| þ   | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIESEXCHANGE ACT OF 1934 |
|--------------------|----------------------------------------------------------------------------------------|

|  ̈   | TRANSITION REPORT PURSUANT TO 13 OR 15(d) OF THE SECURITIESEXCHANGE ACT OF 1934 |
|--------------------|---------------------------------------------------------------------------------|

| Delaware                                                      | 11-1719724                           |
|---------------------------------------------------------------|--------------------------------------|
| (State or Other Jurisdiction ofIncorporation or Organization) | (I.R.S. Employer Identification No.) |

----

|   | Large accelerated filer | £ |
|--------|-------------------------|--------|

|   | Non-accelerated filer | £  (Do not check if a smaller reporting company) |
|--------|-----------------------|-----------------------------------------------------------------|

|   | Accelerated filer | £ |
|--------|-------------------|--------|

|   | Smaller reporting company | þ |
|--------|---------------------------|--------|

----

|                                                                                                                                                                                                                              | Page No. |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------|
| Part I.  FINANCIAL INFORMATION                                                                                                                                                                                          |     |
|                                                                                                                                                                                                                              |     |
| Item 1 -   Condensed Financial Statements                                                                                                                                                                          |     |
|                                                                                                                                                                                                                              |     |
|  Statements of Income - Three months ended March 31, 2010 and 2009 (unaudited)                                                                                                                                               | 2        |
|                                                                                                                                                                                                                              |     |
|  Balance Sheets – March 31, 2010 (unaudited) and December 31, 2009                                                                                                                                                     | 3-4      |
|                                                                                                                                                                                                                              |     |
|  Statements of Cash Flows –  Three months ended March 31, 2010 and 2009 (unaudited)                                                                                                                          | 5        |
|                                                                                                                                                                                                                              |     |
|  Notes to Financial Statements (unaudited)                                                                                                                                                                                   | 6-11     |
|                                                                                                                                                                                                                              |     |
| Item 2 -   Management's Discussion and Analysis of Financial Condition                    and Results of Operations | 11-15    |
|                                                                                                                                                                                                                              |     |
| Item 3 -   Quantitative and Qualitative Disclosures About Market Risk                                                                                                                                              | 15       |
|                                                                                                                                                                                                                              |     |
| Item 4T - Controls and Procedures                                                                                                                                                                                                 | 15-16    |
|                                                                                                                                                                                                                              |     |
| Part II.  OTHER INFORMATION                                                                                                                                                                                             |     |
|                                                                                                                                                                                                                              |     |
| Item 1 -   Legal Proceedings                                                                                                                                                                                       | 16       |
|                                                                                                                                                                                                                              |     |
| Item 1A - Risk Factors                                                                                                                                                                                                            | 16       |
|                                                                                                                                                                                                                              |     |
| Item 2 -   Unregistered Sales of Equity Securities and Use of Proceeds                                                                                                                                             | 16       |
|                                                                                                                                                                                                                              |     |
| Item 3 -   Defaults Upon Senior Securities                                                                                                                                                                         | 16       |
|                                                                                                                                                                                                                              |     |
| Item 4 -   Submission of Matters to a Vote of Security Holders                                                                                                                                                     | 16       |
|                                                                                                                                                                                                                              |     |
| Item 5 -   Other Information                                                                                                                                                                                       | 16       |
|                                                                                                                                                                                                                              |     |
| Item 6 -   Exhibits and Reports On Form 8-K                                                                                                                                                                        | 17       |
|                                                                                                                                                                                                                              |     |
| Signatures                                                                                                                                                                                                                        | 17       |

----

ITEM 1.

STATEMENTS

|                                                                                                                                                                                                                                                              |   | THREE MONTHS ENDEDMARCH 31, |      |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------|-----------|
|                                                                                                                                                                                                                                                              |   | 2010                        |      |   | 2009 |   |
|                                                                                                                                                                                                                                                              |   |                        |      |   |   |   |
| Net sales                                                                                                                                                                                                                                                         |   | $                           | 3,576,915 |   |   | $ | 3,895,143 |   |
|                                                                                                                                                                                                                                                              |   |                        |      |   |   |   |   |   |
| Costs and expenses:                                                                                                                                                                                                                                               |   |                        |      |   |   |   |   |   |
|   Cost of sales                                                                                                                                                                                                                                         |   |                        | 1,414,567 |   |   |   | 1,546,319 |   |
|   Operating expenses                                                                                                                                                                                                                                    |   |                        | 618,049   |   |   |   | 709,985 |   |
|                                                                                                                                                                                                                                                              |   |                        | 2,032,616 |   |   |   | 2,256,304 |   |
|                  Income from operations                                                                                                                                      |   |                        | 1,544,299 |   |   |   | 1,638,839 |   |
|                                                                                                                                                                                                                                                              |   |                        |      |   |   |   |   |   |
| Other income:                                                                                                                                                                                                                                                     |   |                        |      |   |   |   |   |   |
|   Investment income                                                                                                                                                                                                                                     |   |                        | 92,270    |   |   |   | 91,602 |   |
|                                                                                                                                                                                                                                                              |   |                        |      |   |   |   |   |   |
|                 Income from operations before                    income taxes |   |                        | 1,636,569 |   |   |   | 1,730,441 |   |
|                                                                                                                                                                                                                                                              |   |                        |      |   |   |   |   |   |
| Provision for income taxes                                                                                                                                                                                                                                        |   |                        | 540,725   |   |   |   | 575,200 |   |
|                                                                                                                                                                                                                                                              |   |                        |      |   |   |   |   |   |
|                 Net income                                                                                                                                                        |   | $                           | 1,095,844 |   |   | $ | 1,155,241 |   |
|                                                                                                                                                                                                                                                              |   |                        |      |   |   |   |   |   |
| Earnings per common share(Basic and Diluted)                                                                                                                                                                                                                      |   | $                           | 0.22      |   |   | $ | 0.23 |   |
|                                                                                                                                                                                                                                                              |   |                        |      |   |   |   |   |   |
| Weighted average shares – basic and diluted                                                                                                                                                                                                                 |   |                        | 4,946,439 |   |   |   | 4,946,439 |   |

----

BALANCE

| ASSETS                                                                                                         |   | MARCH 31,   |       |   | DECEMBER 31, |   |
|----------------------------------------------------------------------------------------------------------------|--------|-------------|------------|--------|--------------|--------|
|                                                                                                           |   |  2010  |       |   |  2009   |   |
|                                                                                                           |   | (UNAUDITED) |       |   |         |   |
| Current assets:                                                                                                |   |        |       |   |         |   |
| Cash and cash equivalents                                                                                      |   | $           | 2,216,474  |   |         | $      | 5,021,073 |   |
| Certificates of deposit                                                                                        |   |        | 711,154    |   |         |   | 1,014,866 |   |
| Marketable securities                                                                                          |   |        | 10,837,497 |   |         |   | 8,438,757 |   |
| Accounts receivable, net of allowance for doubtful accounts of $27,000 at March 31, 2010 and December 31, 2009 |   |        | 1,702,874  |   |         |   | 1,364,886 |   |
| Inventories (net)                                                                                              |   |        | 1,502,040  |   |         |   | 1,153,134 |   |
| Prepaid expenses and other current assets                                                                      |   |        | 265,325    |   |         |   | 220,815 |   |
| Deferred income taxes                                                                                          |   |        | 443,034    |   |         |   | 443,034 |   |
| Total current assets                                                                                           |   |        | 17,678,398 |   |         |   | 17,656,565 |   |
|                                                                                                           |   |        |       |   |         |   |   |   |
|                                                                                                           |   |        |       |   |         |   |   |   |
| Property, plant and equipment:                                                                                 |   |        |       |   |         |   |   |   |
| Land                                                                                                           |   |        | 69,000     |   |         |   | 69,000 |   |
| Factory equipment and fixtures                                                                                 |   |        | 3,366,209  |   |         |   | 3,302,967 |   |
| Building and improvements                                                                                      |   |        | 2,585,208  |   |         |   | 2,541,115 |   |
| Waste disposal plant                                                                                           |   |        | 133,532    |   |         |   | 133,532 |   |
|                                                                                                           |   |        | 6,153,949  |   |         |   | 6,046,614 |   |
| Less: Accumulated depreciation                                                                                 |   |        | 5,137,600  |   |         |   | 5,099,903 |   |
| Total property, plant and equipment, net                                                                       |   |        | 1,016,349  |   |         |   | 946,711 |   |
|                                                                                                           |   |        |       |   |         |   |   |   |
| Other assets                                                                                                   |   |        | 103,598    |   |         |   | 113,016 |   |
|                                                                                                           |   |        |       |   |         |   |   |   |
| TOTAL ASSETS                                                                                                   |   | $           | 18,798,345 |   |         | $      | 18,716,292 |   |

----

| LIABILITIES AND STOCKHOLDERS’ EQUITY                                                                                                                     |   |        |       |   |         |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------|------------|--------|--------------|--------|
|                                                                                                                                                           |   | MARCH 31,   |       |   | DECEMBER 31, |   |
|                                                                                                                                                           |   | 2010        |       |   | 2009         |   |
| Current liabilities:                                                                                                                                           |   | (UNAUDITED) |       |   |         |   |
|                                                                                                                                                           |   |        |       |   |         |   |
| Dividends payable                                                                                                                                              |   | $           | ---        |   |         | $      | 1,582,860 |   |
| Accounts payable                                                                                                                                               |   |        | 374,820    |   |         |   | 322,325 |   |
| Accrued expenses                                                                                                                                               |   |        | 874,541    |   |         |   | 819,194 |   |
| Pension liability                                                                                                                                              |   |        | 112,857    |   |         |   | 108,892 |   |
| Income taxes payable                                                                                                                                           |   |        | 504,503    |   |         |   | 87,403 |   |
| Total current liabilities                                                                                                                                      |   |        | 1,866,721  |   |         |   | 2,920,674 |   |
|                                                                                                                                                           |   |        |       |   |         |   |   |   |
| Deferred income taxes                                                                                                                                          |   |        | 151,927    |   |         |   | 138,007 |   |
|                                                                                                                                                           |   |        |       |   |         |   |   |   |
| Stockholders’ equity:                                                                                                                                    |   |        |       |   |         |   |   |   |
| Common stock $.10 par value, authorized, 10,000,000 shares; 5,008,639 shares issued, and 4,946,439 shares outstanding at March 31, 2010 and December 31, 2009. |   |        | 500,864    |   |         |   | 500,864 |   |
| Capital in excess of par value                                                                                                                                 |   |        | 3,819,480  |   |         |   | 3,819,480 |   |
| Accumulated other comprehensive loss                                                                                                                           |   |        | (319,750   | )      |         |   | (345,992 | ) |
| Retained earnings                                                                                                                                              |   |        | 13,138,733 |   |         |   | 12,042,889 |   |
| Treasury stock, at cost; 62,200 shares                                                                                                                         |   |        | (359,630   | )      |         |   | (359,630 | ) |
| Total stockholders’ equity                                                                                                                               |   |        | 16,779,697 |   |         |   | 15,657,611 |   |
|                                                                                                                                                           |   |        |       |   |         |   |   |   |
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY                                                                                                               |   | $           | 18,798,345 |   |         | $      | 18,716,292 |   |

----

STATEMENTS 

|                                                                                                                                                                                                                                                                              |   | THREE MONTHS ENDED |       |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------|------------|
|                                                                                                                                                                                                                                                                              |   | MARCH 31,          |       |
|                                                                                                                                                                                                                                                                              |   | 2010               |       |   | 2009 |   |
| Cash flows from operating activities:                                                                                                                                                                                                                                             |   |               |       |   |   |   |
| Net income                                                                                                                                                                                                                                                                        |   | $                  | 1,095,844  |   |   | $ | 1,155,241 |   |
| Adjustments to reconcile net income to net cashprovided by operating activities:                                                                                                                                                                                             |   |               |       |   |   |   |   |   |
|               Depreciation and amortization                                                                                                                                                                      |   |               | 55,075     |   |   |   | 42,174 |   |
|               Realized loss on sale of investments                                                                                                                                                               |   |               | 5,564      |   |   |   | --- |   |
|               Recovery of losses on accounts receivable                                                                                                                                                          |   |               | ---        |   |   |   | (2,616 | ) |
|               Increase (decrease) in cash resulting from                  changes in operating assets and liabilities: |   |               |       |   |   |   |   |   |
|                       Accounts receivable                                                                                                                                |   |               | (337,988   | ) |   |   | (132,777 | ) |
|                       Inventories                                                                                                                                        |   |               | (348,906   | ) |   |   | 163,863 |   |
|                       Prepaid expenses and other currentassets                                                                                                           |   |               | (44,510    | ) |   |   | 39,106 |   |
|                       Accounts payable                                                                                                                                   |   |               | 52,495     |   |   |   | 146,771 |   |
|                       Accrued expenses and taxes payable                                                                                                                 |   |               | 476,412    |   |   |   | 352,667 |   |
|                                                                                                                                                                                                                                                                              |   |               |       |   |   |   |   |   |
| Net cash provided by operating activities                                                                                                                                                                                                                                         |   |               | 953,986    |   |   |   | 1,764,429 |   |
|                                                                                                                                                                                                                                                                              |   |               |       |   |   |   |   |   |
| Cash flows from investing activities:                                                                                                                                                                                                                                             |   |               |       |   |   |   |   |   |
|          Acquisition of property, plant and equipment                                                                                                                                                                                                    |   |               | (115,295   | ) |   |   | (3,905 | ) |
|          Net change in certificates of deposit                                                                                                                                                                                                           |   |               | 303,712    |   |   |   | (3,818 | ) |
|          Proceeds from sale of marketable securities                                                                                                                                                                                 |   |               | 600,000    |   |   |   | 300,000 |   |
|          Purchase of marketable securities                                                                                                                                                                                                               |   |               | (2,964,142 | ) |   |   | (44,337 | ) |
| Net cash  (used in) provided by investingactivities                                                                                                                                                                                                                     |   |               | (2,175,725 | ) |   |   | 247,940 |   |
|                                                                                                                                  |   |               |       |   |   |   |   |   |
| Cash flows from financing activities:                                                                                                                                                                                                                                             |   |               |       |   |   |   |   |   |
|          Payment of long-term debt                                                                                                                                                                                                                       |   |               | ---        |   |   |   | (1,997 | ) |
|          Dividends paid                                                                                                                                                                                                                                  |   |               | (1,582,860 | ) |   |   | (1,385,003 | ) |
| Net cash used in financing activities                                                                                                                                                                                                                                             |   |               | (1,582,860 | ) |   |   | (1,387,000 | ) |
|                                                                                                                                                                                                                                                                              |   |               |       |   |   |   |   |   |
| Net (decrease) increase  in cash and cashequivalents                                                                                                                                                                                                                    |   |               | (2,804,599 | ) |   |   | 625,369 |   |
| Cash and cash equivalents at beginning of period                                                                                                                                                                                                                                  |   |               | 5,021,073  |   |   |   | 3,425,538 |   |
| Cash and cash equivalents at end of period                                                                                                                                                                                                                                        |   | $                  | 2,216,474  |   |   | $ | 4,050,907 |   |

----

NOTES 

| 1. | Nature of Business |
|----|--------------------|

| 2.  | Basis of Presentation |
|----------|-----------------------|

| 3. | Stock-Based Compensation |
|----|--------------------------|

|       | As of March 31, 2010, the Company had no share-based awards outstanding and exercisable and did not grant any options during the three months ended March 31, 2010. |
|--------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|       | As of March 31, 2010, there was no remaining unrecognized compensation cost related to the non-vested share-based compensation arrangements granted under the Company's plans. |
|--------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|       | The Company did not record any compensation expense during the three-month periods ended March 31, 2010 and 2009. |
|--------------------------------|-------------------------------------------------------------------------------------------------------------------|

|   | The Company did not receive any proceeds from the exercise of options during the three months ended March 31, 2010 and 2009. |
|--------|------------------------------------------------------------------------------------------------------------------------------|

| 4. | Recent Accounting Pronouncements |
|----|----------------------------------|

----

| 5.   | Investments |
|----------------|-------------|

----

| ·   | Level 1 – inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. |
|---------------|-------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Level 2 – inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially for the full term of the financial statement. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Level 3 – inputs to the valuation methodology are unobservable and significant to the fair value measurement. |
|--------------------|---------------------------------------------------------------------------------------------------------------------|

|                                                                                                                 |   |   |       |   |       |   |       | Unrealized  |   |
|----------------------------------------------------------------------------------------------------------------------|--------|--------|------------|--------|------------|--------|------------|-------------|--------|
|                                                                                                                 |   | Cost   |       |   | Fair Value |   |       | Gain/(Loss) |   |
| Available for sale:                                                                                                  |   |   |       |   |       |   |       |        |   |
|     U.S. treasury and agencies                                                                   |   |   |       |   |       |   |       |        |   |
|         Maturities within 1 year                                             |   | $      | 1,044,653  |   |       | $      | 1,046,780  |        |   | $ | 2,127 |   |
|         Maturities after 1 year through 5 years                              |   |   | 1,108,726  |   |       |   | 1,119,414  |        |   |   | 10,688 |   |
|               Total U.S. treasury and agencies |   |   | 2,153,379  |   |       |   | 2,166,194  |        |   |   | 12,815 |   |
|     Corporate bonds                                                                              |   |   |       |   |       |   |       |        |   |   |   |   |
|         Maturities after 1 year through 5 years                              |   |   | 267,251    |   |       |   | 264,272    |        |   |   | (2,979 | ) |
|      Fixed income mutual funds                                                              |   |   | 8,142,360  |   |       |   | 8,186,377  |        |   |   | 44,017 |   |
|      Equity and other mutual funds                                                          |   |   | 245,574    |   |       |   | 220,654    |        |   |   | (24,920 | ) |
|                                                                                                                 |   | $      | 10,808,564 |   |       | $      | 10,837,497 |        |   | $ | 28,933 |   |

| Available for sale:                                                                                                  |   |   |      |   |   |   |      |   |   |
|----------------------------------------------------------------------------------------------------------------------|--------|--------|-----------|--------|--------|--------|-----------|--------|--------|
|     U.S. treasury and agencies                                                                   |   |   |      |   |   |   |      |   |   |
|         Maturities within 1 year                                             |   | $      | 1,650,218 |   |   | $      | 1,659,596 |   |   | $ | 9,378 |   |
|         Maturities after 1 year through 5 years                              |   |   | 1,108,726 |   |   |   | 1,124,527 |   |   |   | 15,801 |   |
|               Total U.S. treasury and agencies |   |   | 2,758,944 |   |   |   | 2,784,123 |   |   |   | 25,179 |   |
|     Corporate bonds                                                                              |   |   |      |   |   |   |      |   |   |   |   |   |
|         Maturities after 1 year through 5 years                              |   |   | 267,251   |   |   |   | 262,846   |   |   |   | (4,405 | ) |
|      Fixed income mutual funds                                                              |   |   | 5,179,005 |   |   |   | 5,181,990 |   |   |   | 2,985 |   |
|      Equity and other mutual funds                                                          |   |   | 244,786   |   |   |   | 209,798   |   |   |   | (34,988 | ) |
|                                                                                                                 |   | $      | 8,449,986 |   |   | $      | 8,438,757 |   |   | $ | (11,229 | ) |

----

| 6. | Inventories - Net  |
|----|-------------------------|

|                                        |   | March 31, |      |   | December 31, |   |
|---------------------------------------------|--------|-----------|-----------|--------|--------------|--------|
|                                        |   | 2010      |      |   | 2009         |   |
| Inventories consist of the following:  |   |      |      |   |         |   |
| Raw materials and work in process           |   | $         | 638,203   |   |         | $      | 329,562 |   |
| Finished products                      |   |      | 863,837   |   |         |   | 823,572 |   |
|                                        |   | $         | 1,502,040 |   |         | $      | 1,153,134 |   |

|       | Finished products inventories at March 31, 2010 and December 31, 2009 are stated net of a reserve of $39,000 for slow moving and obsolete inventory. |
|--------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------|

| 7. | Supplemental Financial Statement Information |
|----|----------------------------------------------|

|   | Research and development expenses amounted to $128,153 and $102,320 for the three months ended March 31, 2010 and March 31, 2009, respectively, and are included in operating expenses. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The Company paid dividends of $1,582,860 ($0.32 per share) and $1,385,003 ($0.28 per share) during the periods ended March 31, 2010 and March 31, 2009. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------|

| 8. | Income Taxes |
|----|--------------|

|       | The Company’s tax provision is based on its estimated annual effective tax rate. The Company continues to fully recognize its tax benefits, which are offset by a valuation allowance to the extent that it is more likely than not that the deferred tax assets will not be realized. As of December 31, 2009 and March 31, 2010, the Company did not have any unrecognized tax benefits. |
|--------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|       | The Company files consolidated Federal income tax returns in the U.S., and separate income tax returns in New York State. The Company is subject to examination by the Internal Revenue Service  and by New York State for years 2006 through 2009. |
|--------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | The Company's policy is to recognize interest and penalties as interest expense. |
|--------|----------------------------------------------------------------------------------|

| 9. | Comprehensive Income |
|----|----------------------|

|                                                                                                         |   | Three months endedMarch 31, |      |
|--------------------------------------------------------------------------------------------------------------|--------|-----------------------------|-----------|
|                                                                                                    |   | 2010                        |      |   | 2009 |   |
|                                                                                                         |   |                        |      |   |   |   |
| Net income                                                                                                   |   | $                           | 1,095,844 |   |   | $ | 1,155,241 |   |
|                                                                                                         |   |                        |      |   |   |   |   |   |
| Other comprehensive income:                                                                                  |   |                        |      |   |   |   |   |   |
|                                                                                                         |   |                        |      |   |   |   |   |   |
|      Unrealized gain on marketable securities during period                    |   |                        | 40,162    |   |   |   | 5,072 |   |
|                                                                                                         |   |                        |      |   |   |   |   |   |
|       Income tax expense related to other comprehensive income  |   |                        | 13,920    |   |   |   | 1,758 |   |
|                                                                                                         |   |                        |      |   |   |   |   |   |
| Other comprehensive income, net of tax                                                             |   |                        | 26,242    |   |   |   | 3,314 |   |
| Comprehensive income                                                                                    |   | $                           | 1,122,086 |   |   | $ | 1,158.555 |   |

|       | Accumulated other comprehensive income comprises unrealized gains and losses on marketable securities and liability for pension benefit net of the related tax effect. |
|--------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10. | Defined Benefit Pension Plan and New Defined Contribution Plan |
|-----|----------------------------------------------------------------|

|                                                     |   | 2010        |     |   | 2009   |   |
|----------------------------------------------------------|--------|-------------|----------|--------|--------|--------|
|                                                     |   | (projected) |     |   |   |   |
| Interest cost – projected benefit obligation  |   | $           | 117,303  |   |   | $      | 113,864 |   |
| Expected return on plan assets                      |   |        | (130,353 | )      |   |   | (131,315 | ) |
| Amortization of net loss                                 |   |        | 28,910   |   |   |   | 6,659 |   |
| Net periodic costs (benefit)                        |   | $           | 15,860   |   |   | $      | (10,792 | ) |

----

|                            |   | March 31, |    |   | December 31, |   |
|---------------------------------|--------|-----------|---------|--------|--------------|--------|
|                            |   | 2010      |    |   | 2009         |   |
|                            |   |      |    |   |         |   |   |   |
| Accrued 401K plan contributions |   | $         | 43,750  |   |         | $      | --- |   |
| Accrued bonuses                 |   |      | 273,000 |   |         |   | 182,000 |   |
| Accrued distribution fees       |   |      | 303,759 |   |         |   | 303,493 |   |
| Other                           |   |      | 254,032 |   |         |   | 333,701 |   |
|                            |   | $         | 874,541 |   |         | $      | 819,194 |   |

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

----

|       | Accordingly, results actually achieved may differ materially from those anticipated as a result of such forward-looking statements, and those statements speak only as of the date they are made. The Company does not undertake, and specifically disclaims, any obligation to update any forward-looking statements to reflect events or circumstances occurring after the date of such statements. |
|--------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|      | The Company is a Delaware corporation that conducts research, product development, manufacturing and marketing of cosmetic ingredients, personal and health care products, pharmaceuticals, and specialty industrial products. All of the products that the Company manufactures, with the exception of its RENACIDIN IRRIGATION®, are produced at its facility in Hauppauge, New York, and are marketed through marketing partners, distributors, wholesalers, direct advertising, mailings, and trade exhibitions. Its most important personal care product line is its LUBRAJEL® line of water-based moisturizing and lubricating gels. It also sells two pharmaceutical products for urological uses. Those products are sold primarily through the major drug wholesalers, which in turn sell the products to pharmacies, hospitals, nursing homes and other long-term care facilities, and to government agencies, primarily the Veteran's Administration. |
|--------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|       | While the Company does have competition in the marketplace for some of its products, many of its products are either unique in their field or have some unique characteristics, and therefore are not in direct competition with the products of other pharmaceutical, specialty chemical, or health care companies.  Many of the Company’s products are manufactured using patented or proprietary processes.  The Company’s research and development department is actively working on the development of new products to expand the Company's line of personal care and performance products. |
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|   | The Company recognizes revenue when products are shipped, title and risk of loss pass to the customers, persuasive evidence of a sales arrangement exists, and collections are reasonably assured.  An allowance for returns, based on historical experience, is taken as a reduction of sales within the same period the revenue is recognized. |
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|       | The Company has been issued many patents and trademarks and intends, whenever possible, to make efforts to obtain patents in connection with its product development program.     |
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|       | As disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2009, the discussion and analysis of the Company’s financial condition and results of operations are based on its financial statements, which have been prepared in conformity with U.S. generally accepted accounting principles. The preparation of those financial statements required the Company to make estimates and assumptions that affect the carrying value of assets, liabilities, revenues and expenses reported in those financial statements. Those estimates and assumptions can be subjective and complex, and consequently actual results could differ from those estimates and assumptions. The Company’s most critical accounting policies relate to revenue recognition, concentration of credit risk, inventory, pension costs, patents, and income taxes. Since December 31, 2009, there have been no significant changes to the assumptions and estimates related to those critical accounting policies. |
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|       | The following discussion and analysis covers material changes in the financial condition of the Company since the year ended December 31, 2009, and a comparison of the results of operations for the three months ended March 31, 2010 and March 31, 2009. This discussion and analysis should be read in conjunction with "Management's Discussion and Analysis or Plan of Operation" included in the Company's Annual Report on Form 10-K for the year ended December 31, 2009. |
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|   | Sales |
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| (a)   | Personal care products: For the three months ended March 31, 2010 the Company’s gross sales of personal care products decreased by $132,383 (5.8%) when compared with the same period in 2009.  This decrease was due to a decrease of $202,415 (11.4%) in sales to the Company’s largest distributor for the three-month period ended March 31, 2010 when compared with the comparable period in 2009.  The Company believes that this decline was primarily due to the timing of customer orders. This decrease was partially offset by an increase of $70,032 (13.3%) in sales to the Company’s other distributors. |
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| (b)   | Pharmaceuticals:  Pharmaceutical gross sales increased by $116,259 (17.7%) for the three months ended March 31, 2010 when compared with the same period in 2009.  On April 1, 2010, the Company implemented a price increase on its pharmaceutical products, which resulted in customers purchasing larger than normal volumes in advance of the price increase. In 2009 the Company did not implement a pharmaceutical price increase until May, so the increase in sales due to the price increase was not felt until the second quarter. |
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| (c)   | Medical (non-pharmaceutical) products:  Gross sales of the Company’s medical products decreased $322,034 (32.2%) for the three-month period ended March 31, 2010 when compared with the same period in 2009.  The decrease was primarily the result of a decrease in sales of $264,816 to one of the Company’s customers. This customer had increased its purchases in the first half of 2009 prior to a move of its production operations in late 2009, and did not resume its purchasing until late February of 2010. |
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|       | Working capital increased by $1,075,786 to $15,811,677 at March 31, 2010 from $14,735,891 at December 31, 2009. The current ratio increased to 9.5 to 1 at March 31, 2010 from 6.0 to 1 at December 31, 2009. The increase in the current ratio was primarily due to the effect of a decrease in dividends payable. |
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|   | During the three-month period ended March 31, 2010 the average period of time that an account receivable was outstanding was approximately 39 days. The average period of time that an account receivable was outstanding during the three-month period ended March 31, 2009 was 34 days.  The increase was mainly due to a few customers who were paying more slowly than normal during the three-month period ended March 31, 2010. |
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|       | The Company believes that its working capital is and will continue to be sufficient to support its operating requirements for at least the next twelve months.  The Company does not expect to incur any significant capital expenditures for the remainder of 2010. |
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|       | The Company generated cash from operations of $953,986 and $1,764,429 for the three months ended March 31, 2010 and March 31, 2009, respectively. The decrease in cash was primarily due to an increase in inventory and accounts receivable. |
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|   | Cash used in investing activities for the three-month period ended March 31, 2010 was $2,175,725, while cash provided by investing activities for the three-month period ending March 31, 2009 was $247,940. This decrease in cash was primarily due to the purchase of marketable securities. |
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|   | The Company has no off balance sheet transactions that have, or are reasonably likely to have, a current or future effect on the Company’s financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources. |
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|   | The information to be reported under this item is not required of smaller reporting companies. |
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Item 3.

Item 4T.

| (a)   | DISCLOSURE CONTROLS AND PROCEDURES |
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| (b)   | CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING |
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| ITEM 1. | LEGAL PROCEEDINGS |
|---------|-------------------|

| ITEM 1A. | RISK FACTORS |
|----------|--------------|

|   | The information to be reported under this item is not required of smaller reporting companies. |
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| ITEM 2. | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OFPROCEEDS. |
|---------|-------------------------------------------------------------|

| ITEM 3. | DEFAULTS UPON SENIOR SECURITIES |
|---------|---------------------------------|

| ITEM 4. | (Removed and Reserved) |
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ITEM 5.

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ITEM 6.

| 31.1      | Certification of Kenneth H. Globus, President and principal executive officer of the Company, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002  |
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|                     |                                                                                                                                                     |
| 31.2      | Certification of Robert S. Rubinger, Chief Financial Officer of the Company, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                   |
|                     |                                                                                                                                                     |
| 32.1      | Certification of Kenneth H. Globus, President and principal executive officer of the Company, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
|                     |                                                                                                                                                     |
| 32.2      | Certification of Robert S. Rubinger, Chief Financial Officer of the Company, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                  |

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SIGNATURES

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