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

                                   Form 10-K/A

                                 Amendment No.1


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

                   For the fiscal year ended December 31, 2006
                                       or
(   ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

                   For the transition period from _____to_____
                         Commission file number 0-26775

                         Samaritan Pharmaceuticals Inc.
             (Exact name of registrant as specified in its charter)

                    Nevada                            88-0431538
        (State or other jurisdiction of     (I.R.S. Employer Identification No.)
        Incorporation or organization)

    101 Convention Center Drive, Suite 310, Las Vegas, Nevada      89109
         (Address of Principal Executive Offices)                (Zip Code)

                                 (702) 735-7001
                            Issuer's telephone number

        Securities to be registered Pursuant to Section 12(b) of the Act:
                                      None

      Securities Registered Pursuant to Section 12(g) of the Exchange Act:
            Common Stock, $0.001 par value per share (Title of class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as
defined in Rule 405 of the Securities Act. Yes|_| No |X|

Indicate by check mark if the registrant is not required to file reports
pursuant to Section 13 or Section 15(d) of the Act.  Yes |_| No |X|

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

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. |X|

Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, or a non-accelerated filer. See definition of "accelerated
filer and large accelerated filer" in Rule 12b-2 of the Exchange Act. (Check
one):
Large accelerated filer |_|  Accelerated filer |_|   Non-accelerated filer |X|

Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of Act).  Yes |_| No |X|

The aggregate market value of Common Stock held by non-affiliates as of June 30,
2006 was $47,077,301. All executive officers and directors of the registrant
have been deemed, solely for the purpose of the foregoing calculation, to be
"affiliates" of the registrant.


The Company had 159,422,456 common shares issued and outstanding as of April 4,
2007.


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                                EXPLANATORY NOTE

         Pursuant to Rule 12b-15 of the Securities Exchange Act of 1934,
Samaritan Pharmaceuticals, Inc. (the "Company" or "Samaritan") hereby amends its
Annual Report on Form 10-K for the year ended December 31, 2006 (the "Original
10-K") to include the information required by Items 10, 11, 12, 13 and 14 of
Part III relating to Directors, Executive Officers and Corporate Governance of
the Registrant, Executive Compensation, Security Ownership of Certain Beneficial
Owners and Management and Related Stockholder Matters, Certain Relationships and
Related Transactions, and Director Independence, and Principal Accountant Fees
and Services, respectively. Certain information required by Part III was to be
incorporated by reference to Samaritan's definitive proxy statement for the 2007
Annual Meeting of Shareholders. Samaritan's definitive proxy statement will not
be filed with the Securities and Exchange Commission (the "SEC") within 120 days
of the fiscal year ended December 31, 2006. Therefore, Part III, Items 10
through 14 of the Company's Original 10-K are hereby amended and restated in
their entirety. The Company also inserted a performance graph section in
Part II, Item 5. No modification or update to other disclosures as presented in
the Original 10-K have been made.


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                                Table of Contents

                                     Part I

Item  1.  Business..........................................................3

Item  1A. Risk Factors.....................................................16

Item  1B. Unresolved Staff Comments........................................26

Item  2.  Properties.......................................................26

Item  3.  Legal Proceedings................................................26

Item  4.  Submission of Matters to a Vote of Security Holders..............26

                                     Part II

Item  5.  Market For Samaritan's Common Equity, Related Stockholder Matters
          and Issuer's Purchases of Equity Securities......................26

Item  6.  Selected Consolidated Financial Data.............................28

Item  7.  Management's Discussion and Analysis of Financial Condition and
          Results of Operations............................................29

Item  7A. Quantitative and Qualitative Disclosures about Market Risk.......37

Item  8.  Consolidated Financial Statements and Supplementary Data Report
          of Independent Registered Public Accounting Firm.................37

Item  9.  Changes in and Disagreements with Accountants on Accounting and
          Financial Disclosure.............................................37

Item  9A. Controls and Procedures..........................................37

Item  9B. Other Information................................................38

                                    Part III

Item  10. Directors, Executive Officers and Corporate Governance...........38


Item  11. Executive Compensation...........................................42

Item  12. Security Ownership of Certain Beneficial Owners and Management
          and Related Stockholder Matters..................................53

Item  13. Certain Relationships and Related Transactions, and Director
          Independence.....................................................54

Item  14. Principal Accounting Fees and Services...........................55

                                     Part IV

Item  15.   Exhibits, Financial Statement Schedules........................58

Signatures

<PAGE>

                           FORWARD-LOOKING STATEMENTS

The statements in this annual report that are not descriptions of historical
facts may be forward-looking statements. Those statements involve substantial
risks and uncertainties. You can identify those statements by the fact that they
contain words such as "anticipate," "believe," "estimate," "expect," "intend,"
"project" or other terms of similar meaning. Those statements reflect
management's current beliefs, but are based on numerous assumptions, over which
Samaritan Pharmaceuticals may have little or no control and that may not develop
as Samaritan expects. Consequently, actual results may differ materially from
those projected in the forward-looking statements. Among the factors that could
cause actual results to differ materially are the risks, uncertainties and other
matters discussed below under Item 1A. Risk Factors, and elsewhere in this
report. Samaritan is also developing several products for potential future
marketing. There can be no assurance that such development efforts will succeed,
that such products will receive required regulatory clearance or that, even if
such regulatory clearance is received, such products will ultimately achieve
commercial success. Unless otherwise indicated, the information in this annual
report is as of December 31, 2006. This annual report will not be updated as a
result of new information or future events.

                                     PART I

ITEM 1.   BUSINESS

Samaritan Pharmaceuticals, Inc. (including the subsidiaries, referred to as
Samaritan, the "Company", "its", "we", and "our"), formed in September 1994, is
an entrepreneurial biopharmaceutical company, focused on commercializing
innovative therapeutic products to relieve the suffering of patients with
Alzheimer's disease; cancer; cardiovascular disease, HIV, and Hepatitis C; as
well as, commercializing its acquired marketing and sales rights, to sell nine
marketed revenue-generating products, in Greece, and/or various Eastern European
countries.

Samaritan has partnered its oral entry inhibitor HIV drug SP-01A, a drug that
has demonstrated safety and efficacy, in Phase II clinical trials, with
Pharmaplaz, Ireland to advance to Phase III clinical trials. In addition,
Samaritan aims to commercialize three blockbuster market drug candidates with
late-stage preclinical development programs. Samaritan is evaluating the use of
Caprospinol, SP-233 in Alzheimer's disease patients; the use of SP-1000 with
acute coronary disease patients; and the use of SP-10 as an "oral treatment" for
Hepatitis C patients.

Business Model

Our commercialization business model is focused dually on, the partnering of our
promising innovative products to pharmaceutical companies; and the acquisition
of the marketing and sales rights to revenue-generating marketed products for
sales in Greece and Eastern Europe. This model allows Samaritan to focus on our
core competencies in drug discovery and drug development. Samaritan partners
promising innovative therapeutics anywhere in the early "human" clinical trial
stage, i.e. late-stage preclinical studies, Phase I Clinical trials, or proof of
concept, Phase II clinical trials, with the objective of partnering before
costly Phase III clinical trials. Potential revenue streams with this model
could include up-front fees, milestone payments, and participation in the
marketing success of partnered products through royalties. In addition,
Samaritan is enhancing and strengthening its sales and marketing force, in
Greece and Eastern Europe, to allow for the significant economics gained by
advancing the commercialization of its contracted marketed products. Our
business model is entirely focused on achieving growth and maximizing value for
the benefit of our investors.

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Marketed Products

Samaritan has also entered into strategic collaborative relationships with other
pharmaceutical companies to commercialize branded approved prescription products
in selected niche territories, such as, in Greece, Albania, Bosnia, Bulgaria,
Croatia, Cyprus, Czech Republic, Egypt, FYROM, Hungary, Montenegro, Poland,
Romania, Serbia, Slovakia, Slovania, Syria and Turkey. We use our expertise to
register approved drugs with regulatory agencies in the country we have acquired
the rights for; and then, upon regulatory approval, we distribute, market and
sell these products. Currently, we have in-licensed the rights to sell nine
drugs, Amphocil from Three Rivers Pharmaceuticals, Elaprase from Shire
Pharmaceuticals, Infasurf from Ony, Inc, and Mepivamol, Methadone, Morphine
Sulphate, Naloxone, Naltrexone, and Oramorph from Molteni Farmaceutici. Our
efforts are focused on specialist physicians in private practice or at hospitals
and major medical centers in our territories. Below is a description of our
in-licensed products.

AMPHOCIL(R)

AMPHOCIL(R) is a lipid form of amphotericin B indicated for the treatment of
invasive aspergillosis, a life threatening systemic fungal infection.
AMPHOCIL(R) is indicated for the treatment of severe systemic and/or deep
mycoses in cases where toxicity or renal failure precludes the use of
conventional amphotericin B in effective doses, and in cases where prior
systemic antifungal therapy has failed. Fungal infections successfully treated
with AMPHOCIL(R) include disseminated candidiasis and aspergillosis. AMPHOCIL(R)
has been used successfully in severely neutropenic patients.

AMPHOCIL(R) is an approved FDA prescription product owned by Three Rivers
Pharmaceuticals, Inc. and marketed by Three Rivers Pharmaceuticals, Inc. in the
US. Samaritan signed an exclusive distribution deal for Greece and Cyprus with
Three Rivers on December 14, 2005.

In April 2006, Samaritan was granted marketing authorization for AMPHOCIL(R) in
Greece; however Samaritan needed to apply for a price increase for it to be
profitable, which we received in March 2007. Samaritan expects to launch
AMPHOCIL(R) in Greece in April 2007. Marketing authorization for AMPHOCIL(R) is
pending in Cyprus.

ELAPRASE(R)

ELAPRASE(R) is a human enzyme replacement therapy for the treatment of Hunter
syndrome, also known as Mucopolysaccharidosis II (MPS II). Hunter syndrome is a
rare, life-threatening genetic condition that results from the absence or
insufficient levels of the lysosomal enzyme iduronate-2-sulfatase. Without this
enzyme, cellular waste products accumulate in tissues and organs, which then
begin to malfunction.

ELAPRASE(R) was granted marketing authorization for the long-term treatment of
patients with Hunter's disease by the European Commission in January 2007.
ELAPRASE(R) is the first, and only, enzyme replacement therapy for Hunter's
disease patients and was launched in the U.S. in July 2006.

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ELAPRASE(R) will be sold and distributed by Samaritan on a named patient basis
until the pricing and the reimbursement of ELAPRASE(R) is established in Greece
and Cyprus, with the relevant regulatory authorities. Samaritan expects to
launch ELAPRASE(R) in Greece and Cyprus in the second quarter of 2007.
Samaritan signed an exclusive licensing agreement with Shire Pharmaceuticals for
the marketing and sale of ELAPRASE(R) in Greece and Cyprus which became
effective March 1, 2007.

INFASURF(R)

INFASURF(R) treats and prevents Respiratory Distress Syndrome (RDS). This
syndrome occurs when infants lack surfactant, a natural substance normally
produced in the body, which is necessary for lungs to function normally.
INFASURF(R) is used exclusively in hospitals with a neonatal intensive care unit
(NICU) and is administered by neonatologists, neonatal nurses, neonatal nurse
practitioners and respiratory therapists.

On January 16, 2007, Samaritan signed an exclusive agreement with Siraeo, Ltd
for the marketing and distribution of the product INFASURF(R) in Turkey, Serbia,
Bosnia, Macedonia, Albania, Egypt and Syria. INFASURF(R) is an approved FDA
prescription product owned by ONY, Inc. and marketed by Forest Laboratories in
the US.

Currently, Samaritan Pharmaceuticals is utilizing the US FDA approved regulatory
file in preparing marketing applications for INFASURF(R) with regulatory
authorities in Turkey, Serbia, Bosnia, F.Y.R.O.M., Albania, Egypt and Syria to
gain country marketing authorization drug approval.

MEPIVAMOL(R)

MEPIVAMOL(R) (Mepivacaine) is an effective and reliable local anesthetic of
intermediate duration and low systemic toxicity. It is widely used for regional
anesthetic procedures such as IVRA, infiltration, epidural blockade, plexus and
peripheral nerve blockade. MEPIVAMOL(R) is approved by the Italian Ministry of
Health (The equivalent to the US FDA) and is owned by Molteni Farmaceutici,
Inc. and marketed by Molteni Farmaceutici, Inc. in Italy.

On January 1, 2007, Samaritan entered into an exclusive licensing agreement with
Molteni Farmaceutici for the marketing and distribution of MEPIVAMOL(R) in the
countries of Greece and Cyprus. Currently, Samaritan Pharmaceuticals is
utilizing the Italian Ministry of Health approved regulatory file in preparing
marketing applications for MEPIVAMOL(R) with regulatory authorities in Greece
and Cyprus to gain country marketing authorization drug approval.

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METHADONE HCL(R)

METHADONE HCL(R) is an opiate agonist. METHADONE HCL(R) prevents heroin or
morphine from interacting with receptors for natural painkillers called
endorphins, blocking the effects of the addictive drugs and reducing the
physical cravings. METHADONE HCL(R) is approved by the Italian Ministry of
Health (The equivalent to the US FDA) and is owned by Molteni Pharmaceuticals,
Inc. and marketed by Molteni Farmaceutici, Inc. in Italy.

On January 1, 2007, Samaritan entered into an exclusive licensing agreement with
Molteni Farmaceutici for the marketing and distribution of METHADONE HCL(R) in
the countries of Greece and Cyprus.

Currently, METHADONE HCL(R) can only be sold in Greece and Cyprus via a
centralized government tender. Samaritan is preparing a tender application for
the next request by Greek authorities for applications.

MORPHINE SULPHATE(R)

MORPHINE SULPHATE(R) (Injectable Formulation) relieves moderate to severe pain
by binding to brain receptors. Morphine Sulphate may be used to control the pain
following surgery, child birth, and other procedures. It may also be used to
treat the pain associated with cancer, heart attacks, sickle cell disease and
other medical conditions.

On January 1, 2007, Samaritan entered into an exclusive licensing agreement with
Molteni Farmaceutici for the marketing and distribution of MORPHINE SULPHATE(R)
in the countries of Greece and Cyprus.

Currently, MORPHINE SULPHATE(R) can only be sold in Greece and Cyprus via a
centralized government tender. Samaritan is preparing a tender application for
the next request by Greek authorities for applications.

NALOXONE MOLTENI(R)

NALOXONE MOLTENI(R) is an opioid antagonist which reverses the effects of opioid
overdose, for example heroin and morphine overdose. Specifically, Naloxone is
used in opioid overdoses for countering life-threatening depression of the
central nervous system and respiratory system.

On January 1, 2007, Samaritan entered into an exclusive licensing agreement with
Molteni Farmaceutici for the marketing and distribution of NALOXONE MOLTENI(R)
in the countries of Greece and Cyprus.

Currently, NALOXONE(R) will be sold and distributed by Samaritan on a named
patient basis until the pricing and the reimbursement of NALOXONE(R) is
established in Greece and Cyprus, with the relevant regulatory authorities.

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NALTREXONE MOLTENI(R)

NALTREXONE MOLTENI(R) is an opioid antagonist which is used to help people who
have a narcotic or alcohol addiction stay drug free. NALTREXONE MOLTENI(R) is
used after the patient has stopped taking drugs or alcohol. It works by blocking
the effects of narcotics or by decreasing the craving for alcohol.

NALTREXONE MOLTENI(R) is approved by the Italian Ministry of Health (The
equivalent to the US FDA) and is owned by Molteni Farmaceutici, Inc. and
marketed by Molteni Farmaceutici, Inc. in Italy.

On January 1, 2007, Samaritan entered into an exclusive licensing agreement with
Molteni Farmaceutici for the marketing and distribution of NALTREXONE MOLTENI(R)
in the countries of Greece and Cyprus.

Currently, Samaritan Pharmaceuticals is utilizing the Italian Ministry of Health
approved regulatory file in preparing marketing applications for NALTREXONE
MOLTENI(R) with regulatory authorities in Greece and Cyprus to gain country
marketing authorization drug approval.

ORAMORPH(R)

ORAMORPH(R) is morphine sulphate in an oral solution and is used for managing
moderate to severe chronic pain for more than a few days. It works by dulling
the pain perception center in the brain. ORAMORPH(R) is approved by the Italian
Ministry of Health (The equivalent to the US FDA) and is marketed by Molteni in
Italy.

ORAMORPH(R) is approved by the Italian Ministry of Health (The equivalent to the
US FDA) and is owned by Molteni Farmaceutici, Inc. and marketed by Molteni
Farmaceutici, Inc. in Italy.

On January 1, 2007, Samaritan entered into an exclusive licensing agreement with
Molteni Farmaceutici for the marketing and distribution of ORAMORPH(R) in the
countries of Greece and Cyprus.

Currently, Oramorph has a Greek marketing authorization. Oramorph can only be
sold in Greece via a centralized government tender. Samaritan is preparing a
tender application for the next request by Greek authorities for applications.


Sales and Marketing

We in-license products that focus on targeting healthcare providers, managed
healthcare organizations, specialty distribution companies, government
purchasers and payers.

Product Candidates

A significant portion of our operating expenses are related to the research and
development of investigational-stage product candidates. Research and
development expenses were $4,667,053 in 2006, $3,456,301 in 2005, and $1,543,921
in 2004.

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We currently focus our research and development efforts in the therapeutic areas
of Alzheimer's, Cancer, Cardiovascular and Infectious Diseases. Any of our
programs in these disease areas could become more significant to us in the
future, but there can be no assurance that any program in development or
investigation will generate viable marketable products. As such, we continually
evaluate all product candidates and may, from time to time, discontinue the
development of any given program and focus our attention and resources
elsewhere. We may choose to address new opportunities for future growth in a
number of ways including, but not limited to, internal discovery and development
of new products, out-licensing and in-licensing of products and technologies,
and/or acquisition of companies with products and/or technologies. Any of these
activities may require substantial research and development efforts and
expenditure of significant amounts of capital. The following summarizes our
current product candidate programs with relevant out-licensing deals that the
Company has completed.

Alzheimer's disease

SP-233

Caprospinol (SP-233) is a novel Alzheimer's drug candidate that Samaritan
believes has the potential to clear beta-amyloid plaques from the brain; a
problem that most researchers today believe, is the cause of Alzheimer's.
Samaritan filed an IND application for Caprospinol on October 30, 2006 and was
subsequently granted an IND number by the FDA. Samaritan believes that
Caprospinol could be a significant breakthrough in the treatment of Alzheimer's,
Samaritan plans to provide the information requested by the FDA as quickly as
possible, in order to continue moving our Caprospinol development program
forward.

On December 7, 2006, Samaritan announced that the U.S. Food and Drug
Administration (FDA) has completed its regulatory review of our IND
(Investigational New Drug) application for Caprospinol and has requested that
additional information be submitted in support of the safety of Caprospinol,
prior to initiating Samaritan's proposed Phase I clinical study. Currently,
Samaritan has entered into a service agreement with Advinus Therapeutics Ltd,
India to provide the additional studies requested by the FDA.

Cardiovascular

SP-1000

SP-1000 is a peptide that can be used to clean the blood of excessive
cholesterol in acute high cholesterol conditions. SP-1000 plays a role in
transformation and binding of LDL cholesterol and raising HDL, the good
cholesterol, with immediate results.

To this end, Samaritan's collaborating scientists developed SP-1000 to be a
potential hypocholesterolemic agent that acts through a new and novel mechanism
of action that is quite distinct to the mechanism mediating the effects of
statins.

The effectiveness of SP-1000 peptide treatment has been demonstrated in two
validated hypercholesterolemia animal models, a genetically engineered mouse
model mimicking familial hypercholesterolemia, and in diet-induced
hypercholesterolemia in guinea pigs.

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Based on the study results, Samaritan collaborative scientists believe that the
SP-1000 peptide could have the following pharmacological activities:

     o    SP-1000 peptide will not interfere with cholesterol metabolism and
          disposition

     o    SP-1000 peptide will increase HDL while decreasing serum free
          cholesterol and total bile cholesterol

     o    SP-1000 peptide will be effective in removing atheromas and preventing
          plaque formation

     o    SP-1000 peptide will protect against high cholesterol-induced
          neurological, cardiac and muscular suffering, and gross liver
          morphology

Taken together, these data on classic animal models of familial and dietary
hypercholesterolemia show that SP-1000 is an interesting new and novel lipid
lowering drug with a strong patent position that represents a competitive
advantage over currently available therapeutic options whether marketed alone
and/or in combination with another cholesterol lowering drug.

Infectious Diseases

SP-01A

SP-01A is an HIV oral entry inhibitor drug. In order for viruses to reproduce,
they must infect or hi-jack a cell, and use it to make new viruses. Just as your
body is constantly making new skin cells, or new blood cells, each cell often
makes new proteins in order to stay alive and to reproduce itself. Viruses hide
their own DNA in the DNA of the cell, and then, when the cell tries to make new
proteins, it accidentally makes new viruses as well. HIV mostly infects cells in
the immune system.

Clinical studies to date suggest that SP-01A prevents HIV from entering cells by
inhibiting HIV-1 viral replication through a novel mechanism that is unique to
any antiviral drug. SP-01A reduces intracellular cholesterol and corticosteroid
biosynthesis, which causes the inability of lipid rafts in the cellular membrane
to organize, ultimately preventing fusion of an HIV receptor and both the CCR5
and CXCR4 cellular receptors.

On March 28, 2007, Samaritan and Pharmaplaz, announced that they have a
collaboration to develop and commercialize SP-01A, an "oral" HIV entry inhibitor
that has demonstrated safety and efficacy in Phase II human clinical trials.

Under the terms of the agreement, Samaritan receives $10 million upfront in two
payments. The first payment of $1.4 million was received by Samaritan, and the
remaining $8.6 million is payable on September 16, 2007. Pharmaplaz will be
responsible for clinical development, clinical trial costs and manufacturing.
Upon successful commercialization, Samaritan and Pharmaplaz will co-market
SP-01A and will share 50-50 in its revenue royalty stream.

SP-10

SP-10 has demonstrated promise in preclinical studies as an antiviral
therapeutic in the treatment of Hepatitis C (HCV) as well as a therapeutic
adjuvant in the treatment of HIV. SP10 offers several distinctive competitive
advantages as a potential adjuvant therapeutic in the treatment of HCV infected
individuals. SP10 is uniquely different from other inhibitors of viral
replication in that it appears to condition the cell. This unique multiple
target mechanism of action provides several advantages.

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     1.   In HCV infected individuals, SP10 uses its unique mechanism to build a
          fence around the cell and prevent viral entry. Consequently, HCV is
          unable to replicate or mutate and is eventually eradicated by the
          immune system.

     2.   Because SP10's targets belong to the host cell and not to the virus
          itself, SP10 may not be susceptible to the development of resistance.

     3.   SP10 does not appear to be contraindicated with any other currently
          approved ARV or HCV treatments.

Therefore, based on its favorable in-vitro inhibition data, Samaritan is
developing a Phase I clinical study protocol for SP10 as a potential adjuvant
therapeutic in the treatment of HCV infected individuals.

Other Products

SP-6300

SP-6300 is a new and novel approach for the treatment of Cushing's syndrome,
also known as exogenous hypercortisolism. Cushing's syndrome affects adults 20
to 50 with an estimated 10 to 15 of every million people affected each year.
Hypercortisolism occurs when the body's tissues are exposed to excessive levels
of cortisol for long periods of time.

Many people suffer the symptoms of exogenous hypercortisolism because they take
glucocorticoid hormones such as prednisone, dexamethasone (Decadron) and
methylprednisolone (Medrol), for asthma, rheumatoid arthritis, lupus and other
inflammatory diseases or for immunosuppression after transplantation. People can
also develop exogenous hypercortisolism from injectable corticosteroids -- for
example, repeated injections for joint pain, bursitis and back pain. While
certain inhaled steroid medicines (taken for asthma) and steroid skin creams
(for skin disorders such as eczema) are in the same general category of drugs,
they're generally not implicated in hypercortisolism unless taken in very high
doses.

People also develop endogenous hypercortisolism because of overproduction of
cortisol by the body. Normally, the production of cortisol follows a precise
chain of events. First, the hypothalamus sends corticotrophin releasing hormone
(CRH) to the pituitary gland. CRH causes the pituitary to secrete ACTH
(adrenocorticotropin), a hormone that stimulates the adrenal glands. When the
adrenals receive the ACTH, they respond by releasing cortisol into the
bloodstream. Cortisol performs vital tasks in the body. It helps maintain blood
pressure and cardiovascular function, reduces the immune system's inflammatory
response, balances the effects of insulin in breaking down sugar for energy, and
regulates the metabolism of proteins, carbohydrates, and fats. When the amount
of cortisol in the blood is adequate, the hypothalamus and pituitary release
less CRH and ACTH. This ensures that the amount of cortisol released by the
adrenal glands is precisely balanced to meet the body's daily needs.

Other Non Drug Products

Alzheimer's Diagnostic

Our Alzheimer's diagnostic is a simple blood test which can be used as an
alternative or supplement to spinal taps or expensive MRIs currently used by
competitors.

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Breast Cancer Diagnostic

Our non-invasive blood test could be the first diagnostic tool to predict if a
breast tumor is cancerous, with the added possibility to detect one single
aggressive cancer cell out of a million blood cells. This tool could also be
used as a monitoring tool to measure the success of chemotherapy, radiation and
other drug treatments for aggressive cancer and ultimately allow patients to
avoid the high costs and negative effects of unnecessary chemotherapy.

Alzheimer's Rat Model

We have developed an animal model that mimics the human phenotype of Alzheimer's
disease pathology. We believe this Alzheimer's Rat Model will likely provide
pharmaceutical companies the means to rapidly screen and develop therapeutics to
control Alzheimer's disease.

Collaborations, Alliances, and Investments

Georgetown University

On June 8, 2001, Samaritan executed research collaboration (the "Research
Collaboration") with Georgetown University to further develop Samaritan's
pipeline. Commencing on April 1, 2004, the Research Collaboration term was
extended to 2014 and the budget has been increased to $1,000,000 per year. The
$1,000,000 paid by Samaritan over four (4) quarterly payments of $250,000 is
unallocated and covers the general research and development effort.

Under the Research Collaboration, Samaritan receives worldwide exclusive rights
to any novel therapeutic agents or diagnostic technologies that may result from
the Research Collaboration. Dr. Vassilios Papadopoulos and Dr. Janet Greeson
lead our team of eight (8) research professionals (including five (5) Ph.D.
level research scientists) who have expertise in the fields of endocrinology,
pharmacology, cell biology, organic and steroid chemistry, and computer
modeling. We are not obligated to pay Georgetown University any milestone
payments. Georgetown University is entitled to receive royalties based on our
revenue from product sales and sublicenses, if any. Samaritan has assumed
responsibility, at its own expense, for the process of seeking any regulatory
approvals for and conducting clinical trials with respect to any licensed
product or application of the licensed technology. Samaritan controls and has
the financial responsibility for the prosecution and maintenance in respect to
any patent rights related to the licensed technology. In the second quarter of
2007, we plan to terminate the Georgetown University research collaboration;
however, Samaritan's existing worldwide exclusive rights to licensed
technologies with Georgetown will remain in force under the terms of their
license agreements. Samaritan is currently negotiating a research collaboration
with McGill University, Montreal, which we plan to initiate in the third quarter
of 2007.

Advinus Therapeutics Ltd

On March 5, 2007, the Company announced that it had signed a service agreement
with Advinus Therapeutics Limited, India, to perform validating preclinical
studies for Caprospinol (SP-233), the Company's lead Alzheimer's drug. Samaritan
has completed a series of studies that suggests Caprospinol offers a new and
novel neuroprotective treatment that could potentially protect the memory of
Alzheimer's patients. Promising preclinical studies have shown that Caprospinol
directly targets the amyloid peptide which is commonly thought to be the cause
of Alzheimer's. Advinus will perform studies to validate Samaritan's previous
findings; and in addition, Samaritan's strategy is to perform extensive
preclinical studies with the intention of out-licensing Caprospinol to a major
pharmaceutical company; and concurrently, expand Samaritan's investigational new
drug application (IND) to the FDA, to enter Phase I human clinical trials.

                                       11
<PAGE>

Advinus is located in Bangalore, India, with capabilities in drug discovery and
contract services for pharmaceutical companies.

Pharmaplaz, LTD

On March 28, 2007, Samaritan and Pharmaplaz announced they have a collaboration
to develop and commercialize SP-01A, an "oral" HIV entry inhibitor, which has
demonstrated safety and efficacy in Phase II human clinical trials. Under the
terms of the agreement, Pharmaplaz is required to pay Samaritan $10 million
upfront. The first payment of $1.4 million was received on March 28, 2007, and
the remaining $8.6 million is required to be paid on September 16, 2007.
Pharmaplaz will be responsible for clinical development, clinical trial costs
and manufacturing. Upon successful commercialization, Samaritan and Pharmaplaz
will co-market SP-01A and will share 50-50, in its revenue royalty stream.
Samaritan is responsible for all patent expenses, including filing, prosecution,
and enforcement expenses.

Pharmaplaz is a fully integrated pharmaceutical company located in Athlone,
Ireland. Pharmaplaz develops patented pharmaceutical technologies and products,
and has expertise in initial research, process development, clinical trials,
regulatory submissions and product manufacturing. Pharmaplaz, in addition,
offers facilities for the development of products and processes in life
sciences, and can also provide additional support with government grant aid and
regulatory affairs.

Shire Pharmaceuticals

On March 1, 2007, Samaritan executed a two-year exclusive licensing deal with
Shire Pharmaceuticals for the marketing of Elaprase in Greece and Cyprus. The
product shall be supplied on a named patient basis until the conclusion of the
negotiations relating to the pricing and reimbursement of Elaprase in the
territories with the relevant regulatory authorities.

Founded in 1986, Shire is a global specialty pharmaceutical company marketing
products to defined customer groups (specialist doctors). Sales and marketing is
a core Shire competence, where effective targeting of prescribers allows
maximization of sales by a relatively small but high quality sales force.

Shire's strategic goal is to become the leading specialty pharmaceutical company
that focuses on meeting the needs of the specialist physician. Shire focuses its
business on attention deficit and hyperactivity disorder (ADHD), human genetic
therapies (HGT), gastrointestinal (GI) and renal diseases. The structure is
sufficiently flexible to allow Shire to target new therapeutic areas to the
extent opportunities arise through acquisitions. Shire believes that a carefully
selected portfolio of products with a strategically aligned and relatively
small-scale sales force will deliver strong results. Shire's in-licensing,
merger and acquisition efforts are focused on products in niche markets with
strong intellectual property protection either in the US or Europe.

                                       12
<PAGE>

Three Rivers Pharmaceuticals(R)

On December 12, 2005, Samaritan signed a ten-year (with five-year automatic
renewals) exclusive licensing agreement with Three Rivers Pharmaceuticals, Inc.
for the marketing of Amphocil, a prescription drug in Greece; authorization is
pending for Cyprus.

Established in 2000, Three Rivers Pharmaceuticals(R) devotes its efforts and
resources to developing, manufacturing, and marketing pharmaceutical therapies
which are indicated for diseases/medical conditions requiring specialized
treatment. Currently, Three Rivers Pharmaceuticals markets prescription drugs in
both the U.S. and internationally, in the therapeutic categories of antiviral
and antifungal agents.

Three Rivers has continued to expand its product line into the branded market
with the acquisition of AMPHOTEC/AMPHOCIL(R) in May of 2005. This product is
currently being marketed in over 40 countries worldwide.

Molteni Farmaceutici

On January 1, 2007, Samaritan executed a four-year (with two-year automatic
renewals) exclusive licensing agreement with Molteni Farmaceutici for the
marketing of Mepivamol, Methadone, Morphine Sulphate, Naloxone, Naltrexone, and
Oramorph in Greece and Cyprus.

Molteni is rich in history with over a century of experience beginning with the
opening of its manufacturing facility at the Molteni Pharmacy Laboratory located
in the historic center of Florence, Italy. The strategic therapeutic areas on
which Molteni makes an effort for trading new alliances are concentrated on
Analgesia, Anesthesia and Drug Addition Therapy.

Siraeo, Ltd.

On December 28, 2006, Samaritan signed a ten-year (with three-year automatic
renewals) exclusive licensing agreement with Siraeo, Ltd for the marketing of
Infasurf in Turkey, Serbia, Bosnia, Macedonia, Albania, Egypt and Syria.
Infasurf is an approved FDA prescription product owned by Ony, Inc. and marketed
by Forest Laboratories in the US.

Metastatin Pharmaceuticals

On March 1, 2007, Samaritan announced that we had completed our acquisition of
Metastatin Pharmaceuticals, a biopharmaceutical company engaged in the
development of cytostatic and anti-metastatic therapies for the management of
cancer. As part of the acquisition of Metastatin, Samaritan acquired the
following patent rights:

Patent No.                          Description
08/400,084    Methods and Compositions for Inhibiting Metastasis of Epithelial
              Cell-Derived Cancers (US)

122266        Method and a Kit for Determining Metastatic Potential of a Tumor
              of Epithelial Cell Origin (Israel)

08/486,203    Determining Evasiveness of Prostatic Adenocarcinoma (US)

08/658,796    Methods and Compositions for Inhibiting Metastasis of Epithelial
              Cell-Derived Cancer (US)

08/966,196    Kit for Identifying Prostatic Intraepithelial Neoplasia (PIN) (US)

09/512,385    Uteroglobin Therapy for Epithelial Cell Cancer (US)

09/556,468    Non-Steroidal Anti-Inflammatory Agent Therapy for Epithelial Cell
              Cancer (US)

                                       13
<PAGE>

09/556,467    Uteroglobin Gene Therapy for Epithelial Cell Cancer (US)

09/433,092    Pharmaceutical Compositions, Methods and Kits for Treatment and
              Diagnosis of Breast Cancer (US)

08/987,502    Methods for Inhibiting Metastasis (US)

08/987,505    Pharmaceutical Compositions, Methods and Kits for Treatment and
              Diagnosis of Lung Cancer (US)


Patents, Licenses and Proprietary Rights

The products and product candidates currently being developed or considered for
development by Samaritan are in the area of biotechnology, an area in which
there are extensive patent filings. We rely on patent protection against use of
our proprietary products and technologies by competitors. The patent positions
of biotechnology firms generally are highly uncertain and involve complex legal
and factual questions. To date, no consistent policy has emerged regarding the
breadth of claims allowed in biotechnology patents. We currently own or
in-license patents related to our products or product candidates and own or
in-license additional applications for patents that are currently pending. In
general, when we in-license intellectual property from various third parties, we
are required to pay royalties to the parties on product sales.

Our marketed products, AMPHOCIL(R), ELAPRASE(R), INFASURF(R), MEPIVAMOL(R),
METHADONE(R), MORPHINE SULPHATE(R), NALOXONE(R), NALTREXONE(R), and ORAMORPH(R),
are covered by trademark registrations and pending applications for registration
by their respective owners. Trademark protection continues in some countries for
as long as the mark is used and, in other countries, for as long as it is
registered. Registrations generally are for fixed, but renewable, terms.

The protection of our unpatented confidential and proprietary information and
materials is important to us. To protect our trade secrets, materials and other
confidential information, we generally require our employees, consultants,
scientific advisors, and parties to collaboration and licensing agreements to
execute confidentiality agreements upon the commencement of employment, the
consulting relationship, or the collaboration or licensing arrangement with us.
However, others could either develop independently the same or similar
information or obtain access to our information.


                                       14
<PAGE>

<TABLE>
<CAPTION>

----------------------------------------------------------- ----------------------------------------------------------
       PATENT SUMMARY TABLE                                        TRADEMARK SUMMARY TABLE
----------------------------------------------------------- ----------------------------------------------------------
Item             Issued        Pending        Total         Item            Issued         Pending       Total
---------------- ------------- -------------- ------------- --------------- -------------- ------------- -------------
<S>              <C>           <C>            <C>                           <C>            <C>           <C>
US Patents       12            27             39            US Trademarks   3              3             6
---------------- ------------- -------------- ------------- --------------- -------------- ------------- -------------
Foreign Patents  4             63             67            Foreign         1              1             2
                                                            Trademarks
---------------- ------------- -------------- ------------- --------------- -------------- ------------- -------------
Total            16            90             106           Total           4              4             8
---------------- ------------- -------------- ------------- --------------- -------------- ------------- -------------
</TABLE>

Our trademarks for our marketed products are not included in the above list,
since they are trademarked by our partners.

Government Regulation

The research, development, manufacture and sale of our products are subject to
numerous complex laws and statutes as well as regulations promulgated by the
applicable governmental authorities, principally the FDA in the U.S. and similar
authorities in other countries. While there is considerable time and expense
associated with complying with these requirements, knowledge of and experience
with these matters also yields benefits to Samaritan. For example, the more
knowledgeable we are about these matters, the more we are able to design our
research, development and manufacturing strategies in a manner that is
calculated to obtain regulatory approval to market our products in the
applicable countries. Moreover, the complexity of these matters can have the
effect of delaying or limiting the number of competing products that can
successfully be brought to market. In addition, certain regulatory approval
pathways, for example, orphan drug designation in the U.S. for marketing
products applicable to rare diseases or small populations, can also have the
effect of limiting the number of competing products available in the market.

Competition

The biotechnology and pharmaceutical industries are characterized by rapidly
evolving technology and intense competition. Our competitors include
pharmaceutical, chemical and biotechnology companies, many of which have
financial, technical and marketing resources significantly greater than ours. In
addition, many specialized biotechnology companies have formed collaborations
with large, established companies to support research, development and
commercialization of products that may be competitive with ours. Academic
institutions, governmental agencies and other public and private research
organizations are also conducting research activities and seeking patent
protection and may commercialize products on their own or through collaboration
arrangements.

We expect our products to compete primarily on the basis of product efficacy,
safety, patient convenience, reliability and patent position. In addition, the
first product to reach the market in a therapeutic or preventive area is often
at a significant competitive advantage relative to later entrants to the market.
Our competitive position will also depend on our ability to attract and retain
qualified scientific and other personnel, develop effective proprietary
products, implement product and marketing plans, obtain patent protection and
secure adequate capital resources.

Employees

As of the date of this Form 10-K, we have sixteen (16) employees consistent of
fifteen (15) full-time employees and one part time employee. Ten (10) employees
are engaged in our research, development, clinical and manufacturing efforts;
four (4) employees perform regulatory, general administration, financial and
investor relations functions and; two (2) Information Technology employees (one
full time and one part time). Additionally, Samaritan has eight (8) research
professionals (including five (5) Ph.D. level research scientists) who work
under the Research Collaboration with Georgetown University. Further, we make
extensive use of another fifteen (15) consultants including Dr. Papadopoulos,
our Key Scientific Consultant.

                                       15
<PAGE>

A significant number of our management and professional employees have had
experience with pharmaceutical, biotechnology or medical product companies.
While we have been successful in attracting skilled and experienced scientific
personnel, there can be no assurance that we will be able to attract or retain
the necessary qualified employees and/or consultants in the future. None of our
employees are covered by collective bargaining agreements and we consider
relations with our employees to be good.

ITEM 1A. RISK FACTORS

You should carefully consider the risks described below before purchasing our
Common Stock. Our most significant risks and uncertainties are described below;
however, they are not the only risks we face. If any of the following risks
actually occur, our business, financial condition, or results of operations
could be materially adversely affected, the trading of our Common Stock could
decline, and you may lose all or part of your investment therein. You should
acquire shares of our Common Stock only if you can afford to lose your entire
investment.

Risks Associated With our Business

We Have A Limited Operating History With Significant Losses And Expect Losses To
Continue In The Near Future

We have yet to establish any history of profitable operations. We have incurred
annual operating losses of $7,572,746 and $5,557,559 during the years ended
December 31, 2006 and 2005 respectively. As a result, at December 31, 2006, we
had an accumulated deficit of $41,309,142. To date, our revenues have not been
sufficient to sustain our operations. Our profitability will require the
successful commercialization of one or more drugs for our territories in Eastern
Europe as well as the out-licensing of our internal development programs in
Alzheimer's, Cancer Cardiovascular disease and Infectious Diseases. Currently,
the Company has in-licensed nine products to be marketed and distributed in our
Eastern Europe territories. No assurances can be given when this will occur or
when we will become profitable.

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

We Will Require Additional Financing To Sustain Our Operations And Without It We
May Not Be Able To Continue Operations. We Cannot Currently Access Funds Under
The Purchase Agreement II.

We had an operating cash flow deficit of $6.25 million for the year ended
December 31, 2006 and $4.64 million for the year ended December 31, 2005.

The availability of funds under the Purchase Agreement II with Fusion Capital is
subject to many conditions, some of which are predicated on events that are not
within our control. Accordingly, we cannot guarantee that these capital
resources will be sufficient to fund our business operations.

                                       16
<PAGE>

Fusion Capital shall not have the right nor the obligation to purchase any
shares of our Common Stock on any trading days that the market price of our
Common Stock is less than $0.25. Accordingly, if the stock price is below $0.25,
the Company cannot access funds under the Purchase Agreement II. If we are
unable to access funds under the Purchase Agreement II, we may need to sell
additional equity securities in private placements. As of March 30, 2007, with
2,209,372 remaining available under the Registration Statement, the selling
price of our Common Stock to Fusion Capital will have to average at least $16.16
per share for us to receive the remaining proceeds of $35,700,000 without
registering additional shares of Common Stock. Shares issued to date under the
Common Stock Purchase Agreement are 12,790,628, with proceeds of $4,300,000.
Assuming a minimum purchase price of $0.25 per share and the purchase by Fusion
Capital of the full 2,209,372 remaining shares under the Purchase Agreement II,
the remaining proceeds to us would be $552,343 unless we choose to register more
than 2,209,372 shares, which we have the right, but not the obligation, to do.
In the event we elect to sell more than the 2,209,372 shares, we will be
required to file a new Registration Statement and have it declared effective by
the U.S. Securities & Exchange Commission. The number of shares ultimately
offered for sale by Fusion Capital is dependent upon the number of shares
purchased by Fusion Capital under the Purchase Agreement II. We have the right
to receive $40,000 per trading day under the Purchase Agreement II, unless our
stock price equals or exceeds $1.50, in which case the daily amount may be
increased under certain conditions as the price of our Common Stock increases.

The extent to which we rely on Fusion Capital as a source of funding will depend
on a number of factors including the prevailing market price of our Common
Stock, which as of March 30, 2007, was $0.27, and the extent to which we are
able to secure working capital from other sources, such as through the sale of
our products. If obtaining sufficient financing from Fusion Capital were to
prove unavailable or prohibitively dilutive and if we are unable to sell enough
of our products, we may need to secure another source of funding in order to
satisfy our working capital needs. Even if we are able to access the remaining
$35,700,000 under the Purchase Agreement II with Fusion Capital, we may still
need additional capital to fully implement our business, operating and
development plans. Should the financing we require to sustain our working
capital needs be unavailable or prohibitively expensive when we require it, we
could be forced to curtail or cease our business operations.

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The Sale Of Our Common Stock To Fusion Capital May Cause Dilution And The Sale
Of The Shares Of Common Stock Acquired By Fusion Capital And Other Shares
Registered for Selling Stockholders Could Cause The Price Of Our Common Stock To
Decline

In connection with entering into the Purchase Agreement II with Fusion Capital,
we authorized the sale to Fusion Capital of up to 26,643,100 shares of our
Common Stock and registered 16,700,000. The number of shares ultimately offered
for sale by Fusion Capital is dependent upon the number of shares purchased by
Fusion Capital under the agreement. The purchase price for the Common Stock to
be sold pursuant to the Purchase Agreement II will fluctuate based on the price
of our Common Stock. Depending upon market liquidity at the time, a sale of
shares by Fusion Capital at any given time could cause the trading price of our
Common Stock to decline. Fusion Capital may ultimately purchase all, some or
none of the 16,700,000 shares of Common Stock being registered under the
Purchase Agreement II. Further, the lower the stock price, the more shares we
would have to sell to Fusion Capital to receive the same proceeds. After it has
acquired such shares, it may sell all, some or none of such shares registered
under the accompanying Registration Statement. Therefore, sales to Fusion
Capital by us under the Purchase Agreement II may result in substantial dilution
to the interests of other holders of our Common Stock. The sale of a substantial
number of shares of our Common Stock by Fusion Capital, or anticipation of such
sales, could make it more difficult for us to sell equity or equity-related
securities in the future at a time and at a price that we might otherwise wish
to effect sales. However, we have the right to control the timing and amount of
any sales of our shares of Common Stock to Fusion Capital and the Purchase
Agreement II may be terminated by us at any time at our discretion without any
cost to us.

                                       17
<PAGE>

Further, the sale by Fusion Capital of our Common Stock will increase the number
of our publicly traded shares, which could depress the market price of our
Common Stock. Moreover, the mere prospect of resales by Fusion Capital and other
selling stockholders as contemplated in the prospectus filed January 26, 2007
could depress the market price for our Common Stock. The issuance of shares to
Fusion Capital under the Purchase Agreement II, will dilute the equity interest
of existing stockholders and could have an adverse effect on the market price of
our Common Stock.

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The Company's License Agreements May Be Terminated In The Event Of A Breach

The license agreements pursuant to which the Company has licensed its core
technologies for its potential drug products permit the licensors, including
Georgetown University, to terminate such agreements under certain circumstances,
such as the failure by the licensee to use its reasonable best efforts to
commercialize the subject drug or the occurrence of any uncured material breach
by the licensee. The license agreements also provide that the licensor is
primarily responsible for obtaining patent protection for the licensed
technology, and the licensee is required to reimburse the licensor for costs it
incurs in performing these activities. The license agreements also require the
payment of specified royalties. Any inability or failure to observe these terms
or pay these costs or royalties may result in the termination of the applicable
license agreement in certain cases. The termination of any license agreement
could force us to curtail our business operations.

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Protecting Our Proprietary Rights Is Difficult and Costly

The patent positions of pharmaceutical companies can be highly uncertain and
involve complex legal and factual questions. The license agreements also provide
that the licensor is primarily responsible for obtaining patent protection for
the licensed technology, and the licensee is required to reimburse the licensor
for costs it incurs in performing these activities. Accordingly, we cannot
predict the breadth of claims allowed in these companies' patents or whether the
Company may infringe or be infringing on these claims. Patent disputes are
common and could preclude the commercialization of our products. Patent
litigation is costly in its own right and could subject us to significant
liabilities to third parties. In addition, an adverse decision could force us to
either obtain third-party licenses at a material cost or cease using the
technology or product in dispute.

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                                       18
<PAGE>

Our Success Will Depend On Our Ability To Attract And Retain Key Personnel

In order to execute our business plan, we need to attract, retain and motivate a
significant number of highly qualified managerial, technical, financial and
sales personnel. If we fail to attract and retain skilled scientific and
marketing personnel, our research and development and sales and marketing
efforts will be hindered. Our future success depends to a significant degree
upon the continued services of key management personnel, including Dr. Janet
Greeson, our Chief Executive Officer, President and Chairman of the Board of
Directors, and Dr. Vassilios Papadopoulos, Chief Scientist of the Science of
Technology Advisory Committee and our key consultant. We do not maintain key man
insurance on either of these individuals. The loss of their services could delay
our product development programs and our research and development efforts at
Georgetown University. In addition, the loss of Dr. Greeson is grounds for our
Research Collaboration with Georgetown University to terminate. In addition,
competition for qualified employees among companies in the biotechnology and
biopharmaceutical industry is intense and we cannot be assured that we would be
able to recruit qualified personnel on commercially acceptable terms, or at all,
to replace them.

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

We Are Forming A New Collaboration with McGill University and Our Success Is
Dependent Upon A Smooth Transition from Our Long Term Collaboration with
Georgetown University.

Dr. Vassilios Papadopoulos, the lead scientist in the Georgetown
University/Samaritan research collaboration, has been appointed as the new
Director of the Research Institute of the McGill University Health Centre (MUHC)
in Montreal, Canada. Dr. Papadopoulos has an international reputation as a
scientist and a proven track record of leadership in biomedical research and
administration. Dr. Papadopoulos will assume his new role officially on July 1,
2007. Between now and then he expects to be at the Research Institute of the
MUHC on a regular basis, working on development and operational issues.

Each license granted or to be granted from Georgetown to Samaritan shall not be
terminated or any way affected if the research collaboration between Georgetown
and Samaritan is terminated. Each such license has its own termination
provisions as set forth in the respective license.

Samaritan has the right to terminate the Georgetown research collaboration under
this Agreement upon a 60-day notice in the event that Dr. Papadopoulos' ceases
to be the Principal Investigator or have responsibility for directing our
collaborated research. Samaritan intends to transfer our research collaboration
with Georgetown to MUHC and expects to initiate a research collaboration with
McGill officially in the third quarter of 2007.

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

We Are Faced With Intense Competition And Industry Changes, Which May Make It
More Difficult For Us To Achieve Significant Market Penetration.

The pharmaceutical and biotech industry generally is characterized by rapid
technological change, changing customer needs, and frequent new product
introductions. If our competitors' existing products or new products are more
effective than or considered superior to our products, the commercial
opportunity for our products will be reduced or eliminated. We face intense
competition from companies in our marketplace as well as companies offering
other treatment options. Many of our potential competitors are significantly
larger than we are and have greater financial, technical, research, marketing,
sales, distribution and other resources than we do. We believe there will be
intense price competition for products developed in our markets. Our competitors
may develop or market technologies and products that are more effective or
commercially attractive than any that we are developing or marketing. Our
competitors may obtain regulatory approval, and introduce and commercialize
products before we do. These developments could force us to curtail or cease or
business operations. Even if we are able to compete successfully, we may not be
able to do so in a profitable manner.

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

                                       19
<PAGE>

If We Are Unable To Continue Product Development, Our Business Will Suffer

Our growth depends in part on continued ability to successfully develop our
products. We may experience difficulties that could delay or prevent the
successful development and commercialization of these products. Our products in
development may not prove safe and effective in clinical trials. Clinical trials
may identify significant technical or other obstacles that must be overcome
before obtaining necessary regulatory or reimbursement approvals. In addition,
our competitors may succeed in developing commercially viable products that
render our products obsolete or less attractive. Failure to successfully develop
and commercialize new products and enhancements would likely have a significant
negative effect on our financial prospects.

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There Is No Assurance That Our Products Will Have Market Acceptance

The success of the Company will depend in substantial part on the extent to
which a drug product, once approved, achieves market acceptance. The degree of
market acceptance will depend upon a number of factors, including (a) the
receipt and scope of regulatory approvals, (b) the establishment and
demonstration in the medical community of the safety and efficacy of a drug
product, (c) the product's potential advantages over existing treatment methods
and (d) reimbursement policies of government and third party payers. We cannot
predict or guarantee physicians, patients, healthcare insurers, maintenance
organizations, or the medical community in general, will accept or utilize any
drug product of the Company. If our products do not develop market acceptance,
we will be forced to curtail or cease our business operations.

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There Is Uncertainty Relating To Third-Party Reimbursement, Which Is Critical To
Market Acceptance Of Our Products.

International market acceptance of our products may depend, in part, upon the
availability of reimbursement within prevailing health care payment systems.
Reimbursement and health care payment systems in international markets vary
significantly by country, and include both government sponsored health care and
private insurance. We may not obtain international reimbursement approvals in a
timely manner, if at all. Our failure to receive international reimbursement
approvals may negatively impact market acceptance of our products in the
international markets in which those approvals are sought and could force us to
curtail or cease our business operations.

                                       20
<PAGE>

From time to time significant attention has been focused on reforming the health
care system in the United States and other countries. Any changes in Medicare,
Medicaid or third-party medical expense reimbursement, which may arise from
health care reform, may have a material adverse effect on reimbursement for our
products or procedures in which our products are used and may reduce the price
we are able to charge for our products. In addition, changes to the health care
system may also affect the commercial acceptance of products we are currently
developing and products we may develop in the future.

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If We Fail To Protect Our Licensed Intellectual Property Rights, Our Competitors
May Take Advantage Of Our Ideas And Compete Directly Against Us.

Our success will depend to a significant degree on our ability to secure and
protect intellectual property rights and to enforce patent and trademark
protections relating to our technology which we license. From time to time,
litigation may be advisable to protect our intellectual property position.
However, these legal means afford only limited protection and may not adequately
protect our rights or permit us to gain or keep any competitive advantage. Any
litigation in this regard could be costly, and it is possible that we will not
have sufficient resources to fully pursue litigation or to protect our other
intellectual property rights. It could result in the rejection or invalidation
of our existing and future patents. Any adverse outcome in litigation relating
to the validity of our patents, or any failure to pursue litigation or otherwise
to protect our patent position, could force us to curtail or cease our business
operations. Also, even if we prevail in litigation, the litigation would be
costly in terms of management distraction as well as in terms of money. In
addition, confidentiality agreements with our employees, consultants, customers,
and key vendors may not prevent the unauthorized disclosure or use of our
technology. It is possible that these agreements could be breached or that they
might not be enforceable in every instance, and that we might not have adequate
remedies for any such breach. Enforcement of these agreements may be costly and
time consuming. Furthermore, the laws of foreign countries may not protect our
intellectual property rights to the same extent as the laws of the United
States.

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We May Be Sued For Allegedly Violating The Intellectual Property Rights Of
Others.

The pharmaceutical industry has in the past been characterized by a substantial
amount of litigation and related administrative proceedings regarding patents
and intellectual property rights. In addition, major pharmaceutical companies
have used litigation against emerging growth companies as a means of gaining or
preserving a competitive advantage.

Should third parties file patent applications or be issued patents claiming
technology also claimed by us in pending applications, we may be required to
participate in interference proceedings in the United States Patent and
Trademark Office to determine the relative priorities of our inventions and the
third parties' inventions. We could also be required to participate in
interference proceedings involving our issued patents and pending applications
of another entity. An adverse outcome in an interference proceeding could
require us to cease using the technology or to license rights from prevailing
third parties and force us to curtail or cease our business operations.

                                       21
<PAGE>

 Third parties may claim we are using their patented inventions and may go to
court to stop us from engaging in our normal operations and activities. These
lawsuits are expensive to defend and conduct and would also consume and divert
the time and attention of our management. A court may decide that we are
infringing a third party's patents and may order us to cease the infringing
activity. A court could also order us to pay damages for the infringement. These
damages could be substantial and could have a material adverse effect on our
business, financial condition, results of operations and cash flows. An adverse
outcome on an infringement claim could force us to curtail or cease our business
operations.

 If we are unable to obtain any necessary license following an adverse
determination in litigation or in interference or other administrative
proceedings, we would have to redesign our products to avoid infringing a third
party's patent and could temporarily or permanently have to discontinue
manufacturing and selling some of our products. If this were to occur, it would
negatively impact future sales and, in turn, our business, financial condition,
results of operations and cash flows, which could force us to curtail or cease
our business operations.

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If We Fail To Obtain Or Maintain Necessary Regulatory Clearances Or Approvals
For Products, Or If Approvals Are Delayed Or Withdrawn, We Will Be Unable To
Commercially Distribute And Market Our Products Or Any Product Modifications.

Government regulation has a significant impact on our business. Government
regulation in the United States and other countries is a significant factor
affecting the research and development, manufacture and marketing of our
products. In the United States, the Food and Drug Administration (FDA) has broad
authority under the federal Food, Drug and Cosmetic Act to regulate the
distribution, manufacture and sale of pharmaceutical products. The process of
obtaining FDA and other required regulatory clearances and approvals is lengthy
and expensive. We may not be able to obtain or maintain necessary approvals for
clinical testing or for the manufacturing or marketing of our products. Failure
to comply with applicable regulatory approvals can, among other things, result
in fines, suspension or withdrawal of regulatory approvals, product recalls,
operating restrictions, and criminal prosecution. In addition, governmental
regulations may be established which could prevent, delay, modify or rescind
regulatory approval of our products. Any of these actions by the FDA, or change
in FDA regulations, could have a material adverse effect on our business,
financial condition, results of operations and cash flows.

Regulatory approvals, if granted, may include significant limitations on the
indicated uses for which our products may be marketed. In addition, to obtain
such approvals, the FDA and foreign regulatory authorities may impose numerous
other requirements on us. FDA enforcement policy prohibits the marketing of
approved medical devices for unapproved uses. In addition, product approvals can
be withdrawn for failure to comply with regulatory standards or unforeseen
problems following initial marketing. We may not be able to obtain or maintain
regulatory approvals for our products on a timely basis, or at all, and delays
in receipt of or failure to receive such approvals, the loss of previously
obtained approvals, or failure to comply with existing or future regulatory
requirements could have a material adverse effect on our business, financial
condition, results of operations and cash flows, which could force us to curtail
or cease our business operations.

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                                       22
<PAGE>

Positive Results In Preclinical And Early Clinical Trials Do Not Ensure Future
Clinical Trials Will Be Successful Or Drug Candidates Will Receive Any
Necessary Regulatory Approvals For The Marketing, Distribution Or Sale Of Such
Drug Candidates.

Success in preclinical and early clinical trials does not ensure that
large-scale clinical trials will be successful. Clinical results are frequently
susceptible to varying interpretations, delaying, limiting or preventing
regulatory approvals. The length of time necessary to complete clinical trials
and submit an application for marketing approval for a final decision by a
regulatory authority varies significantly and may be difficult to predict.

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

If We Become Subject To Product Liability Claims, We May Be Required To Pay
Damages That Exceed Our Insurance Coverage.

Our business exposes us to potential product liability claims that are inherent
in the testing, production, marketing and sale of pharmaceuticals products.
While we maintain a commercial general liability policy for $2 million, we may
not be able to maintain insurance in amounts or scope sufficient to provide us
with adequate coverage. A claim in excess of our insurance coverage would have
to be paid out of cash reserves, which could have a material adverse effect on
our business, financial condition, results of operations and cash flows and
force us to curtail or cease our business operations. In addition, any product
liability claim likely would harm our reputation in the industry and our ability
to develop and market products in the future.

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

Insurance Coverage Is Increasingly More Difficult To Obtain or Maintain

Obtaining insurance for our business, property and products is increasingly more
costly and narrower in scope, and we may be required to assume more risk in the
future. If we are subject to third party claims or suffer a loss or damage in
excess of our insurance coverage, we may be required to share that risk in
excess of our insurance limits. Furthermore, any first-or-third-party claims
made on any of our insurance policies may impact our ability to obtain or
maintain insurance coverage at reasonable costs or at all in the future.

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

We Are Dependent On Third Parties For A Significant Portion Of Our Bulk Supply
And The Formulation, Fill And Finish Of Our Product Candidates.

We currently produce a substantial portion of clinical product candidates'
supply at our collaborative partner's Ireland manufacturing facility. However,
we also depend on third parties for a significant portion of our product
candidates' bulk supply as well as for some of the formulation, fill and finish
of product candidates that we manufacture. Pharmaplaz is our third-party
contract manufacturer of product candidates' bulk drug; accordingly, our
clinical supply of product candidates is currently significantly dependent on
Pharmaplaz's production schedule for product candidates. We would be unable to
produce product candidates in sufficient quantities to substantially offset
shortages in Pharmaplaz's scheduled production if Pharmaplaz or other
third-party contract manufacturers used for the formulation, fill and finish of
product candidates bulk drug were to cease or interrupt production or services
or otherwise fail to supply materials, products or services to us for any
reason, including due to labor shortages or disputes, regulatory requirements or
action or contamination of product lots or product recalls. We cannot guarantee
that an alternative third-party contract manufacturer would be available on a
timely basis or at all. This in turn could materially reduce our ability to
satisfy demand for product candidates, which could materially and adversely
affect our operating results.

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

                                       23
<PAGE>

Our Corporate Compliance Program Cannot Guarantee That We Are In Compliance With
All Potentially Applicable U.S. Federal And State Regulations And All
Potentially Applicable Foreign Regulations.

The development, manufacturing, distribution, pricing, sales, marketing and
reimbursement of our products, together with our general operations, is subject
to extensive federal and state regulation in the United States and to extensive
regulation in foreign countries. While we have developed and instituted a
corporate compliance program based on what we believe to be current best
practices, we cannot assure you that we or our employees are or will be in
compliance with all potentially applicable U.S. federal and state regulations
and/or laws or all potentially applicable foreign regulations and/or laws. If we
fail to comply with any of these regulations and/or laws a range of actions
could result, including, but not limited to, the termination of clinical trials,
the failure to approve a product candidate, restrictions on our products or
manufacturing processes, including withdrawal of our products from the market,
significant fines, exclusion from government healthcare programs or other
sanctions or litigation.

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

Risks Associated With An Investment In Our Common Stock

The Market Price Of Our Common Stock Is Highly Volatile.

The market price of our Common Stock has been and is expected to continue to be
highly volatile. Various factors, including announcements of technological
innovations by us or other companies, regulatory matters, new or existing
products or procedures, concerns about our financial position, operating
results, litigation, government regulation, developments or disputes relating to
agreements, patents or proprietary rights may have a significant impact on the
market price of our stock. If our operating results are below the expectations
of securities analysts or investors, the market price of our Common Stock may
fall abruptly and significantly.

Future sales of our Common Stock, including shares issued upon the exercise of
outstanding options and warrants or hedging or other derivative transactions
with respect to our stock, could have a significant negative effect on the
market price of our Common Stock. These sales also might make it more difficult
for us to sell equity securities or equity-related securities in the future at a
time and price that we would deem appropriate.

We entered into registration rights agreements in connection with certain
financings pursuant to which we agreed to register for resale by the investors
the shares of Common Stock issued. Sales of these shares could have a material
adverse effect on the market price of our shares of Common Stock.

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

                                       24
<PAGE>

If We Do Not Show Progress Consistent With Our Compliance Plan, There Is No
Assurance That Our Stock Will Not Be Delisted From The American Stock Exchange
("AMEX", the "Exchange").

On April 3, 2007, the American Stock Exchange ("AMEX") notified Samaritan
Pharmaceuticals, Inc. that its listing on the AMEX exchange is being continued
pursuant to an extension with a plan completion date of May 31, 2007, which
encompasses the due date for Samaritan's quarterly Report (Form 10-Q) for the
period ending March 31, 2007 to demonstrate that it has regained compliance with
the continued listing standards in Section 1003(a)(ii) and (iii) of the AMEX
Company Guide. The Company must also address Section 1003(f)(v) of the AMEX
Company Guide.

Previously on November 6, 2006 and on January 30, 2007 , the AMEX Listing
Qualifications staff notified the Company it no longer complies with the
Exchange's continued listing standard due to its shareholder's equity of less
than $4 million and losses from continuing operations and/or losses in three out
of its four most recent fiscal years, as set forth in Section 1003(a)(ii) of the
Company Guide; with its shareholder's equity of less than $6 million from
continuing operations and/or net losses in its five most recent fiscal years, as
set forth in Section 1003(a)(iii) of the Company Guide; and with its low selling
price, as set forth in Section 1003(f)(v) of the Company Guide.

The Company is required by the AMEX to provide periodic reports showing progress
consistent with the Company's compliance plan. If the Company does not show
progress consistent with our compliance plan, the Staff will review the
circumstances and may immediately commence delisting proceedings. Thus, there is
no assurance that the Company will be able to maintain continued listing on the
AMEX.

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

Under Provisions Of The Company's Articles Of Incorporation, Bylaws And Nevada
Law, The Company's Management May Be Able To Block Or Impede A Change In Control

The issuance of blank check preferred stock, where the Board of Directors can
designate rights or preferences, may make it more difficult for a third party to
acquire, or may discourage a third party from acquiring, a majority of our
voting stock. These and other provisions in our Articles of Incorporation
(restated as last amended June 10, 2005) and in our Bylaws (restated as last
amended April 18, 2005), as well as certain provisions of Nevada law, could
delay or impede the removal of incumbent directors and could make it more
difficult to effect a merger, tender offer or proxy contest involving a change
of control of the Company, even if such events could be beneficial to the
interest of the shareholders as a whole. Such provisions could limit the price
that certain investors might be willing to pay in the future for our Common
Stock.

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

                                       25
<PAGE>

Officers and Directors Liabilities Are Limited Under Nevada Law

Pursuant to the Company's Articles of Incorporation (restated as last amended
June 10, 2005) and Bylaws (restated as last amended April 18, 2005), and as
authorized under applicable Nevada law, Directors are not liable for monetary
damages for breach of fiduciary duty, except in connection with a breach of the
duty of loyalty for (a) acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (b) for dividend payments
or stock repurchases illegal under applicable Nevada law or (c) any transaction
in which a Director has derived an improper personal benefit. The Company's
Articles of Incorporation (restated as last amended June 10, 2005) and Bylaws
(restated as last amended April 18, 2005) provide that the Company must
indemnify its officers and Directors to the fullest extent permitted by
applicable Nevada law for all expenses incurred in the settlement of any actions
against such persons in connection with their having served as officers or
Directors.

ITEM 1B.  UNRESOLVED STAFF COMMENTS.

None.

ITEM 2.  PROPERTIES

The Company's executive offices are currently located at 101 Convention Center
Drive, Suite 310, Las Vegas, Nevada 89109. On October 3, 2005, the Company
expanded its premises to a 2,601 square foot office space which is rented at a
base rent of $4,681.80 per month. In addition, pursuant to a research
collaboration, Georgetown University provides office and laboratory space at the
Samaritan Research Laboratories, Biochemistry and Molecular Biology Dept.,
Med/Dent Bldg #SE101A, 3900 Reservoir Road NW, Washington, D.C. 20057.

ITEM 3.  LEGAL PROCEEDINGS

We are, from time to time, involved in various legal proceedings in the ordinary
course of our business. While it is impossible to predict accurately or to
determine the eventual outcome of these matters, the Company believes the
outcome of these proceedings will not have an adverse material effect on the
financial statements of the Company. Other than routine litigation incidental to
our business, there are no legal proceedings or actions pending at this time.

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

No matters were submitted to a vote of security holders during the fourth
quarter of 2006.

                                     PART II

ITEM 5.  MARKET FOR SAMARITAN'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND
ISSUER PURCHASES OF EQUITY SECURITIES.

The Company's Common Stock is traded on the American Stock Exchange under the
symbol "LIV". As of December 31, 2006, there were approximately nine hundred
(900) holders of record of Common Stock. Certain of the shares of Common Stock
are held in street names and may, therefore, be held by numerous beneficial
owners. The Company has never paid a cash dividend on its Common Stock. The
payment of dividends may be made at the discretion of the Board of Directors of
the Company and will depend upon, among other things, the Company's financial
condition, results of operations, and other factors the Board of Directors may
consider. The following table sets forth the range of high and low bid prices
for our Common Stock for each quarter within the last three (3) fiscal years.
Such quotes reflect inter-dealer prices without retail mark-up, mark-down or
commission and may not represent actual transactions. The quotations may be
rounded for presentation.

                                       26
<PAGE>

                                        FISCAL YEAR ENDED
                   ------------------------------------------------------------
                   December 31, 2006   December 31, 2005    December 31, 2004
                   ------------------- -------------------- -------------------
                     High      Low       High       Low       High      Low
                   --------- --------- --------- ---------- --------- ---------
First Quarter         $0.91     $0.30     $1.14      $0.45     $0.72     $0.33
Second Quarter        $0.71     $0.36     $0.92      $0.35     $1.69     $0.51
Third Quarter         $0.56     $0.29     $0.71      $0.33     $1.40     $0.77
Fourth Quarter        $0.34     $0.17     $0.57      $0.38     $1.17     $0.80


Dividends

We have not paid any dividends on our Common Stock and do not anticipate paying
any cash dividends in the near future. We intend to retain any earnings to
finance the growth of the business. We make no assurances we will ever pay cash
dividends. Whether we pay any cash dividends in the future will depend on the
Company's financial condition, results of operations and other factors the Board
of Directors will consider.

Recent Sales of Unregistered Securities

The following discussion sets forth securities sold by the Company in the last
three (3) fiscal years. These securities were shares of Common Stock of the
Company. They were sold for cash and, unless otherwise noted, sold in private
transactions to persons believed to be of a class of accredited investors not
affiliated with the Company unless otherwise noted and purchasing the shares
with an investment intent, and the Company relied upon, among other possible
exemptions, Section 4(2) of the Securities Act of 1933, as amended. The
Company's reliance on said exemption was based upon the fact no public
solicitation was used by the Company in the offer or sale, and the securities
were legend shares, along with a notation at the respective transfer agent,
restricting the shares from sale or transfer as is customary with reference to
Rule 144 of the SEC.

During the fiscal year ending December 31, 2006, the Company exchanged 7,212,500
shares of the Company Stock for $2,045,000. The Company also issued 450,926
shares upon the exercise of stock options and the receipt of $64,500.

During the fiscal year ending December 31, 2005, the Company issued an aggregate
of 398,900 shares of Common Stock in consideration of services rendered or to be
rendered to the Company. Such shares were valued at an aggregate of $197,184
ranging from $0.41 - $0.72 per share, representing the fair value of the shares
issued. The issuances were recorded as non-cash compensation expense and
deferred compensation. The unamortized balance of deferred compensation at
December 31, 2005 is $40,034.

During the fiscal year ending December 31, 2004, the Company issued an aggregate
of 2,081,249 shares of Common Stock in consideration of services rendered or to
be rendered to the Company. Such shares were valued at an aggregate of
$1,790,478 ranging from $0.16-$1.19 per share, representing the fair value of
the shares issued. The issuances were recorded as non-cash compensation expense.
During the year ending December 31, 2004, the Company exchanged 11,426,733
shares of the Company Stock for $4,300,938.


Performance Graph

The following graph sets forth the cumulative total stockholder return (assuming
reinvestment of dividends) to the Company's stockholders during the five-year
period ended December 31, 2006, as well as an overall stock market index (AMEX
Market Index) and the Company's peer group index (AMEX Biotech Index):

                     COMPARE 5-YEAR CUMULATIVE TOTAL RETURN
                        AMONG SAMARITAN PHARMACEUTICALS,
                  AMEX MARKET INDEX AND AMEX BIOTECH INDEX (1)

[The following information was depicted as a line chart in the printed material]

<TABLE>
<CAPTION>

Company/Index                 Base Period                                    Year Ending
                              12/31/2001      12/31/2002     12/31/2003     12/31/2004     12/31/2005     12/31/2006
                             -------------    -------------  -------------  -------------  -------------  -------------
<S>                               <C>            <C>            <C>            <C>            <C>            <C>
AMEX : LIV                        100            $123.08        $284.62        $753.85        $307.69        $161.54
AMEX Biotech Index                100            $58.26         $84.42         $93.74         $117.28        $129.91
Amex Composite Index              100            $97.26         $138.45        $169.22        $207.53        $242.62
</TABLE>

1) Assumes $100 Invested On December 31, 2001, Assumes Dividend Reinvested,
Fiscal Year Ending December. 31, 2006

The information under "Performance Graph" is not deemed filed with the
Securities and Exchange Commission and is not be incorporated by reference in
any filing of Samaritan under the Securities Act of 1933, as amended, or the
Securities Exchange Act of 1934, as amended, whether made before or after the
date of this 10-K and irrespective of any general incorporation language in
those filings.

                                       27
<PAGE>

ITEM 6.  SELECTED CONSOLIDATED FINANCIAL DATA

The selected financial data presented under the caption "Consolidated Balance
Sheet Data" as of December 31, 2006, 2005, 2004, 2003, and 2002 and under the
caption "Consolidated Statement of Operations Data" for the years ending
December 31, 2006, 2005, 2004, 2003, and 2002 are derived from our consolidated
financial statements which have been audited. The data set forth below should be
read in conjunction with the sections entitled "Management's Discussion and
Analysis of Financial Condition and Results of Operations", and the
"Consolidated Financial Statements" and the Notes thereto and other financial
information included elsewhere in the report.

<TABLE>
<CAPTION>

            Consolidated Statement
              of Operations Data                                   For the Year Ended December 31,
                                                 ---------------------------------------------------------------------
                                                    2006          2005          2004           2003          2002
                                                 ------------ ------------- -------------- ------------- -------------
REVENUES:

<S>                                              <C>          <C>           <C>            <C>           <C>
Consulting                                       $         -  $          -  $           -  $    250,000  $          -
Governmental Research Grants                          32,379       256,847              -             -             -
                                                 ------------ ------------- -------------- ------------- -------------
                                                                   256,847              -       250,000             -

EXPENSES:
Research and development                           4,667,053     3,456,301      1,543,921       838,208     1,097,248
Interest, net                                        (31,795)      (60,021)       (36,730)        6,334        20,307
General and administrative
                                                   2,812,934     2,320,011      3,561,302      4,902,213    2,419,215
Depreciation and amortization                        156,933        98,115         27,218         23,776      520,383
Other income                                                             -       (231,350)             -            -
                                                 ------------ ------------- -------------- ------------- -------------
                                                   7,605,125     5,814,406      4,864,361     5,770,531     4,057,153
                                                 ------------ ------------- -------------- ------------- -------------

NET LOSS                                          (7,572,746)   (5,557,559)    (4,864,361)   (5,520,531)   (4,057,153)

Other Comprehensive Income
Unrealized loss on marketable securities               3,933        12,648        (16,580)            -             -
Foreign translation adjustment                        77,141       (20,540)             -             -             -
                                                 ------------ ------------- -------------- ------------- -------------
Total Comprehensive Income                       $(7,491,672) $ (5,565,451) $  (4,880,941) $ (5,520,531) $ (4,057,153)
                                                 ============ ============= ============== ============= =============

Loss per share, basic                            $      (.05) $      (0.04) $       (0.04) $      (0.07) $      (0.08)
                                                 ============ ============= ============== ============= =============

Weighted average number of shares outstanding:
Basic & diluted                                  147,058,648   134,560,596    124,483,372    79,767,085    50,788,659
                                                 ============ ============= ============== ============= =============



Consolidated Balance Sheet Data
                                                                           At December 31,
                                                 ---------------------------------------------------------------------
                                                    2006          2005          2004           2003          2002
                                                 ------------ ------------- -------------- ------------- -------------

Cash and equivalents and Short-term investments  $   742,075  $    952,531  $   3,929,263  $    370,583  $    357,826

Working capital                                    ($445,644) $    745,036  $   3,835,445  $     (8,968) $   (986,117)

Total assets                                     $ 2,499,467  $  2,237,459  $   5,249,159  $    674,821  $    661,788

Long-term obligations                            $         -  $          -  $           -  $          -  $          -

Stockholders' equity (deficit)                      $979,902  $  1,675,399  $   5,078,992  $    274,011  $   (935,155)

</TABLE>

                                       28
<PAGE>


ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

General

Samaritan Pharmaceuticals, Inc. (including the subsidiaries, referred to as
Samaritan, the "Company", "it", "we", and "our"), formed in September 1994, is
an entrepreneurial biopharmaceutical company, focused on commercializing
innovative therapeutic products to relieve the suffering of patients with
Alzheimer's disease; cancer; cardiovascular disease, HIV, and Hepatitis C; as
well as, commercializing its acquired marketing and sales rights to sell nine
marketed revenue-generating products in Greece and/or various Eastern European
countries.

Samaritan has partnered its oral entry inhibitor HIV drug SP-01A, a drug that
has demonstrated safety and efficacy, in Phase II clinical trials, with
Pharmaplaz, Ireland to advance to Phase III clinical trials. In addition,
Samaritan aims to commercialize three blockbuster market drug candidates with
late-stage preclinical development programs. Samaritan is evaluating the use of
Caprospinol, SP-233 in Alzheimer's disease patients; the use of SP-1000 with
acute coronary disease patients; and the use of SP-10 as an "oral treatment" for
Hepatitis C patients.

Business Model

Our commercialization business model is focused dually on, the partnering of our
promising innovative products to pharmaceutical companies; and the acquisition
of the marketing and sales rights to revenue-generating marketed products for
sales in Greece and Eastern Europe. This model allows Samaritan to focus on our
core competencies in drug discovery and drug development. Samaritan partners
promising innovative therapeutics anywhere in the early "human" clinical trial
stage, i.e. late-stage preclinical studies, Phase I Clinical trials, or proof of
concept, Phase II clinical trials, with the objective of partnering before
costly Phase III clinical trials. Potential revenue streams with this model
could include up-front fees, milestone payments, and participation in the
marketing success of partnered products through royalties. In addition,
Samaritan is enhancing and strengthening our sales and marketing force in Greece
and Eastern Europe to allow for the significant economics gained by advancing
the commercialization of our contracted marketed products. Our business model is
entirely focused on achieving growth and maximizing value for the benefit of our
investors.

Licensing and Collaborative Agreements

To build, advance and promote our product portfolio, Samaritan often seeks to
augment our own internal programs and capabilities with collaborative projects
with a number of outside partners. For our marketed products, we have
established certain license agreements, co-promotion arrangements,
manufacturing, supply and co-development alliances with pharmaceutical and other
biotechnology companies, academic institutions and government laboratories to
which we currently pay royalties. For more information on these collaborations,
please see Item 1, "Business" section. Similarly, for product candidates now in
development, we have secured licenses to certain intellectual property and
entered into strategic alliances with third parties for various aspects of
research, development, manufacturing and commercialization, pursuant to which we
will owe or receive future royalties if the product candidates are licensed and
commercialized.

                                       29
<PAGE>

Pharmaplaz, LTD. On March 28, 2007, Samaritan and Pharmaplaz announced they have
a collaboration to develop and commercialize SP-01A, an "oral" HIV entry
inhibitor, which has demonstrated safety and efficacy in Phase II human clinical
trials. Under the terms of the agreement, Samaritan is to receive $10 million
dollars upfront in two payments, $1.4 million was received on March 28, 2007,
and the remaining $8.6 million on September 16, 2007. Pharmaplaz will be
responsible for clinical development, clinical trial costs and manufacturing.
Upon successful commercialization, Samaritan and Pharmaplaz will co-market
SP-01A and will share 50-50, in its revenue royalty stream.

Shire Pharmaceuticals. On March 1, 2007, Samaritan executed an exclusive
licensing deal with Shire Pharmaceuticals for the marketing of Elaprase in
Greece and Cyprus.

Three Rivers Pharmaceuticals(R). On December 12, 2005, Samaritan signed an
exclusive licensing agreement with Three Rivers Pharmaceuticals, Inc. for the
marketing of Amphocil, a prescription drug in Greece; authorization is pending
for Cyprus.

Molteni Farmaceutici. On January 1, 2007, Samaritan executed an exclusive
licensing agreement with Molteni Farmaceutici for the marketing of Mepivamol,
Methadone, Morphine Sulphate, Naloxone, Naltrexone, and Oramorph in Greece and
Cyprus.

Siraeo, Ltd. On December 28, 2006, Samaritan signed an exclusive licensing
agreement with Siraeo, Ltd for the marketing of Infasurf in Turkey, Serbia,
Bosnia, Macedonia, Albania, Egypt and Syria. Infasurf is an approved FDA
prescription product owned by Ony, Inc. and marketed by Forest Laboratories in
the US.

Metastatin Pharmaceuticals. On March 1, 2007, Samaritan announced that we had
completed our acquisition of Metastatin Pharmaceuticals.

Plan and Results of Operations

We have used the proceeds from private placements of our capital stock,
primarily to expand our preclinical and clinical efforts, as well as for general
working capital.

The net loss since our inception on September 5, 1994 through December 31, 2006
was $41,309,142. We expect losses to continue for the near future, and such
losses will likely increase as human clinical trials are undertaken in the
United States. Future profitability will be dependent upon our ability to
complete the development of our pharmaceutical products, obtain necessary
regulatory approvals and effectively market such products. In addition, future
profitability will require the Company to establish agreements with other
parties for clinical testing, manufacturing, commercialization and sale of its
products.

Liquidity and Capital Resources

The following table sets forth our consolidated net cash provided by (used in)
operating, investing and financing activities for each of the years in the
three-year period ending December 31, 2006:

                                       30
<PAGE>

                                    2006            2005           2004
Cash provided by (used in):
Operating activities             $(6,248,128)    $(4,635,947)   $(3,287,896)
Investing activities                  $44,223        $972,460   $(2,495,178)
Financing activities               $6,489,517      $1,681,500     $7,850,940

As of December 31, 2006, the Company's cash position was $742,075. We are
continuing efforts to raise additional capital and to execute our research and
development plans. Even if we are successful in raising sufficient money to
carry out these plans, additional clinical development is necessary to bring our
products to market, which will require a significant amount of additional
capital.

On March 28, 2007, Samaritan and Pharmaplaz, announced that they have a
collaboration to develop and commercialize SP-01A, an "oral" HIV entry inhibitor
that has demonstrated safety and efficacy in Phase II human clinical trials.
Under the terms of the agreement, Samaritan receives $10 million upfront in two
payments. The first payment of $1.4 million was received by Samaritan, and the
remaining $8.6 million is payable on September 16, 2007. Pharmaplaz will be
responsible for clinical development, clinical trial costs and manufacturing.
Upon successful commercialization, Samaritan and Pharmaplaz will co-market
SP-01A and will share 50-50 in its revenue royalty stream.

Cash provided by investing activities was $44,223 for the twelve (12) month
period ending December 31, 2006, as compared to $972,460 for the twelve (12)
month period ending December 31, 2005. Each period reflects proceeds from the
liquidation of certificates of deposit offset by investing activity such as the
purchase of equipment and patent registration costs. During 2006, there were
fewer marketable securities to liquidate and we increased the rate of
investments in patent costs and technology rights which resulted in the decline
in cash flows from 2005 to 2006.

Cash provided by financing activities was $6,489,517 for the twelve (12) month
period ending December 31, 2006, as compared to $1,681,500 for the twelve (12)
month period ending December 31, 2005, an increase of $4,808,017 or two-hundred
eighty-six percent (286%). This year's results include proceeds of $2,045,000
from private placements, and $64,500 from the exercise of warrants. Furthermore,
proceeds from the equity financing agreement increased this year through
December 31 by $2,591,033.

Cash used in operating activities during the twelve month (12) period ending
December 31, 2006 was $(6,248,128), as compared to $(4,635,947) for the twelve
(12) month period ending December 31, 2005. This increase is primarily
attributable to (a) additional expenses related to development of SP-01A and (b)
the initiation of our clinical trial, including payments to Pharmaplaz, LTD for
performing work to complete the chemistry and manufacturing and controls (CMC)
information for SP-01A.

Current assets as of December 31, 2006 were $1,073,921 as compared to $1,307,096
as of December 31, 2005. This decrease of $233,175, or eighteen percent (18%),
is primarily attributable to the use of cash to fund drug development
activities. Augmenting the private placement funds are the increased proceeds
received through our equity financing arrangement with Fusion Capital as offset
by the increased research expenditures. Current liabilities as of December 31,
2006 were $1,519,565 as compared to $562,060 as of December 31, 2005, an
increase of $957,505 or one hundred seventy percent (170%). Such increase is the
result of increased spending on patent costs, and the acquisition of technology
rights.

                                       31
<PAGE>

On May 12, 2005, we entered into the Purchase Agreement II with Fusion Capital,
pursuant to which Fusion Capital has agreed to purchase our Common Stock from
time to time, at our option, up to an aggregate amount of $40,000,000 over fifty
(50) months commencing on the date the SEC declared effective our Registration
Statement on December 29, 2005 (Commission Registration No. 333-130356), the
Registration Statement on Form SB-2 was declared effective by the SEC. Samaritan
filed a post effective amendment on Form S-1 to the above Registration Statement
No. 333-130356 on January 9, 2007. The SEC declared it effective on February 6,
2007. The number of registered, yet not issued shares remaining under that
Registration Statement as of March 30, 2007, was 2,209,372.

We believe that existing balances of cash, cash equivalents, marketable
securities, cash generated from operations (out-licensing of SP-01A to
Pharmaplaz and future cash derived from marketed products), and funds
potentially available to us under Purchase Agreement II are sufficient to
finance our current operations and working capital requirements on both a
short-term and long-term basis. However, we cannot predict the amount or timing
of our need for additional funds under various circumstances, which could
include a significant acquisition of a business or assets, new product
development projects, expansion opportunities, or other factors that may require
us to raise additional funds in the future. We cannot provide assurance that
funds will be available to Samaritan when needed on favorable terms, or at all.

On March 28, 2007, Samaritan and Pharmaplaz, announced that they have a
collaboration to develop and commercialize SP-01A, an "oral" HIV entry inhibitor
that has demonstrated safety and efficacy in Phase II human clinical trials.

Under the terms of the agreement, Samaritan receives $10 million upfront in two
payments. The first payment of $1.4 million was received by Samaritan, and the
remaining $8.6 million is payable on September 16, 2007. Pharmaplaz will be
responsible for clinical development, clinical trial costs and manufacturing.
Upon successful commercialization, Samaritan and Pharmaplaz will co-market
SP-01A and will share 50-50 in its revenue royalty stream.

We will continue to have significant general and administrative expenses,
including expenses related to clinical studies, our research collaboration with
universities and patent registration costs. Except for our Purchase Agreement
with Fusion Capital, no commitment exists for continued investments, or for any
underwriting.

In addition to our financing arrangements with Fusion Capital (as discussed
above), we may require substantial additional funds to sustain our operations
and to grow our business. The amount will depend, among other things, on (a) the
rate of progress and cost of our research and product development programs and
clinical trial activities; (b) the cost of preparing, filing, prosecuting,
maintaining and enforcing patent claims and other intellectual property rights;
and (c) the cost of developing manufacturing and marketing capabilities, if we
decide to undertake those activities. The clinical development of a therapeutic
product is a very expensive and lengthy process which may be expected to utilize
$5 to $20 million over a three (3) to six (6) year development cycle. We may
also need to obtain additional funds to develop our therapeutic products and our
future access to capital is uncertain. The allocation of limited resources is an
ongoing issue for us as we move from research activities into the more costly
clinical investigations required to bring therapeutic products to market.

                                       32
<PAGE>

The extent to which we rely on Fusion Capital as a source of funding will depend
on a number of factors, including the prevailing market price of our Common
Stock (which must exceed $0.25 per share) and the extent to which we are able to
secure working capital from other sources. Even if we are able to access the
full amounts under Purchase Agreement II with Fusion Capital, we may still need
additional capital to fully implement our business, operating and development
plans. If we are unable to obtain additional financing, we might be required to
delay, scale back or eliminate selected research and product development
programs or clinical trials, or be required to license third parties to
commercialize products or technologies that we would otherwise undertake
ourselves, or cease certain operations all together. However, any of these
options might have a material adverse effect upon the Company. If we raise
additional funds by issuing equity securities, dilution to stockholders may
result, and new investors could have rights superior to existing holders of
shares. Should the financing we require to sustain our working capital needs be
unavailable or prohibitively expensive when we require it, the consequences
would have a material adverse effect on our business, operating results,
financial condition and prospects.

We have been able to meet our cash needs during the past twelve (12) months
through a combination of funds received through private placements and funds
received under the Purchase Agreements. Currently, we have out-licensed our
SP-01A and in-licensed the rights to sell nine drugs, Amphocil from Three Rivers
Pharmaceuticals, Elaprase from Shire Pharmaceuticals, Infasurf from Ony, Inc,
and Mepivamol, Methadone, Morphine Sulphate, Naloxone, Naltrexone, and Oramorph
from Molteni Pharmaceuticals to meet our cash needs. We intend to continue to
explore avenues to obtain additional capital through private placements and by
the sale of our shares of Common Stock to Fusion Capital.

Results of Operations For The Twelve (12) Months Ending December 31, 2006 As
Compared To The Twelve (12) Months Ending December 31, 2005

During the years ending December 31, 2006 and 2005, we incurred research
expenditures pursuant to grants we received from the U.S. Department of Health
and Human Services. We recognized grant revenue of $32,379 and $256,847, the
extent of such qualifying expenditures for 2006 and 2005, respectively.

We incurred research and development expenses of $4,667,053 for the year ended
December 31, 2006, as compared to $3,456,301 for the year ended December 31,
2005. This increase of $1,210,752, or thirty-five percent (35%), was primarily
attributable to (a) the continuation of our Phase IIb HIV clinical trial, (b)
our increase in financial commitment with Georgetown University, (c) additional
expenses incurred to development of SP-01A, including payments to Pharmaplaz,
LTD for the manufacturing of SP-01A and (d) for performing the work necessary to
complete the chemistry, manufacturing and controls (CMC) section of New Drug
Application for the FDA, which will be submitted with studies conducted under
the IND for SP-01A. We expect that research and development expenditures
relating to drug discovery and development will increase in 2007 and into
subsequent years due to FDA clinical trials which include the continuation and
expansion of clinical trials (i) our Alzheimer's drug program, (ii) the
initiation of trials for other potential indications and (iii) additional study
expenditures for potential pharmaceutical candidates. Research and development
expenses may fluctuate from period to period depending upon the stage of certain
projects and the level of preclinical testing and clinical trial-related
activities.

                                       33
<PAGE>

Research and Development Expense

Research and development expenses consist of the costs associated with our
research activities, as well as the costs associated with our drug discovery
efforts, conducting preclinical studies and clinical trials, manufacturing
development efforts and activities related to regulatory filings. Our research
and development expenses consist of:

    -external research and development expenses incurred under agreements with
     third-party contract research organizations and investigative sites,
     third-party manufacturing organizations and consultants;
    -employee-related expenses, which include salaries and benefits for the
     personnel involved in our drug discovery and development activities.

We use our employee across multiple research projects, including our drug
development programs. We track direct expenses related to our clinical programs
on a per project basis. Accordingly, we allocate internal employee-related, as
well as third-party costs, to each clinical program. We do not allocate expenses
related to preclinical programs.

The following table summarizes our principal product development programs,
including the related stages of development for each product candidate in
development and the research and development expenses allocated to each clinical
product candidate. The information in the column labeled "Estimated Completion
of Current Trial" is our estimate of the timing of completion of the current
clinical trial or trials for the particular product candidate. The actual timing
of completion could differ materially from the estimates provided in the table.

<TABLE>
<CAPTION>

                                         Estimated
                                        Completion           Research and Development Expenses
                            Phase of    of Current                  Year Ended December 31,
Product Candidate          Indication   Development   Trial       2004        2005        2006
-------------------------- ----------- -------------- ------ -------------------------------------
<S>                                                <C> <C>   <C>          <C>         <C>
Clinical Development
SP-01A**                          HIV        Phase 2   2006  $   836,424  $2,263,903  $ 2,534,856

Research and preclinical                                     $   707,497  $1,192,398  $ 2,132,197
                                                             ------------ ----------- ------------
                                                             $ 1,543,921  $3,456,301  $ 4,667,053
                                                             ============ =========== ============
</TABLE>

            **On March 28, 2007, Samaritan entered into an agreement in which
            Pharmaplaz will bear the expense of the development of SP-01A going
            forward.

The successful development of our product candidates is highly uncertain. At
this time, we cannot reasonably estimate or know the nature, timing and
estimated costs of the efforts that will be necessary to complete the remainder
of the development of, or the period, if any, in which material net cash inflows
may commence from, SP-01A or any of our preclinical product candidates. This is
due to the numerous risks and uncertainties associated with developing drugs,
including the uncertainty of:

    -the scope, rate of progress and expense of our clinical trials and other
    research and development activities;
    -the potential benefits of our product candidates over other therapies;
    -our ability to market, commercialize and achieve market acceptance for any
    of our product candidates that we are developing or may develop in the
    future;
    -future clinical trial results;
    -the terms and timing of regulatory approvals; and
    -the expense of filing, prosecuting, defending and enforcing any patent
    claims and other intellectual property rights.

                                       34
<PAGE>

A change in the outcome of any of these variables with respect to the
development of a product candidate could mean a significant change in the costs
and timing associated with the development of that product candidate. For
example, if the FDA or other regulatory authority were to require us to conduct
clinical trials beyond those which we currently anticipate will be required for
the completion of clinical development of a product candidate or if we
experience significant delays in enrollment in any our clinical trials, we could
be required to expend significant additional financial resources and time on the
completion of clinical development.

General and administrative expenses increased to $2,812,934 for the year ended
December 31, 2006, as compared to $2,320,011 for the year ended December 31,
2005. This increase of $492,923 or twenty-one percent (21%) was primarily
attributable to increases in payroll and advertising.

Depreciation and amortization amounted to $156,933 for the year ended December
31, 2006, as compared to $98,115 for the year ended December 31, 2005. This
increase of $58,818 (60%) was primarily attributable to research equipment
purchases during the second quarter of 2005 and amortization of patent
registration costs of $55,458 for the year ended December 31, 2006.

Net interest (income) expense amounted to $(31,795) and $(60,021) for the years
ending December 31, 2006 and 2005, respectively. The credit balance in the
interest expense account is due to offsetting interest earned from holding our
cash in marketable securities and certificates of deposits. During 2006, a
certificate of deposit was liquidated to provide operating capital. Therefore,
interest earnings declined from 2005 to 2006.

Other comprehensive income (loss) is comprised of two components. The Company
invests in marketable securities to earn a return on cash not needed in the
short-term. Temporary, unrealized gains and losses are recorded to reflect
changes in the market value of the temporary investments as they occur. At
December 31, 2006, such market fluctuations totaled $3,933. During 2006, there
was a realized loss of $3,160 on the liquidation of the CD. The other component
of comprehensive income is due to the payment in foreign currency of operations
that occur in Ireland and Greece. The amount of the gain or loss is a function
of the relative strength of the American dollar to the Euro. At December 31,
2006, the balance of the foreign currency translation gain was $77,141.

We had a net loss of $7,572,746 for the year ended December 31, 2006, as
compared to $5,557,559 for the year ended December 31, 2005. The loss per share
for the yearly periods was $0.05 and 0.04 per share, respectively, for 2006 and
2005 per share. The increased loss of $2,015,187, relates primarily to increased
expenses, particularly in research, as described above.

Results of Operations For The Twelve (12) Months Ending December 31, 2005 As
Compared To The Twelve (12) Months Ending December 31, 2004

During the year ending December 31, 2005, we incurred research expenditures
pursuant to a grant we received from the U.S. Department of Health and Human
Services. We recognized grant revenue of $256,847, the extent of such qualifying
expenditures.

                                       35
<PAGE>

We incurred research and development expenses of $3,456,301 for the year ended
December 31, 2005, as compared to $1,543,921 for the year ended December 31,
2004. This increase of $1,912,381, or one hundred twenty-four percent (124%),
was primarily attributable to (a) the continuation of our Phase IIb HIV clinical
trial, (b) our increase in financial commitment with Georgetown University, (c)
additional expenses incurred to development of SP-01A, including payments to
Pharmaplaz, LTD for the manufacturing of SP-01A and (d) for performing the work
necessary to complete the chemistry, manufacturing and controls (CMC) section of
New Drug Application for the FDA, which was submitted with studies conducted
under the IND for SP-01A. We expect that research and development expenditures
relating to drug discovery and development will increase in 2006 and into
subsequent years due to FDA clinical trials which include the continuation and
expansion of clinical trials (i) for our HIV drug program, (ii) our Alzheimer's
drug program, (iii) the initiation of trials for other potential indications and
(iv) additional study expenditures for potential pharmaceutical candidates.
Research and development expenses may fluctuate from period to period depending
upon the stage of certain projects and the level of preclinical testing and
clinical trial-related activities. On June 1, 2004, we also hired a Chief Drug
Development Officer at an annual salary of $300,000, plus benefits.

General and administrative expenses decreased to $2,320,011 for the year ended
December 31, 2005, as compared to $3,561,302 for the year ended December 31,
2004. This decrease of $1,241,291 or thirty-five percent (35%) was primarily
attributable to a decrease in amortization of fees with third party agreements.

Depreciation and amortization amounted to $98,115 for the year ended December
31, 2005, as compared to $27,218 for the year ended December 31, 2004. This
increase of $70,897 (260%) was primarily attributable to research equipment
purchases during the second quarter of 2005 and amortization of patent
registration costs of $34,268 for the year ended December 31, 2006.

Net interest (income) expense amounted to $(60,021) and $(36,730) for the years
ending December 31, 2005 and 2004, respectively. The credit balance in the
interest expense account is due to offsetting interest earned from holding our
cash in marketable securities and certificates of deposits. Most of the initial
investment in marketable securities was made during the quarter ended September
30, 2004. Therefore, 2004 lacks the first six months of earnings reflected in
2005.

Other comprehensive income (loss) is comprised of two components. The Company
invests in marketable securities to earn a return on cash not needed in the
short-term. Temporary, unrealized gains and losses are recorded to reflect
changes in the market value of the temporary investments as they occur. At
December 31, 2005 and 2004, such market fluctuations totaled $12,648 and
$(16,580), respectively. There have been no realized losses since to date
investments have been held to maturity. The other component of the comprehensive
loss is due to the payment in foreign currency of operations that occur in
Ireland and Greece. The amount of the loss is a function of the relative
strength of the American dollar to the Euro. At December 31, 2005, the balance
of the foreign currency translation loss was $(20,540).

We had a net loss of $5,557,559 for the year ended December 31, 2005, as
compared to $4,864,361 for the year ended December 31, 2004. The loss per share
for both yearly periods was $0.04 per share. The increased loss of $693,198,
relates primarily to increased expenses as described above, offset by grant
revenue of $256,847.

Results of Operations From September 5, 1994 Through December 31, 2006

 The net loss since our inception on September 5, 1994 through December 31, 2006
was $41,309,142. We expect losses to continue for the near future, and such
losses will likely increase as human clinical trials are undertaken. Future
profitability will be dependent upon our ability to complete the development of
our pharmaceutical products, obtain necessary regulatory approvals and
effectively market such products. In addition, future profitability will require
the Company establish agreements with other parties for the clinical testing,
manufacturing, commercialization and sale of its products.

                                       36
<PAGE>

Contractual Obligations

The following table summarizes our significant contractual obligations and
commercial commitments as of December 31, 2006.

<TABLE>
<CAPTION>

------------------------------- ------------ ------------- ------------- ------------ -------------
                                              Less than        1-3           4-5       More than
                                   Total         Year         Years         Years       5 years
------------------------------- ------------ ------------- ------------- ------------ -------------
<S>                             <C>          <C>           <C>
Operating lease obligations     $   166,935  $     59,940  $    106,996            -             -
------------------------------- ------------ ------------- ------------- ------------ -------------
Other   (1)                     $ 7,500,000  $  1,000,000  $  2,000,000  $ 2,000,000  $  2,500,000
------------------------------- ------------ ------------- ------------- ------------ -------------
Total                           $ 7,666,935  $  1,059,940  $  2,106,996  $ 2,000,000  $  2,500,000
------------------------------- ------------ ------------- ------------- ------------ -------------
</TABLE>

(1) Samaritan has a research collaboration (the "Research Collaboration") with
Georgetown University to further develop Samaritan's pipeline. Commencing on
April 1, 2004, the Research Collaboration term was extended to 2014 with a
budget of $1,000,000 per year. The $1,000,000 paid by Samaritan over four (4)
quarterly payments of $250,000 is unallocated and covers the general research
and development effort. In the second quarter of 2007, we plan to terminate the
Georgetown University research collaboration, however, Samaritan is currently
negotiating a research collaboration with McGill University, Montreal, under the
same terms as the Georgetown University agreement which we plan to initiate in
the third quarter of 2007.

ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

We do not engage in trading market-risk sensitive instruments and do not
purchase hedging instruments or other than trading instruments that are likely
to expose us to market risk, whether interest rate, foreign currency exchange,
commodity price or equity price risk. We have no outstanding debt instruments,
have not entered into any forward or future contracts, and have purchased no
options and entered into no swaps. We have no credit lines or other borrowing
facilities, and do not view ourselves as subject to interest rate fluctuation
risk at the present time.

ITEM 8.   CONSOLIDATED FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA REPORT OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Samaritan Pharmaceuticals, Inc. financial statements, schedules and
supplementary data, appear in a separate section of this report
beginning with page F-1.

ITEM 9A.   CONTROLS AND PROCEDURES

(A) Evaluation of Disclosure Controls and Procedures. As of the end of the
period covered by this report, the Company carried out an evaluation, under the
supervision and with the participation of the Company's Principal Executive
Officer and Principal Financial Officer of the effectiveness of the design and
operation of the Company's disclosure controls and procedures. The Company's
disclosure controls and procedures are designed to provide a reasonable level of
assurance of achieving the Company's disclosure control objectives. The
Company's Principal Executive Officer and Principal Financial Officer have
concluded that the Company's disclosure controls and procedures are, in fact,
effective at this reasonable assurance level as of the end of the period
covered. In addition, the Company reviewed its internal controls, and there have
been no significant changes in our internal controls or in other factors that
could significantly affect those control to the date of their last evaluation or
from the end of the reporting period to the date of the Annual Report on Form
10-K.

                                       37
<PAGE>

 (B) Changes In Internal Controls. In connection with the evaluation of the
Company's internal controls during the Company's fiscal year ended December 31,
2006, the Company's Principal Executive Officer and Principal Financial Officer
have determined that there were no changes to the Company's internal controls
over financial reporting that have materially affected, or are reasonably likely
to materially effect, the Company's internal controls over financial reporting
during the fiscal year ended December 31, 2006, or subsequent to the date of
their last evaluation, or from the end of the reporting period to the date of
this Annual Report on Form 10-K.

ITEM 9B. OTHER INFORMATION

None.


                                    PART III

ITEM 10.  DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

The following table sets forth the name, age and position of our executive
officers, directors, key employees and key consultants as of the date hereof:
<TABLE>
<CAPTION>

Name                                   Age     Served Since   Position(s) with Company
------------------------------------ ------- ---------------- ----------------------------------------
<S>                  <C>               <C>     <C>   <C>
Dr. Janet R. Greeson (2)(3)            63      10/19/1997     CEO, President and Chairman of the Board
Mr. Eugene J. Boyle (4)                41      05/20/2000     CFO, COO and Director
Dr. Thomas Lang                        55      06/20/2004     Chief Drug Development Officer
Ms. Kristi C. Eads                     37      11/20/2000     VP Business Development, Corporate Sec.
Mr. George Weaver                      41      07/20/2003     Regulatory Affairs Officer
Dr. Laurent Lecanu (2)(5)              38      06/10/2005     Director
Mr. Douglas D. Bessert (5)(6)          49      03/20/2001     Director
Dr. Erasto R. C. Saldi (1)(2)(3)       47      05/20/2003     Director
Mr. Welter Holden (1)(3)(7)            75      10/19/1997     Director
Mr. H. Thomas Winn (5)(6)              66      03/19/1999     Director
Ms. Cynthia C. Thompson (1)(4)(6)(7)   47      03/19/1999     Director
Dr. Vassilios Papadopoulos (2)         46      03/20/2001     Chief Scientist and Key Consultant
Dr. Christos Dakas                     45      06/29/2005     Managing Director, Samaritan Europe
Ms. Dianne Thompson                    44      10/01/2006     Comptroller
____________________________________
</TABLE>

(1) Member of the Nominating Committee.
(2) Member of the Science and Technology Advisory Committee.
(3) Class I Director, term expires 2007.
(4) Class II Director, new term expires 2009.
(5) Class III Director, term expires 2008.
(6) Member of the Audit and Finance Committee.
(7) Member of the Compensation and Governance Committee.


                                       38
<PAGE>

Dr. Janet R. Greeson. Dr. Greeson has served as the Company's CEO, President and
Chairman of the Board since October 30, 2000 and has led the bold initiative
that transformed Samaritan from a "one drug" Company to an innovative "Drug
Development Pipeline" Biopharmaceutical Company. Dr. Greeson is a successful
healthcare professional with over two (2) decades of corporate experience
focused on emerging growth situations, leadership development, and mergers and
acquisitions. Dr. Greeson has worked with Samaritan for ten (10) years, and has
served as CEO for the past five (5) years. As CEO she has demonstrated a
relentless perseverance and determination to succeed in the face of unrelenting
change. She is extremely motivated and equipped to attack problems and seize
realistic opportunities, with capability, courage and confidence. Dr. Greeson is
a co-inventor of eighteen (18) patent applications, and presently has nine "peer
reviewed" journal publications.

She currently fulfills her altruistic energies with the Samaritan Innovative
Science Foundation. Dr. Greeson holds a BA, from Florida Technological
University in 1978; an MA from Rollins College in 1979; and a Ph.D. from
Columbia Pacific University in 1987.

Mr. Eugene J. Boyle. Eugene Boyle has served as Chief Financial Officer, Chief
Operations Officer, and a Director of Samaritan Pharmaceuticals since June 16,
2000. Mr. Boyle received a BSE in Computer Engineering and Applied Mathematics
from Tulane University, served in the US Navy as a Lt. during the Gulf War and
then went on to get his MBA from Babson College and JD from Concord University.
Mr. Boyle is a registered patent agent and admitted to practice before the
United States Patent and Trademark Office (USPTO) in all matters relating to
patents. He also served on Nevada Gold & Casino's (AMEX:UWN) Advisory Board from
1999 to 2003.

Dr. Thomas Lang. Dr. Lang has served as the Chief Drug Development Officer for
Samaritan since 2004. Prior to joining the Company he was the former Vice
Chairman and President of Serono Inc., the U.S. Company of Serono, S.A. Dr. Lang
holds technical degrees in Chemistry and Pharmacy, an MBA degree, a Ph.D. degree
and is a registered pharmacist in the State of New Jersey.

Ms. Kristi C. Eads. Kristi Eads, J.D., Vice President of Business Development,
joined Samaritan Pharmaceuticals in 2000, and has functioned as Vice President
of Samaritan since January of 2004. Ms. Eads works with Samaritan's business
development team to optimize Samaritan's licensing and partnering opportunities
by executing business development initiatives and assisting with strategic
planning. Ms. Eads obtained her juris doctorate from Concord University and has
a bachelor of arts from the University of Oregon.

Mr. George Weaver. Mr. Weaver has served as the Regulatory Affairs Officer for
Samaritan since 2003. Mr. Weaver majored in chemistry and minored in business
economics at UCLA. After working as an environmental toxicology consultant for
two (2) years, Mr. Weaver earned a Bachelor's of Science in Environmental
Engineering and assumed an appointed position as Chair of Industry Waste
Classification and Toxicology Focus Group under the California Department of
Toxic Substances Control Regulatory Structure Update.

Dr. Laurent Lecanu. Dr. Lecanu has served as a director since June 10, 2005. He
serves on the Nominating and Corporate Governance and Science and Technology
committees of Samaritan. Dr. Lecanu received his D.Pharm. in pharmaceutical
chemistry and his Ph.D. in neuropharmacology from the School of Pharmaceutical
and Biological Sciences at University of Paris (V), Paris, France. Dr. Lecanu is
also a former Intern of Paris Hospitals, France, where he demonstrated
excellence in the management and performance of clinical trials for new
medications.

Mr. Douglas D. Bessert. Mr. Bessert has served as a director since 2001 and
currently serves on the Company's Audit Committee. Currently, Mr. Bessert is the
Vice President of Sales and Marketing of Southview Properties, LLC, a land
development company. From April 2001 to February 2004, Mr. Bessert was the Vice
President of Investor Relations with Samaritan. Mr. Bessert received his BS in
Marketing from the University of Wyoming.

Dr. Erasto R. C. Saldi. Dr. Saldi has served as a director of the Company since
2003. Currently, Dr. Saldi serves as the Company's Chief Medical Officer and
Clinical Study Director, overseeing the clinical site's Principal Investigators
that run the Company's FDA clinical trials. From 1999 to 2004, Dr. Saldi was the
Medical Director of Fremont Medical Clinic, Desert Lane Care Center, and
Cheyenne Care Center, where he improved physician compliance and formulated
patient care protocols. From 1996 to 1997, he was Chief Resident, Internal
Medicine and from 1997 to 1998 he served as Assistant Clinical Professor,
Internal Medicine at the University of Nevada School of Medicine, Las Vegas,
Nevada. Dr. Saldi, as an Internist, has extensive experience as a Principal
Investigator and manager of clinical research trials.

                                       39
<PAGE>

Mr. Welter "Budd" Holden. Mr. Holden is a co-founder, has served as a director
since 1997, is the Chairman of the Nominating and Corporate Governance
Committee, and serves on the Compensation Committee. Mr. Holden has assisted the
Company in recruiting and networking patients for clinical trials. He is a
well-known designer who has consulted with the rich and famous throughout his
whole life. He is a renowned networker and has presented Samaritan to many of
his past clients and venture capital groups, including principals of
pharmaceutical companies. Mr. Holden is the Chairman of our Business Advisory
Board and acts as liaison to the "Samaritan Innovative Science Foundation". He
received his B.A. in architectural and interior design from the Pratt Institute
in New York, New York.

Mr. H. Thomas Winn. Mr. Winn has served as a Director since 1999 and is the
Chairman of the Audit Committee. Mr. Winn is founder and Chairman of Nevada Gold
& Casinos, Inc. (AMEX:UWN). Since 1983, he has served as President of Aaminex
Capital Corporation, a financial consulting and venture capital firm. Mr. Winn
has formed numerous investment limited partnerships and capital formation
ventures ranging from mining projects, renewable energy, commercial real estate
and motion pictures.

Ms. Cynthia C. Thompson. Cynthia C. Thompson has been a director since March 31,
1999. She is the Chairman of the Compensation Committee and serves on the Audit
Committee. Ms. Thompson founded Quest Entertainment, Inc., a gaming technology
company, in August of 2003 and serves as the Chairman of the Board and is the
President/Chief Executive Officer. Since 1998, she has served as President/CEO
of Intuitive Solutions International, Inc., a consulting firm offering corporate
support services, including financing and financial structures, strategic
planning and partnering, marketing and investor relations.

Dr. Vassilios Papadopoulos, D.Pharm., Ph.D. Dr. Papadopoulos served as a
director from 2001 through June 2005 and currently serves as the Principal
Investigator for Samaritan Research Laboratories at Georgetown University. Dr.
Papadopoulos has over twenty (20) years of experience and over one hundred forty
(140) peer review article publications in the Biopharmaceutical field and
numerous patents in the field of steroid biosynthesis, Alzheimer's disease and
cancer. Dr. Papadopoulos has been appointed as the new Director of the Research
Institute of the McGill University Health Centre in Montreal, Canada. Dr.
Papadopoulos will assume his new role officially on July 1, 2007.

Dr. Christos Dakas, D.Pharm., Ph.D. Dr. Christos Dakas, joined Samaritan in June
2005 to oversee European operations, including Samaritan Ireland
Pharmaceuticals, Limited. Prior to joining Samaritan, Dr. Dakas had a successful
career in various executive positions with Gerolymatos, Genesis Pharma, and most
recently Arriani Pharmaceuticals. A pharmaceutical chemist by training with a
number of published papers, he holds degrees from the University of Toronto,
Kings College of University of London, and the University of Wales in Cardiff.

Dianne Thompson. Ms. Thompson is the Comptroller of Samaritan Pharmaceuticals,
and the Senior V.P. of Public Affairs & Development for the Samaritan Innovative
Science Foundation. Ms. Thompson received her BS in Business Administration and
Economics from the College of Notre Dame, Belmont, California, and her MBA from
Pepperdine University, Malibu, California. Ms. Thompson founded her own business
management consulting company in 1998 and has had a vast array of clients in
both the for-profit and nonprofit sectors.

                                       40
<PAGE>

Compliance with Section 16(a) of the Exchange Act

Section 16(a) of the Exchange Act requires our officers and directors, and
persons who own more than ten percent of a registered class of equity
securities, to file reports with the Securities and Exchange Commission
reflecting their initial position of ownership on Form 3 and changes in
ownership on Form 4 or Form 5. Based solely on a review of the copies of such
Forms received by us, we believe that, during the fiscal year ended December 31,
2006, all of our officers, directors and ten percent stockholders complied with
all applicable Section 16(a) filing requirements on a timely basis.

Standards of Business Conduct and Ethics

The Board has adopted Standards of Business Conduct and Ethics that are
applicable to all employees and directors, including our Chief Executive
Officer, Chief Financial Officer, other executive officers and senior financial
personnel. A copy of our Standards of Business Conduct and Ethics is available
on our website at www.samaritanpharma.com. Information on our website is not
incorporated by reference. We intend to post any waiver of, or material changes
to, these Standards, if any, to our website within four business days of such
event.

The Board of Directors and Committees

The Board held in person meetings, conference calls or unanimous consents thirty
(30) times during the fiscal year ended December 31, 2006, of which twenty-seven
(27) were unanimous actions adopted by the Board. All of our directors attended
one hundred percent (100%) of the aggregate of the total number of meetings of
the Board. The Company has formed, by determination of the Board, an Audit
Committee, with Mr. H. Thomas Winn as Chairman, who is an independent director
and a financial expert as used in Item 7(d)(3)(iv) of Schedule 14 A (240.14a-101
of this chapter) under the Exchange Act. The Audit Committee held seven (7)
meetings during the fiscal year ended December 31, 2006. The Compensation
Committee, with Independent Director Ms. Cynthia C. Thompson as Chairman, held
two (2) meetings during the fiscal year ended December 31, 2006. The Nomination
Committee, with Independent Director Mr. Walter "Budd" Holden as Chairman held
one (1) meeting during the fiscal year ended December 31, 2006.

Class I directors shall serve until the 2007 annual meeting, Class II directors
shall serve until the 2009 annual meeting and Class III directors shall serve
until the 2008 annual meeting. Each director elected shall serve until his
successor is elected and duly qualified.

The Board currently does have a Nominating Committee that believes members of
the Board must possess certain basic personal and professional qualities in
order to properly discharge their fiduciary duties to stockholders, provide
effective oversight of the management of the Company and monitor the Company's
adherence to principles of sound corporate governance. Board nominations must be
selected by the Nomination Committee, which is comprised solely of independent
directors. Although there are formal procedures for you to nominate persons to
serve as directors, the Board will consider recommendations from you, which
should be addressed to Samaritan Pharmaceuticals, Inc., 101 Convention Center
Drive, Suite 310, Las Vegas, Nevada 89109. Our officers are elected by our Board
and serve until the earlier of their resignation or removal, or until their
successors have been duly elected and qualified.

Committees of the Board of Directors

The Board of Directors has established four committees: an Audit Committee, a
Compensation Committee, a Nominating and Corporate Governance Committee, and
Scientific and Technology Advisory Committee. Each of these committees has two
or more members who serve at the discretion of the Board of Directors. The Audit
Committee has a written charter approved by the Board of Directors and can be
found under the "Investor Relations" section of our website at
www.samaritanpharma.com. The members of the committees are identified in the
paragraphs that follow.

                                       41
<PAGE>

Audit Committee. Thomas Winn (Chairman), Cynthia Thompson and Douglas Bessert
currently serve on the Audit Committee. Consistent with SEC rules regarding
auditor independence, the Audit Committee has responsibility for appointing,
setting compensation and overseeing the work of the independent registered
public accounting firm. In recognition of this responsibility, the Audit
Committee has established a policy to pre-approve all audit and permissible
non-audit services provided by the independent registered public accounting
firm.

Compensation Committee. Cynthia Thompson (Chairman), Welter "Budd" Holden, and
Dr. Erasto Saldi currently serve on the Compensation Committee. The Compensation
Committee administers our executive compensation program. Each member of the
Committee is a non-employee and an independent director. The Compensation
Committee is responsible for establishing salaries and administering the
incentive programs for our Chief Executive Officer and other executive officers.
The Compensation Committee has designed the Company's compensation program based
on the philosophy that all of our executives are important to our success, with
our executive officers setting the direction of our business and having overall
responsibility for our results. As with other pharmaceutical companies, we
operate in a highly competitive and difficult economic environment. Accordingly,
the Compensation Committee has structured the Company's compensation to
accomplish several goals: (a) to attract and retain very talented individuals,
(b) to reward creativity in maximizing business opportunities and (c) to enhance
stockholder value by achieving our short-term and long-term business objectives.

Nominating and Corporate Governance Committee. Welter "Budd" Holden (Chairman),
Dr. Erasto Saldi, and Dr. Laurent Lecanu currently serve on the Nominating
Committee. The nominating committee is responsible for overseeing corporate
governance matters, reviewing possible candidates for Board membership and
recommending nominees for election. The Committee is also responsible for
evaluating the function and performance of the Board and overseeing the process
for performance evaluation of the Committees of the Board. Additionally, the
Committee reviews the Company's management succession plans and executive
resources.

Science and Technology Advisory Committee. Dr. Erasto Saldi (Chairman), Dr.
Laurent Lecanu, and Dr. Vassilios Papadopoulos currently serve on the Science
and Technology Advisory Committee. It advises the Board on scientific matters
that include major internal projects, interaction with academic and other
outside research organizations, and the acquisition of technologies and
products.

ITEM 11.  EXECUTIVE COMPENSATION

Compensation Discussion and Analysis

Overview. The Compensation Committee administers our executive compensation
program. Each member of the Compensation Committee is a non-employee and an
independent director. The Compensation Committee is responsible for establishing
salaries, administering the incentive programs, and determining the total
compensation for our Chief Executive Officer and other executive officers. The
Compensation Committee seeks to achieve the following goals with the Company's
executive compensation programs: to attract, motivate and retain key executives
and to reward executives for value creation. The Compensation Committee seeks to
foster a performance-oriented environment by tying a significant portion of each
executive's cash and equity compensation to the achievement of performance
targets that are important to the Company and its stockholders. The Company's
executive compensation program has three principal elements: base salary, cash
bonuses and equity incentives under the Amended Samaritan Pharmaceuticals, Inc.
2001 Stock Incentive Plan and Samaritan Pharmaceuticals, Inc. 2005 Stock
Incentive Plan.

                                       42
<PAGE>

We conducted an annual benchmark review of the aggregate level of our executive
compensation, as well as the mix of elements used to compensate our executive
officers. This review is based on a survey of executive compensation, "BioWorld
Executive Compensation Report", conducted by an independent third party, Thomson
BioWorld.

Compensation Philosophy. The Compensation Committee has designed the Company's
compensation program based on the philosophy that all of our executives are
important to our success, with our executive officers setting the direction of
our business and having overall responsibility for our results. As with other
pharmaceutical companies, we operate in a highly competitive and difficult
economic environment. Accordingly, the Compensation Committee has structured the
Company's compensation to accomplish several goals: (a) to attract and retain
very talented individuals, (b) to reward creativity in maximizing business
opportunities and (c) to enhance stockholder value by achieving our short-term
and long-term business objectives.

Elements of Compensation

Executive compensation consists of the following elements:

Base Salary. The Compensation Committee considers peer data as well as
individual performance when approving base salaries for executive officers. The
Compensation Committee evaluates individual performance based on the achievement
of corporate or divisional operating goals and subjective criteria, as well as
the Chief Executive Officer's evaluation of the other executive officers. No
specific weight is assigned to any particular factor. The Company is currently
negotiating new agreements with the Dr. Janet Greeson and Mr. Eugene Boyle. Dr.
Thomas Lang and Dr. Christos Dakas each have employment agreements negotiated at
arm's length with the Compensation Committee, and each such agreement provides
for a minimum annual base salary. In setting base salaries, the Board has
considered (a) the contributions made by each executive to our Company, (b)
compensation paid by peer companies to their executive officers and (c) outside
compensation reports. In 2006, all executive officers received salary increases
of approximately five percent (5%) reflecting competitive trends, general
economic conditions as well as a number of factors relating to the particular
individual, including the performance of the individual executive, and level of
experience, ability and knowledge of the job.

Bonuses. The Compensation Committee has the authority to award discretionary
bonuses to our executive officers. The incentive bonuses are intended to
compensate officers for achieving financial and operational goals and for
achieving individual annual performance objectives. These objectives vary
depending on the individual executive, but relate generally to strategic factors
such as a) initial signing of an employment agreement; b) upon acceptance of
filing of a new drug application by the FDA; c) the FDA approval to move from
one phase to the next phase in the FDA application process; d) pharmaceutical
sales goals achieved e) completion of an in-licensing contract; f) completion of
an out-licensing contract; and g) increases in market capitalization. The
Compensation Committee did not make any cash bonuses to the executive officers
in 2006.

                                       43
<PAGE>

Long-Term Incentive Program. We believe that long-term performance is achieved
through an ownership culture that encourages such performance by our executive
officers through the use of stock and stock-based awards. Our stock compensation
plans have been established to provide certain of our employees, including our
executive officers, with incentives to help align those employees' interests
with the interests of stockholders. The compensation committee believes that the
use of stock and stock-based awards offers the best approach to achieving our
compensation goals. We have not adopted stock ownership guidelines and our stock
compensation plans have provided the principal method for our executive officers
to acquire equity or equity-linked interests in our Company. We believe that the
annual aggregate value of these awards should be set near competitive median
levels for comparable companies. However, due to the early stage of our
business, we expect to provide a greater portion of total compensation to our
executives through our stock compensation plans than through cash-based
compensation. The Compensation Committee makes stock awards to executive
officers and this type of award may occur in future years, based on the
Compensation Committee's assessment of the Company's needs and objectives, which
are as follows.

Stock Options. Our Compensation Committee is the administrator of the stock
option plan. Stock option grants are made at the commencement of employment and,
occasionally, following a significant change in job responsibilities or to meet
other special retention or performance objectives. The Plans are designed to (a)
reward executives for achieving long-term financial performance goals over a
three (3) year to ten (10) year period, (b) provide retention incentives for
executives and (c) tie a significant portion of an executive's total
compensation to our long-term performance. Periodic stock option grants are made
at the discretion of the Compensation Committee to eligible employee and, in
appropriate circumstances, the Compensation Committee considers the
recommendations of members of management, such as Dr. Janet Greeson, our Chief
Executive Officer, and Eugene Boyle, Chief Financial Officer. In 2006, certain
named executive officers were awarded stock options in the amounts indicated in
the sections entitled "Summary Compensation Table" and "Grants of Plan Based
Awards". The short and long-term compensation program includes stock options
granted under the Amended Samaritan Pharmaceuticals, Inc. 2001 Stock Incentive
Plan and the Samaritan Pharmaceuticals, Inc. 2005 Stock Incentive Plan
(together, the "Plans") as well as non-qualified stock options. Stock options
for our executive officers, key employees and key consultants are part of our
incentive program and link the enhancement of shareholder value directly to
their total compensation. The Compensation Committee determines the number of
stock options granted based upon several factors: (a) level of responsibility,
(b) expected contribution towards our performance and (c) total compensation
strategy for mix of base salary, short-term incentives and long-term incentives.

Our Plans authorize us to grant options to purchase shares of common stock to
our employees, directors and consultants. Stock options granted by us typically
have an exercise price equal to the fair market value of our common stock on the
day of grant, and typically vest twenty-five percent (25%) over a particular
period, and generally expire between three and ten years after the date of
grant. Incentive stock options also include certain other terms necessary to
assure compliance with the Internal Revenue Code of 1986, as amended.

                                       44
<PAGE>

Stock Appreciation Rights. Our Amended Samaritan Pharmaceuticals, Inc. 2001
Stock Incentive Plan and the Samaritan Pharmaceuticals, Inc. 2005 Stock
Incentive Plan authorizes us to grant stock appreciation rights, or SARs. A SAR
represents a right to receive the appreciation in value, if any, of our common
stock over the base value of the SAR. The base value of each SAR equals the
value of our common stock on the date the SAR is granted. Upon surrender of each
SAR, unless we elect to deliver common stock, we will pay an amount in cash
equal to the value of our common stock on the date of delivery over the base
price of the SAR. SARs typically vest based upon continued employment on a
pro-rata basis over a four-year period, and generally expire ten years after the
date of grant. Our Compensation Committee is the administrator of our stock
appreciation rights plan. To date, no SARs have been awarded to any of our
executive officers.

Restricted Stock Grants. Our Compensation Committee has and may in the future
elect to make grants of restricted stock to our executive officers.

Other Compensation. The amounts shown in the Summary Compensation Table under
the heading "Other Compensation" represent the value of Company matching
contributions to the executive officers' 401(k) accounts and the taxable value
of certain life insurance benefits. Executive officers did not receive any other
perquisites or other personal benefits or property.

Chief Executive Officer Compensation. The Compensation Committee uses the same
factors in determining the compensation of the Chief Executive Officer as it
does for the executive officers. The Chief Executive Officer's base salary for
Fiscal 2006 was $482,434, and as of December 31, 2006, the Chief Executive
Officer has accrued compensation of $335,846 which could be converted into
restricted shares, at the executive's option. The Chief Executive Officer
received other compensation as indicated in the Summary Compensation Table.

The Compensation Committee is mindful of the potential impact upon the Company
of Section 162(m) of the Code, which provides that compensation in excess of
$1,000,000 paid to the President and CEO or to any of the other four most highly
compensated executive officers of a public company will not be deductible for
federal income tax purposes unless such compensation satisfies one of the
enumerated exceptions set forth in Section 162(m) of the Code. The Compensation
Committee has reviewed our compensation plans and programs with regard to the
deduction limitation set forth in Section 162(m) of the Code. Based on this
review, the Compensation Committee anticipates that the annual bonus, long term
incentive plan bonus and gain, if any, recognized by our President and CEO and
named executive officers upon the exercise of stock options or SARS meet the
requirements for deductibility under Section 162(m) of the Code.

Compensation Committee Report

The Compensation Committee of the Board is composed of three (3) independent
directors. The Compensation Committee does not have a written charter. The
Compensation Committee is responsible for overseeing the Company's compensation
process on behalf of the Board. The members of the Compensation Committee
consist of independent directors Ms. Cynthia C. Thompson, Chairman, Welter
"Budd" Holden, and Dr. Erasto Saldi.

                                       45
<PAGE>

The Compensation Committee has reviewed and discussed this Compensation
Discussion & Analysis (CD&A) with management. Based on the review and
discussions, the Compensation Committee recommended to the Board that the CD&A
be included in the Company's Annual Report on Form 10-K for the year ended
December 31, 2006, for filing with the SEC and as applicable, the Company's
proxy or information statement.

The foregoing report is provided by the following directors, who constitute the
Compensation Committee:

The Compensation Committee:

         Ms. Cynthia C. Thompson (Chairman)
         Mr. Welter "Budd" Holden
         Dr. Erasto Saldi


                                       46
<PAGE>

Summary Compensation Table

<TABLE>
<CAPTION>

                                                                                                Change In
                                                                                                 Pension
                                                                                                Value and
                                                                                  Non-Equity   Nonqualified
                                                                                  Incentive     Deferred
                                                      Restricted     Option         Plan      Compensation  Compen-       Other
                                     Salary   Bonus  Stock Awards  Awards(6)    Compensation    Earnings     sation       Total
Name And Principal Position  Year       $       $          $            $             $             $       $(7),(8)        $
---------------------------  ----    -------  -----  ------------  ----------   ------------   ------------ --------     --------
<S>                          <C>     <C>        <C>        <C>          <C>           <C>           <C>      <C>         <C>
Dr. Janet R. Greeson         2006    482,434   -0-        -0-          -0-           -0-           -0-       10,799      493,233
CEO, President and           2005    459,461   -0-        -0-          -0-           -0-           -0-       8,850       468,311
Chairman of the Board (1),
  (2)                        2004    437,582   -0-        -0-          -0-           -0-           -0-       19,559      457,141


Mr. Eugene J. Boyle          2006    321,622   -0-        -0-          -0-           -0-           -0-       9,213       330,835
CFO and COO (1), (3)         2005    306,307   -0-        -0-          -0-           -0-           -0-       6,857       313,164
                             2004    291,721   -0-        -0-          -0-           -0-           -0-       2,698       294,419

Dr. Thomas Lang              2006    324,188   -0-        -0-          -0-           -0-           -0-       15,190      339,378
Chief Drug Development       2005    308,750   -0-        -0-          -0-           -0-           -0-       11,190      319,940
Officer (4)                  2004    173,538   -0-        -0-          -0-           -0-           -0-       3,742       177,280


Dr. Christos Dakas           2006   136,075    -0-        -0-          -0-           -0-           -0-       16,611      152,686
Managing Director -          2005    68,038    -0-        -0-          -0-           -0-           -0-       8,306        76,344
Samaritan Europe(5)

Mr. George Weaver(1)         2006    129,675   -0-        -0-         10,428         -0-           -0-       8,386       148,489
Regulatory Affairs           2005    123,500   -0-        -0-          -0-           -0-           -0-       6,283       129,783
                             2004    120,000   -0-        -0-          -0-           -0-           -0-       2,409       122,409
</TABLE>

1)       The following executives have accrued compensation as of December 31,
         2006, Janet Greeson, $335,846, Eugene Boyle, $170,506, George Weaver,
         $91,686 and Thomas Lang, $7,234. Each executive has the option to
         convert their respective accrued compensation into restricted shares.
         In 2006, George Weaver exercised his option and the Board of Directors
         approved the conversion of $90,000 into restricted shares. As of
         December 31, 2006, the restricted shares have not been issued, since
         the Company was awaiting an additional share application approval from
         the AMEX. Subsequently, the shares were issued in the 1st Quarter 2007.
2)       The Company and Dr. Greeson have entered into an employment agreement,
         a copy of which is attached as Exhibit 10.9 to the Company's Quarterly
         Report on Form 10-QSB as filed with the SEC on August 14, 2002. The
         agreement filed on August 14, 2002 expired as of December 31, 2005. The
         Company is currently negotiating a new agreement with the Dr. Greeson.
3)       The Company and Mr. Boyle have entered into an employment agreement, a
         copy of which is attached as Exhibit 10.8 to the Company's Quarterly
         Report on Form 10-QSB as filed with the SEC on August 14, 2002. The
         agreement filed on August 14, 2002 expired as of December 31, 2005. The
         Company is currently negotiating a new agreement with Mr. Boyle.
4)       On June 1, 2004, the Company entered into an employment agreement with
         Dr. Thomas Lang pursuant to which Dr. Lang shall serve as the Company's
         Chief Drug Development Officer for a term of four (4) years. Dr. Lang
         is entitled to a base salary of $300,000 per year which may be paid in
         stock pursuant to a formula as set forth in the agreement. Dr. Lang is
         entitled to receive bonus payments of $50,000 for each Investigational
         New Drug Applications "granted" by the FDA. Dr. Lang has received a
         one-time signing bonus of 100,000 options to purchase our Common Stock
         at $1.00 per share, such options to expire after three (3) years. Dr.
         Lang is entitled to moving expenses up to $30,000. Dr. Lang shall
         receive a grant of 1,200,000 options, one-quarter (1/4) of which shall
         vest each year. The price of the options shall be $1.08 with a term of
         ten (10) years. Upon termination of the employment agreement, such
         1,200,000 options (vested and non-vested) shall expire within thirty
         (30) days thereafter. Dr. Lang shall have the opportunity to
         participate in all of the Company's qualified defined benefit and
         defined contribution retirement plans (subject to eligibility
         requirements in such plans), three (3) weeks paid vacation (and paid
         holidays observed by the Company.

                                       47
<PAGE>

5)       On June 29, 2005 the Company entered into an employment arrangement
         with Christos Dakas to serve as the European Business Development and
         Managing Director of Samaritan Pharmaceuticals S.A. in Greece, once
         such entity is established ("Samaritan Pharmaceuticals Europe"). Dr.
         Dakas shall receive a base salary of (Euro) 105,280 per year, a car
         allowance equal to (Euro) 12,852 per year and a performance based bonus
         to be awarded annually at the discretion of the CEO of the Company. Dr.
         Dakas also is entitled to receive 100,000 Company stock options priced
         at one hundred ten percent (110%) of the market price effective July
         11, 2005 and said options expire after three (3) years, or after thirty
         (30) days after Dr. Dakas leaves his employ with Samaritan
         Pharmaceuticals Europe. Dr. Dakas is entitled to health insurance and
         other benefit programs per Samaritan Pharmaceuticals Europe. The
         amounts shown in this column cover amounts for the payment of
         Medicare/Social Security taxes, life insurance premiums and life
         annuity premiums for the benefit of the particular employee, and the
         employers matching contribution to the particular employees 401(k).
6)       Effective January 1, 2006, the Company has fully adopted the provisions
         of SFAS No. 123R and related interpretations as provided by SAB 107. As
         such, compensation cost is measured on the date of the grant as the
         excess of the current market price of the underlying stock over the
         exercise price. Such compensation amounts, if any, are amortized over
         the respective vesting periods of the option grant. The Company applies
         this statement prospectively. Had the Company applied this statement
         retrospectively, the amount in this column for fiscal year 2005, Eugene
         Boyle would have been $1,297,831, and Dr. Christos Dakas would have
         been $14,320; the amount for fiscal year 2004, Dr. Janet Greeson would
         have been $2,024,871, Eugene Boyle would been $912,069, Dr. Thomas Lang
         would have been $1,114,625 and George Weaver would have been $5,660.
         These amounts represent the estimated present value of these stock
         options at the respective date of grant, calculated using the
         Black-Scholes option pricing model, based on the following assumptions
         used in developing the grant valuations: an volatility of 110% for
         options granted for 2006; an average volatility of 41% for options
         granted during 2005 and an average volatility of 82% for options
         granted during 2004; a risk-free interest rate of 5% per year for
         options granted in 2006, 2005 and 2004; and a dividend yield of 0% for
         options granted in years 2006, 2005 and 2004. The actual value of the
         options, if any, realized by an officer will depend on the extent to
         which the market value of the Common Stock exceeds the exercise price
         of the option on the date the option is exercised. Consequently, there
         is no assurance that the value realized by an officer will be at or
         near the value estimated above. These amounts should not be used to
         predict stock performance.
7)       The amounts shown in this column cover amounts for the payment of
         medical and dental insurance, short and long term disability insurance,
         Medicare/Social Security taxes, car allowances, life insurance
         premiums, life annuity premiums and accidental death and dismemberment
         insurance for the benefit of the particular employee, and the employers
         matching contribution to the particular employees 401(k).
8)       We adopted a tax-qualified employee savings and retirement plan, or
         401(k) plan, covering our full-time employees located in the United
         States. The 401(k) plan is intended to qualify under Section 401(k) of
         the Internal Revenue Code of 1986, as amended (the "Code"), so that
         contributions to the 401(k) plan by employees, and the investment
         earnings thereon, are not taxable to employees until withdrawn from the
         401(k) plan. Under the 401(k) plan, employees may elect to reduce their
         current compensation up to the statutorily prescribed annual limit and
         have the amount of such contribution contributed to the 401(k) plan.
         The 401(k) plan does permit additional matching contributions to the
         401(k) plan by us on behalf of participants in the 401(k).

Grants of Plan-Based Awards

Options to purchase 60,000 shares of the Company's common stock were granted
under the Option Plan to the executive officers named in the Summary
Compensation Table during fiscal 2006. The following table shows the number of
options granted and the exercise price per share.

<TABLE>
<CAPTION>


                                         Number of
                                         Securities
                          Grant          Underlying     Exercise or Base
Name                       Date           Options        Price of Option      Expiration Date
---------------------    -----------     -----------    -----------------     ---------------
<S>                                          <C>                <C>                     <C>
Dr. Janet R. Greeson       N/A              -0-                -0-                     -0-
Mr. Eugene J. Boyle        N/A              -0-                -0-                     -0-
Mr. Thomas Lang            N/A              -0-                -0-                     -0-
Dr. Christos Dakas         N/A              -0-                -0-                     -0-
Mr. George Weaver (1)     12/15/2006     60,000                .25              12/15/2011
</TABLE>


                                       48
<PAGE>

1) In December 2006, the Compensation Committee evaluated George Weaver and
awarded 60,000 stock options which vest in equal quarterly installments
beginning on March 15, 2007. The Compensation Committee determines the number of
stock options granted based upon several factors: (a) level of responsibility,
(b) expected contribution towards our performance and (c) total compensation
strategy for mix of base salary, short-term incentives and long-term incentives.

Outstanding Equity Awards at Fiscal Year-End

The following table sets forth information with respect to the unexercised
options to purchase shares of the Company's common stock granted under the
Option Plan to the executive officers named in the Summary Compensation Table
and held by them at December 31, 2006.

<TABLE>
<CAPTION>

                                Number of         Number of
                               Securities        Securities
                               Underlying        Underlying
                               Unexercised       Unexercised                             Option
                                 Options          Options #       Option Exercise   Expiration Date
           Name               # Exercisable     Unexercisable          Price
---------------------------- ---------------- ------------------ ------------------ -----------------
<S>                                <C>                <C>               <C>         <C>   <C>
Janet Greeson                      1,532,210         -0-                .58         12/31/2011
                                   1,532,210         -0-                .58         01/02/2012
                                   1,779,684         -0-                .58         04/25/2012
                                   2,582,238         -0-                .58         01/15/2013
                                   2,807,350         -0-                .34         01/02/2014
                                   1,446,210         -0-                .58         01/02/2014

Eugene Boyle                         766,105         -0-                .58         12/31/2011
                                     766,104         -0-                .58         01/02/2012
                                     444,921         -0-                .58         04/25/2012
                                   1,291,118         -0-                .58         01/15/2013
                                   1,590,085         -0-                .34         01/02/2014
                                     536,695         -0-                .58         01/02/2014
                                   2,641,088         -0-                .93         01/05/2015

Thomas Lang                           25,000         -0-                .50         10/09/2008
                                     600,000       600,000             1.08         06/01/2014
                                     100,000         -0-               1.00         06/01/2007

Christos Dakas                       100,000         -0-                .49         07/11/2008

George Weaver                         50,000         -0-                .34         01/02/2014
</TABLE>

Option Exercises and Stock Vested

The following table sets forth information with respect to the option exercises
and stock vested as of December 31, 2006:

<TABLE>
<CAPTION>

 Name of Executive
      Officer                      Option Awards                             Stock Awards
-------------------- ------------------------------------------- -------------------------------------
                                              Number of Shares      Number of
                        Number of Shares         Acquired On     Shares Acquired    Value Realized on
                      Acquired On Exercise         Exercise         on Vesting          Exercise
                                #                     #                 $                  $
<S>                             <C>                   <C>               <C>                <C>
Janet Greeson                  -0-                   -0-               -0-                -0-
Eugene Boyle                   -0-                   -0-               -0-                -0-
Thomas Lang                    -0-                   -0-               -0-                -0-
Christos Dakas                 -0-                   -0-               -0-                -0-
George Weaver                  -0-                   -0-               -0-                -0-
</TABLE>


                                       49
<PAGE>

Retirement Plan Potential Annual Payments and Benefits

None of our named executives participate in or have account balances in
qualified or non-qualified defined benefit plans sponsored by us. The
Compensation Committee, which is solely comprised of "outside directors" as
defined for purposes of Section 162(m) of the Code, may elect to adopt qualified
or non-qualified defined benefit plans if the Compensation Committee determines
that doing so is in our best interests.

Nonqualified Defined Contribution and Other Deferred Compensation Plans

The Company has established "Rabbi Trust" agreements for the benefit of select
management and highly-compensated employees and has appointed a trustee that is
a non-director and officer providing for the payment out of the assets of the
Rabbi Trust agreements accrued under the Company's various employment agreements
and other employment arrangements as the Company may specify from time to time.
The Rabbi Trust agreements would become irrevocable upon a change of control of
Samaritan. The Company may make contributions to the Rabbit Trust agreements
from time to time, and additional funding may be required upon a change of
control. To the extent funded, the Rabbi Trust agreements are to be used,
subject to their terms and to the claims of the Company's general creditors in
specified circumstances, to make payments under the terms of the benefit plans,
employment agreements and other employment arrangements as the Company may
specify from time to time. To date, only restricted shares have been deferred
into the nonqualified deferred compensation plan, thus the plan will be settled
in restricted shares.

<TABLE>
<CAPTION>

                               Executive         Registrant        Aggregate        Aggregate           Aggregate
                           Contributions in   Contributions in    Earnings in      Withdrawals/      Balance at Last
                                Last FY            Last FY          Last FY     Distributions (3)        FYE (4)
          Name                     $                  $                $                $                   $
-------------------------- ------------------ ------------------ -------------- ------------------- ------------------
<S>           <C>                  <C>                <C>              <C>           <C>                <C>
Janet Greeson (1)                 -0-                -0-              -0-            540,000            1,952,687
Eugene Boyle (1)                  -0-                -0-              -0-              -0-              2,294,289
Thomas Lang (1)                   -0-                -0-              -0-              -0-                 -0-
Christos Dakas                    -0-                -0-              -0-              -0-                 -0-
George Weaver (1)                 -0-                -0-              -0-              -0-               141,775
Doug Bessert (1), (2)             -0-                -0-              -0-            231,081             835,800
</TABLE>

1)       As of April 6, 2007, the Company has issued 22,764,894 shares into the
         Rabbi Trust with the following credit allocation: Dr. Janet Greeson
         9,298,509; Mr. Eugene J. Boyle 10,425,186; Dr. Vassilios Papadopoulos
         1,497,845; Mr. George Weaver 825,117; Mr. Welter "Budd" Holden 518,237;
         Ms. Cynthia C. Thompson 100,000; Mr. H. Thomas Winn 80,000; and Dr.
         Erasto R. C. Saldi 20,000.
2)       In February 2004, Doug Bessert, left the Company for personal reasons
         but remains a Member of the Board of Directors. Under his agreement, a
         voluntary resignation entitles him to retain all benefits which vested
         prior to his voluntary resignation in accordance with the rules and
         procedures then in effect with respect to vesting.
3)       The $0.27 price per share of the Company's securities is the closing
         market price as of October 17, 2006.
4)       The $0.21 price per share of the Company's securities is the closing
         market price as of December 29, 2006.

Discussion of Director Compensation

Directors who are employees of the Company do not receive additional
compensation for serving as directors. Each director who is not an employee of
the Company receives a grant of a non-qualified stock option to purchase 10,000
shares of our common stock, annually as compensation for his or her services as
a member of the Board of Directors. Non-employee directors receive no additional
fee for meetings of the Board of Directors attended in person by such director
or for each telephone meeting in which such director participates. Non-employee
directors who serve on a committee of the Board receive a grant of a
non-qualified stock option to purchase 10,000 shares of our common stock,
annually as compensation for his or her services as a member of such committee.
Chairmen of the committees receive a grant of a non-qualified stock option to
purchase 20,000 shares of our common stock annually as compensation for his or
her services as a chairman of such committee. All directors of the Company are
reimbursed for out-of-pocket expenses incurred in attending meetings of the
Board or committees thereof, and for other expenses incurred in their capacities
as directors of the Company.

                                       50
<PAGE>

The following director compensation table sets forth the total annual
compensation paid or accrued by the Company to or for the account of each member
of the Board of the Company except the Chief Executive Officer, Dr. Janet
Greeson, and Chief Financial Officer, Mr. Eugene Boyle, who receive no
additional compensation in their individual capacity as Board members:

<TABLE>
<CAPTION>

Director Compensation Table
                               Fees
                              Earned or                                 Non-Stock
                               Paid in    Stock          Option      Incentive Plan         All Other
Name                            Cash        Awards     Awards(1)      Compensation        Compensation            Total
                                  $           $            $                $                   $                   $
---------------------------- ------------ ----------- ------------- ------------------ -------------------- -------------------
<S>                               <C>         <C>        <C>                <C>                 <C>               <C>
Thomas Winn                      -0-         -0-         16,240            -0-                 -0-                16,240
Cynthia Thompson                 -0-         -0-         24,360            -0-                 -0-                24,360
Welter "Budd" Holden             -0-         -0-         16,240            -0-                 -0-                16,240
Doug Bessert                     -0-         -0-         6,090             -0-                 -0-                6,090
Erasto Saldi                     -0-         -0-         16,240            -0-                 -0-                16,240
Laurent Lecanu                   -0-         -0-         16,240            -0-                 -0-                16,240
</TABLE>

1)       Effective January 1, 2006, the Company has fully adopted the provisions
         of SFAS No. 123R and related interpretations as provided by SAB 107. As
         such, compensation represents the estimated present value of these
         stock options at the respective date of grant, calculated using the
         Black-Scholes option pricing model, based on the following assumptions
         used in developing the grant valuations an volatility of 98% for
         options granted; a risk-free interest rate of 5% per year for options;
         and a dividend yield of 0% for options granted in years 2006. The
         actual value of the options, if any, realized by an officer will depend
         on the extent to which the market value of the Common Stock exceeds the
         exercise price of the option on the date the option is exercised.
         Consequently, there is no assurance that the value realized by an
         officer will be at or near the value estimated above. These amounts
         should not be used to predict stock performance.

Change of Control Plan

On May 30, 2006 the Board approved and adopted the Change in Control Severance
Plan for Certain Covered Executives and Employees of Samaritan Pharmaceuticals
(the "Change in Control Plan"), effective May 30, 2006. The Change in Control
Plan is intended to help avoid the loss and distraction of certain key employees
of the Company in the event of a change in control. The Plan has an initial term
of three (3) years with automatic three-year extensions, unless terminated by
the Board at least six (6) months prior to the end of the then current term.

The Chief Executive Officer, Chief Financial Officer, Chief Operating Officer,
Senior Vice Presidents, Vice Presidents, and Directors are eligible to
participate in the Change in Control Plan, and the Board may designate other
employees of the Company as Plan participants. The Company shall pay or cause to
be paid to the participant a cash severance calculated based on a multiplier of
four (4) months of base salary for every year of service up to maximum in of
either twenty four (24) months or thirty six (36) months depending on the
participants job title or job category. The severance amount equals the
applicable multiplier times the sum of (A) the participant's highest annual rate
of base salary as reported on the participant's W-2 for employee or on the
participant's 1099 for directors within the thirty six (36) month period
immediately preceding the Effective Date of the change in control and (B) the
participant's maximum annual target bonus in effect upon the date of the change
in control under the Company's bonus plan or the Participant's actual earned
commission incentive for the last two quarters, which will be annualized, prior
to the change in Control, not to exceed the target at 100% of achievement as
defined in the Company's Sales Incentive Plan in effect upon the date of the
change in control.

                                       51
<PAGE>

The Change in Control Plan provides that, if, within three years following a
"change in control" (as defined in the Change in Control Plan), a participant's
employment is terminated by the Company without "cause" (as defined in the Plan)
or by the participant for "good reason" (as defined in the Change in Control
Plan), the participant is eligible for severance benefits equal to a multiple of
the sum of the participant's base salary and the higher of the participant's
target bonus opportunity during the year in which the change in control occurs
or his or her target bonus opportunity following the change in control. Each
participant will also receive his or her salary through the date of termination,
a pro rata target bonus payment for the year in which the termination occurs, a
pro rata long-term incentive payment to the extent provided in the Company's
Long Term Incentive Plan, and any earned but unpaid long-term incentive payments
or annual bonuses. In the event that a participant becomes subject to an excise
tax under section 280G of the Internal Revenue Code of 1986, as amended, the
participant will generally be entitled to receive an additional amount such that
the participant is placed in the same after-tax position as if no excise tax had
been imposed. The Change in Control Plan may be amended by the Board at any
time, except that no amendment that adversely affects the rights or potential
rights of a participant will be effective in the event that a change in control
occurs within three (3) year of such amendment.

In the event the named executive officers were terminated without "cause" or
they terminated their employment for "good reason" following a change of
control, the named executive officers would receive the following severance
payments (based on current salary rates, the average bonuses of the named
executive officers for the last three fiscal years as the highest bonus and
additional retirement benefits). Assuming the employment of our executive
officers were to be terminated without cause (whether through constructive
termination or otherwise) on December 31, 2006, the following individuals would
be entitled to payments in the amounts set forth: Dr. Janet Greeson, $1,286,496;
Eugene Boyle, $643,248; Dr. Thomas Lang, $244,970; Dr. Christos Dakas, $68,037;
and George Weaver, $130,731. The foregoing does not include any amounts that
would be payable under the "gross-up" provisions of the change of control
employment agreements, or any amounts attributable to the accelerated vesting of
equity awards upon a change of control.

                                       52
<PAGE>

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDERS MATTERS.

Equity Compensation Plan Information
<TABLE>
<CAPTION>

                                                                         Number Of
                                                                         Securities To     Weighted
                                                                         Be Issued Upon    Average
                                                                         Exercise Of       Exercise Price
                                                                         Outstanding       Of Outstanding    Number Of
                                                                         Options,          Options,          Securities
                                                                         Warrants And      Warrants          Remaining For
Name Of Plan                                                             Rights            And Rights        Future Issuance
----------------------------------------------------------------         --------------   ---------------    ---------------
<S>                                                    <C> <C>            <C>                <C>              <C>
Equity compensation plans approved by security holders (1) (2)            25,718,518         $0.62            21,277,294

Equity compensation plans not approved by security holders (3)            29,094,894         $0.27                     0
                                                                         --------------   ----------------   ---------------
Total                                                                     54,813,412                          21,277,294
                                                                         ==============                      ===============
</TABLE>

1) The Amended Samaritan Pharmaceuticals, Inc. 2001 Stock Incentive Plan was
filed as Exhibit 4.2 to the Company's Quarterly Report on Form 10-QSB, as filed
with the SEC on August 16, 2004.
2) The Samaritan Pharmaceuticals, Inc. 2005 Stock Incentive Plan was filed with
the SEC on Schedule 14A as filed with the SEC on April 29, 2005.
3) Samaritan has entered into "Rabbi Trust" agreements to fund deferred
compensation benefits, with an institutional trustee providing for the payment
out of the assets of the trusts of benefits accrued under our various benefit
plans, employment agreements and other employment arrangements as the Company
specifies from time to time. To the extent not already irrevocable, the trusts
would become irrevocable upon a change of control of Samaritan. The Company may
contribute to the trusts from time to time, and additional funding could be
required upon a change of control. The Rabbi Trust agreements are subject to
their terms and to the claims of our general creditors in specified
circumstances, to make payments under the terms of the benefit plans, employment
agreements and other employment arrangements from time to times specified by the
Company.

Beneficial ownership is determined in accordance with the rules of the SEC.
Except as indicated by footnote, to our knowledge, the persons named in the
table below have sole voting and investment power with respect to all shares of
common stock shown as beneficially owned by them. Options to purchase shares of
the our common stock that are exercisable within sixty (60) days of April 25,
2007 are deemed to be beneficially owned by the person holding such options for
the purpose of computing ownership of such person, but are not treated as
outstanding for the purpose of computing the ownership of any other person.
Applicable percentage of beneficial ownership is based on 159,422,456 shares of
common stock outstanding as of April 25, 2007.

The following table sets forth information we know with respect to the
beneficial ownership of our common stock as of April 25, 2007, for each person
or group of affiliated persons, whom we know to beneficially own more than 5% of
our common stock. The table also sets forth such information for our directors
and executive officers, individually and as a group. The address for each listed
stockholder is: c/o Samaritan Pharmaceuticals, Inc., 101 Convention Center
Drive, Suite 310, Las Vegas, Nevada 89109.

                                       53
<PAGE>

<TABLE>
<CAPTION>

                                                                                                   Percentage of
                                                                                 Total Number of       Total
                                                 Number of        Number of        Options and    Number of Shares
                                                   Shares          Options           Shares         and Options
                                               Beneficially      Beneficially     Beneficially      Beneficially
Beneficial Owner                                   Owned            Owned           Owned (1)          Owned
--------------------------------------         ------------      ------------    ---------------  ----------------
<S>                                              <C>              <C>              <C>                 <C>
Dr. Janet R. Greeson                             6,447,642        11,679,902       18,127,544          11.4%
Mr. Eugene J. Boyle                              2,007,106         8,036,116       10,043,222           6.3%
Dr. Thomas Lang                                    107,143         1,325,000        1,432,143            *
Ms. Kristi C. Eads                                 345,000            60,000          405,000            *
Mr. George Weaver                                      -0-           110,000          110,000            *
Dr. Laurent Lecanu                                  50,000            80,000          130,000            *
Mr. Douglas D. Bessert                           4,855,855            30,000        4,885,855           3.1%
Dr. Erasto R.C. Saldi                               46,380            80,000          126,380            *
Mr. Welter "Budd" Holden                         2,635,147            80,000        2,715,147           1.7%
Mr. H. Thomas Winn                                 100,000            80,000          180,000            *
Ms. Cynthia C. Thompson                            743,555           120,000          863,555            *
All Executive officers and directors
   as a group (eleven persons)                  17,337,828        21,681,018       39,018,846          24.5%
Dr. Vassilios Papadopoulos (2)                     100,000         1,750,000        1,850,000          1.16%
Dr. Christos Dakas (3)                                 -0-           100,000          100,000            *

                                                                                        *Less than one percent (1%)
</TABLE>

1)       If an officer or director had previously elected to exercise options or
         deferred compensation through a program that involves the crediting of
         deferred shares of the Company's Common Stock held pursuant to the
         Trust under Samaritan Pharmaceuticals, Inc. Executive Benefit Plan (the
         "Rabbi Trust") for distribution to the executive after termination of
         employment, the shares were excluded from the above calculation. As of
         April 6, 2007, the Company has issued 22,764,894 shares into the Rabbi
         Trust with the following credit allocation: Dr. Janet Greeson
         9,298,509; Mr. Eugene J. Boyle 10,425,186; Dr. Vassilios Papadopoulos
         1,497,845; Mr. George Weaver 825,117; Mr. Welter "Budd" Holden 518,237;
         Ms. Cynthia C. Thompson 100,000; Mr. H. Thomas Winn 80,000; and Dr.
         Erasto R. C. Saldi 20,000.
2)       Dr. Vassilios Papadopoulos is a key consultant for Samaritan and a
         former officer and director.
3)       Dr. Christos Dakas is an executive of our subsidiary, Samaritan Europe.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
INDEPENDENCE

We have entered into indemnity agreements with all directors, and officers and
certain employees, which provide, among other things, that we will indemnify
such officer or director, under the circumstances and to the extent provided for
in the agreements, for expenses, damages, judgments, fines and settlements he or
she may be required to pay in actions or proceedings which he or she is or may
be made a party to by reason of his or her position as a director, officer or
other agent of the Company, and otherwise to the full extent permitted under
Nevada law and our bylaws. The Company filed a form of the agreement as Exhibit
10.17 to the Company's Quarterly Report on Form 10-Q as filed with the SEC on
August 14, 2006.

Policies and Procedures for Approval of Related Person Transactions

Our policy and procedures with respect to any related person transaction between
the Company and any related person requiring disclosure under Item 404(a) of
Regulation S-K under the Securities Exchange Act of 1934, is that such
transaction is consummated only if the Audit Committee approves or ratifies such
transaction; the disinterested members of the Board of Directors approves or
ratifies such transaction; or the transaction involves compensation approved or
ratified by the Compensation Committee.

Director Independence

The Company's Board of Directors is made up of the following members: Dr. Janet
Greeson, Mr. Eugene Boyle, Mr. Thomas H. Winn, Ms. Cynthia Thompson, Mr. Welter
"Budd" Holden, Mr. Doug Bessert, Dr. Erasto Saldi and Dr. Lecanu Laurent. The
Board has determined that a majority of the Company's directors and all current
members of the Audit, Compensation, and Nominating Committees are "independent"
under Section 121A of the American Stock Exchange ("AMEX") Company Guide. The
Board has also determined that the members of the Audit Committee meet the
additional independence standards set forth by Rule 10A-3 under the Securities
Exchange Act of 1934 and Section 121B of the AMEX Company Guide. The independent
directors are Mr. Thomas H. Winn, Ms. Cynthia Thompson, Mr. Welter "Budd"
Holden, Mr. Doug Bessert, Dr. Erasto Saldi and Dr. Lecanu Laurent.

There were no undisclosed transactions, relationships or arrangements pursuant
to Item 404(a) (related-party transactions) that were considered by the Board
under the applicable independence definitions in determining that the director
is independent.

                                       54
<PAGE>

ITEM 14.   PRINCIPAL ACCOUNTING FEES AND SERVICES

Audit and Non-Audit Fees

The following table presents fees for professional audit services rendered by
SHERB & CO., LLP for the audit of the Company's annual financial statements for
the fiscal years ended December 31, 2006 and December 31, 2005, and fees billed
for other services rendered by SHERB & CO LLP during those periods:


                           2006        2005
                           -------     -------

Audit fee:                 $45,000     $33,000
Audit-related fees:        $15,000     $ 9,000
Tax fees:                  $     -     $     -
Other:                     $4,025      $ 1,385
                           --------    --------
Total:                     $64,025     $43,385



Audit fees consisted principally of audit work performed on the consolidated
financial statements and internal control over financial reporting, as well as
work generally only the independent registered public accounting firm can
reasonably be expected to provide, such as statutory audits. The Company
generally does not engage SHERB & CO LLP, for other services, other than Edgar
services.

Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit
Services of Independent Registered Public Accounting Firm

Consistent with SEC rules regarding auditor independence, the Audit Committee
has responsibility for appointing, setting compensation and overseeing the work
of the independent registered public accounting firm. In recognition of this
responsibility, the Audit Committee has established a policy to pre-approve all
audit and permissible non-audit services provided by the independent registered
public accounting firm.

Prior to engagement of the independent registered public accounting firm for the
next year's audit, management will submit a list of services and related fees
expected to be rendered during that year within each of categories of services
to the Audit Committee for approval.

Audit services include audit work performed on the financial statements and
internal control over financial reporting, as well as work that generally only
the independent registered public accounting firm can reasonably be expected to
provide, including comfort letters, statutory audits and discussions surrounding
the proper application of financial accounting and/or reporting standards.

                                       55
<PAGE>

Audit-Related services are for assurance and related services that are
traditionally performed by the independent registered public accounting firm,
including due diligence related to mergers and acquisitions, employee benefit
plan audits, and special procedures required to meet certain regulatory
requirements.

Tax services include all services, except those services specifically related to
the audit of the financial statements, performed by the independent registered
public accounting firm's tax personnel, including tax analysis; assisting with
coordination of execution of tax-related activities, primarily in the area of
corporate development; supporting other tax-related regulatory requirements; and
tax compliance and reporting.

All Other services are those services not captured in the audit, audit-related
or tax categories.

The Company generally does not request such services from the independent
registered public accounting firm. Prior to engagement, the Audit Committee
pre-approves independent public accounting firm services within each category
and the fees for each category are budgeted. The Audit Committee requires the
independent registered public accounting firm and management to report actual
fees versus the budget periodically throughout the year by category of service.
During the year, circumstances may arise when it may become necessary to engage
the independent registered public accounting firm for additional services not
contemplated in the original pre-approval categories. In those instances, the
Audit Committee requires specific pre-approval before engaging the independent
registered public accounting firm.

The Audit Committee may delegate pre-approval authority to one (1) or more of
its members. The member to whom such authority is delegated must report, for
informational purposes only, any pre-approval decisions to the Audit Committee
at its next scheduled meeting.

Audit Committee Report

The Audit Committee of the Board is composed of three (3) independent directors.
The Audit Committee operates under a written charter adopted by the Board and
attached as Exhibit A to the proxy statement filed with the SEC on April 3,
2001.

The Audit Committee is responsible for overseeing the Company's financial
reporting process on behalf of the Board. The members of the Audit Committee
consist of independent directors Mr. H. Thomas Winn, Ms. Cynthia C. Thompson and
Mr. Douglas Bessert. Each year, the Audit Committee recommends to the Board,
subject to stockholder ratification, the selection of the Company's independent
auditors.

Management is responsible for the Company's financial statements and the
financial reporting process, including internal controls. The independent
auditors are responsible for performing an independent audit of the Company's
consolidated financial statements in accordance with generally accepted auditing
standards and for issuing a report thereon. The Audit Committee's responsibility
is to monitor and oversee these processes.

                                       56
<PAGE>

In this context, the Audit Committee has met and held discussions with
management and SHERB & CO., LLP. Management represented to the Committee that
the Company's consolidated financial statements were prepared in accordance with
generally accepted accounting principles, and the Audit Committee has reviewed
and discussed the consolidated financial statements with management and the
independent auditors. The Audit Committee discussed with SHERB & CO., LLP the
matters required to be discussed by Statement on Auditing Standards No.
61(Communication with Audit Committees). These matters included a discussion of
SHERB & CO., LLP's judgments about the quality (not just the acceptability) of
the Company's accounting principles as applied to financial reporting.

SHERB & CO., LLP also provided the Audit Committee with the written disclosures
and letter required by Independence Standards Board Standard No. 1(Independence
Discussions with Audit Committees), and the Audit Committee discussed with SHERB
& CO., LLP that firm's independence. The Audit Committee further considered
whether the provision by SHERB & CO., LLP of the non-audit services described
elsewhere in this proxy statement is compatible with maintaining the auditors'
independence.

Based upon the Audit Committee's discussion with management and the independent
auditors and the Audit Committee's review of the representation of management
and the disclosures by the independent auditors to the Audit Committee, the
Audit Committee recommended to the Board that the Company's audited consolidated
financial statements be included in the Company's Annual Report on Form 10-K for
the year ended December 31, 2006, for filing with the SEC. The Audit Committee
and the Board have also recommended the selection of SHERB & CO., LLP as the
Company's independent auditors for 2007, subject to stockholder ratification.

The Audit Committee Report does not constitute soliciting material, and shall
not be deemed to be filed or incorporated by reference into any other Company
filing under the Securities Act of 1933, as amended, or the Exchange Act, except
to the extent that the Company specifically incorporates the Audit Committee
Report by reference therein.

The Audit Committee:

         Mr. H. Thomas Winn (Chairman)
         Ms. Cynthia C. Thompson
         Mr. Douglas Bessert

                                       57
<PAGE>

                                     PART IV

ITEM 15.  EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

Listed below are all exhibits filed as part of this Annual Report on Form 10-K.
Some exhibits are filed by the Company with the SEC pursuant to Rule 12b-32
under the Securities Exchange Act of 1934, as amended.

<TABLE>
<CAPTION>

EXHIBIT NO.        DESCRIPTION                                         LOCATION
------------------ -------------------------------------------------   --------------------------------------------
<S>                                                                                                         <C>
3.1                Articles of Incorporation, restated as last         Incorporated by reference to Exhibit 3.1
                   amended June 10, 2005                               to the Company's Current Report on Form
                                                                       8-K as filed with the U.S. Securities and
                                                                       Exchange Commission on July 8, 2005

3.2                Bylaws, restated as last amended April 18, 2005     Incorporated by reference to Exhibit 3.2
                                                                       to the Company's Current Report on Form
                                                                       8-K as filed with the U.S. Securities and
                                                                       Exchange Commission on July 8, 2005

4.1                Form of Common Stock Certificate                    Incorporated by reference to Exhibit 4.1
                                                                       to the Company's Current Report Form
                                                                       10-SB12G as filed with the U.S. Securities
                                                                       and Exchange Commission on July 21, 1999

4.2                Amended Samaritan Pharmaceuticals, Inc. 2001        Incorporated by reference to Exhibit 4.2
                   Stock Option Plan                                   to the Company's Quarterly Report on Form
                                                                       10-QSB as filed with the U.S. Securities
                                                                       and Exchange Commission on August 16, 2004

4.3                Samaritan Pharmaceuticals, Inc.  2005 Stock         Incorporated by reference to Schedule 14-A
                   Option Plan                                         Information Statement as filed with the
                                                                       U.S. Securities and Exchange Commission on
                                                                       April 29,  2005 and approved by the
                                                                       shareholders on June 10, 2005

10.1               Research, Development and Commercialization         Incorporated by reference to Exhibit 10.1
                   Collaboration Agreement for SP-01A dated March      to the Company's Form 10-K as filed with
                   28, 2007 by and between Pharmaplaz and the          the U.S. Securities and Exchange
                   Company.                                            Commission on April 13, 2007.

10.2               Common Stock Purchase Agreement (Purchase           Incorporated by reference to Exhibit 10.1
                   Agreement I), dated April 22, 2003, by and          to the Company's Current Report on Form
                   between the Company and Fusion Capital Fund II,     8-K as filed with the U.S. Securities and
                   LLC                                                 Exchange Commission on April 25, 2003

10.3               Registration Rights Agreement, dated April 22,      Incorporated by reference to Exhibit 10.2
                   2003, by and between the Company and Fusion         to the Company's Current Report on Form
                   Capital Fund II, LLC                                8-K as filed with the U.S. Securities and
                                                                       Exchange Commission on April 25, 2003

10.4               Employment Agreement, dated as of January 1,        Incorporated by reference to Exhibit 10.6
                   2001, by and between Samaritan Pharmaceuticals,     to the Company's Quarterly Report on Form
                   Inc. and Mr. Thomas Lang.                           10-QSB as filed with the U.S. Securities
                                                                       and Exchange Commission on August 16, 2004

10.5               Form of Trust Under Samaritan Pharmaceuticals,      Incorporated by reference to Exhibit 10.10
                   Inc. Deferred Compensation Plan                     to
                                                                       the Company's Quarterly Report on Form
                                                                       10-QSB as filed with the U.S. Securities
                                                                       and Exchange Commission on August 14, 2002

10.6               Master Clinical Trial and Full Scale                Incorporated by reference to Exhibit 10.10
                   Manufacturing Agreement, dated October 5, 2004,     to the Company's Quarterly Report on Form
                   by and between the Company and Pharmaplaz, LTD      10-QSB as filed with the U.S. Securities
                                                                       and Exchange Commission on November 15,
                                                                       2004

10.7               Common Stock Purchase Agreement (Purchase           Incorporated by reference to Exhibit 10.11
                   Agreement II), dated May 12, 2005, by and           to the Company's Quarterly Report on Form
                   between the Company and Fusion Capital Fund II,     10-QSB as filed with the U.S. Securities
                   LLC                                                 and Exchange Commission on May 13, 2005

10.8               Amendment to Common Stock Purchase Agreement,       Incorporated by reference to Exhibit 10.12
                   dated December 19, 2005, by and between the         to the Company's Registration Statement on
                   Company and Fusion Capital Fund II, LLC             Form SB-2 as filed with the U.S.
                                                                       Securities and Exchange Commission on
                                                                       December 15, 2005


                                       58
<PAGE>

10.9               Registration Rights Agreement, dated May 12,        Incorporated by reference to Exhibit 10.12
                   2005, by and between the Company and Fusion         to the Company's Quarterly Report on Form
                   Capital Fund II, LLC                                10-QSB as filed with the U.S. Securities
                                                                       and Exchange Commission on May 13, 2005

10.10              Norbrook Supply Agreement                           Incorporated by reference to Exhibit 1 to
                                                                       the Company's Current Report on Form 8-K
                                                                       as filed with the U.S. Securities and
                                                                       Exchange Commission on September 27, 2005

10.11              Research Collaboration and Licensing Agreement,     Incorporated by reference to Exhibit 10.10
                   dated June 8, 2001, by and between Georgetown       to the Company's Registration Statement on
                   University and Samaritan Pharmaceuticals, Inc.      Form SB-2 as filed with the U.S.
                                                                       Securities and Exchange Commission on July
                                                                       30, 2003

10.12              Change in Control Severance Plan for Certain        Incorporated by reference to Exhibit 10.16
                   Covered Executives and Employees of Samaritan       to the Company's Quarterly Report on Form
                   Pharmaceuticals, Inc.                               10-Q as filed with the U.S. Securities and
                                                                       Exchange Commission on August 14, 2006.

10.13              Samaritan Pharmaceuticals, Inc.'s                   Incorporated by reference to Exhibit 10.17
                   Director/Officer's Indemnification Agreement        to the Company's Quarterly Report on Form
                                                                       10-Q as filed with the U.S. Securities and
                                                                       Exchange Commission on August 14, 2006.

10.14              Stock Purchase Agreement among Samaritan            Incorporated by reference to Exhibit 10.18
                   Pharmaceuticals, Metastatin Pharmaceuticals,        to the Company's Quarterly Report on Form
                   and the shareholders of Metastatin                  10-Q as filed with the U.S. Securities and
                   Pharmaceuticals.                                    Exchange Commission on November 14, 2006.

14.1               The Samaritan Pharmaceuticals, Inc. Code of         Incorporated by reference to Exhibit 14.1
                   Conduct                                             to the Company's Form 10-KSB as filed with
                                                                       the U.S.  Securities and Exchange
                                                                       Commission on April 15, 2003.

16.1               Letter Regarding Change in Certifying Accountant    Incorporated by reference to Exhibit 16.1
                                                                       to the Company's Current Report on Form
                                                                       8-K as filed with the U.S. Securities and
                                                                       Exchange Commission on September 27, 2002.

21                 List of Subsidiaries                                Incorporated by reference to Exhibit 21 to
                                                                       the Company's Quarterly Report on Form
                                                                       10-QSB as filed with the U.S. Securities
                                                                       and Exchange Commission on August 15, 2005

23.1               Consent of Independent Registered Public            Incorporated by reference to Exhibit 23.1
                   Accounting Firm                                     to the Company's Registration Statement on
                                                                       Form SB-2 as filed with the U.S.
                                                                       Securities and Exchange Commission on
                                                                       December 15, 2005

23.2               Consent of Nevada Counsel                           Incorporated by reference to Exhibit 23.2
                                                                       to the Company's Registration Statement on
                                                                       Form SB-2 as filed with the U.S.
                                                                       Securities and Exchange Commission on
                                                                       December 15, 2005

31.1               Certification of Chief Executive Officer re:        Provided herewith
                   Section 302

31.2               Certification of Chief Financial Officer re:        Provided herewith
                   Section 302

32.1               Certification of Chief Executive Officer re:        Provided herewith
                   Section 906

32.2               Certification of Chief Financial Officer re:        Provided herewith
                   Section 906
</TABLE>


                                       59
<PAGE>

SIGNATURES

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

SAMARITAN PHARMACEUTICAL, INC

Dated: April 27, 2007                         By: /s/ Janet Greeson, Ph.D.
                                              -----------------------------
                                                       Janet Greeson, Ph.D.
                                                 President, Chief Executive
                                                          Officer, Chairman

Dated:  April 27, 2007                        By: /s/ Eugene Boyle
                                              -----------------------------
                                                              Eugene Boyle,
                                                   Chief Financial Officer,
                                                                   Director

Dated:  April 27, 2007                        By: /s/ Doug Bessert
                                              -----------------------------
                                                               Doug Bessert
                                                                   Director

Dated:  April 27, 2007                        By: /s/ Laurent Lecanu
                                              -----------------------------
                                                             Laurent Lecanu
                                                                   Director

Dated:  April 27, 2007                        By: /s/ H. Thomas Winn
                                              -----------------------------
                                                             H. Thomas Winn
                                                                   Director

Dated:  April 27, 2007                        By: /s/ Cynthia C. Thompson
                                              -----------------------------
                                                        Cynthia C. Thompson
                                                                   Director

<PAGE>

                         SAMARITAN PHARMACEUTICALS, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                                      INDEX
                                                                  PAGE NUMBER

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM               F-2

CONSOLIDATED FINANCIAL STATEMENTS:

       Balance Sheet                                                  F-3

       Statements of Operations and Comprehensive Income              F-4

       Statements of Shareholders' Equity (Deficit)               F-5  -  F-8

       Statements of Cash Flows                                       F-9

       Notes to Financial Statements                              F-10 - F-23


<PAGE>

             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


Board of Directors and Stockholders
Samaritan Pharmaceuticals, Inc.

We have audited the accompanying consolidated balance sheets of Samaritan
Pharmaceuticals, Inc. (a development stage company)as of December 31, 2006 and
2005 and the related consolidated statements of operations and comprehensive
income, shareholders' equity and cash flows for the years ending December 31,
2006, 2005 and 2003 and for the period from January 1, 2000 through December 31,
2006. The period beginning January 1, 1997 through December 31, 1999 was audited
by the predecessor accounting firm. These consolidated financial statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these consolidated financial statements based on our audit.

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

In our opinion, the consolidated financial statements referred to above present
fairly, the consolidated financial position of Samaritan Pharmaceuticals, Inc.
(a development stage company) as of December 31, 2006 and 2005 and the
consolidated results of its operations and its cash flows for the years ending
December 31, 2006, 2005 and 2004 and for the period from January 1, 2000 through
December 31, 2006. The period beginning January 1, 1997 through December 31,
1999 was audited by the predecessor accounting firm, in conformity with
accounting principles generally accepted in the United States of America.

The accompanying consolidated cumulative statements of operations and
comprehensive income, shareholder's equity and cash flows regarding the period
from inception (September 5, 1994) through December 31, 1996, was activity prior
to our engagement as auditors upon which we or the predecessor auditor have not
performed procedures. Therefore, we do not express an opinion on them.

                                                    /s/  Sherb & Co., LLP
                                                    ----------------------------
                                                    Sherb & Co., LLP
                                                    Certified Public Accountants

New York, New York
March 23, 2007

                                      F-2

<PAGE>

                         SAMARITAN PHARMACEUTICALS, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                           CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>


                                                                                       December 31,
                                                                       --------------------------------------------
                                                                              2006                    2005
                                                                       --------------------    --------------------
                                     ASSETS

CURRENT ASSETS:
<S>                                                                    <C>                     <C>
       Cash and cash equivalents                                       $           742,075     $           456,463
       Grant receivable                                                                  -                  51,117
       Marketable securities                                                             -                 496,068
       Note receivable                                                             250,000                 250,000
       Interest receivable                                                          71,096                  42,861
       Prepaid expenses                                                             10,750                  10,587
                                                                       --------------------    --------------------
            TOTAL CURRENT ASSETS                                                 1,073,921               1,307,096

PROPERTY AND EQUIPMENT                                                             127,627                 206,803
                                                                       --------------------    --------------------

OTHER ASSETS:
       Patent registration costs                                                 1,042,791                 700,798
       Purchased  technology rights                                                252,349                  19,983
       Deposits                                                                      2,779                   2,779
                                                                       --------------------    --------------------
            TOTAL OTHER ASSETS                                                   1,297,919                 723,560
                                                                       --------------------    --------------------


                                                                       $         2,499,467     $         2,237,459
                                                                       ====================    ====================

                      LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES:
       Accounts payable and accrued expenses                           $           414,237     $           267,945
       Accrued officers salaries                                                   515,271                 247,856
       Accounts payable to be settled through issuance of stock                    590,057                       -
       Common stock to be issued                                                         -                  46,259
                                                                       --------------------    --------------------
            TOTAL CURRENT LIABILITIES                                            1,519,565                 562,060
                                                                       --------------------    --------------------



SHAREHOLDERS'  EQUITY:
       Preferred stock, 5,000,000 shares authorized at $.001 par value,
            -0- issued and outstanding at December 31, 2005 and 2004                     -                       -
       Common stock, 250,000,000 shares authorized at $.001
            par value,  156,652,708 and  136,866,274 issued and                    156,653                 136,866
            outstanding at December 31, 2006 and 2005, respectively
       Additional paid-in capital                                               42,094,536              35,589,683
       Common stock to be issued                                                   231,502                       -
       Deferred compensation                                                             -                 (40,034)
       Treasury stock                                                             (250,248)               (250,248)
       Accumulated other comprehensive loss                                         56,601                 (24,472)
       Accumulated deficit during development stage                            (41,309,142)            (33,736,396)
                                                                       --------------------    --------------------
            TOTAL SHAREHOLDERS' EQUITY                                             979,902               1,675,399
                                                                       --------------------    --------------------
                                                                       $         2,499,467     $         2,237,459
                                                                       ====================    ====================
</TABLE>



        See accompanying notes to the consolidated financial statements.

                                       F-3
<PAGE>

                            SAMARITAN PHARMACEUTICALS, INC.
                             (A DEVELOPMENT STAGE COMPANY)

         CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

<TABLE>
<CAPTION>

                                                               From
                                                            Inception
                                     From Jan. 1, 1997  (September 5, 1994)
                                           To                   To                   For the Years Ended December 31,
                                      Dec. 31, 2006       Dec. 31, 1996           2006               2005             2004
                                    ------------------  -------------------  ----------------   ---------------   -------------
                                        (Audited)           (Unaudited)
REVENUES:
<S>                                 <C>                 <C>                  <C>               <C>                <C>
 Consulting                         $         300,000   $                -   $             -   $             -    $          -
 Government research grants                   289,226                    -            32,379           256,847               -
                                    ------------------  -------------------  ----------------   ---------------   -------------
                                              589,226                    -            32,379           256,847               -
                                    ------------------  -------------------  ----------------   ---------------   -------------

EXPENSES:

Research and development                   14,324,653               82,171         4,667,053         3,456,301       1,543,921
Interest, net                                 (78,540)                   -           (31,795)          (60,021)        (36,730)
General and administrative                 24,469,144            2,067,188         2,812,934         2,320,011       3,561,302
Depreciation and amortization               1,399,398                3,484           156,933            98,115          27,218
Other income                                 (369,130)                   -                 -                 -        (231,350)
                                    ------------------  -------------------  ----------------   ---------------   -------------
                                           39,745,525            2,152,843         7,605,125         5,814,406       4,864,361
                                    ------------------  -------------------  ----------------   ---------------   -------------

NET LOSS                                  (39,156,299)          (2,152,843)       (7,572,746)       (5,557,559)     (4,864,361)

Other Comprehensive Income (Loss):
Unrealized gain on marketable
securities                                          -                    -             3,933            12,648         (16,580)
Foreign translation adjustment                 56,601                    -            77,141           (20,540)              -
                                    ------------------  -------------------  ----------------   ---------------   -------------
Total Comprehensive Loss            $     (39,099,698)  $       (2,152,843)  $    (7,491,672)   $   (5,565,452)   $ (4,880,941)
                                    ==================  ===================  ================   ===============   =============



Loss per share, basic and diluted                                            $         (0.05)   $        (0.04)   $      (0.04)
                                                                             ================   ===============   =============

Weighted average number of shares
outstanding:

                  Basic and diluted                                              147,058,648       134,560,596     124,483,372
                                                                             ================   ===============   =============



                                       See accompanying notes to the consolidated financial statements

                                                                     F-4
</TABLE>

<PAGE>
                         SAMARITAN PHARMACEUTICALS, INC.
                          (A DEVELOPMENT STAGE COMPANY)
            CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (DEFICIT)
             FROM INCEPTION (SEPTEMBER 5, 1994) TO December 31, 2006
<TABLE>
<CAPTION>
                                                                    Shares
                                         Number       Par Value    Reserved     Additional       Common
                                           of          Common         for         Paid in       Stock to
                                         Shares         Stock      Conversion     Capital       be issued      Warrants
                                      -------------   ----------   ----------   ------------   -----------    -----------
<S>                    <C>                         <C>          <C>                         <C>
Inception at September 5, 1994                   -    $       -    $       -    $         -    $        -     $        -

Shares issued for cash, net of
 offering costs                          6,085,386          609            -        635,481             -              -
Warrants issued for cash                         -            -            -              -             -          5,000
Shares issued as compensation
 for services                              714,500           71            -      1,428,929             -              -
Net loss                                         -            -            -              -             -              -
                                      -------------   ----------   ----------   ------------   -----------    -----------
December 31, 1996 (Unaudited)            6,799,886          680            -      2,064,410             -          5,000

Issuance of stock, prior to
 acquisition                               206,350           21            -        371,134             -              -
Acquisition of subsidiary for stock      1,503,000          150            -         46,545             -              -
Shares of parent redeemed, par
 value $.0001                           (8,509,236)        (851)           -            851             -              -
Shares of public subsidiary
 issued, par value $.001                 7,689,690        7,690          820         (8,510)            -              -
Net loss                                         -            -            -              -             -              -
                                      -------------   ----------   ----------   ------------   -----------    -----------
December 31, 1997 (Audited)              7,689,690        7,690          820      2,474,430             -          5,000

Conversion of parent's shares              696,022          696         (696)             -             -              -
Shares issued for cash, net of
 offering costs                            693,500          694            -        605,185             -              -
Shares issued in cancellation of debt      525,000          525            -        524,475             -              -
Shares issued as compensation              400,000          400            -        349,600             -              -
Net loss                                         -            -            -              -             -              -
                                      -------------   ----------   ----------   ------------   -----------    -----------
December 31, 1998 (Audited)             10,004,212       10,005          124      3,953,690             -          5,000

Conversion of parent's shares               13,000           13          (13)             -             -              -
Shares issued in cancellation of debt       30,000           30            -         29,970             -              -
Shares issued for cash, net of
 offering costs                             45,000           45            -         41,367             -              -
Shares issued as compensation            3,569,250        3,569            -        462,113             -              -
Detachable warrants issued                       -            -            -              -             -        152,125
Detachable warrants exercised              100,000          100            -        148,900             -       (149,000)
Debentures converted to stock            1,682,447        1,682            -        640,438             -              -
Net loss                                         -            -            -              -             -              -
                                      -------------   ----------   ----------   ------------   -----------    -----------
December 31, 1999 (Audited)             15,443,909       15,444          111      5,276,478             -          8,125

Conversion of parent's shares              128,954          129         (111)           (18)            -              -
Shares issued for cash, net of
offering costs                           1,575,192        1,575            -        858,460             -              -
Shares issued in cancellation of debt      875,000          875            -        660,919             -              -
Shares issued in cancellation
 of accounts payable                       100,000          100            -         31,165             -              -
Shares issued as compensation            3,372,945        3,373            -      2,555,094             -              -
Warrants exercised                          38,807           39            -          3,086             -         (3,125)
Warrants expired                                 -            -            -          5,000             -         (5,000)
Net loss                                         -            -            -              -             -              -
                                       ------------    ---------    ---------   ------------   -----------    -----------
December 31, 2000 (Audited)             21,534,807       21,535            -      9,390,184             -              -

Shares issued for cash, net of
 offering cost                           6,497,088         6,497           -      1,257,758             -             -
Shares issued as compensation            9,162,197         9,162           -      1,558,599             -             -
Shares issued for previously
 purchased shares                          342,607           342           -        188,208             -             -
Shares issued in cancellation
 of accounts payable                       200,000           200           -         68,880             -             -
Amortization of deferred compensation            -             -           -              -             -             -
Stock options issued for services                -             -           -        439,544             -             -
Net loss                                         -             -           -              -             -             -
                                       ------------    ----------    --------   ------------   -----------   -----------
December 31, 2001 (Audited)             37,736,699        37,736           -     12,903,173             -             -
</TABLE>
        See accompanying notes to the consolidated financial statements.

                                       F-5
<PAGE>
                         SAMARITAN PHARMACEUTICALS, INC.
                          (A DEVELOPMENT STAGE COMPANY)
            CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (DEFICIT)
             FROM INCEPTION (SEPTEMBER 5, 1994) TO December 31, 2006
                                   CONTINUED
<TABLE>
<CAPTION>
                                                    Accumulated
                                                       Other          Stock                                       Total
                                         Deferred    Comprehensive Subscriptions  Treasury    Accumulated     Shareholders'
                                        Compensation   Income      Receivable     Shares       Deficit          Deficit
                                       ------------- ------------ ------------  -----------  -------------   ---------------
<S>                    <C>             <C>                        <C>           <C>          <C>             <C>
Inception at September 5, 1994         $         -             -  $         -   $        -   $          -    $            -

Shares issued for cash, net of
 offering costs                                  -             -            -            -              -           636,090
Warrants issued for cash                         -             -            -            -              -             5,000
Shares issued as compensation
 for services                                    -             -            -            -              -         1,429,000
Net loss                                         -             -            -            -     (2,152,843)       (2,152,843)
                                       ------------ ------------- ------------  -----------  -------------   ---------------
December 31, 1996 (Unaudited)                    -             -            -            -     (2,152,843)          (82,753)

Issuance of stock, prior to
 acquisition                                     -             -            -            -              -           371,155
Acquisition of subsidiary for stock              -             -            -            -              -            46,695
Shares of parent redeemed,
 par value $.0001                                -             -            -            -              -                 -
Shares of public subsidiary
 issued, par value $.001                         -             -            -            -              -                 -
Net loss                                         -             -            -            -       (979,635)         (979,635)
                                       ------------ ------------- ------------  -----------  -------------   ---------------
December 31, 1997 (Audited)                      -             -            -            -     (3,132,478)         (644,538)

Conversion of parent's shares                    -             -            -            -              -                 -
Shares issued for cash, net
 of offering costs                               -             -            -            -              -           605,879
Shares issued in cancellation of debt            -             -            -            -              -           525,000
Shares issued as compensation                    -             -            -            -              -           350,000
Net loss                                         -             -            -            -     (1,009,945)       (1,009,945)
                                       ------------ ------------- ------------  -----------  -------------   ---------------
December 31, 1998 (Audited)                      -             -            -            -     (4,142,423)         (173,604)

Conversion of parent's shares                    -             -            -            -              -                 -
Shares issued in cancellation of debt            -             -            -            -              -            30,000
Shares issued for cash, net of
 offering costs                                  -             -            -            -              -            41,412
Shares issued as compensation                    -             -            -            -              -           465,682
Detachable warrants issued                       -             -            -            -              -           152,125
Detachable warrants exercised                    -             -            -            -              -                 -
Debentures converted to stock                    -             -            -            -              -           642,120
Net loss                                         -             -            -            -     (1,671,255)       (1,671,255)
                                       ------------ ------------- ------------  -----------  -------------   ---------------
December 31, 1999 (Audited)                      -             -            -            -     (5,813,678)         (513,520)

Conversion of parent's shares                    -             -            -            -              -                 -
Shares issued for cash, net of
 offering costs                                  -             -            -            -              -           860,035
Shares issued in cancellation of debt            -             -            -            -              -           661,794
Shares issued in cancellation
 of accounts payable                             -             -            -            -              -            31,265
Shares issued as compensation             (759,560)            -            -            -              -         1,798,907
Warrants exercised                               -             -            -            -              -                 -
Warrants expired                                 -             -            -            -              -                 -
Net loss                                         -             -            -            -     (3,843,308)       (3,843,308)
                                       ------------ ------------- ------------  -----------  -------------   ---------------
December 31, 2000 (Audited)               (759,560)            -            -            -     (9,656,986)       (1,004,827)

Shares issued for cash, net
 of offering costs                               -             -            -            -              -         1,264,255
Shares issued as compensation             (230,512)            -            -            -              -         1,337,249
Shares issued for previously
 purchased shares                                -             -            -            -              -           188,550
Shares issued in cancellation
 of accounts payable                             -             -            -            -              -            69,080
Amortization of deferred compensation      495,036             -            -            -              -           495,036
Stock options issued for services                -             -            -            -              -           439,544
Net loss                                         -             -            -            -     (4,079,806)       (4,079,806)
                                       ------------ ------------- ------------  -----------  -------------   ---------------
December 31, 2001 (Audited)               (495,036)            -            -            -    (13,736,792)       (1,290,919)
</TABLE>
        See accompanying notes to the consolidated financial statements.

                                       F-6
<PAGE>
                         SAMARITAN PHARMACEUTICALS, INC.
                          (A DEVELOPMENT STAGE COMPANY)
            CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (DEFICIT)
             FROM INCEPTION (SEPTEMBER 5, 1994) TO December 31, 2006
                                   CONTINUED
<TABLE>
<CAPTION>
                                                                    Shares
                                         Number       Par Value    Reserved     Additional       Common
                                           of          Common         for         Paid in       Stock to
                                         Shares         Stock      Conversion     Capital       be issued     Warrants
                                      -------------   ----------   ----------   ------------   -----------   -----------
<S>                                      <C>               <C>     <C>            <C>
Shares issued for cash, net of
 offering costs                         18,657,500        18,658           -      2,077,641             -             -
Shares issued as compensation            3,840,525         3,841           -      1,044,185             -             -
Shares issued for previously
 purchased shares                           50,000            50           -          4,950             -             -
Shares issued in cancellation
 of accounts payable                     4,265,184         4,265           -        539,291             -             -
Amortization of deferred compensation            -             -           -              -             -             -
Stock options issued for services                -             -           -        225,000             -             -
Net loss                                         -             -           -              -             -             -
                                       ------------    ----------   ---------   ------------   -----------   -----------
December 31, 2002 (Audited)             64,549,908        64,550           -      16,794,240            -              -

Shares issued for cash, net of
 offering costs                         17,493,664        17,493           -      2,392,296             -             -
Shares issued as compensation            4,062,833         4,063           -        549,779             -             -
Shares issued for previously
 purchased shares                        1,160,714         1,161           -        161,339             -             -
Shares issued in cancellation
 of accounts payable and
 accrued compensation                    9,615,870         9,616           -      3,448,950             -             -
Shares issued in connection
 with equity financing                   3,125,000         3,125           -         (3,125)            -             -
Exercise of stock options                7,770,892         7,771           -      1,112,077             -             -
Shares reacquired in settlement
 of judgement                           (1,564,048)       (1,564)          -        251,812             -             -
Stock options issued for services                -             -           -        145,000             -             -
Net loss                                         -             -           -              -             -             -
                                       ------------    ----------   ---------   ------------   -----------   -----------
December 31, 2003 (Audited)            106,214,833       106,214           -     24,852,369             -             -

Shares issued for cash, net
 of offering costs                      11,426,733        11,427           -      4,289,511             -             -
Shares issued as compensation,
 expensed                                2,081,249         2,081           -      1,788,397             -             -
Amortization of deferred compensation            -             -           -              -             -             -
Shares issued for previously
 purchased shares                           83,332            83           -         12,417             -             -
Exercise of stock options               16,950,468        16,951           -      4,841,869             -             -
Exercise of warrants                       635,000           635           -        449,365             -             -
Shares issued in connection
 with equity financing                   8,758,240         8,758           -      3,091,243             -             -
Stock retired in settlement of
 subscriptions receivable              (13,869,656)      (13,870)          -     (5,964,798)            -             -
Shares reacquired in settlement
of judgement                              (250,000)         (250)          -       (231,100)            -             -
Stock options issued for services                -             -           -        567,771             -             -
Other comprehensive income (loss)                -             -           -              -             -             -
Net Loss                                         -             -           -              -             -             -
                                       ------------    ----------   ---------   ------------   -----------   -----------
December 31, 2004 (Audited)            132,030,199       132,030           -     33,697,043             -             -

Shares issued as compensation,
expensed                                   398,900           399           -        196,785             -             -
Amortization of deferred compensation            -             -           -              -             -             -
Exercise of stock options                  170,000           170           -         31,330             -             -
Shares issued in connection
with equity financing                    4,267,175         4,267           -      1,599,473             -             -
Stock options issued for services                -             -           -         65,052             -             -
Other comprehensive income (loss)                -             -           -              -             -             -
Net loss                                         -             -           -              -             -             -
                                       ------------    ----------   ---------   ------------   -----------   -----------
December 31, 2005 (Audited)            136,866,274       136,866           -     35,589,683             -             -

Shares issued for cash, net of
offering cost                            7,212,500         7,213           -      2,037,787             -             -
Common stock to be issued                        -             -           -              -             -       231,502
Amortization of deferred compensation            -             -           -              -             -             -
Exercise of stock options                  450,926           451           -         64,049             -             -
Shares issued in connection with
equity financing                        12,123,008        12,123           -      4,182,651             -             -
Stock options issued for services                -             -           -        220,366             -             -
Other comprehensive income (loss)                -             -           -              -             -             -
Net loss                                         -             -           -              -             -             -
                                       ------------    ----------   ---------   ------------   -----------   -----------
December 31, 2006 (Audited)            156,652,708     $ 156,653    $      -    $42,094,536    $        -    $  231,502
                                       ============    ==========   =========   ============   ===========   ===========
</TABLE>
        See accompanying notes to the consolidated financial statements.

                                       F-7
<PAGE>
                         SAMARITAN PHARMACEUTICALS, INC.
                          (A DEVELOPMENT STAGE COMPANY)
            CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (DEFICIT)
             FROM INCEPTION (SEPTEMBER 5, 1994) TO December 31, 2006
                                   CONTINUED
<TABLE>
<CAPTION>
                                                    Accumulated
                                                       Other          Stock                                       Total
                                         Deferred    Comprehensive Subscriptions  Treasury    Accumulated     Shareholders'
                                        Compensation   Income      Receivable     Shares       Deficit          Deficit
                                       ------------- ------------ ------------  -----------  -------------   ---------------
<S>                                                                                                               <C>
Shares issued for cash, net
 of offering costs                               -             -            -            -              -         2,096,299
Shares issued as compensation                    -             -            -            -              -         1,048,026
Shares issued for previously
 purchased shares                                -             -            -            -              -             5,000
Shares issued in cancellation
 of accounts payable                             -             -            -            -              -           543,556
Amortization of deferred compensation      495,036             -            -            -              -           495,036
Stock options issued for services                -             -            -            -              -           225,000
Net loss                                         -             -            -            -     (4,057,153)       (4,057,153)
                                       ------------ ------------- ------------  -----------  -------------   ---------------
December 31, 2002 (Audited)                      -             -            -            -    (17,793,945)         (935,155)

Shares issued for cash, net of
 offering costs                                  -             -            -            -              -         2,409,789
Shares issued as compensation                    -             -            -            -              -           553,842
Shares issued for previously
 purchased shares                                -             -            -            -              -           162,500
Shares issued in cancellation
 of accounts payable and
 accrued compensation                            -             -            -            -              -         3,458,566
Shares issued in connection
 with equity financing                           -             -            -            -              -                 -
Exercise of stock options                        -             -   (1,119,848)           -              -                 -
Shares reacquired in settlement
 of judgement                                    -             -            -     (250,248)             -                 -
Stock options issued for services                -             -            -            -              -           145,000
Net loss                                         -             -            -            -     (5,520,531)       (5,520,531)
                                       ------------ ------------- ------------  -----------  -------------   ---------------
December 31, 2003 (Audited)                      -             -   (1,119,848)    (250,248)   (23,314,476)          274,011

Shares issued for cash, net
 of offering costs                               -             -           -            -              -          4,300,938
Shares issued as compensation,
expensed                                  (544,416)            -           -            -              -          1,246,062
Amortization of deferred compensation      240,000             -           -            -              -            240,000
Shares issued for previously
 purchased shares                                -             -           -            -              -             12,500
Exercise of stock options                        -             -  (4,858,820)           -              -                  -
Exercise of warrants                             -             -           -            -              -            450,000
Shares issued in connection
 with equity financing                           -             -           -            -              -          3,100,001
Stock retired in settlement of
 subscriptions receivable                        -             -   5,978,668            -              -                  -
Shares reacquired in settlement
of judgement                                     -             -           -            -              -           (231,350)
Stock options issued for services                -             -           -            -              -            567,771
Other comprehensive income (loss)                -       (16,580)          -            -              -            (16,580)
Net Loss                                         -             -           -            -     (4,864,361)        (4,864,361)
                                       ------------ ------------- -----------   ----------   ------------   ----------------
December 31, 2004 (Audited)               (304,416)      (16,580)          -     (250,248)   (28,178,837)         5,078,992

Shares issued as compensation,
expensed                                  (128,034)           -            -            -              -             69,150
Amortization of deferred compensation      392,416            -            -            -              -            392,416
Exercise of stock options                        -            -            -            -              -             31,500
Shares issued in connection
with equity financing                            -            -            -            -              -          1,603,740
Stock options issued for services                -            -            -            -              -             65,052
Other comprehensive income (loss)                -       (7,892)           -            -              -             (7,892)
Net loss                                         -            -            -            -     (5,557,559)        (5,557,559)
                                       ------------ ------------  -----------   ----------   ------------   ----------------
December 31, 2005 (Audited)                (40,034)     (24,472)           -     (250,248)   (33,736,396)         1,675,399

Shares issued for cash, net of
offering cost                                    -            -            -            -              -          2,045,000
Common stock to be issued                        -            -            -            -              -            231,502
Amortization of deferred compensation       40,034            -            -            -              -             40,034
Exercise of stock options                        -            -            -            -              -             64,500
Shares issued in connection with
equity financing                                 -            -            -            -              -          4,194,774
Stock options issued for services                -            -            -            -              -            220,366
Other comprehensive income (loss)                -       81,073            -            -              -             81,073
Net loss                                         -            -            -            -     (7,572,746)        (7,572,746)
                                       ------------ ------------  -----------   ----------   ------------   ----------------
December 31, 2006 (Audited)            $         -  $    56,601   $        -    $(250,248)  $(41,309,142)   $       979 902
                                       ============ ============  ===========   ==========   ============   ================
</TABLE>
        See accompanying notes to the consolidated financial statements.

                                       F-8
<PAGE>

                         SAMARITAN PHARMACEUTICALS, INC.
                          (A DEVELOPMENT STAGE COMPANY)
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
                                                                   From                                                  From
                                                    From        Inception                                              Inception
                                              January 1, 1997  (09/05/1994)                                           (09/05/1994)
                                                     To             To                                                     To
CASH FLOWS FROM OPERATING ACTIVITIES:          December 31,    December 31,    For the Years Ended December 31,        December 31,
                                                   2006           1996          2006         2005        2004             2006
                                               -------------   ------------ ------------ ------------ ------------   --------------
                                                 (Audited)     (Unaudited)                                            (Unaudited)
<S>                                            <C>             <C>          <C>          <C>          <C>            <C>
Net loss                                       $(39,156,299)   $(2,152,843) $(7,572,746) $(5,557,559) $(4,864,361)   $ (41,309,142)
Adjustments to reconcile net loss to net
 cash used in operating activities:
        Depreciation and amortization             1,399,398          3,484      156,933       98,115       27,218        1,402,882
        Stock based compensation                  8,230,280      1,429,000            -       69,150    1,246,062        9,659,280
        Stock options issued for services         1,662,733              -      220,366       65,052      567,771        1,662,733
        Amortization of deferred
         compensation                             1,662,522              -       40,034      392,416      240,000        1,662,522
        Foreign currency loss                        56,601              -       77,141      (20,540)           -           56,601
        Other income                               (228,190)             -        3,160            -     (231,350)        (228,190)
(Increase) decrease in assets:
        Accounts receivable                          (5,584)         5,584       51,117      (51,117)                            -
        Interest receivable and prepaids            (95,086)             -      (28,398)      22,901      (55,092)         (95,086)
        Deposits                                     13,724           (783)           -            -            -           12,941
Increase (decrease) in liabilities:
        Deferred revenue                           (200,000)       200,000            -            -            -                -
        Accounts payable and accrued
         expenses                                 3,151,606         29,274      804,265      345,635     (218,144)       3,180,880
                                               -------------   ------------ ------------ ------------ ------------   --------------
NET CASH USED IN OPERATING ACTIVITIES           (23,508,295)      (486,284)  (6,248,128)  (4,635,947)  (3,287,896)     (23,994,579)
                                               -------------   ------------ ------------ ------------ ------------   --------------

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of technology rights                       (63,492)       (95,477)     (50,000)           -            -         (158,969)
Purchase of furniture and equipment                (330,824)       (12,837)      (5,165)    (222,533)     (17,316)        (343,661)
Note receivable                                    (250,000)             -            -            -     (250,000)        (250,000)
(Purchase) liquidation of marketable securities      (3,160)             -      496,840    1,500,000   (2,000,000)          (3,160)
Patent registration costs                        (1,117,072)       (24,866)    (397,452)    (305,007)    (227,862)      (1,141,938)
                                               -------------   ------------ ------------ ------------ ------------   --------------
NET CASH (USED IN) PROVIDED BY INVESTING
ACTIVITIES                                       (1,764,548)      (133,180)      44,223      972,460   (2,495,178)      (1,897,728)
                                               -------------   ------------ ------------ ------------ ------------   --------------

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from warrants/options                      703,125              -       64,500       31,500      450,000          703,125
Proceeds from debentures                            642,120              -            -            -            -          642,120
Proceeds from stock issued for cash              13,987,479        641,090    2,045,000            -    4,300,938       14,628,569
Proceeds from equity financing                    8,898,516              -    4,194,774    1,603,741    3,100,001        8,898,516
Common stock to be issued                           437,552              -      185,243       46,259            -          437,552
Short-term loan repayments                         (288,422)             -            -            -            -         (288,422)
Short-term loan proceeds                          1,612,922              -            -            -            -        1,612,922
                                               -------------   ------------ ------------ ------------ ------------   --------------
NET CASH PROVIDED BY FINANCING ACTIVITIES        25,993,292        641,090    6,489,517    1,681,500    7,850,940       26,634,382
                                               -------------   ------------ ------------ ------------ ------------   --------------

CHANGE IN CASH                                      720,449         21,626      285,612   (1,981,987)   2,067,866          742,075
CASH AND CASH EQUIVALENTS AT BEGINNING OF
 PERIOD                                              21,626              -      456,463    2,438,451      370,585                -
                                               -------------   ------------ ------------ ------------ ------------   --------------
CASH AND CASH EQUIVALENTS  AT END OF PERIOD    $    742,075    $    21,626  $   742,075  $   456,464  $ 2,438,451    $     742,075
                                               =============   ============ ============ ============ ============   ==============

NON-CASH FINANCING AND INVESTING ACTIVITIES:

Purchase of net, non-cash assets of subsidiary
    for stock                                  $        195    $         -  $         -  $         -  $         -    $         195
Short-term debt retired through issuance
    of stock                                   $  1,890,695    $         -  $         -  $         -  $         -    $   1,890,695
Issuance of common stock, previously
    subscribed                                 $    180,000    $         -  $         -  $         -  $    12,500    $     180,000
Cash paid for interest and taxes               $          -    $         -  $         -  $         -  $         -    $           -
Purchase of technology rights for accounts
    payable to be settled through issuance
    of stock                                   $    199,500    $         -  $   199,500  $         -  $         -    $           -
Treasury stock acquired through settlement
    of judgement                               $    250,248    $         -  $         -  $         -  $         -    $     250,248
Stock subscriptions receivable                 $  1,119,848    $         -  $         -  $         -  $         -    $   1,119,848
Stock retired in settlement of subscriptions
    receivable                                 $ (5,978,668)   $         -  $         -  $         -  $(5,978,668)   $  (5,978,668)
Stock received in settlement                   $   (231,350)   $         -  $         -  $         -  $  (231,350)   $    (231,350)
Stock as compensation for services             $  5,175,792    $ 1,357,735  $         -  $ 1,357,735  $ 1,246,062    $   6,533,527
Stock issued in cancellation of accounts
    payable                                    $  4,248,938    $         -  $         -  $         -  $         -    $   4,248,938
Exercise of stock options                      $  4,858,820    $         -  $         -  $         -  $ 4,858,820    $   4,858,820

                                   See accompanying notes to the consolidated financial statements

                                                                 F-9
</TABLE>
<PAGE>

                         SAMARITAN PHARMACEUTICALS, INC.
                          (A DEVELOPMENT STAGE COMPANY)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                  YEARS ENDED DECEMBER 31, 2006, 2005 AND 2004

NOTE 1   -   ORGANIZATION AND NATURE OF BUSINESS

Samaritan Pharmaceuticals, Inc. (`the Company') was formed in September 1994 and
became public in October 1997. Our principle executive offices are located in
Las Vegas, Nevada.

Samaritan Pharmaceuticals, Inc., is an entrepreneurial biopharmaceutical
company, focused on commercializing innovative therapeutic products to relieve
the suffering of patients with Alzheimer's disease; cancer; cardiovascular
disease, HIV, and Hepatitis C; as well as, commercializing its acquired
marketing and sales rights, to sell nine marketed revenue-generating products,
in Greece, and/or various Eastern European countries.

NOTE 2   -   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

A.       Basis of Consolidation

The accompanying financial statements include the accounts of the Company and
its wholly owned subsidiaries. All intercompany balances and transactions have
been eliminated in consolidation.

B.       Revenue recognition

The Company follows the guidance of the Securities and Exchange Commission's
Staff Accounting Bulletin 104 for revenue recognition. The Company recognizes
revenue when persuasive evidence of a final agreement exists, delivery has
occurred, the selling price is fixed or determinable and collectability is
reasonably assured. During 2006 and 2005, revenue consisted of grant income
recognized when the qualifying expenditure was incurred. During 2003, revenue
consisted of a consulting fee deemed earned since there was no further services
under the agreement.

C.       Cash Equivalents

The Company considers all highly liquid temporary cash investments with an
original maturity of three months or less to be cash equivalents.

The Company maintains its cash in bank accounts at high credit quality financial
institutions. The balances at times may exceed federally insured limits.

                                      F-10
<PAGE>

D.      Concentration of Credit Risks

The Company is subject to concentrations of credit risk primarily from their
equity purchase agreement with Fusion Capital. If Fusion Capital is unable to
meet its commitments under the agreement or is unable to sell the stock in the
open market, this will have a materially adverse effect on the Company's
financial position and its ability to continue its current research.

E.       Property and Equipment

Property and equipment are recorded at cost. Depreciation is provided using the
straight line method over the estimated useful lives of the assets.

F.       Intangibles

Legal fees associated with filing patents are recorded at cost and amortized
over 17 years. We currently own or in-license patents related to our products or
product candidates and own or in-license additional applications for patents
that are currently pending. In general, when we in-license intellectual property
from various third parties, we are required to pay royalties to the parties on
product sales. The Company reviews patent costs for impairment by comparing the
carrying value of the patents with the fair value. The Company believes it will
recover the full amount of the patent costs based on forecasts of sales of the
products related to the patents. Patent registration costs are amortized over
seventeen (17) years once approved. Patent amortization expense was $55,458 and
$34,268 during the years ended December 31, 2006 and 2005, respectively.
Projected amortization is $61,341 for 2007 through 2011. Certain U.S. patents
may be eligible for patent term extensions under the Hatch-Waxman Act may be
available to Samaritan for the lost opportunity to market and sell the invention
during the regulatory review process.

Purchased technology rights are recorded at cost and are being amortized using
the straight line method over the estimated useful life of the technology.
Amortization expense was $10,896 for the years ending December 31, 2003 to 2005,
and $17,134 for the year ended December 31, 2006. Projected amortization expense
associated with these technology rights in the future will be $23,763 for 2007
and $14,676 for 2008 through 2011.

G.       Earnings (loss) per share

 The Company reports loss per common share in accordance with Statement of
Financial Accounting Standards ("SFAS") No. 128, "Earnings Per Share." The
Company has 25,718,518 and 23,856,018 and 20,942,930 options outstanding at
December 31, 2006, 2005 and 2004, respectively, which have not been included.

H.       Use of Estimates

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

                                      F-11
<PAGE>

I.       Income Taxes

Pursuant to Statement of Financial Accounting Standards No. 109 (`SFAS 109')
Accounting for Income Taxes', the Company accounts for income taxes under the
liability method. Under the liability method, a deferred tax asset or liability
is determined based upon the tax effect of the differences between the financial
statement and tax basis of assets and liabilities as measured by the enacted
rates, which will be in effect when these differences reverse.

J.       Research and Development Costs

Research and development costs are expensed when incurred.

K.       Impairment of Long-Lived Assets

The Company reviews long-lived assets and certain identifiable assets related to
those on a quarterly basis for impairment whenever circumstances and situations
change such that there is an indication that the carrying amounts may not be
recovered. At December 31, 2006, the Company does not believe that any
impairment has occurred.

L.       Fair Value of Financial Instruments

Statement of Financial Accounting Standard No. 107 Disclosures about Fair Value
of Financial Instruments ("SFAS 107") requires the disclosure of fair value
information about financial instruments whether or not recognized on the balance
sheet, for which it is practicable to estimate the value. Where quoted market
prices are not readily available, fair values are based on quoted market prices
of comparable instruments. The carrying amount of cash, accounts payable and
accrued expenses approximates fair value because of the short maturity of those
instruments.

M.       Foreign Currency Translation

Assets and liabilities of subsidiaries operating in foreign countries are
translated into U.S. dollars using both the exchange rate in effect at the
balance sheet date of historical rate, as applicable. Results of operations are
translated using the average exchange rates prevailing throughout the year. The
effects of exchange rate fluctuations on translating foreign currency assets and
liabilities into U.S. dollars are included in stockholders equity (Accumulated
other comprehensive loss), while gains and losses resulting from foreign
currency transactions are included in operations.

N.       Stock Based Compensation

In December 2004, the FASB issued SFAS No. 123(R), "Share-Based Payment," which
replaces SFAS No. 123 and supersedes APB Opinion No. 25. Under SFAS No. 123(R),
companies are required to measure the compensation costs of share-based
compensation arrangements based on the grant-date fair value and recognize the
costs in the financial statements over the period during which employees are
required to provide services. Share-based compensation arrangements include
stock options, restricted share plans, performance-based awards, share
appreciation rights and employee share purchase plans. In March 2005 the SEC
issued Staff Accounting Bulletin No. 107, or "SAB 107". SAB 107 expresses views
of the staff regarding the interaction between SFAS No. 123(R) and certain SEC
rules and regulations and provides the staff's views regarding the valuation of
share-based payment arrangements for public companies. SFAS No. 123(R) permits
public companies to adopt its requirements using one of two methods. On April
14, 2005, the SEC adopted a new rule amending the compliance dates for SFAS No.

                                      F-12
<PAGE>

123(R). Companies may elect to apply this statement either prospectively, or on
a modified version of retrospective application under which financial statements
for prior periods are adjusted on a basis consistent with the pro forma
disclosures required for those periods under SFAS 123. Effective January 1,
2006, the Company has fully adopted the provisions of SFAS No. 123(R) and
related interpretations as provided by SAB 107. As such, compensation cost is
measured on the date of grant as the excess of the current market price of the
underlying stock over the exercise price. Such compensation amounts, if any, are
amortized over the respective vesting periods of the option grant. The Company
applies this statement prospectively. Prior to January 1, 2006, the Company
accounted for stock-based employee compensation plans (including shares issued
under its stock option plans) in accordance with APB Opinion No. 25 and followed
the pro forma net income, pro forma income per share, and stock-based
compensation plan disclosure requirements set forth in the Statement of
Financial Accounting Standards No. 123, Accounting for Stock-Based Compensation
("SFAS No. 123").

O.       Marketable Securities

At December 31, 2006, the Company held one brokered Certificate of Deposit with
a total market value of $496,068 which was classified as available for sale. The
original cost was $500,000. During 2006, the certificate was redeemed.
Unrealized gains and losses, determined by the difference between historical
purchase price and the market value at each balance sheet date, are recorded as
a component of Accumulated Other Comprehensive loss in Shareholder's Deficit.
Realized gains and losses will be determined by the difference between
historical purchase price and gross proceeds received when the marketable
securities are sold.

At December 31, 2006, the Company did not own any Certificate of Deposits.

P.       Accrued Officers' Compensation

Accrued officers' compensation consists of the unpaid portion of the respective
officer's contract salary.

Q.       Unissued Stock

Unissued stock consists of proceeds from private placements received by year-end
for stock that had yet to be issued. Such amounts were retired through the
issuance of shares subsequent to the balance sheet date.

R.       New Accounting Pronouncements

In February 2006, the FASB issued SFAS 155, which applies to certain "hybrid
financial instruments," which are instruments that contain embedded derivatives.
The new standard establishes a requirement to evaluate beneficial interests in
securitized financial assets to determine if the interests represent
freestanding derivatives or are hybrid financial instruments containing embedded
derivatives requiring bifurcation. This new standard also permits an election
for fair value re-measurement of any hybrid financial instrument containing an
embedded derivative that otherwise would require bifurcation under SFAS 133. The
fair value election can be applied on an instrument-by-instrument basis to
existing instruments at the date of adoption and can be applied to new
instruments on a prospective basis. The adoption of SFAS No.155 did not have a
material impact on the Company's financial position and results of operations.

                                      F-13
<PAGE>

In March 2006, the FASB issued SFAS No. 156, "Accounting for Servicing of
Financial Assets, an amendment of FASB Statement No. 140, Accounting for
Transfers and Servicing of Financial Assets and Extinguishments of Liabilities".
This statement requires all separately recognized servicing assets and servicing
liabilities be initially measured at fair value, if practicable, and permits for
subsequent measurement using either fair value measurement with changes in fair
value reflected in earnings or the amortization and impairment requirements of
Statement No. 140. The subsequent measurement of separately recognized servicing
assets and servicing liabilities at fair value eliminates the necessity for
entities that manage the risks inherent in servicing assets and servicing
liabilities with derivatives to qualify for hedge accounting treatment and
eliminates the characterization of declines in fair value as impairments or
direct write-downs. SFAS No. 156 is effective for an entity's first fiscal year
beginning after September 15, 2006. The adoption of this statement is not
expected to have a significant effect on the Company's future reported financial
position or results of operations.

In July 2006, the Financial Accounting Standards Board (FASB) issued FASB
Interpretation (FIN) No. 48, "Accounting for Uncertainty in Income Taxes-an
interpretation of FASB Statement No. 109." This interpretation provides guidance
for recognizing and measuring uncertain tax positions, as defined in SFAS No.
109, "Accounting for Income Taxes." FIN No. 48 prescribes a threshold condition
that a tax position must meet for any of the benefit of an uncertain tax
position to be recognized in the financial statements. Guidance is also provided
regarding de-recognition, classification, and disclosure of uncertain tax
positions. FIN No. 48 is effective for fiscal years beginning after December 15,
2006. The Company does not expect that this interpretation will have a material
impact on its financial position, results of operations, or cash flows.

In September 2006, the FASB issued FASB Statement No. 157. This Statement
defines fair value, establishes a framework for measuring fair value in
generally accepted accounting principles (GAAP), and expands disclosures about
fair value measurements. This Statement applies under other accounting
pronouncements that require or permit fair value measurements, the Board having
previously concluded in those accounting pronouncements that fair value is a
relevant measurement attribute. Accordingly, this Statement does not require any
new fair value measurements. However, for some entities, the application of this
Statement will change current practices. This Statement is effective for
financial statements for fiscal years beginning after November 15, 2007. Earlier
application is permitted provided that the reporting entity has not yet issued
financial statements for that fiscal year. Management believes this Statement
will have no impact on the financial statements of the Company once adopted.

In February 2007, the FASB issued SFAS No. 159, "The Fair Value Option for
Financial Assets and Financial Liabilities-including an amendment of FAS 115"
(Statement 159). Statement 159 allows entities to choose, at specified election
dates, to measure eligible financial assets and liabilities at fair value that
are not otherwise required to be measured at fair value. If a company elects the
fair value option for an eligible item, changes in that item's fair value in
subsequent reporting periods must be recognized in current earnings. Statement
159 is effective for fiscal years beginning after November 15, 2007. We are
currently evaluating the potential impact of Statement 159 on our financial
statements. We do not expect the impact will be material.

Other accounting standards that have been issued or proposed by the FASB or
other standards-setting bodies that do not require adoption until a future date
are not expected to have a material impact on the consolidated financial
statements upon adoption.

                                      F-14
<PAGE>

NOTE 3   -   PROPERTY AND EQUIPMENT

Property and equipment, at cost, consist of the following as of December 31:

                                      Estimated
                                        Useful
                                         Life           2005             2006
                                       ---------     ---------     -----------
Furniture and Fixtures                     3-7       $ 130,828     $  135,248
Software                                     3          10,392         11,137
Lab Equipment                                3         197,279        197,279
                                                     ---------     -----------
                                                       338,499        343,664
                                                     ---------     ----------
Less: accumulated depreciation                        (131,696)     (216,037)
                                                     ---------     ----------
                               Total                 $ 206,803     $ 127,627
                                                     =========     ==========

Depreciation expense for the years ended December 31, 2006, 2005 and 2004 was
$84,342, $52,951, and $16,322, respectively.

NOTE 4   -   SHAREHOLDERS' EQUITY

The Company amended its articles of incorporation on June 27, 2003, to increase
the authorized number of shares to 250 million and on April 24, 2001, authorized
a class of 5 million shares of preferred stock. There are no outstanding
preferred stock shares at December 31, 2006.

A.       Stock Option Plans.

The short and long-term compensation program includes stock options granted
under Stock Incentive Plans as well as non-qualified stock options. The Company
currently has two stock option plans: The 2005 Stock Option Plan, approved by
the shareholders on June 10, 2005 as an additional plan to the Company's 2001
Stock Plan; and the 2001 Stock Option Plan, approved by the shareholders on
April 24, 2001. Both option plans are designed to reward executives for
achieving long-term financial performance goals over a three-year to ten-year
period, provide retention incentives for executives, and tie a significant
portion of an executive's total compensation to long-term performance. Stock
options for executive officers and key associates are part of the incentive
program and link the enhancement of shareholder value directly to their total
compensation.

                                      F-15
<PAGE>

Shares available under the 2005 Plan: On a calendar year basis, Awards under the
Plan may be made for a maximum of ten percent (10%) of the total shares of
Common Stock outstanding on a fully diluted basis (without taking into account
outstanding Awards at the end of the prior calendar year), less Awards
outstanding at the end of the prior calendar year. Notwithstanding this limit,
not more than three percent (3%) of the total shares of within the plan may be
subject to ISO Awards during the term of the Plan, and not more than seven
percent (7%) of the total shares within the plan may be subject to Awards in a
form other than options and SARs. No director, officer, or employee may be
granted options with respect to the total awards available under the plan to
more than half of the awards within the Plan, nor more than 5,000,000 shares per
fiscal year, subject to a limit of 2,500,000 shares per fiscal year for
individuals first hired that year. The number of shares subject to these limits
will be adjusted in the event of certain changes in the capitalization of the
Company.

Shares Available under the 2001 Plan: The number of awards that may be granted
under the 2001 Plan in each calendar year will not exceed twenty percent (20%)
of (i) the total shares of common stock outstanding on a fully diluted basis,
without taking into account awards outstanding under the 2001 Plan that are
exercisable for or convertible into common stock or that are unvested stock
awards (referred to as 'outstanding awards'), at the close of business on the
last day of the preceding calendar year, less (ii) the number of shares subject
to 'outstanding awards' at the close of business on that date.

There were 2,642,500 options granted, 525,000 options exercised, and 255,000
options expired pursuant to both plans. As of December 31, 2006, there were
25,718,518 options remaining outstanding pursuant to both plans. Of the
2,642,500 options granted, 1,030,000 were issued for services and expenses
accordingly, and 1,612,500 were issued in association with private placements.

The following table summarizes the Company's stock options outstanding at
December 31, 2006, 2005, and 2004:

                                                           Weighted average
                                           Shares          exercise price
                                        ------------      -----------------
   Outstanding and exercisable
   at December 31, 2003                   15,962,258      $             .34
   Granted                                25,000,806                    .51
   Exercised                             (17,585,468)                  (.30)
   Expired                                (2,452,666)                  (.51)
                                        -------------     -----------------
   Outstanding and exercisable
   at December 31, 2004                   20,924,930                   .56
   Granted                                 3,201,088                   .88
   Exercised                                (170,000)                 (.19)
   Expired                                  (100,000)                (1.00)
                                        -------------     -----------------
   Outstanding and exercisable
   at December 31, 2005                   23,856,018                   .60
   Granted                                 2,642,500                   .76
   Exercised                                (525,000)                 (.20)
   Expired                                  (255,000)                (1.18)
                                        -------------     -----------------
   Outstanding and exercisable
   at December 31, 2006                   25,718,518      $            .62
                                        -------------     -----------------

Information, at date of issuance, regarding options for the year ended December
31, 2006:
<TABLE>
<CAPTION>

                                                                             Weighted
                                                            Shares            Average            Weighted
                                                                             Exercise          Average Fair
                                                                               Price              Value
<S>                                                       <C>           <C>               <C>
  Exercise price exceeds market price                     2,582,500     $       .77       $        .19
  Exercise price equals market price                         60,000     $       .39       $        .26
  Exercise price is less than market price                   -0-        $       -0-       $        -0-
</TABLE>

                                      F-16
<PAGE>

The Company applies APB No. 25, Accounting for Stock Issued to Employees, and
related interpretations in accounting for its stock options. As a result no
compensation expense had been recognized for employee and director stock options
prior to 2006 when FASB Statement No. 123R, Share-Based Payment, an Amendment of
FASB Statement No. 123 (FAS No. 123R) was adopted. Had the Company determined
compensation cost based on the fair value at the grant date for its stock
options during those years under SFAS No. 123, Accounting for Stock-Based
Compensation, the Company's net loss would have been reported as follows:

                                                         December 31,
                                                    2004               2005
                                              ----------------    --------------
Net Loss:
  As reported                                 $    (4,864,361)    $ (5,557,559)
  Pro Forma                                   $    (8,927,246)    $ (6,887,390)
Basic and diluted loss per common share:
  As reported                                      (0.04)           (0.04)
  Pro Forma                                        (0.07)           (0.05)

The Company utilizes the Black-Scholes option-pricing model to calculate the
fair value of each individual issuance of options with the following assumptions
used for grants during the year ended December 31, 2006, 2005, and 2004. The
per-share weighted average fair value of stock options granted during 2006, 2005
and 2004 was $0.76, $0.43 and $0.24, respectively, on the date of grant using
the Black Scholes pricing model and the following assumptions for the years
ended December 31:

                                      2004             2005             2006
                                  ------------     ------------     ------------

Expected dividend yield               0%               0%                 0%
Risk-free interest rate               5%               5%               3.8%
Annualized volatility                82%              NA                 NA
Average quarterly volatility
for applicable quarters                               41%                NA
Volatility calculated by
 grant date                                                            86%-110%

<TABLE>
<CAPTION>


             -------------------------------------------------------------------------------------------------------------
                                                               Calendar Year 2006
             -------------------------------------------------------------------------------------------------------------
                                                    Options Outstanding Options Exercisable
             -------------------------------------------------------------------------------------------------------------
                                 Weighted
                                 -Average
                                  Range of                        Remaining
                 Exercise          Number          Contractual    Weighted -Average        Number       Weighted-Average
                 Prices         Outstanding      Life (Months)    Exercise Price        Exercisable     Exercise Price
             --------------- ---------------- ----------------- -------------------- ---------------- --------------------
<S>             <C>   <C>          <C>                 <C>                <C>              <C>                <C>
             $  .15 - .25          387,500             52       $         .22              387,500    $       .22
             --------------- ---------------- ----------------- -------------------- ---------------- --------------------
             $  .26 - .50        5,462,435             78       $         .36            5,462,435    $      .36
             --------------- ---------------- ----------------- -------------------- ---------------- --------------------
             $  .51 - 1.00      18,418,583             68       $         .67           18,418,583    $       .67
             --------------- ---------------- ----------------- -------------------- ---------------- --------------------
                Above 1.00       1,450,000             89       $        1.11            1,450,000    $      1.11
             --------------- ---------------- ----------------- -------------------- ---------------- --------------------
</TABLE>

                                      F-17
<PAGE>

C.       Stock as compensation and settlement of debt

The Company issues stock as compensation for services valuing such issues
premised upon the fair market value of the stock.

During the year ended December 31, 2006, no shares were issued as compensation.
During the year ended December 31, 2005, the Company issued an aggregate of
398,900 shares of common stock in consideration of services rendered or to be
rendered to the Company. Such shares were valued at an aggregate of $198,184
ranging from $.41 - $.72 per share, representing the fair value of the shares
issued. The issuances were recorded as non-cash compensation expense and
deferred compensation. The unamortized balance of deferred compensation at
December 31, 2005 is $40,034. During the year ended December 31, 2004, the
Company issued an aggregate of 2,081,249 shares of common stock in consideration
of services rendered or to be rendered to the Company. Such shares were valued
at an aggregate of $1,790,478 ranging from $.16 - $1.19 per share, representing
the fair value of the shares issued. The issuances were recorded as non-cash
compensation expense and deferred compensation. The unamortized balance of
deferred compensation at December 31, 2004 is $304,416.

During the year ended December 31, 2006, the Company also issued 12,123,008
shares in connection with the common stock purchase agreement with Fusion
Capital (Note 11). During the year ended December 31, 2005, the Company also
issued 2,567,175 shares in connection with the common stock purchase agreement
with Fusion Capital (Note 11). During the year ended December 31, 2004, the
Company also issued 8,758,240 shares in connection with the common stock
purchase agreement with Fusion Capital (Note 9).

D.       Private Placement

During the year ended December 31, 2006, through various private placements, the
Company sold 7,212,500 shares for $2,045,000. During the year ended December 31,
2005, the Company did not offer any private placements. During the year ended
December 31, 2004, through various private placements, the Company sold
11,426,733 shares for $4,300,938.

NOTE 5   -    INCOME TAXES

The Company has net operating losses at December 31, 2006 of approximately
$28,448,000 expiring through 2025. Utilization of these losses may be limited by
the "change of ownership" rules as set forth in section 382 of the Internal
Revenue Code.

                                      F-18
<PAGE>

A reconciliation of the statutory U.S. Federal rate thirty-five percent (35%)
and effective rates is as follows:
<TABLE>
<CAPTION>

                                                Years Ended December 31,
                                         2004               2005                2006
                                   -------------       -------------        -------------
<S>                                <C>                 <C>                  <C>
Expected income tax (benefit)
at Federal statutory rate          $ (1,702,000)       $ (1,945,000)        $ (2,622,000)
State tax (benefit) net of
Federal effect                         (243,000)           (278,000)            (375,000)
Permanent differences                   821,000             230,000               18,000
Increase in valuation allowance       1,124,000           1,993,000            2,979,000
                                   -------------       -------------        -------------
                                   $          -        $          -         $          -
                                   =============       =============        =============
</TABLE>

                                               December 31,
                              ---------------------------------------
                                    2005                     2006
                             ----------------       -----------------
Net operating losses         $     8,469,000        $     11,360,000
Stock Option Expense                                          88,000
Valuation allowance               (8,469,000)            (11,448,000)
                             ----------------       -----------------
                             $             -        $              -
                             ================       =================

The valuation allowances have been established equal to the full amounts of the
deferred tax assets, as the Company is not assured that it is more likely than
not that these benefits will be realized.

NOTE 6   -   COMMITMENTS AND CONTINGENCIES

A. The Company leases various facilities under operating lease agreements
expiring through September 2008. Rental expense for the years ended December 31,
2006, 2005, and 2004 was $62,115, $39,708, and $49,883 respectively. Future
minimum annual lease payments under the facilities lease agreements for
agreements lasting more than one year are as follows:

                                  2007 $56,572
                                  2008 $43,307

B. Samaritan has a research collaboration (the "Research Collaboration") with
Georgetown University to further develop Samaritan's pipeline. Commencing on
April 1, 2004, the Research Collaboration term was extended to 2014 with a
budget of $1,000,000 per year. The $1,000,000 paid by Samaritan over four (4)
quarterly payments of $250,000 is unallocated and covers the general research
and development effort. In the second quarter of 2007, we plan to terminate the
Georgetown University research collaboration, however, Samaritan is currently
negotiating a research collaboration with McGill University, Montreal, under the
same terms as the Georgetown University agreement which we plan to initiate in
the third quarter of 2007.


C. The Company has no written employment agreement with the Dr. Janet Greeson
and Mr. Eugene Boyle. Dr. Thomas Lang and Dr. Christos Dakas each have
employment agreements negotiated at arm's length with the Compensation
Committee, and each such agreement provides for a minimum annual base salary. In
setting base salaries, the Board has considered (a) the contributions made by
each executive to our Company, (b) compensation paid by peer companies to their
executive officers and (c) outside compensation reports. In 2006, all executive
officers received salary increases of approximately 5% reflecting competitive
trends, general economic conditions as well as a number of factors relating to
the particular individual, including the performance of the individual
executive, and level of experience, ability and knowledge of the job.

                                      F-19
<PAGE>

The Compensation Committee also has the authority to award discretionary bonuses
to our executive officers. The incentive bonuses are intended to compensate
officers for achieving financial and operational goals and for achieving
individual annual performance objectives. These objectives vary depending on the
individual executive, but relate generally to strategic factors such as 1)
initial signing of an employment agreement; 2) upon acceptance of filing of a
new drug application by the FDA; 3) the FDA approval to move from one phase to
the next phase in the FDA application process; 4) pharmaceutical sales goals
achieved 5) completion of an in-licensing contract; 6) completion of an
out-licensing contract; and 7) increases in market capitalization. The
Compensation Committee did not make any cash bonuses to the executive officers
in 2006.

NOTE 7   -   RESEARCH AND DEVELOPMENT COSTS

Research and development expenses consist of the costs associated with our
research activities, as well as the costs associated with our drug discovery
efforts, conducting preclinical studies and clinical trials, manufacturing
development efforts and activities related to regulatory filings. Our research
and development expenses consist of:
    -external research and development expenses incurred under agreements with
     third-party contract research organizations and investigative sites,
     third-party manufacturing organizations and consultants;
    -employee-related expenses, which include salaries and benefits for the
     personnel involved in our drug discovery and development activities.

We use our employee across multiple research projects, including our drug
development programs. We track direct expenses related to our clinical programs
on a per project basis. Accordingly, we allocate internal employee-related, as
well as third-party costs, to each clinical program. We do not allocate expenses
related to preclinical programs.

The following table summarizes our principal product development programs,
including the related stages of development for each product candidate in
development and the research and development expenses allocated to each clinical
product candidate. The information in the column labeled "Estimated Completion
of Current Trial" is our estimate of the timing of completion of the current
clinical trial or trials for the particular product candidate. The actual timing
of completion could differ materially from the estimates provided in the table.

<TABLE>
<CAPTION>

                                         Estimated
                  Completion Research and Development Expenses
                            Phase of    of Current                  Year Ended December 31
Product Candidate          Indication   Development   Trial       2004        2005        2006
-------------------------- ----------- -------------- ------ -------------------------------------
<S>                                                <C> <C>   <C>          <C>         <C>
Clinical Development
SP-01A**                          HIV        Phase 2   2006  $   836,424  $2,263,903  $ 2,534,856

Research and preclinical                                     $   707,497  $1,192,398  $ 2,332,197
                                                             ------------ ----------- ------------
                                                             $ 1,543,921  $3,456,301  $ 4,667,053
                                                             ============ =========== ============
</TABLE>



         **On March 28, 2007, Samaritan entered into an agreement in which
         Pharmaplaz will bear the expense of the development of SP-01A going
         forward.

The successful development of our product candidates is highly uncertain. At
this time, we cannot reasonably estimate or know the nature, timing and
estimated costs of the efforts that will be necessary to complete the remainder
of the development of, or the period, if any, in which material net cash inflows
may commence from, SP-01A or any of our preclinical product candidates. This is
due to the numerous risks and uncertainties associated with developing drugs,
including the uncertainty of:

                                      F-20
<PAGE>

    -the scope, rate of progress and expense of our clinical trials and other
     research and development activities;
    -the potential benefits of our product candidates over other therapies;
    -our ability to market, commercialize and achieve market acceptance for any
     of our product candidates that we are developing or may develop in the
     future;
    -future clinical trial results;
    -the terms and timing of regulatory approvals; and
    -the expense of filing, prosecuting, defending and enforcing any patent
     claims and other intellectual property rights.

A change in the outcome of any of these variables with respect to the
development of a product candidate could mean a significant change in the costs
and timing associated with the development of that product candidate. For
example, if the FDA or other regulatory authority were to require us to conduct
clinical trials beyond those which we currently anticipate will be required for
the completion of clinical development of a product candidate or if we
experience significant delays in enrollment in any our clinical trials, we could
be required to expend significant additional financial resources and time on the
completion of clinical development.

NOTE 8   -   LITIGATION

Samaritan, from time to time, is involved in various legal proceedings in the
ordinary course of its business.

NOTE 9   -   RELATED PARTY TRANSACTIONS


In the ordinary course of business, we entered into transactions with Clay
County Holdings (`CCH'). These transactions include loans made to and from CCH.
In the past, CCH had made a loan to Samaritan which Samaritan paid off in 2003.
During 2004, Samaritan created a notes receivable with CCH for $250,000 which
amount bears interest at a rate of twelve percent (12%) per annum. The note
receivable is secured by pledge of common stock in Samaritan owned by CCH. A
Director of the Company is the Chairman of the Board of Nevada Gold and Casinos
but is not a shareholder of CCH. The CEO and CFO of the Company are mother and
son.


NOTE 10  -   OTHER INCOME

In the December 31, 2004 financial statements, other income consists of the
return of 250,000 shares of common stock that had been issued as compensation to
a consultant in a prior year. The shares were returned due to the fact that the
services were not performed. The shares were valued at their original issuance
value, $231,350.

                                      F-21
<PAGE>

NOTE 11   -   FUSION TRANSACTION

On May 12, 2005, we entered into a second common stock purchase agreement, as
amended ("Purchase Agreement II") with Fusion Capital pursuant to which Fusion
Capital has agreed to purchase our common stock from time to time at our option
up to an aggregate amount of $40,000,000 over fifty (50) months from the date
the SEC declares effective a registration statement covering the shares of
common stock to be purchased by Fusion Capital pursuant to such Purchase
Agreement II. The SEC declared effective the Company's registration statement on
Form SB-2, Commission Registration No. 333-130356 on December 29, 2005, covering
the shares of common stock to be purchased by Fusion Capital and such shares
will be priced based on the market price of our shares at the time of sale to
Fusion Capital. We have the right to sell to Fusion Capital up to $40,000 of our
common stock on each business day and may increase that amount with additional
$5,000 for every $0.25 increase in our stock price above $1.50 for five
consecutive days immediately prior to the submission of Daily Purchase Amount
Increase Notice. We have the right to control timing and the amount of shares we
sell to Fusion Capital. On February 17, 2006, the conditions for commencement of
sales of our shares specified in the purchased agreement with Fusion Capital
were satisfied. During the year ended December 31, 2006, the Company also issued
12,123,008 shares in connection with the common stock purchase agreement with
Fusion Capital. Samaritan filed a post effective amendment on Form S-1 to the
above Registration Statement No. 333-130356 on January 9, 2007. The SEC declared
it effective on February 6, 2007.

NOTE 12   -   RISKS AND UNCERTAINTIES

Marketability of the product is dependent, among other things, upon securing
additional capital to successfully complete the clinical testing of the product,
securing FDA approval, and procurement of viable patents.

NOTE 13   -   QUARTERLY FINANCIAL DATA - (Unaudited)

The following quarterly financial data are unaudited, but in the opinion of
management include all necessary adjustments for a fair presentation of the
interim results.

<TABLE>
<CAPTION>

                                         First             Second            Third            Fourth
                                       Quarter           Quarter           Quarter          Quarter       Total
                                      ------------      ------------      ------------      -----------  ----------
Year ended December 31, 2006

<S>                                   <C>               <C>               <C>               <C>          <C>
Government Research Grants            $    21,793       $         -       $    10,586       $        -   $   32,379
Income from operations                 (1,193,558)       (2,257,555)       (1,774,588)      (2,347,045)  (7,572,746)
Net income (loss)                      (1,193,558)       (2,257,555)       (1,774,588)      (2,347,045)  (7,572,746)
Basic and diluted earnings (loss)
per share                             $      (.01)      $      (.02)      $      (.01)      $     (.02)  $     (.05)


                                         First             Second            Third            Fourth
                                       Quarter           Quarter           Quarter            Quarter          Total
                                      ------------      ------------      ------------      -----------     ----------
Year ended December 31, 2005

Government Research Grants            $         -       $    15,250       $   120,179       $  121,418   $  256,847
Income from operations                 (1,261,556)       (1,470,396)       (1,344,515)      (1,481,092)  (5,557,559)
Net income (loss)                      (1,261,556)       (1,470,396)       (1,344,515)      (1,481,092)  (5,557,559)
Basic and diluted earnings (loss)
per share                             $      (.01)      $     (.01)       $      (.01)      $     (.01)  $     (.04)
</TABLE>

                                      F-22
<PAGE>


NOTE 14   -   SUBSEQUENT EVENTS (Unaudited)

On March 28, 2007, Samaritan and Pharmaplaz announced they have a collaboration
to develop and commercialize SP-01A, an "oral" HIV entry inhibitor, which has
demonstrated safety and efficacy in Phase II human clinical trials. Under the
terms of the agreement, Samaritan is to receive $10 million dollars upfront in
two payments, $1.4 million was received on March 28, 2007, and the remaining
$8.6 million on September 16, 2007. Pharmaplaz will be responsible for clinical
development, clinical trial costs and manufacturing. Upon successful
commercialization, Samaritan and Pharmaplaz will co-market SP-01A and will share
50-50, in its revenue royalty stream.

On March 5, 2007, the Company announced that it had signed a service agreement
with Advinus Therapeutics Limited, India, to perform validating preclinical
studies for Caprospinol (SP-233), the company's lead Alzheimer's drug. Samaritan
has completed a series of studies that suggests Caprospinol offers a new and
novel neuroprotective treatment that could potentially protect the memory of
Alzheimer's patients. Promising preclinical studies have shown that Caprospinol
directly targets the amyloid peptide which is commonly thought to be the cause
of Alzheimer's. Advinus will perform studies to validate Samaritan's previous
findings; and in addition, Samaritan's strategy is to perform extensive
preclinical studies with the intention of out-licensing Caprospinol to a major
pharmaceutical company; and concurrently, expand Samaritan's investigational new
drug application (IND) to the FDA, to enter Phase I human clinical trials.

On February 26, 2007, the Company announced that it had signed a marketing
agreement with Shire Plc to sell Shire's Elaprase to treat Hunter's disease in
Greece and Cyprus. Samaritan will sell the drug on a "named patient" basis until
Greece and Cyprus establish pricing and reimbursement for the drug. The drug is
expected to launch in the two countries during the second quarter of 2007.

On January 22, 2007, the Company announced that it had signed an exclusive
license for the marketing and sales of U.S. approved Infasurf (calfactant), a
specialist medication used to treat and prevent respiratory distress syndrome
(RDS) in premature infants. Under this agreement, Samaritan has obtained
exclusive rights to sell Infasurf in Turkey, Serbia, Bosnia, Macedonia, Albania,
Egypt and Syria. The cumulative population of these countries is greater than
180 million people.

On January 16, 2007, the Company announced that it had signed an exclusive
license with Molteni Farmaceutici, Italy in-licensing the marketing and sales
rights for six prescription medications: Oramorph(tm), Morphine Sulphate,
Methadone, Naloxone Molteni(tm), Naltrexone(tm), and Mepivamol(tm), in Greece
and Cyprus.

During the first quarter 2007, we issued 1,099,748 shares in consideration of
services performed in 2006; issued 500,000 shares for the acquisition of
Metastatin Pharmaceuticals; issued 50,000 shares for the asset purchase from
Quest Pharmatech.. Additionally in first quarter 2007, the Company received
$280,000 in exchange for the issuance of 1.12 million shares to Fusion Capital.
The Company also completed one (1) private placement in which the Company
received qualified subscriptions for 5,335,000 shares of our Common Stock at a
purchase price of $0.15 per share of total proceeds equal to $800,250, for which
we are in the process of filing an AMEX additional listing application to issue
the shares.

                                      F-23