2005                                                         |

----

| **INTEGRATED                    PHARMACEUTICALS, INC.** |
|---------------------------------------------------------|
| **(A                    Development Stage Company)**    |
| **BALANCE                    SHEETS**                   |

|                                                                |   | September                    30, |        |                             |   |
|---------------------------------------------------------------------|--------|----------------------------------|-------------|---------------------------------------|--------|
|                                                                |   | 2005                             |        |  December                    31, |   |
|                                                                |   | (unaudited)                      |        |  2004                            |   |
|                                                                |   |                             |        |                             |   |
| **ASSETS**                                                          |   |                             |        |                             |   |
| CURRENT                    ASSETS                                   |   |                             |        |                             |   |
| Cash                                                                |   | $                                | 119,764     |                                  | $      | 1,461,708 |   |
| Accounts                    receivable                              |   |                             | 17,500      |                                  |   | - |   |
| Inventory                                                           |   |                             | 141,676     |                                  |   | 83,558 |   |
| Prepaid                    expenses                                 |   |                             | 34,112      |                                  |   | 42,543 |   |
| Total                    Current Assets                             |   |                             | 313,052     |                                  |   | 1,587,809 |   |
|                                                                |   |                             |        |                                  |   |   |   |
| PROPERTY                    AND EQUIPMENT, net                      |   |                             | 1,878,054   |                                  |   | 2,075,001 |   |
|                                                                |   |                             |        |                                  |   |   |   |
| OTHER                    ASSETS                                     |   |                             |        |                                  |   |   |   |
| Investments                                                         |   |                             | 1,000       |                                  |   | 2,000 |   |
| Deposits                                                            |   |                             | 763         |                                  |   | 763 |   |
| Total                    Other Assets                               |   |                             | 1,763       |                                  |   | 2,763 |   |
|                                                                |   |                             |        |                                  |   |   |   |
| **TOTAL                    ASSETS**                                 |   | $                                | 2,192,869   |                                  | $      | 3,665,573 |   |
|                                                                |   |                             |        |                                  |   |   |   |
| **LIABILITIES                    AND STOCKHOLDERS' EQUITY**         |   |                             |        |                                  |   |   |   |
| CURRENT                    LIABILITIES                              |   |                             |        |                                  |   |   |   |
| Accounts                    payable                                 |   | $                                | 179,999     |                                  | $      | 269,030 |   |
| Accrued                    expenses                                 |   |                             | 109,683     |                                  |   | 114,709 |   |
| Capital                    leases payable                           |   |                             | 662         |                                  |   | 4,646 |   |
| Total                    Current Liabilities                        |   |                             | 290,344     |                                  |   | 388,385 |   |
|                                                                |   |                             |        |                                  |   |   |   |
|                                                                |   |                             |        |                                  |   |   |   |
| Total                    Liabilities                                |   |                             | 290,344     |                                  |   | 388,385 |   |
|                                                                |   |                             |        |                                  |   |   |   |
| COMMITMENTS                    AND CONTINGENCIES                    |   |                             | -           |                                  |   | - |   |
|                                                                |   |                             |        |                                  |   |   |   |
| STOCKHOLDERS'                    EQUITY                             |   |                             |        |                                  |   |   |   |
| Preferred                    stock, $0.10 par value, 20,000 shares  |   |                             |        |                                  |   |   |   |
| authorized;                    no shares issued                     |   |                             | -           |                                  |   | - |   |
| Common                    stock, $0.01 par value, 75,000,000 shares |   |                             |        |                                  |   |   |   |
| authorized;                    17,637,655 and 16,443,500 shares     |   |                             |        |                                  |   |   |   |
| issued                    and outstanding, respectively             |   |                             | 176,376     |                                  |   | 164,435 |   |
| Additional                    paid-in capital                       |   |                             | 6,517,551   |                                  |   | 5,609,581 |   |
| Other                    comprehensive income (loss)                |   |                             | (1,020      | )                                     |   | (20 | ) |
| Stock                    options and warrants                       |   |                             | 7,667,164   |                                  |   | 6,613,509 |   |
| Accumulated                    deficit prior to development stage   |   |                             | (494,624    | )                                     |   | (494,624 | ) |
| Accumulated                    deficit during development stage     |   |                             | (11,962,922 | )                                     |   | (8,615,693 | ) |
|                                                                |   |                             |        |                                  |   |   |   |
| Total                    Stockholders' Equity                       |   |                             | 1,902,525   |                                  |   | 3,277,188 |   |
|                                                                |   |                             |        |                                  |   |   |   |
| **TOTAL                    LIABILITIES AND**                        |   |                             |        |                                  |   |   |   |
| **STOCKHOLDERS'                    EQUITY**                         |   | $                                | 2,192,869   |                                  | $      | 3,665,573 |   |

----

| **INTEGRATED                    PHARMACEUTICALS,                    INC.**         |
|----------------------------------------------------------------------------------------------------------------------------|
| **(A                    Development Stage                    Company)**            |
| **STATEMENTS                    OF OPERATIONS**                                                                            |

|                                                         |   |                                  |       |                                   |   |                                   |   |                                   |       |  Period                    from           |   |
|--------------------------------------------------------------|--------|---------------------------------------|------------|---------------------------------------------|--------|---------------------------------------------|--------|---------------------------------------------|------------|------------------------------------------------|--------|
|                                                         |   |                                  |       |                                   |   |                                   |   |                                   |       |  February                    1, 2003      |   |
|                                                         |   |                                  |       |                                   |   |                                   |   |                                   |       |  (inception                    of         |   |
|                                                         |   | Three                    Months Ended |       |  Nine                    Months Ended  |   |  development                    stage) |   |
|                                                         |   | September                    30, 2005 |       |  September                    30, 2004 |   |  September                    30, 2005 |   |  September                    30, 2004 |       |  to                    September 30, 2005 |   |
|                                                         |   | (unaudited)                           |       |  (unaudited)                           |   |  (unaudited)                           |   |  (unaudited)                           |       |  (unaudited)                              |   |
|                                                         |   |                                  |       |                                   |   |                                   |   |                                   |       |                                      |   |
| REVENUES                                                     |   | $                                     | 17,560     |                                        | $      | -                                           |   | $                                           | 52,210     |                                           | $      | - |   | $ | 52,210 |   |
|                                                         |   |                                  |       |                                        |   |                                        |   |                                        |       |                                           |   |   |   |   |   |   |
| COST                    OF GOODS SOLD                        |   |                                  |       |                                        |   |                                        |   |                                        |       |                                           |   |   |   |   |   |   |
| Materials                    and supplies                    |   |                                  | 19,000     |                                        |   | -                                           |   |                                        | 24,694     |                                           |   | - |   |   | 24,694 |   |
| Total                    Cost of Goods Sold                  |   |                                  | 19,000     |                                        |   | -                                           |   |                                        | 24,694     |                                           |   | - |   |   | 24,694 |   |
|                                                         |   |                                  |       |                                        |   |                                        |   |                                        |       |                                           |   |   |   |   |   |   |
| GROSS                    PROFIT                              |   |                                  | (1,440     | )                                           |   | -                                           |   |                                        | 27,516     |                                           |   | - |   |   | 27,516 |   |
|                                                         |   |                                  |       |                                        |   |                                        |   |                                        |       |                                           |   |   |   |   |   |   |
| GENERAL                    AND ADMINISTRATIVE EXPENSES       |   |                                  |       |                                        |   |                                        |   |                                        |       |                                           |   |   |   |   |   |   |
| Depreciation                    and amortization             |   |                                  | 63,689     |                                        |   | 83,428                                      |   |                                        | 189,186    |                                           |   | 145,465 |   |   | 453,902 |   |
| Research                    and development                  |   |                                  | 66,204     |                                        |   | 115,162                                     |   |                                        | 233,346    |                                           |   | 352,015 |   |   | 706,099 |   |
| Marketing                                                    |   |                                  | 58,804     |                                        |   | 66,123                                      |   |                                        | 209,957    |                                           |   | 271,919 |   |   | 569,614 |   |
| Legal                    and professional fees               |   |                                  | 70,894     |                                        |   | 128,275                                     |   |                                        | 257,333    |                                           |   | 327,061 |   |   | 980,810 |   |
| Consulting                                                   |   |                                  | 198,038    |                                        |   | 499,696                                     |   |                                        | 552,431    |                                           |   | 2,017,251 |   |   | 3,029,830 |   |
| Idle                    facility expense                     |   |                                  | 242,045    |                                        |   | -                                           |   |                                        | 858,669    |                                           |   | - |   |   | 1,266,559 |   |
| Occupancy                                                    |   |                                  | 44,660     |                                        |   | 149,046                                     |   |                                        | 223,228    |                                           |   | 449,323 |   |   | 990,661 |   |
| Labor                    and benefits                        |   |                                  | 81,403     |                                        |   | 80,098                                      |   |                                        | 231,909    |                                           |   | 260,416 |   |   | 735,900 |   |
| Services                    paid by stock options            |   |                                  | 180,085    |                                        |   | 202,850                                     |   |                                        | 454,155    |                                           |   | 467,360 |   |   | 1,125,220 |   |
| Office                    supplies and expenses              |   |                                  | 8,191      |                                        |   | 20,279                                      |   |                                        | 30,657     |                                           |   | 92,257 |   |   | 155,006 |   |
| Travel                                                       |   |                                  | 1,134      |                                        |   | 13,001                                      |   |                                        | 25,002     |                                           |   | 35,112 |   |   | 168,237 |   |
| Other                    general and administrative expenses |   |                                  | 44,311     |                                        |   | 66,852                                      |   |                                        | 109,538    |                                           |   | 157,239 |   |   | 397,627 |   |
| Total                    General and Administrative Expenses |   |                                  | 1,059,458  |                                        |   | 1,424,810                                   |   |                                        | 3,375,411  |                                           |   | 4,575,418 |   |   | 10,579,465 |   |
|                                                         |   |                                  |       |                                        |   |                                        |   |                                        |       |                                           |   |   |   |   |   |   |
| OPERATING                    LOSS                            |   |                                  | (1,060,898 | )                                           |   | (1,424,810                                  | )      |                                        | (3,347,895 | )                                              |   | (4,575,418 | ) |   | (10,551,949 | ) |
|                                                         |   |                                  |       |                                        |   |                                        |   |                                        |       |                                           |   |   |   |   |   |   |
| OTHER                    INCOME (EXPENSES)                   |   |                                  |       |                                        |   |                                        |   |                                        |       |                                           |   |   |   |   |   |   |
| Interest                    income                           |   |                                  | 127        |                                        |   | 2,686                                       |   |                                        | 1,255      |                                           |   | 7,029 |   |   | 10,167 |   |
| Interest                    expense                          |   |                                  | (179       | )                                           |   | (16,295                                     | )      |                                        | (589       | )                                              |   | (1,048,235 | ) |   | (1,415,580 | ) |
| Miscellaneous                    income (expense)            |   |                                  | -          |                                        |   | -                                           |   |                                        | -          |                                           |   | (5,481 | ) |   | (5,560 | ) |
| Total                    Other Income and Expenses           |   |                                  | (52        | )                                           |   | (13,609                                     | )      |                                        | 666        |                                           |   | (1,046,687 | ) |   | (1,410,973 | ) |
|                                                         |   |                                  |       |                                        |   |                                        |   |                                        |       |                                           |   |   |   |   |   |   |
| LOSS                    BEFORE TAXES                         |   |                                  | (1,060,950 | )                                           |   | (1,438,419                                  | )      |                                        | (3,347,229 | )                                              |   | (5,622,105 | ) |   | (11,962,922 | ) |
|                                                         |   |                                  |       |                                        |   |                                        |   |                                        |       |                                           |   |   |   |   |   |   |
| INCOME                    TAXES                              |   |                                  | -          |                                        |   | -                                           |   |                                        | -          |                                           |   | - |   |   | - |   |
|                                                         |   |                                  |       |                                        |   |                                        |   |                                        |       |                                           |   |   |   |   |   |   |
| NET                    LOSS                                  |   |                                  | (1,060,950 | )                                           |   | (1,438,419                                  | )      |                                        | (3,347,229 | )                                              |   | (5,622,105 | ) |   | (11,962,922 | ) |
|                                                         |   |                                  |       |                                        |   |                                        |   |                                        |       |                                           |   |   |   |   |   |   |
| OTHER                    COMPREHENSIVE INCOME (LOSS)         |   |                                  |       |                                        |   |                                        |   |                                        |       |                                           |   |   |   |   |   |   |
| Unrealized                    gain (loss) in market value of |   |                                  |       |                                        |   |                                        |   |                                        |       |                                           |   |   |   |   |   |   |
| investments                                                  |   |                                  | (220       | )                                           |   | -                                           |   |                                        | (1,000     | )                                              |   | 80 |   |   | (1,020 | ) |
|                                                         |   |                                  |       |                                        |   |                                        |   |                                        |       |                                           |   |   |   |   |   |   |
| COMPREHENSIVE                    LOSS                        |   | $                                     | (1,061,170 | )                                           | $      | (1,438,419                                  | )      | $                                           | (3,348,229 | )                                              | $      | (5,622,025 | ) | $ | (11,963,942 | ) |
|                                                         |   |                                  |       |                                        |   |                                        |   |                                        |       |                                           |   |   |   |   |   |   |
| NET                    LOSS PER COMMON SHARE,                |   |                                  |       |                                        |   |                                        |   |                                        |       |                                           |   |   |   |   |   |   |
| BASIC                    AND DILUTED                         |   | $                                     | (0.06      | )                                           | $      | (0.09                                       | )      | $                                           | (0.20      | )                                              | $      | (0.40 | ) |   |   |   |
|                                                         |   |                                  |       |                                        |   |                                        |   |                                        |       |                                           |   |   |   |   |   |   |
| WEIGHTED                    AVERAGE NUMBER OF COMMON         |   |                                  |       |                                        |   |                                        |   |                                        |       |                                           |   |   |   |   |   |   |
| SHARES                    OUTSTANDING, BASIC AND DILUTED     |   |                                  | 17,438,891 |                                        |   | 16,231,487                                  |   |                                        | 16,849,830 |                                           |   | 14,155,239 |   |   |   |   |

----

| **INTEGRATED                    PHARMACEUTICALS,                    INC.**       |
|----------------------------------------------------------------------------------------------------------------|
| **(A                    Development Stage                    Company)**          |
| **STATEMENTS                    OF CASH FLOWS**                                                                |

|                                                                         |   |                                   |       |                                   |   |  Period                    from           |   |
|------------------------------------------------------------------------------|--------|---------------------------------------------|------------|---------------------------------------------|--------|------------------------------------------------|--------|
|                                                                         |   |                                   |       |                                   |   |  February                    1, 2003      |   |
|                                                                         |   |  Nine                    Months        |       |  Nine                    Months        |   |  (inception                    of         |   |
|                                                                         |   |  Ended                                 |       |  Ended                                 |   |  development                    stage)    |   |
|                                                                         |   |  September                    30, 2005 |       |  September                    30, 2004 |   |  to                    September 30, 2005 |   |
|                                                                         |   |  (unaudited)                           |       |  (unaudited)                           |   | (unaudited)                                    |   |
| CASH                    FLOWS FROM OPERATING ACTIVITIES:                     |   |                                   |       |                                   |   |                                      |   |
| Net                    income (loss)                                         |   | $                                           | (3,347,229 | )                                           | $      | (5,622,105                                     | )      | $ | (11,962,922 | ) |
| Adjustments                    to reconcile net income (loss) to net cash    |   |                                        |       |                                        |   |                                           |   |   |   |   |
| flows                    provided (used) by operating activities:            |   |                                        |       |                                        |   |                                           |   |   |   |   |
| Depreciation                                                                 |   |                                        | 396,043    |                                        |   | 145,465                                        |   |   | 660,719 |   |
| Loss                    on disposition of assets                             |   |                                        | -          |                                        |   | 5,481                                          |   |   | 7,024 |   |
| Stock                    and warrants issued as incentive for notes payables |   |                                        | -          |                                        |   | 389,900                                        |   |   | 496,389 |   |
| Stock                    issued for interest expense                         |   |                                        | -          |                                        |   | -                                              |   |   | 149,878 |   |
| Stock                    issued for rent expense                             |   |                                        | 149,666    |                                        |   | 266,955                                        |   |   | 578,325 |   |
| Stock                    issued for services                                 |   |                                        | 69,934     |                                        |   | -                                              |   |   | 997,280 |   |
| Stock                    issued for assets and securities                    |   |                                        | -          |                                        |   | -                                              |   |   | 43,739 |   |
| Recognition                    of noncash deferred financing expense         |   |                                        | -          |                                        |   | 578,699                                        |   |   | 578,699 |   |
| Options                    and warrants issued for services and financing    |   |                                        | 969,761    |                                        |   | 2,566,616                                      |   |   | 3,498,732 |   |
| Noncash                    recovery of other income                          |   |                                        | -          |                                        |   | -                                              |   |   | (1,850 | ) |
| Changes                    in assets and liabilities:                        |   |                                        |       |                                        |   |                                           |   |   |   |   |
| Receivables                                                                  |   |                                        | (17,500    | )                                           |   | (630                                           | )      |   | (1,416 | ) |
| Inventory                                                                    |   |                                        | (58,118    | )                                           |   | (194,451                                       | )      |   | (141,676 | ) |
| Prepaid                    expenses                                          |   |                                        | 8,431      |                                        |   | 80,585                                         |   |   | 113,447 |   |
| Other                    assets                                              |   |                                        | -          |                                        |   | -                                              |   |   | 5,607 |   |
| Deferred                    Compensation                                     |   |                                        | -          |                                        |   | 9,000                                          |   |   |   |   |
| Accounts                    payable                                          |   |                                        | (89,031    | )                                           |   | (37,614                                        | )      |   | 81,452 |   |
| Accrued                    expenses                                          |   |                                        | (5,026     | )                                           |   | (92,780                                        | )      |   | (73,300 | ) |
| Net                    cash used by operating activities                     |   |                                        | (1,923,069 | )                                           |   | (1,904,879                                     | )      |   | (4,969,873 | ) |
|                                                                         |   |                                        |       |                                        |   |                                           |   |   |   |   |
| CASH                    FLOWS FROM INVESTING ACTIVITIES:                     |   |                                        |       |                                        |   |                                           |   |   |   |   |
| Purchase                    of fixed assets                                  |   |                                        | (199,096   | )                                           |   | (1,785,950                                     | )      |   | (2,673,868 | ) |
| Leasehold                    concessions received                            |   |                                        | -          |                                        |   | -                                              |   |   | 185,000 |   |
| Net                    cash used by investing activities                     |   |                                        | (199,096   | )                                           |   | (1,785,950                                     | )      |   | (2,488,868 | ) |
|                                                                         |   |                                        |       |                                        |   |                                           |   |   |   |   |
| CASH                    FLOWS FROM FINANCING ACTIVITIES:                     |   |                                        |       |                                        |   |                                           |   |   |   |   |
| Sale                    of common stock units                                |   |                                        | 783,125    |                                        |   | 5,632,050                                      |   |   | 6,415,175 |   |
| Payments                    on capital leases                                |   |                                        | (3,984     | )                                           |   | (3,833                                         | )      |   | (8,901 | ) |
| Payments                    on related party loans                           |   |                                        | -          |                                        |   | (41,123                                        | )      |   | (56,701 | ) |
| Proceds                    from exercise of options                          |   |                                        | 1,080      |                                        |   | -                                              |   |   | 1,080 |   |
| Proceeds                    from convertible debt                            |   |                                        | -          |                                        |   | 389,900                                        |   |   | 939,900 |   |
| Net                    cash provided by financing activities                 |   |                                        | 780,221    |                                        |   | 5,976,994                                      |   |   | 7,290,553 |   |
|                                                                         |   |                                        |       |                                        |   |                                           |   |   |   |   |
| Net                    increase in cash                                      |   |                                        | (1,341,944 | )                                           |   | 2,286,165                                      |   |   | (168,188 | ) |
|                                                                         |   |                                        |       |                                        |   |                                           |   |   |   |   |
| Cash,                    beginning of period                                 |   |                                        | 1,461,708  |                                        |   | 253,940                                        |   |   | 287,952 |   |
|                                                                         |   |                                        |       |                                        |   |                                           |   |   |   |   |
| Cash,                    end of period                                       |   | $                                           | 119,764    |                                        | $      | 2,540,105                                      |   | $ | 119,764 |   |
|                                                                         |   |                                        |       |                                        |   |                                           |   |   |   |   |
| SUPPLEMENTAL                    CASH FLOW DISCLOSURES:                       |   |                                        |       |                                        |   |                                           |   |   |   |   |
| Income                    taxes paid                                         |   | $                                           | -          |                                        | $      | -                                              |   | $ | - |   |
| Interest                    paid                                             |   | $                                           | -          |                                        | $      | -                                              |   | $ | 25,000 |   |
|                                                                         |   |                                        |       |                                        |   |                                           |   |   |   |   |
| NON-CASH                    INVESTING AND FINANCING:                         |   |                                        |       |                                        |   |                                           |   |   |   |   |
| Stock                    and warrants issued for convertible debt            |   | $                                           | -          |                                        | $      | 1,447,798                                      |   | $ | 1,613,076 |   |
| Stock                    issued for assets and securities                    |   | $                                           | -          |                                        | $      | -                                              |   | $ | 43,739 |   |
| Stock                    issued as deferred incentive for notes payables     |   | $                                           | -          |                                        | $      | 389,900                                        |   | $ | 496,389 |   |
| Stock                    issued for prepaid rent and rent expense            |   | $                                           | 149,666    |                                        | $      | 266,955                                        |   | $ | 578,325 |   |
| Stock                    and warrants issued for services                    |   | $                                           | 69,934     |                                        | $      | -                                              |   | $ | 997,280 |   |
| Warrants                    and options issued for services and financing    |   | $                                           | 969,761    |                                        | $      | 2,566,616                                      |   | $ | 3,498,732 |   |
| Accounts                    payable paid by contributed capital              |   | $                                           | -          |                                        | $      | -                                              |   | $ | 27,767 |   |
| Noncash                    recovery of other income                          |   | $                                           | -          |                                        | $      | -                                              |   | $ | 1,850 |   |

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**NOTE      1 - BUSINESS ORGANIZATION AND BASIS OF PRESENTATION**

**NOTE      2 - LIMITED SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**

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**NOTE      3 - PROPERTY AND EQUIPMENT**

|                                          |   | 2005   |      | 2004   |   |
|-----------------------------------------------|--------|--------|-----------|--------|--------|
| Equipment                                     |   | $      | 1,730,584 |   | $      | 1,609,268 |   |
| Furniture                and fixtures         |   |   | 120,114   |   |   | 106,809 |   |
| Leasehold                improvements         |   |   | 826,511   |   |   | 762,036 |   |
|                                          |   |   | 2,677,209 |   |   | 2,478,113 |   |
| Less:                Accumulated depreciation |   |   | (799,155  | )      |   | (403,112 | ) |
| Total                                         |   | $      | 1,878,054 |   | $      | 2,075,001 |   |

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**NOTE      4 - CAPITAL STOCK**

**NOTE      5 - COMMON STOCK OPTIONS AND WARRANTS**

| Plan                                                                     |   | Number                ofsecurities                to beissued                uponexercise                ofoutstandingoptions |      | Weighted-averageexercise                price ofoutstanding                options |   | Number                of securitiesremaining                availablefor                future issuanceunder                equitycompensation                plans |   |
|--------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------------------------------------------------------|-----------|------------------------------------------------------------------------------------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
|                                                                     |   |                                                                                                                          |      |                                                                               |   |                                                                                                                                                                |   |
| Equity                compensation plan approved by security holders (1) |   |                                                                                                                          | 1,185,000 |                                                                               | $      | 0.65                                                                                                                                                                |   |   | 415,000 |   |
| Total                                                                    |   |                                                                                                                          | 1,185,000 |                                                                               |   |                                                                                                                                                                |   |   | 415,000 |   |

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|                                                                  |   | Number                of Shares |      | Weighted                Average Exercise Price |   |
|-----------------------------------------------------------------------|--------|---------------------------------|-----------|------------------------------------------------|--------|
| Outstanding                at December 31, 2003                       |   |                            | 690,000   |                                           | $      | 0.25 |   |
| Granted                                                               |   |                            | 668,000   |                                           |   | 1.61 |   |
| Exercised                                                             |   |                            | -         |                                           |   | - |   |
| Rescinded                                                             |   |                            | (75,000   | )                                              |   | - |   |
| Outstanding                at December 31, 2004                       |   |                            | 1,283,000 |                                           |   | 0.96 |   |
| Granted                                                               |   |                            | 2,000     |                                           |   | 0.65 |   |
| Exercised                                                             |   |                            | (6,000    | )                                              |   | (0.18 | ) |
| Rescinded                                                             |   |                            | (94,000   | )                                              |   | 2.62 |   |
| Options                outstanding at September 30, 2005              |   |                            | 1,185,000 |                                           | $      | 0.65 |   |
|                                                                  |   |                            |      |                                           |   |   |   |
| Options                exercisable at September 30, 2005              |   |                            | 617,000   |                                           | $      | 0.74 |   |
| Weighted                average fair value of options granted in 2005 |   |                            |      |                                           | $      | 0.36 |   |

**NOTE      6 - CONCENTRATIONS**

**NOTE      7 - COMMITMENTS AND CONTINGENCIES**

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**NOTE      8 -SUBSEQUENT EVENTS**

**Item      2 **
**Management’s      Discussion and Analysis **

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**Item      3. Controls and Procedures**

**PART      II. - OTHER INFORMATION**

**Item      1. Legal Proceedings.**

**ITEM      2**
**Unregistered      Sales of Equity Securities and Use of Proceeds**

**ITEM      3 Default Upon Senior Securities**

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

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**Item      5. Other Information.**

**ITEM      6 Exhibits and Reports on Form 8-K **

| **Number** | **Description                of Exhibit**                                                                                                                                                                                                                                  |
|------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 3.1        | Amended                and Restated Articles of Incorporation of Integrated Pharmaceuticals,                Inc.                (1)                                                                                                                                        |
| 3.2        | Amended                and Restated Bylaws of Integrated Pharmaceuticals, Inc.                (2)                                                                                                                                                                          |
| 4.1        | Specimen                Certificate for Integrated Pharmaceuticals, Inc. Common Stock, par                value                $.01 per share (2)                                                                                                                          |
| 4.2        | Form                of Common Stock Purchase Warrant (2)                                                                                                                                                                                                                   |
| 10.1       | Amended                and Restated Patent License Agreement with NEC Partners                (2)                                                                                                                                                                          |
| 10.2       | Lease                Agreement with Chantilas Properties, LLC and Advanced Process                Technologies, Inc. (2)                                                                                                                                                   |
| 10.3       | Assignment                and Assumption of Lease(2)                                                                                                                                                                                                                       |
| 10.4       | Consulting                and Warrant Agreements with James Czirr (2)                                                                                                                                                                                                      |
| 10.5       | 2002                Stock Plan (2)                                                                                                                                                                                                                                         |
| 10.6       | Registration                Rights Agreement(2)                                                                                                                                                                                                                            |
| 10.7       | First                Amended and Restated Supply Agreement with Frag-Chem Corporation                (3)                                                                                                                                                                   |
| 10.8       | Letter                dated May 5, 2005 amending the Patent License Agreement with NEC                Partners                (3)                                                                                                                                          |
| 10.9       | Letter                dated October 13, 2005 amending the Patent License Agreement with                NEC                Partners                                                                                                                                         |
| 31         | Certification                of the Chief Financial Officer of the Company as adopted pursuant                to                section 302 of the Sarbanes-Oxley Act of 2002                                                                                              |
| 32         | Certification                of the Chief Executive Office rand Chief Financial Officer of the                Company                pursuant to 18 U.S.C. section 1250 as adopted pursuant to section                906 of                the Sarbanes-Oxley Act of 2002 |

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**SIGNATURES**

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