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

                                   Form 10-KSB

(X) Annual Report Under SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT
    OF 1934

                  For the fiscal year ended December 31, 2004

( ) TRANSITIONAL REPORT UNDER 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.
                 (Name of small business issuer in its charter)

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

      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, $.001 par value per share (Title of class)

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

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

The registrant had no revenues in the fiscal year ended December 31, 2004. The
aggregate market value of the issued voting and non-voting common equity held by
non-affiliates computed by reference to the average bid and asked price of such
common stock, as of March 31, 2005, was approximately $48,800,803 based upon, as
a reasonable assumption, that the issuer's shareholders list, standing alone,
supplies an accurate presentation of those shareholders who are non affiliates,
determined by the issuer to be those persons who are not officers, directors or
owners of 10% or more of the common stock. The company had 133,282,603 common
shares issued and outstanding as of March 31, 2005.

Transitional Small Business Disclosure Format (Check one):     Yes__ No _X_









<PAGE>

                         SAMARITAN PHARMACEUTICALS, INC.
                                   FORM 10-KSB

                   GENERAL FORM FOR REGISTRATION OF SECURITIES

                                Table of Contents

                                     Part I

Item  1.    Description of Business..........................................1

Item  2.    Description of Property..........................................8

Item  3.    Legal Proceedings................................................8

Item  4.    Submission of Matters to a Vote of Security Holders..............8

                                     Part II

Item  5.    Market For Common Equity and Related Stockholder Matters.........8

Item  6.    Management's Discussion and Analysis or Plan of Operation.......10

Item  7.    Financial Statements............................................20

Item  8.    Changes in and Disagreements with Accountants on
            Accounting and Financial Disclosures............................21

Item 8A.    Controls and Procedures.........................................21

Item 8B.    Other Information...............................................21

                                    Part III

Item  9.    Directors, Executive Officers, Promoters and Control Persons;
            Compliance With Section 16(a) of the Exchange Act...............21

Item 10.    Executive Compensation..........................................21

Item 11.    Security Ownership of Certain Beneficial Owners and Management
            and Related Stockholder Matters.................................21

Item 12.    Certain Relationships and Related Transactions..................21

Item 13.    Exhibits .......................................................21

Item 14.    Principal Accountant Fees and Services..........................22

Signatures..................................................................23














<PAGE>

                                     PART I


ITEM 1.  BUSINESS.

Samaritan was formed in September 1994 and became public in October 1997. Our
principal executive offices are located at 101 Convention Center Drive, Suite
310, Las Vegas, NV 89109, and our telephone number is (702) 735-7001.

Samaritan Pharmaceuticals is working to ensure a longer and better life, for
patients suffering with AIDS, Alzheimer's, Cancer, and Cardiovascular disease.
Samaritan is a pipeline-driven Biopharmaceutical company, with a clear focus on
advancing early stage innovative drugs through clinical development, to become
commercially valuable compounds.

Business Model

We believe that Samaritan fills a unique niche in that it brings commercial drug
development expertise, and the financial resources to further University
innovation; innovation that could be reluctantly left on a scientist's bench due
to a University's lack of expertise, or a University's economic priorities.

Samaritan brings a business acumen to University discoveries, that includes an
expertise in accomplishing Pre-IND FDA preclinicals, FDA regulatory affairs,
patent applications (IP), NIH grants, clinical study drug production, chemistry,
manufacturing and controls, stability studies, and human clinical trials "proof
of concept studies" with all its related preclinical studies required to get FDA
drug approval. In addition, Samaritan brings a specialized relationship based
business development program to market and license its innovation with potential
partners in the pharmaceutical industry.

Samaritan strives to develop drugs for indications that have a potential
commercial value of at least $300 million dollars a year to ultimately interest
major pharmaceuticals in-licensing. Samaritan believes its collaborations will
foster greater scientific creativity due to autonomy, and therefore advance drug
candidates more rapidly by decreasing the average travel time from lab to
patients.

Management Team

Samaritan's management team is focused on creating shareholder value. Together
they have created a viable business model that it believes will be the uphill
road map for Samaritan's future. The management team is collectively, bright,
entrepreneurial, energetic, perseverant, and devoted full time to creating
potential value drivers and shareholder value.

Samaritan has shaped its current pipeline of drugs by in-licensing innovative
discoveries through its Samaritan Labs/Georgetown University collaboration; and
its strategic focus is to use this model, with other top tier Universities, to
create a substantial pipeline and gain its own commercial presence.

Overview of Samaritan's Research Pipeline

Samaritan's proprietary HIV drug SP-01A headlines the Company's pipeline. SP-01A
is an oral HIV entry-inhibitor that works by blocking the HIV viruses' ability
to infect CD4+ cells. In Phase I/II clinical trials, SP-01A demonstrated "proof
of concept" with significance in two crucial areas, viral load and improvement
in quality of life. The drug was also observed to have a favorable safety
profile and was well tolerated. The data suggests that SP-01A is a promising
drug for patients experiencing "drug resistance." The innovative concept
underlying the mechanism of action of SP-01A was the basis used to develop two
new HIV drug candidates, SP-10 and SP-03, both with robust HIV entry inhibitor
properties.

                                       1

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Samaritan's Alzheimer's technology features four promising therapeutics, SP-04,
SP-04m, SP-08, and SP-233; two neural stem cell differentiation therapies,
SP-sc4 and SP-sc7; a predictive diagnostic; and an animal model. The stem cell
therapy drugs have been shown, in cell cultures and in animals, to awaken brain
dormant stem cells and to transform them (differentiate) into new neurons. The
Alzheimer's diagnostic is a simple blood test that has proven superior to the
invasive spinal taps and MRIs currently used. Finally, the Alzheimer's animal
model offers a model to rapidly screen and develop innovative drugs for
Alzheimer's disease.

A promising cancer drug, SP-C007, and a breast cancer diagnostic highlight
Samaritan's cancer program. The diagnostic provides a predictive prognosis of
cancerous tumor aggressiveness with more than twice the accuracy rate than that
of current technologies.

Samaritan's pipeline rounds out nicely with its cholesterol recognition peptide.
This technology plays a role in binding and taking out cholesterol from LDL,
thus offering an immediate response to hypercholesterolemia.

Samaritan's Drug Development Programs

Samaritan is currently advancing two distinct drug development programs:

AIDS/HIV Program
     o    SP-01A for HIV Resistance  (Oral Entry  Inhibitor);  PII/III  Clinical
          trials 2005-2006
     o    SP-10 for HIV Resistance (Oral Entry  Inhibitor);  Preclinicals  being
          readied to apply for  Investigational  New Drug (IND) application with
          the FDA

Alzheimer's Program
     o    SP-233  for  Alzheimer's;  Preclinicals  being  readied  to apply  for
          Investigational New Drug (IND) application with the FDA
     o    SP-004 and SP-04m for Alzheimer's; Preclinicals being readied to apply
          for Investigational New Drug (IND) application with the FDA


AIDS/HIV Drug Development Program

Background: Currently approved antiretroviral medications target either the HIV
viral reverse transcriptase (RT), Nucleoside Reverse Transcriptase Inhibitors
(NRTIs), Non-Nucleoside Reverse Transcriptase Inhibitors (NNRTIs), and the viral
Protease Inhibitors (PIs), or they inhibit viral fusion with host cells (Fusion
Inhibitors). A regimen using a combination of these agents is considered the
standard of care and, when effective, results in suppression of the virus below
the detection limits.

The long-term use of antiretroviral therapy is sometimes hampered by poor
compliance due to pill burden, by the route of administration when the oral
delivery is impossible, food restrictions, and major side effects that impact
Quality of Life. Furthermore, one of the major reasons for therapy failure is
the emergence of resistant virus against one or more of the anti-HIV medications
or, to some extent, an entire class of drug (cross-resistance).

Enfuvirtide (Fuzeon(TM)) was recently approved as an HIV-1 fusion/entry
inhibitor, a new class of treatment that inhibits the fusion of the HIV-1 virus
to the CD4+ cell membrane by preventing the conformational changes required for
this fusion. Since the mechanism of action of Enfuvirtide is different from
other classes of anti-HIV medication, it is effective in patients who have
failed other therapies due to emergence of resistant virus. However, a recent
study demonstrated the emergence of resistance to Enfuvirtide due to different
mutations of the viral glycoprotein gp41. The rapid rate of mutation of HIV-1
and conferred resistance of the virus to current therapies continues to
necessitate a need for additional new therapeutic agents.

                                       2

<PAGE>

To that end, Samaritan has advanced a hypothesis regarding the immuno-modulating
and anti-viral effects of SP-01A in the treatment of HIV infection.

SP-01A Hypothesis

Samaritan hypothesized that the HIV-associated dysregulation of cortisol levels
may play a role in the pathophysiology of AIDS including modulation of
cell-mediated immunity. Experimental evidence suggested that cortisol and its
receptors were critically involved at some level in the regulation of immune
function in HIV infection. Therefore, it was reasonable to hypothesize that
treatment with a cortisol-modulating agent may improve the immune function in
HIV-infected patients.

In pursuing this hypothesis, we discovered that the modulatory effect of SP-01A
on the stress-induced corticosteroid increase may be related to a reduction of
the expression of the cholesterol synthesis key enzyme HMG-CoA reductase mRNA
leading to a reduction in cholesterol synthesis. Several observations have also
established that inhibitors of cholesterol synthesis inhibit cell fusion
formation induced by HIV-l and that drugs extracting cholesterol from the
cellular membrane exert an anti-HIV-1 effect, in-vitro.

Taken together, Samaritan's preclinical data appears to suggest that the effect
of SP-01A on cholesterol synthesis leads to a modification of the cholesterol
content of the host cell membrane, which, in turn, reduces the HIV-1 virus
replication by rendering it much more difficult for the virus to enter and
infect the cell.

SP-10 Second HIV Drug Development in Conjunction with SP-01A

SP-10 discovered in Samaritan Laboratories, Georgetown University, was a result
of the Samaritan/Georgetown University collaboration. After its discovery,
continuous HIV preclinical studies demonstrated that SP-10 exhibited antiviral
properties by blocking the entry of HIV and multi drug-resistant HIV viruses
into the cells. Moreover, SP-10 has shown very low toxicity, suggesting that it
lacks serious side effects. Toxicity is a major problem with most current
antivirals, along with the development of drug resistance. So far, all of the
current antivirals on the market are demonstrating drug resistance.

Since SP-01A is intended to be administered in combination with current
antiviral therapy for the indication of HIV drug resistance; Samaritan decided
to pursue SP-10 as overall antiviral for HIV that could be administered alone or
in combination with the normally administered triple therapy for both HIV in
general and drug resistance.

In pursuing the preclinical development of SP-01A as an antiviral for drug
resistance, we decided, at the same time, to accomplish the same preclinical
data required by the FDA for SP-01A for SP-10 although we intend to study SP-10
as a stand alone antiviral.

So far, preclinical data taken together for SP-01A and SP-10, suggests that
these compounds reduce HIV virus replication by modifying the structure of the
host cell membrane thus rendering it impossible for the HIV virus to enter and
infect the cell. They both can be classified as oral entry inhibitors and could
prove more effective than today's antiretroviral therapy because they would
prevent HIV from invading healthy cells, rather than going after the virus when
it might be too late as it has already inserted itself into these cells.

SP-01A Development

Proof of Concept/Phase I/II study
The safety and dose response of orally administered SP-01A in HIV-infected
patients was assessed in a Phase I/II study. The study was an 8-week
non-randomized, open-label study conducted at a single investigational site
(AIDS Research Alliance, West Hollywood, CA) with 29 patients infected with
HIV-1 who were being treated with concomitant triple combination antiretroviral
therapy for at least 8 weeks prior to study initiation.

                                       3

<PAGE>

Upon submitting PI/II clinical study efficacy data, and upon evaluation by the
FDA, Samaritan's IND/protocol was transferred to the Anti-Viral Division of FDA,
which in turn requested further supporting antiviral preclinical studies, such
as demonstration of anti-HIV-1 drug resistance and numerous other studies where
SP-01A confirmed its results as an antiretroviral therapy. In addition, the
inhibitory effect of SP-01A on the entry of HIV and multi drug resistant HIV
viral strains reinforced our conviction of a new mechanism of action which
targets the host cell, rather than the virus itself, rendering therefore SP-01A
less susceptible, than any other drug on the market, to emerging resistances.
Studies to investigate whether SP-01A induces resistance are underway.

SP-01 A Phase II/III Development
Samaritan expects to commence "A Multi-Center Double-Blind, Randomized,
Placebo-Controlled Study of Orally Administered SP-01A as Monotherapy Treatment
of HIV-Infected Patients" trial to demonstrate efficacy as an antiviral and
gather dosage data in preparation for later stage PIII clinical trials, assuming
positive outcome data.

Why Samaritan Choose Drug Resistance Indication

Resistance: The Ability of the HIV Virus to Mutate and Survive
"We keep returning to the same issue: Whatever we throw at HIV, this simple but
highly mutable virus finds a way to dodge it." This was the comment made by
clinicians and researchers at The 11th Conference on Retroviruses and
Opportunistic Infections (Boston; February 10 - 14, 2003). The subject was
resistance; the ability of the human immunodeficiency virus (HIV) to mutate such
that antiretroviral agents, designed to inhibit its replication, are no longer
effective.

HIV Resistant Mutant Strains Are Evolving at a Record Pace
From 1995 to 2000, the frequency of resistance mutations increased from 8.0
percent to 22.7 percent. Simultaneously, the frequency of multi-drug resistance
increased from 3.8 percent to 10.2 percent.

Resistance Among Newly-Infected Patients
It is estimated that the prevalence of transmitted resistance to antiretroviral
drugs is between 1% and 11% among persons in North America who are newly
infected with HIV. The frequency of high-level resistance to one or more drugs
increased from 3.4 percent during the period from 1995 to 1998, to 12.4 percent
during the period from 1999 to 2000 and the frequency of multi-drug resistance
increased from 1.1 percent to 6.2 percent. Moreover, phenotypic resistance has
increased at least three-fold in five years: resistance to nucleoside reverse
transcriptase inhibitors (NRTI) - 269% increase; resistance to non-nucleoside
reverse transcriptase inhibitors (NNRTI) - 374% increase; resistance to protease
inhibitors (PI) - 2,000% increase.

Resistance Among Treatment-Experienced Patients
An estimated 10% - 20% of all people with HIV/AIDS that undergo HAART therapy
are treatment failures.

The Concerns of Resistance
There is a need for novel new therapies with the ability to suppress and
maintain inhibition of viral replication upon initiation of therapy. This virus
must not be able to develop resistance to this therapy. In lieu of such a
therapy, there is a need for treatment modalities with the ability to maintain
or even increase the efficacy of first and subsequent HAART regimens.

Drug Development Alzheimer's Program

Samaritan has a long-term commitment to developing innovative and unique
treatments for Alzheimer's disease. It is widely recognized that new approaches
are vitally needed to help suffering patients and their families in the fight
against Alzheimer's disease. Samaritan believes the best strategy against
Alzheimer's disease may be to prevent, reduce or slow its onset to spare
patients, families and the healthcare system much of the tremendous burdens and
tragedies that accompany this illness.

One of the major problems with the diagnosis and treatment of neurological
diseases, such as Alzheimer's disease, is the inability of clinicians to
determine the onset of disease. Recent evidence suggests that inflammation and
increase in free radicals may play a large role in the specific cause of
Alzheimer's disease.

                                       4

<PAGE>

Alzheimer's Diagnostic
In Samaritan's quest to find an accurate diagnostic, inventors have surprisingly
found that central nervous system DHEA is increased in patients having
Alzheimer's, in contrast to decreased levels of DHEA found in the periphery
(blood). Although this finding agrees with previous reports that DHEA levels in
Alzheimer's patients are abnormally low and have been recommending taking DHEA
supplements as a means of prevention, it suggests that brain DHEA formation is
separate from peripheral DHEA levels, thus questioning the use of DHEA as a
means of Alzheimer's disease prevention.

Samaritan inventors have identified a distinct mechanism for DHEA formation in
brain from precursors that they are able to follow in the blood; using a
chemical reaction, that allows the prediction of DHEA levels in brain. This
research has been the basis of Samaritan's Alzheimer's diagnostic test and
granting of research funds from the National Institute of Health (NIH).

SP-233 Alzheimer's Drug
Excessive accumulation in the brain of the beta-amyloid peptide, due either to
overproduction and/or decreased clearance and the formation of senile plaques,
is one of the hallmarks of Alzheimer disease.

SP-233 was identified based on its ability to protect neurons against
beta-amyloid-induced toxicity. SP-233 was shown to bind to beta-amyloid peptide,
prevent its oligomerization and entry into neurons, protect neuronal
mitochondria from beta-amyloid-induced damage, and maintain neuronal cell energy
levels. Samaritan's preclinical data is suggesting SP-233 as a new unique
approach for Alzheimer's disease therapy.

SP-233 Development
Detailed studies on the mechanism of action of SP-233, in rodent and human
neurons, have been performed and the toxicity of the compound in "in-vitro"
studies has been studied. Samaritan has performed the majority of the
preclinical studies required to apply to the FDA for an IND and is currently
performing toxicology studies.

SP-004/SP-04m Alzheimer's drug
Alzheimer's disease is characterized by multifaceted pathology involving a
number of dysregulated molecular mechanisms that include, at least, changes in
(i) cholinergic transmission, (ii) sigma-1 receptor-mediated pathways, and (iii)
increased free radical production. Even though the improvement of the
cholinergic transmission of the patients suffering from Alzheimer's is necessary
(the basis of most of today's therapies), targeting acetyl cholinesterase solely
is certainly not sufficient, in relationship to the numerous pathways involved
in Alzheimer's disease pathology. Under the Georgetown University-Samaritan
collaboration agreement a number of compounds were developed with the goal to
express multiple properties allowing them to act simultaneously at two distinct
targets, important in neuronal function, i.e., enzyme acetyl cholinesterase, and
the sigma 1 receptor SP-004 and SP-04m efficacy has been validated in vitro, and
in animal models, in vivo.

SP-004/SP-04m Development
Detailed studies on the mechanism of action of SP-004 and SP-04m have been
performed and the toxicity of the compound in-vitro has been studied.
Preclinical toxicology studies will be now undertaken required to apply to the
FDA for an IND.

Alzheimer's Stem Cell Drugs
Samaritan is fast tracking its development of its neuronal stem cell therapy
drugs (SP-sc4 and SP-sc7) that can induce dormant brain neuronal stem cells to
differentiate rapidly into adult neuron cells as a novel treatment for
Alzheimer's disease and other neurodegenerative disorders. Repairing brain
damage by replacing the lost neurons and restoring neuronal function is
certainly the most ambitious and exciting challenge physicians and scientists
are currently facing. In that aspect, the concept of stem cell therapy is
extremely promising. Hence, the access to the differentiation of stem cells into
neurons may serve as a database of specialized cells for regenerative medicine
as a treatment for neurodegenerative diseases and brain stroke.

                                       5

<PAGE>

SP-sc4 and SP-sc7 Development
Screening a database/collection of naturally occurring compounds, the Georgetown
University group under the Samaritan/Georgetown University collaborative
agreement identified compounds that were efficacious in inducing in-vitro and in
rats' in vivo neural stem cell differentiation and neurogenesis. Further in vivo
studies in animal models of neurodegenerative disease are in progress in order
to validate the use of these compounds in regenerating the neuronal network from
pre-existing stem cells in the adult.

Alzheimer's Rat Model
One of the limiting factors in screening for the compounds displaying
neuroprotective properties is the lack of an animal model allowing for the rapid
evaluation of the efficacy of the compounds under investigation. In our race to
find a way to stop the spread of Alzheimer's disease, we decided to develop an
animal model that mimics the human phenotype of Alzheimer's disease pathology.
Considering the critical role of beta-amyloid peptide in Alzheimer's disease
development, we undertook a non-transgenic approach to induce an "Alzheimer's
like" neuropathology in rat, in which a proprietary formulation is administered
directly in the brain of the rat producing a microenvironment resembling that
which may occur in Alzheimer's disease brain. Four weeks treatment of the rats
with the solution induced memory impairment accompanied by increased
hyperphosphorylated Tau protein levels in CSF, both part of the Alzheimer's
disease phenotype seen in patients. Further histopathology of the rat brains
indicated the presence of neuritic plaques, tangles, neuronal loss and gliosis,
typical features of postmortem Alzheimer's disease human brain specimens. Thus,
this animal model rat in addition to provide us with the means to rapidly screen
and develop therapeutic and diagnostic tools for controlling the disease it
might also be a useful approach to unveil the mechanisms underlying the onset
and progression of Alzheimer's disease.

Our Alzheimer's Rat Model is being validated by Samaritan for use to test the
efficacy of SP compounds and is due for publication. It is also expected to be
validated by other academic scientists specializing in this area of research in
the near future.

Planned Drug Development
SP-1000 Cardiovascular cholesterol drug peptide that binds and removes
cholesterol from LDL.

NIH Grants

1R41 NS048688 STTR ($188,000) entitled "Plasma Diagnostic for Alzheimer's
Disease". 1R41 AG024684 STTR ($100,000) entitled "SP004, a o1 ligand with AchE
inhibition properties".

Samaritan has in-licensed seventeen potential breakthrough discoveries from
Georgetown University and has filed nineteen related patent applications to
protect its growing pipeline of innovation. This pipeline is supported by a
number of peer-reviewed journals that support its credentials.

Peer Reviewed Publications

Neuropharmacology 2005; in press. "Identification, design, synthesis, and
pharmacological activity of (4-ethyl-piperaz-1-yl)-phenylmethanone derivatives
with neuroprotective properties against a-amyloid-induced toxicity"

Pharmacology 2005;74:65-78. "Local Anesthetic Procaine Protects Rat
Pheochromocytoma PC12 Cells against beta-Amyloid-Induced Neurotoxicity"

Steroids 2004; 69:1-16. "Identification of naturally occurring spirostenols
preventing beta-amyloid-induced neurotoxicity"

Analytical Biochemistry 2004; 324: 123-130. "A capillary as chromatography/mass
spectrometric method for the quantification of hydroxysteroids in human plasma"

                                       6

<PAGE>

Neurobiology of Aging 2003; 24:57-65. February "Oxidative Stress-mediated DHEA
Formation in Alzheimer's Disease Pathology"
Journal of Pharmacology Experimental Therapeutics 2003; 307:1148-1157.
"Inhibition of Adrenal Corticol Steroid Formation by Procaine Is Mediated by
Reduction of the cAMP-Induced 3-Hydroxy-3-methylglutaryl-coenzyme A Reductase
Messenger Ribonucleic Acid Levels"

Journal of Receptor & Signal Transduction Research 2003; 23:225-238 "Expression
of Peripheral Benzodiazepine Receptor (PBR) in Human Tumors Relationship to
Breast, Colorectal and Prostate Tumor Progression"

Journal of Neurochemistry 2002; 83: 1110-1119. "22R-Hydroxycholesterol Protects
Neuronal Cells from a-Amyloid-Induced Cytoxicity by Binding to a-Amyloid
Peptide"

Proceedings of the National Academy of Sciences USA 2001; 98: 1267-1272.
"Cholesterol binding at the cholesterol recognition/interaction amino acid
consensus (CRAC) of the peripheral type Benzodiazepine receptor and inhibition
of steroidogenesis by an HIV TAT-CRAC peptide"

Molecular Endocrinology 2001; 15:2211-2228. "Identification, Localization, and
Function in Steroidogenesis of PAP7: A Peripheral-Type Benzodiazepine Receptor-
and PKA (RIa) - Associated Protein"

Endocrinology 1998; 139:4991-4997. "Peripheral-Type Benzodiazepine Receptor
Function in Cholesterol Transport.  Identification of a Putative Cholesterol
Recognition/Interaction Amino Acid Sequence and Consensus Pattern"

Collaborations

Georgetown University Collaboration
On June 8, 2001, Samaritan Pharmaceuticals signed a research collaboration with
Georgetown University to further develop Samaritan's pipeline. Starting with the
quarter beginning April 1, 2004, the research collaboration term was extended to
2014 and the budget between Georgetown University and Samaritan has been
increased to a total of $1,000,000 per year. The $1,000,000 is paid by Samaritan
over four quarterly payments of $250,000, is unallocated, and covers the general
research and development effort.

Under the agreement, 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 their team
of eight research professionals (including five 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 any milestone payments. Georgetown is entitled to receive
royalties based on our revenue from product sales and sublicenses, if any.
Samaritan has, at its own expense, assumed responsibility 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.

Pharmaplaz, Ireland Collaboration
Samaritan Pharmaceuticals and Pharmaplaz, an Athlone, Ireland pharmaceutical
company, based outside of Dublin, Ireland, entered into a broad strategic
collaboration agreement for the production and supply of Samaritan's lead
compound SP-01A, and Samaritan's pipeline of drugs, that expands across a
variety of therapeutic areas to include AIDS, Alzheimer's, cancer and
cardiovascular disease. Under the terms of the alliance, Pharmaplaz will
collaborate with Samaritan's pipeline development, scale up, and manufacturing
requirements, while working on drug formulation and testing, production of pilot
batches, development of analytical methods, drug specifications, process
validations and drug optimization. The companies will also work together to
secure regulatory approval by the FDA for selected products in the U.S. markets.

                                       7

<PAGE>

Employees

As of the date, hereof we have 8 employees that work directly for Samaritan
Pharmaceuticals and 13 Ph.D. scientists that work under our collaboration
agreement with Georgetown University. In addition, we make extensive use of
consultants.

ITEM 2.  DESCRIPTION OF PROPERTY

The company's executive offices are currently located at 101 Convention Center
Drive, Suite 310, Las Vegas, Nevada 89109. The 1,100 square foot office space is
rented at a base rent of $2,700 per month. In addition, under the Research
Collaboration agreement between Georgetown University and Samaritan
Pharmaceuticals, Georgetown provides office and laboratory space, which is
located at Samaritan Research Laboratories, Biochemistry, and Molecular Biology
Dept., Med/Dent Bldg, 3900 Reservoir Road NW, Washington DC 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 that the
outcome of these proceedings will not have a material adverse effect on the
financial statements of the Company.

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 2004.

                                     PART II

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

The Company's Common Stock is traded on the American Stock Exchange under the
symbol "LIV". As of December 31, 2004, there were approximately nine hundred
sixty-nine (969) holders of record of the Company's common stock. Certain of the
shares of common stock are held in "street" name 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 operations, its capital requirements, and its overall financial
condition. The following table sets forth the range of high and low closing
quotations for our common stock for each quarter within the last two 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.

                                           Fiscal Years Ended
                           ----------------------------------------------
                            December 31, 2004           December 31, 2003
                           -------------------        -------------------
                             High        Low            High       Low
                           --------   --------        --------   --------
           First Quarter       .72       .33            .20        .13
           Second Quarter     1.69       .51            .26        .15
           Third Quarter      1.40       .77            .90        .18
           Fourth Quarter     1.30       .80            .72        .30

                                       8

<PAGE>

Equity Compensation Plan Information


<TABLE>
<CAPTION>

                              Number of securities         Weighted average         Number of
                               to be issued upon           exercise price of        securities
                                  exercise of              outstanding              remaining
                              outstanding options          options, warrants        for future
Name of Plan                  warrants, and rights         and rights               issuance
-----------------           ------------------------    -----------------------   ---------------
<S>                                    <C>                             <C>            <C>
Equity compensation
Plans approved
By security holders                20,924,930                   $0.56               5,248,646
(1)

Equity compensation
Plans not approved
By security holders (2)                 0                        0                      0


Total                              20,924,930
</TABLE>

(1) Samaritan Pharmaceuticals, Inc. 2001 Stock Incentive Plan filed as an
exhibit to Form 10-QSB on August 6, 2004 and incorporated herein by reference.

(2) Samaritan Pharmaceuticals, Inc. has entered into irrevocable trust
agreements, "Samaritan Pharmaceuticals Inc. Executive Benefit Plans", to fund
deferred compensations benefits, with institutional trustees 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
Pharmaceuticals. The company may contribute to the trusts from time to time, and
additional funding could be required upon a change of control. The trusts 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 time specified by the
company.

Changes in Securities; Recent sales of unregistered securities; use of proceeds
from registered securities.

Securities, unregistered, were sold by the Company under an exemption from
registration. The title of these securities was the Common Stock of the Company.
They were sold for cash unless otherwise noted in this section. They were sold
in private transactions to persons believed to be of a class of private
investors acting on their own comprised of "accredited investors" (as such term
is defined in Regulation D of the U.S. Securities and Exchange Commission) and a
limited number of non-accredited investors. All investors, to the best knowledge
of the Company, not affiliated with the Company, purchased the shares with
apparent investment intent. The Company relied upon, among other possible
exemptions, Section 4(2) of the Securities Act of 1933, as amended. It's
reliance on said exemption was based upon the fact that no public solicitation
was used by the Company in the offer or sale, and that the securities were
legended 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.

Management notes that the Company issues stock as compensation for services and
supplies, valuing such issues premised upon the fair market value of the stock
or the services, whichever is more clearly determinable.

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. During the
year ended December 31, 2004 the Company exchange 11,426,733 shares of the
company stock for $4,300,938.

                                       9

<PAGE>

During the year ended December 31, 2003, the Company issued an aggregate of
4,062,833 shares of common stock in consideration of services rendered or to be
rendered to the Company. Such shares were valued at an aggregate of $553,842
ranging from $.16-$.71 per share, representing the fair value of the shares
issued. The issuances were recorded as non-cash compensation expense. During the
year ended December 31, 2003 the Company exchanged 12,740,870 shares of the
Company's common stock in settlement of accounts payable, accrued salaries for
officers and equity financing totaling $1,152,703. To the extent that the market
value of shares issued as payment of accrued salaries exceeded the recorded
amount of accrued salaries, such amount was recognized as additional
compensation. The amount of additional compensations recorded at December 31,
2003 was $2,305,863.

During the year 2003, through various private placements, the Company sold
17,493,664 shares for $2,409,789.

On April 22, 2003, we entered into a common stock purchase agreement with Fusion
Capital Fund II, LLC, 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
$10,000,000. The SEC declared effective the Company's registration statement on
Form SB-2, Commission Registration No. 333-105818 on October 9, 2003. In the
year ended December 31, 2004, the company sold 8,758,240 shares of common stock
to Fusion Capital for gross proceeds of $3,100,001. The proceeds from these
sales were used for general corporate purposes and working capital.


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

This Plan of Operation should be read in conjunction with the accompanying
consolidated financial statements and notes included in this report.

General Overview

We are a leading small cap biopharmaceutical company focused on the development
of novel therapeutic and diagnostic products. We have devoted substantially all
of our resources to undertaking our drug discovery and development programs. The
majority of our resources have been expended in the pursuit of FDA required
preclinical studies, and Phase II/III clinical trials, for Samaritan's HIV drug
SP-01A (Sphirewall), an oral entry inhibitor.

In addition, and at the same time, Samaritan has devoted major resources to its
Alzheimer's technology, which features: three promising therapeutics, SP-04,
SP-08, and SP-233; two stem cell, neuron differentiation therapies, SP-sc4 and
SP-sc7; a predictive Alzheimer's diagnostic; and an Alzheimer's animal model.
Samaritan, as well, has devoted resources to its promising cancer drug, SP-C007,
and a breast cancer diagnostic; plus, its cholesterol recognition peptide, which
plays a role in transforming and binding LDL cholesterol while subsequently
raising HDL.

Plan of Operation

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. At this time we are beginning to commit additional resources to the
development of SP-01A as wells as for the development of our other drugs.
Additional detail regarding the human trials and INDs that the Company plans to
file are discussed in Part I, Item 1, Description of Business, of this annual
report.

We incurred research and development expenses of $1,543,921 for the year ended
December 31, 2004, up from $838,208 in the year-earlier period primarily due to
increase in financial commitment with Georgetown University and the hiring of
additional FDA regulatory affairs personnel. We expect that research and
development expenditures related to drug discovery and development will increase

                                       10

<PAGE>

during 2005 and subsequent years due to the continuation and expansion of
clinical trials for our small molecule programs, the initiation of trials for
other potential indications and 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
pre-clinical testing and clinical trial-related activities. In conjunction with
the additional research and development activities we expect to conduct, we
anticipate adding two administrative staff and four research and development
support personnel in the next 12 months. In June 2004, we hired a Chief Drug
Development Officer at an annual salary of $300,000 plus benefits.

General and administrative expenses decreased to $3,561,302 for the year of 2004
from $4,902,213 in the same period in 2003. This decrease primarily reflected a
reduction in stock-based consulting and compensation costs.

Depreciation and amortization amounted to $27,218 and $23,776 for year ended
December 31, 2004 and 2003, respectively. Interest expense amounted to $142 and
$6,334 for the year ended December 31, 2004 and 2003, respectively. The decrease
is due to the retirement of notes payable during 2003.

As a result of the factors noted above, the net loss since inception on
September 5, 1994 to December 31, 2004 was $28.2 million. We had a net loss of
$4,864,361 and $5,520,531 for the year ended December 31, 2004 and 2003,
respectively and had a loss per share of $(0.04) and $(0.07) per share for the
year ended December 31, 2004 and 2003, respectively. Our expenses have related
mainly to costs incurred in research activities for the development of our drug
candidates and from administrative expenses required to support these efforts.
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 for drugs.
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 that the Company establish agreements with other
parties for the clinical testing, manufacturing, commercialization and sale of
its products.

The Company's current cash position is $2,438,451 and the Company has $1,490,812
of marketable securities. We are continuing efforts to raise additional capital
and execute our research and development plans. Even if we are successful in
raising sufficient money to carry out these plans, additional clinical
development, necessary to bring our products to market, we will require
significant additional capital.

Liquidity and Capital Resources

Cash used in operating activities during the twelve-month period ended December
31, 2004 was $3,287,896 compared to $2,233,841 for the same period a year
earlier. The increase is due to the payment of services for cash rather than
stock compensation.

Cash used in investing activities was $2,495,178 for the twelve months period
ended December 31, 2004, compared to $18,734 in for the same period in 2003. The
increase is primarily due to the increase in investments and marketable
securities.

Cash provided by financing activities was $7,850,940 for the twelve-month period
ended December 31, 2004, compared to $2,265,335 in the same period for 2003. The
cash provided in the 2004 period was comprised of $450,000 from the sale of
warrants, $4,300,938 from equity private placements, and $3,100,001 from equity
financing.

Current assets as of December 31, 2004 were $4,005,612 as compared to current
liabilities of $170,167.

On April 22, 2003, we entered into a common stock purchase agreement with Fusion
Capital Fund II, LLC, 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
$10,000,000. The SEC declared effective the Company's registration statement on
Form SB-2, Commission Registration No. 333-105818 on October 9, 2003. The amount
of shares remaining under this Registration Statement as of December 31, 2004
was 3,019,555.

                                       11

<PAGE>

The Company's dependence on raising additional capital will continue at least
until the Company is able to commercially market one of its products at
significant sales level. Depending on profit margins and other factors, the
Company may still need additional funding to continue research and development
efforts. The Company's future capital requirements and the adequacy of its
financing depend upon numerous factors, including the successful
commercialization of the Company's drug candidates, progress in its product
development efforts, progress with preclinical studies and clinical trials, the
cost and timing of production arrangements, the development of effective sales
and marketing activities, the cost of filing, prosecuting, defending and
enforcing intellectual property rights, competing technological and market
developments, and the development of strategic alliances for the marketing of
its products.

We do not believe that debt financing from financial institutions will be
available until at least the time that one of our products is approved for
commercial production. To date, none of our proprietary products has reached a
commercial stage, and hence, we do not have, nor do we anticipate revenue in the
near future. We have been unprofitable since our inception and have incurred
significant losses. We will continue to have significant general and
administrative expenses, including expenses related to clinical studies, our
collaboration with Georgetown University, and patent prosecution. We have funded
our operations through a series of private placements and through our agreement
with Fusion Capital, which we believe will assist the Company in meetings its
cash needs. Except for an agreement to sell shares to Fusion Capital, discussed
above, no commitment exists for continued investments, or for any underwriting.

Even with our financing arrangement with Fusion Capital, we may require
substantial additional funds to sustain our operations and grow our business.
The amount of which will depend, among other things, on the rate of progress and
the cost of our research and product development programs and clinical trial
activities, the cost of preparing, filing, prosecuting, maintaining and
enforcing patent claims and other intellectual property rights, and 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 and may be expected to utilize $5 to $20 million
over a three to six year development cycle. Although we believe we could license
the manufacturing and marketing rights to our products in return for up-front
licensing and other fees and royalties on any sales, there can be no assurance
that we will be able to do so in the event we seek to do so. We need to obtain
additional funds to develop our therapeutics 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.

The extent 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 and
the extent to which we are able to secure working capital from other sources. If
obtaining sufficient financing from Fusion Capital were to prove prohibitively
expensive, we will need to secure another source of funding in order to satisfy
our working capital needs. Even if we are able to access the full amount under
the common stock purchase agreement 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 certain of our 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, any of which might have a
material adverse effect upon us. 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 be 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 12 months. We continue
to explore avenues to obtain the capital needed for our operations through
private placements and by sale of our shares to Fusion Capital.

                                       12

<PAGE>

Quantitative and Qualitative Information 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.

Critical Accounting Policies

Use of Estimates
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Management believes that the estimates utilized in
preparing its financial statements are reasonable and prudent. Actual results
could differ from those estimates.

The most significant accounting estimates relate to valuing equity transactions
as described below. The value assigned to stock warrants granted to
non-employees are accounted for in accordance with SFAS No. 123 and Emerging
Issues Task Force (EITF) 96-18, Accounting for Equity Instruments That Are
Issued to Other Than Employees for Acquiring, or in Conjunction with Selling,
Goods or Services. The Company values warrants using the Black-Scholes pricing
model. Common stock is valued using the market price of common stock on the
measurement date as defined in EITF 96-18.

Accounting for Stock-Based Compensation
The Company applies Statement of Financial Accounting Standards No. 123 and
related interpretations in accounting for employee stock-based compensation, and
includes the required footnote disclosures thereon. The Company accounts for
nonemployee stock-based compensation in accordance with Emerging Issues Task
Force (EITF) 96-18, Accounting for Equity Instruments That Are Issued to Other
Than Employees for Acquiring, or in Conjunction with Selling, Goods or Services.
Amounts are based on the fair value of the consideration received or the fair
value of the equity instruments issued, whichever is more reliably measurable.

Revenue Recognition
The Company recognizes revenue at the time service is performed on commercial
contracts and collectability is assured. Revenue from government grants is a
reimbursement for expenditures associated with the research. The Company submits
bills to the grant agency and revenue is recognized at the time the
reimbursement request is submitted.

New Accounting Pronouncements

In December 2002, the FASB issued  Statement of Financial  Accounting  Standards
No. 148,  Accounting for Stock-Based  Compensation - Transition and Disclosure -
an amendment of FASB Statement No. 123 (SFAS No. 148).  SFAS No. 148 amends FASB
Statement No. 123 to provide  alternative  methods of transition for a voluntary
change to the fair value based method of  accounting  for  stock-based  employee
compensation.  In addition,  SFAS No. 148 amends the disclosure  requirements of
FASB  Statement  No. 123 to require  prominent  disclosures  in both  annual and
interim  financial  statements  about the method of accounting  for  stock-based
employee  compensation  and the effect of the method used on  reported  results.
SFAS No. 148 is effective  for the fiscal  years  beginning  after  December 15,
2002.

In January 2003, the FASB issued FASB Interpretation No. 46, Consolidation of
Variable Interest Entities (FIN 46) which addressed consolidation by business
enterprises of variable interest entities that meet certain criteria. FIN 46 was
effective upon issuance, but did not have an impact on the Company's financial
position or results of operations.

                                       13

<PAGE>

In May 2003, the FASB issued Statement of Financial Accounting Standards No.
150, Accounting for Certain Financial Instruments with Characteristics of both
Liabilities and Equity (SFAS No. 150), which establishes standards for how a
company classifies and measures certain financial instruments with
characteristics of both liabilities and equity. SFAS No. 150 is generally
effective for interim periods beginning after June 15, 2003.

The adoption of these new pronouncements did not have, or are not expected to
have, a material effect on the Company's consolidated financial position or
results of operations.

RISK FACTORS

You should carefully consider the risks described below before making an
investment decision. The risks described below are not the only ones facing our
company. Additional risks not presently known to us or that we currently deem
immaterial may also impair our business operations.

Our business, financial condition or results of operations could be adversely
affected by any of these risks. The trading price of our common stock could
decline due to any of these risks, and you may lose all or part of your
investment.

We have a substantial accumulated deficit and limited working capital.

The Company had an accumulated deficit of $28,245,428 as of December 31, 2004.
Since the Company presently has no source of revenues and is committed to
continuing its product research and development program, significant
expenditures and losses will continue until development of new products is
completed and such products have been clinically tested, approved by the FDA and
successfully marketed. In addition, the Company has funded its operations
primarily through the sale of Company securities, and has had limited working
capital for its product development and other activities. We do not believe that
debt financing from financial institutions will be available until at least the
time that one of our products is approved for commercial production.

We have no current product sales revenues or profits.

The Company has devoted its resources to developing a new generation of
therapeutic drug products, but such products cannot be marketed until clinical
testing is completed and governmental approvals have been obtained. Accordingly,
there is no current source of revenues, much less profits, to sustain the
Company's present activities, and no revenues will likely be available until,
and unless the new products are clinically tested, approved by the FDA and
successfully marketed, either by the Company or a marketing partner, an outcome
which the Company is not able to guarantee.

It is uncertain that the Company will have access to future capital or
government grants.

It is not expected that the Company will generate positive cash flow from
operations for at least the next several years. As a result, substantial
additional equity or debt financing or the receipt of one or more government
grants for research and development and/or clinical development will be required
to fund our activities. We cannot be certain that we will be able to consummate
any such financing on favorable terms, if at all, or receive any such government
grants or that such financing or government grants will be adequate to meet our
capital requirements. Any additional equity financing could result in
substantial dilution to stockholders, and debt financing, if available, will
most likely involve restrictive covenants which preclude the Company from making
distributions to stockholders and taking other actions beneficial to
stockholders. If adequate funds are not available, the Company may be required
to delay or reduce the scope of its drug development program or attempt to
continue development by entering into arrangements with collaborative partners
or others that may require the Company to relinquish some or all of its rights
to proprietary drugs. The inability to fund its capital requirements would have
a material adverse effect on the Company.

                                       14

<PAGE>

The Company is not certain that it will be successful in the development of its
drug candidates.

The successful development of any new drug is highly uncertain and is subject to
a number of significant risks. Our drug candidates, all of which are in a
development stage, require significant, time-consuming and costly development,
testing and regulatory clearance. This process typically takes several years and
can require substantially more time. Risks include, among others, the
possibility that a drug candidate will (i) be found to be ineffective or
unacceptably toxic, (ii) have unacceptable side effects, (iii) fail to receive
necessary regulatory clearances, (iv) not achieve broad market acceptance, (v)
be subject to competition from third parties who may market equivalent or
superior products, or (vi) be affected by third parties holding proprietary
rights that will preclude the Company from marketing a drug product. There can
be no assurance that the development of drug candidates will demonstrate the
efficacy and safety of a drug candidate as a therapeutic drug, or, even if
demonstrated, that there will be sufficient advantages to its use over other
drugs or treatments so as to render the drug product commercially viable. In the
event that the Company is not successful in developing and commercializing one
or more drug candidates, investors are likely to realize a loss of their entire
investment.

Positive results in preclinical and early clinical trials do not ensure that
future clinical trials will be successful or that 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 that may delay, limit or prevent
regulatory approvals. The length of time necessary to complete clinical trials
and to submit an application for marketing approval for a final decision by a
regulatory authority varies significantly and may be difficult to predict.

The Company will face intense competition from other companies in the
pharmaceutical industry.

The Company is engaged in a segment of the pharmaceutical industry that is
highly competitive and rapidly changing. If successfully developed and approved,
any of the Company's drug candidates will likely compete with several existing
therapies. In addition, other companies are pursuing the development of
pharmaceuticals that target the same diseases as are targeted by the drugs being
developed by the Company. The Company anticipates that it will face intense and
increasing competition in the future as new products enter the market and
advanced technologies become available. We cannot assure that existing products
or new products developed by competitors will not be more effective, or more
effectively marketed and sold than those by the Company. Competitive products
may render the Company's drugs obsolete or noncompetitive prior to the Company's
recovery of development and commercialization expenses.

Many of the Company's competitors will also have significantly greater
financial, technical and human resources and will likely be better equipped to
develop, manufacture and market products. In addition, many of these competitors
have extensive experience in preclinical testing and clinical trials, obtaining
FDA and other regulatory approvals and manufacturing and marketing
pharmaceutical products. A number of these competitors also have products that
have been approved or are in late-stage development and operate large,
well-funded research and development programs. Smaller companies may also prove
to be significant competitors, particularly through collaborative arrangements
with large pharmaceutical and biotechnology companies. Furthermore, academic
institutions, government agencies and other public and private research
organizations are becoming increasingly aware of the commercial value of their
inventions and are actively seeking to commercialize the technology they have
developed. Accordingly, competitors may succeed in commercializing products more
rapidly or effectively than the Company, which would have a material adverse
effect on the Company.

                                       15

<PAGE>

There is no assurance that the Company's 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 (i) the
receipt and scope of regulatory approvals, (ii) the establishment and
demonstration in the medical community of the safety and efficacy of a drug
product, (iii) the product's potential advantages over existing treatment
methods and (iv) reimbursement policies of government and third party payors. We
cannot predict or guarantee that physicians, patients, healthcare insurers or
maintenance organizations, or the medical community in general, will accept or
utilize any drug product of the Company.

The unavailability of health care reimbursement for any of our products will
likely adversely impact our ability to market effectively such products and
whether health care reimbursement will be available for any of our products is
uncertain.

The Company's ability to commercialize its technology successfully will depend
in part on the extent to which reimbursement for the costs of such products and
related treatments will be available from government health administration
authorities, private health insurers and other third-party payors. Significant
uncertainty exists as to the reimbursement status of newly-approved medical
products. The Company cannot guarantee that adequate third-party insurance
coverage will be available for the Company to establish and maintain price
levels sufficient for realization of an appropriate return on its investments in
developing new therapies. Government, private health insurers, and other
third-party payors are increasingly attempting to contain health care costs by
limiting both coverage and the level of reimbursement for new therapeutic
products approved for marketing by the FDA. Accordingly, even if coverage and
reimbursement were provided by government, private health insurers, and
third-party payors for uses of the Company's products, the market acceptance of
these products would be adversely affected if the amount of reimbursement
available for the use of the Company's therapies proved to be unprofitable for
health care providers.

Uncertainties related to health care reform measures may affect the Company's
success.

There have been a number of federal and state proposals during the last few
years to subject the pricing of health care goods and services, including
prescription drugs, to government control and to make other changes to U.S.
health care system. It is uncertain which legislative proposals will be adopted
or what actions federal, state, or private payors for health care treatment and
services may take in response to any health care reform proposals or
legislation. The Company cannot predict the effect health care reforms may have
on its business, and there is no guarantee that any such reforms will not have a
material adverse effect on the Company.

Further testing of our drug candidates will be required and there is no
assurance of FDA approval.

The FDA and comparable agencies in foreign countries impose substantial
requirements upon the introduction of medical products, through lengthy and
detailed laboratory and clinical testing procedures, sampling activities and
other costly and time-consuming procedures. Satisfaction of these requirements
typically takes several years or more and varies substantially based upon the
type, complexity, and novelty of the product.

The effect of government regulation and the need for FDA approval will delay
marketing of new products for a considerable period of time, impose costly
procedures upon the Company's activities, and provide an advantage to larger
companies that compete with the Company. There can be no assurance that FDA or
other regulatory approval for any products developed by the Company will be
granted on a timely basis or at all. Any such delay in obtaining, or failure to
obtain, such approvals would materially and adversely affect the marketing of
any contemplated products and the ability to earn product revenue. Further,
regulation of manufacturing facilities by state, local, and other authorities is
subject to change. Any additional regulation could result in limitations or
restrictions on the Company's ability to utilize any of its technologies,
thereby adversely affecting the Company's operations.

                                       16

<PAGE>

Human pharmaceutical products are subject to rigorous preclinical testing,
clinical trials, and other approval procedures mandated by the FDA and foreign
regulatory authorities. Various federal and foreign statutes and regulations
also govern or influence the manufacturing, safety, labeling, storage, record
keeping and marketing of pharmaceutical products. The process of obtaining these
approvals and the subsequent compliance with appropriate U.S. and foreign
statutes and regulations are time-consuming and require the expenditure of
substantial resources. In addition, these requirements and processes vary widely
from country to country.

Among the uncertainties and risks of the FDA approval process are the following:
(i) the possibility that studies and clinical trials will fail to prove the
safety and efficacy of the drug, or that any demonstrated efficacy will be so
limited as to significantly reduce or altogether eliminate the acceptability of
the drug in the marketplace, (ii) the possibility that the costs of development,
which can far exceed the best of estimates, may render commercialization of the
drug marginally profitable or altogether unprofitable, and (iii) the possibility
that the amount of time required for FDA approval of a drug may extend for years
beyond that which is originally estimated. In addition, the FDA or similar
foreign regulatory authorities may require additional clinical trials, which
could result in increased costs and significant development delays. Delays or
rejections may also be encountered based upon changes in FDA policy and the
establishment of additional regulations during the period of product development
and FDA review. Similar delays or rejections may be encountered in other
countries.

The Company's success will be dependent on licenses and proprietary rights it
receives from other parties, and on any patents it may obtain.

Our success will depend in large part on the ability of the Company and its
licensors to (i) maintain license and patent protection with respect to their
drug products, (ii) defend patents and licenses once obtained, (iii) maintain
trade secrets, (iv) operate without infringing upon the patents and proprietary
rights of others and (iv) obtain appropriate licenses to patents or proprietary
rights held by third parties if infringement would otherwise occur, both in the
U.S. and in foreign countries. The Company has obtained licenses to patents and
other proprietary rights from Georgetown University.

The patent positions of pharmaceutical companies, including those of the
Company, are uncertain and involve complex legal and factual questions. There is
no guarantee that the Company or its licensors have or will develop or obtain
the rights to products or processes that are patentable, that patents will issue
from any of the pending applications or that claims allowed will be sufficient
to protect the technology licensed to the Company. In addition, we cannot be
certain that any patents issued to or licensed by the Company will not be
challenged, invalidated, infringed or circumvented, or that the rights granted
thereunder will provide competitive disadvantages to the Company.

Litigation, which could result in substantial cost, may also be necessary to
enforce any patents to which the Company has rights, or to determine the scope,
validity and unenforceability of other parties' proprietary rights, which may
affect the rights of the Company. U.S. patents carry a presumption of validity
and generally can be invalidated only through clear and convincing evidence.
There can be no assurance that the Company's licensed patents would be held
valid by a court or administrative body or that an alleged infringer would be
found to be infringing. The mere uncertainty resulting from the institution and
continuation of any technology-related litigation or interference proceeding
could have a material adverse effect on the Company pending resolution of the
disputed matters.

The Company may also rely on unpatented trade secrets and expertise to maintain
its competitive position, which it seeks to protect, in part, by confidentiality
agreements with employees, consultants and others. There can be no assurance
that these agreements will not be breached or terminated, that the Company will
have adequate remedies for any breach, or that trade secrets will not otherwise
become known or be independently discovered by competitors.

The Company's license agreements can 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, respectively
Georgetown University, to terminate the agreement 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 other uncured material
breach by the licensee. The license agreements also provide that the licensor is

                                       17

<PAGE>

primarily responsible for obtaining patent protection for the technology
licensed, and the licensee is required to reimburse it for the 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 could result in the termination of the applicable
license agreement in certain cases. The termination of any license agreement
would have a material adverse effect on the Company.

Protecting our proprietary rights is difficult and costly.

The patent positions of pharmaceutical and biotechnology companies can be highly
uncertain and involve complex legal and factual questions. Accordingly, we
cannot predict the breadth of claims allowed in these companies' patents or
whether the Company may infringe or be infringing 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.

The Company's success is dependent on its key personnel.

The Company is dependent on a small management group and on independent
researchers, some of whom are inventors of the patents licensed to the Company
for core technologies and drugs developed at Georgetown University. Scientific
personnel may from time to time serve as consultants to the Company and may
devote a portion of their time to the Company's business, as well as continue to
devote substantial time to the furtherance of the Company's sponsored research
at Georgetown University and other affiliated institutions as may be agreed to
in the future, but such personnel are not employees of the Company and are not
bound under written employment agreements. The services of such persons are
important to the Company, and the loss of any of these services may adversely
affect the Company.

Our success is dependent upon the continued services and performance of Dr.
Janet Greeson, our chief executive officer; president and chairman; and Dr.
Vassilios Papadopoulos. We do not maintain key man insurance on either officer.
We have a 5-year employment agreement with Dr. Greeson that expires in 2006. 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. Janet Greeson is grounds for termination of the collaboration with
Georgetown University. In addition, competition for qualified employees among
companies in the biotechnology and biopharmaceutical industry is intense and we
cannot assure you that we would be able to recruit qualified personnel on
acceptable terms to replace them.

We may be unable to retain skilled personnel and maintain key relationships.

The success of our business depends, in large part, on our ability to attract
and retain highly qualified management, scientific and other personnel, and on
our ability to develop and maintain important relationships with leading
research institutions and consultants and advisors. Competition for these types
of personnel and relationships is intense from numerous pharmaceutical and
biotechnology companies, universities and other research institutions. There can
be no assurance that the Company will be able to attract and retain such
individuals on commercially acceptable terms or at all, and the failure to do so
would have a material adverse effect on the Company.

We currently have no sales or marketing capability.

The Company does not have marketing or sales personnel. The Company will have to
develop a sales force, or rely on marketing partners or other arrangements with
third parties for the marketing, distribution and sale of any drug product that
is ready for distribution. There is no guarantee that the Company will be able
to establish marketing, distribution or sales capabilities or arrange with third
parties to perform those activities on terms satisfactory to the Company, or
that any internal capabilities or third party arrangements will be
cost-effective.

                                       18

<PAGE>

In addition, any third parties with which the Company may establish marketing,
distribution or sales arrangements may have significant control over important
aspects of the commercialization of a drug product, including market
identification, marketing methods, pricing, composition of sales force and
promotional activities. There can be no assurance that the Company will be able
to control the amount and timing of resources that any third party may devote to
the products of the Company or prevent any third party from pursuing alternative
technologies or products that could result in the development of products that
compete with, and/or the withdrawal of support for, the products of the Company.

The Company does not have internal manufacturing capabilities and may not be
able to develop efficient manufacturing capabilities or contract for such
services from third parties such as Pharmaplaz on commercially acceptable terms.

The Company will not have any manufacturing capacity. When required, the Company
will seek to establish relationships with third-party manufacturers for the
manufacture of clinical trial material and the commercial production of a drug
product just as it has with Pharmaplaz, Ltd. There can be no assurance that the
Company will be able to establish relationships with third-party manufacturers
on commercially acceptable terms or that third-party manufacturers will be able
to manufacture a drug product on a cost-effective basis in commercial quantities
under good manufacturing practices mandated by the FDA.

The dependence upon third parties for the manufacture of products may adversely
affect future costs and the ability to develop and commercialize a drug product
on a timely and competitive basis. Further, there can be no assurance that
manufacturing or quality control problems will not arise in connection with the
manufacture of the drug product or that third party manufacturers will be able
to maintain the necessary governmental licenses and approvals to continue
manufacturing such products. Any failure to establish relationships with third
parties for its manufacturing requirements on commercially acceptable terms
would have a material adverse effect on the Company.

The Company does not have its own research facilities and will be dependent on
third parties for drug development.

The Company does not have its own research and development facilities and
engages consultants and independent contract research organizations to design
and conduct clinical trials in connection with the development of a drug. As a
result, these important aspects of a drug's development will be outside the
direct control of the Company. In addition, there can be no assurance that such
third parties will perform all of their obligations under arrangements with the
Company or will perform those obligations satisfactorily.

In the future, we anticipate that we will need to obtain additional or increased
product liability insurance coverage and it is uncertain that such increased or
additional insurance coverage can be obtained on commercially reasonable terms.

The business of the Company will expose it to potential product liability risks
that are inherent in the testing, manufacturing and marketing of pharmaceutical
products. There can be no assurance that product liability claims will not be
asserted against the Company. The Company intends to obtain additional limited
product liability insurance for its clinical trials, directly or through its
marketing development partners or CRO (contract research organization) partners,
when they begin in the U.S. and to expand its insurance coverage if and when the
Company begins marketing commercial products. However, there can be no assurance
that the Company will be able to obtain product liability insurance on
commercially acceptable terms or that the Company will be able to maintain such
insurance at a reasonable cost or in sufficient amounts to protect against
potential losses. A successful product liability claim or series of claims
brought against the Company could have a material adverse effect on the Company.

                                       19

<PAGE>

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.

The market price of our shares, like that of many biotechnology companies, is
highly volatile.

Market prices for the Company's Common Stock and the securities of other medical
and biomedical technology companies have been highly volatile and may continue
to be highly volatile in the future. Factors such as announcements of
technological innovations or new products by the Company or its competitors,
government regulatory action, litigation, patent or proprietary rights
developments, and market conditions for medical and high technology stocks in
general can have a significant impact on any future market for the Common Stock.

We are not paying dividends on our Common Stock.

The Company has never paid cash dividends on Common Stock, and does not intend
to do so in the foreseeable future.

The issuance of more common shares or our preferred stock may adversely affect
our Common Stock.

The Board of Directors is authorized to issue more common stock and designate
one or more series of preferred stock and to fix the rights, preferences,
privileges and restrictions thereof, without any action by the stockholders. The
designation and issuance of such shares of our preferred stock may adversely
affect the Common Stock, if the rights, preferences and privileges of such
preferred stock (i) restrict the declaration or payment of dividends on Common
Stock, (ii) dilute the voting power of Common Stock, (iii) impair the
liquidation rights of the Common Stock or (iv) delay or prevent a change in
control of the Company from occurring, among other possibilities.

Under provisions of the Company's certificate of incorporation, bylaws and
Nevada law, the Company's management may be able to block or impede a change in
control.

The issuance of preferred stock may make it more difficult for a third party to
acquire, or may discourage a third party from acquiring, a majority of the
voting stock. These and other provisions of the Certificate of Incorporation and
the by-laws, as well as certain provisions of Nevada law, could delay or impede
the removal of incumbent directors and could make more difficult 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 stockholders as a
whole. Such provisions could limit the price that certain investors might be
willing to pay in the future for the Common Stock.

Officers' and directors' liabilities are limited under Nevada law.

Pursuant to the Company's Certificate of Incorporation and by-laws, 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 acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, for dividend payments or
stock repurchases illegal under Nevada law or for any transaction in which a
director has derived an improper personal benefit. The Certificate of
Incorporation and by-laws provide that the Company must indemnify its officers
and directors to the fullest extent permitted by 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 7.  FINANCIAL STATEMENT

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

                                       20

<PAGE>

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

The company had a change in registrant's certifying accountant filed as an 8-K,
on September 27, 2002 and incorporated herein by reference.

ITEM 8A.  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 Accounting
Officer have concluded that the Company's disclosure controls and procedures
are, in fact, effective at this reasonable assurance level as of the period
covered.

ITEM 8B. OTHER INFORMATION.

In connection with the evaluation of the Company's internal controls during the
Company's fourth fiscal quarter ended December 31, 2004, the Company's Principal
Executive Officer and Principal Financial Officer have determined that there are
no changes to the Company's internal controls over financial reporting that has
materially affected, or is reasonable likely to materially effect, the Company's
internal controls over financial reporting.

                                    PART III

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

The information required by Item 9 as to directors, executive officers,
promoters and control persons is incorporated by reference from the Company's
Proxy Statement to be filed by the Company with Securities and Exchange
Commission within 120 days after the end of the fiscal year.

ITEM 10.  EXECUTIVE COMPENSATION

The information required by Item 10 as to executive compensation is incorporated
by reference from the Company's Proxy Statement to be filed by the Company with
Securities and Exchange Commission within 120 days after the end of the fiscal
year.

ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The information required by Item 11 as to security ownership of certain
beneficial owners and management is incorporated by reference from the Company's
Proxy Statement to be filed by the Company with Securities and Exchange
Commission within 120 days after the end of the fiscal year.

ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The information required by Item 12 as to certain relationships and related
transactions is incorporated by reference from the Company's Proxy Statement to
be filed by the Company with Securities and Exchange Commission within 120 days
after the end of the fiscal year.

ITEM 13.  EXHIBITS

Listed below are all exhibits filed as part of this report. Some exhibits are
filed by the Registrant with the Securities and Exchange Commission pursuant to
Rule 12b-32 under the Securities Exchange Act of 1934, as amended.

                                       21

<PAGE>

Exhibits
No.                      Description
----------------------------------------------------------------------
2.1.....Agreement and Plan of Reorganization (1)
3.1.....Articles of Incorporation, as amended and restated (6)
3.2.....By-laws (3)
4.1.....Form of common stock certificate (1)
4.2.....2001 Stock Option Plan (9)
10.1....Assignment between Linda Johnson and the Company dated September 6,
        2000. (5)
10.2....Assignment between Linda Johnson and Spectrum Pharmaceuticals
        Corporation dated May 14, 1999. (5)
10.3....Agreement containing the assignment of U.S. Patent Application
        07/233,247 with improvements dated May 22, 1990. (5)
10.4....Common Stock Purchase Agreement between Company and Fusion Capital Fund
        II, LLC, dated April 22, 2003 (2)
10.5....Registration Rights Agreement between Company and Fusion Capital Fund
        II, LLC dated April 22, 2003. (2)
10.6 ...Agreement between Samaritan Pharmaceuticals, Inc. and Thomas Lang (9)
10.7....Agreement between Samaritan Pharmaceuticals, Inc. and Eugene Boyle (5)
10.8....Agreement between Samaritan Pharmaceuticals, Inc and Janet Greeson (5)
10.9....Research Collaboration and Licensing Agreement between Georgetown
        University and Samaritan Pharmaceuticals, Inc., dated June 8, 2001 (6)
10.10...Master Clinical Trial and Full Scale Manufacturing Agreement dated
        October 5, 2004 (10)
14.1....Code of Ethics (8)
16.1....Letter on change in certifying accountant (7)
21.1....List of Subsidiaries (1)
31.1....Certification of Chief Executive Officer
31.2....Certification of Chief Financial Officer
32.1....Certification re: Section 906
--------------------------------------------------------------------------------
(1).....Filed as an exhibit to Samaritan Pharmaceutical's Form 10-SB, filed on
        July 21, 1999, and incorporated herein by reference. (2).....Filed as an
        exhibit to Samaritan Pharmaceutical's Report on Form 8-K filed on April
        25, 2003, and incorporated herein by reference.
(3).....Filed as an exhibit to Samaritan Pharmaceutical's Annual Report on Form
        10K- SB, filed on April 3, 2001, and incorporated herein by reference.
(4).....Filed as an exhibit to Samaritan Pharmaceutical's Schedule 14A filed on
        April 3, 2001, and incorporated herein by reference. (5).....Filed as an
        exhibit to Samaritan Pharmaceutical's Quarterly Report on Form 10-QSB
        filed on August 14, 2002, and incorporated herein by reference.
(6).....Filed as an exhibit to Samaritan Pharmaceutical's Registration Statement
        on Form SB-2 (SEC file number 333-105818) an incorporated herein by
        reference.
(7).....Filed as an exhibit to Form 8-K, on September 27, 2002 and incorporated
        herein by reference.
(8).....Filed as an exhibit to Form 10-KSB on April 15, 2003 and incorporated
        herein by reference.
(9).....Filed as an exhibit to Form 10-QSB on August 16, 2004 and incorporated
        herein by reference.
(10)....Filed as an exhibit to Form 10-QSB on November 15, 2004 and incorporated
        herein by reference.

ITEM 14.  PRINCIPAL ACCOUNTANT FEES AND SERVICES

The information required by Item 14 as to principal accounting fees and services
is incorporated by reference from the Company's Proxy Statement to be filed by
the Company with Securities and Exchange Commission within 120 days after the
end of the fiscal year.

                                       22

<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 14, 2005                      By: /s/ Janet Greeson, Ph.D.
                                                   -----------------------------
                                                   Janet Greeson, Ph.D.
                                                   President, Chief Executive
                                                   Officer, Chairman

Dated: April 14, 2005                      By: /s/ Eugene Boyle
                                                   -----------------------------
                                                   Eugene Boyle,
                                                   Chief Financial Officer,
                                                   Director

Dated: April 14, 2005                      By: /s/ Doug Bessert
                                                   -----------------------------
                                                   Doug Bessert
                                                   Director

Dated: April 14, 2005                      By: /s/ Vassilios Papadopoulos, Ph.D.
                                                   -----------------------------
                                                   Vassilios Papadopoulos, Ph.D.
                                                   Director

Dated: April 14, 2005                      By: /s/ H. Thomas Winn
                                                   -----------------------------
                                                   H. Thomas Winn
                                                   Director

Dated: April 14, 2005                      By: /s/ Cynthia C. Thompson
                                                   -----------------------------
                                                   Cynthia C. Thompson
                                                   Director

Dated: April 14, 2005                      By: /s/ Welter "Budd" Holden
                                                   -----------------------------
                                                   Welter "Budd" Holden
                                                   Director

Dated: April 14, 2005                      By: /s/ Erasto Saldi, M.D.
                                                   -----------------------------
                                                   Erasto Saldi, M.D.
                                                   Director








                                       23

<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                               F - 5

       Statements of Cash Flows                                         F - 6

       Notes to Financial Statements                                  F-7 - F-14
















                                      F-1

<PAGE>

             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM



Board of Directors and Stockholders
Samaritan Pharmaceuticals, Inc.

         We have audited the accompanying consolidated balance sheet of
Samaritan Pharmaceuticals, Inc. (a development stage company) as of December 31,
2004 and the related consolidated statements of operations and comprehensive
income, shareholders' equity and cash flows for the years ended December 31,
2004 and 2003. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audit.

         We conducted our audits in accordance with the standards of the Public
Company Accounting Oversight Board (United States). Those standards require that
we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.

         In our opinion, the financial statements referred to above present
fairly, the consolidated financial position of Samaritan Pharmaceuticals, Inc.
(a development stage company) as of December 31, 2004 and the consolidated
results of its operations and its cash flows for the years ended December 31,
2004 and 2003 in conformity with accounting principles generally accepted in the
United States of America.

         The accompanying cumulative statements of operations and comprehensive
income, shareholders' equity and cash flows regarding the period from inception
(September 5, 1994) through December 31, 2004, include 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 31, 2005



                                       F-2

<PAGE>

                         SAMARITAN PHARMACEUTICALS, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                           CONSOLIDATED BALANCE SHEET

                                December 31, 2004

                                     ASSETS

CURRENT ASSETS:

     Cash                                                          $  2,438,451

     Marketable securities                                            1,490,812

     Interest receivable                                                 23,238

     Prepaid expenses                                                    53,111
                                                                   -------------

                                 TOTAL CURRENT ASSETS                 4,005,612


PROPERTY AND EQUIPMENT                                                   37,221
                                                                   -------------

OTHER ASSETS:

     Patent registration costs                                          430,060

     Purchased  technology rights                                        30,879

     Marketable securities                                              492,608

     Note receivable                                                    250,000

     Deposits                                                             2,779
                                                                   -------------

                                 TOTAL OTHER ASSETS                   1,206,326
                                                                   -------------



                                                                   $  5,249,159
                                                                   =============

                      LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES:

     Accounts payable                                              $    147,753

     Accrued expenses                                                    22,414
                                                                   -------------

                                 TOTAL CURRENT LIABILITIES              170,167
                                                                   -------------



SHAREHOLDERS'  EQUITY:
     Common stock, 200,000,000 shares authorized at $.001
      par value,  132,030,199 issued and outstanding                    132,030

     Additional paid-in capital                                      33,697,043

     Deferred compensation                                             (304,416)

     Treasury stock                                                    (250,248)

     Accumulated other comprehensive income                             (16,580)

     Accumulated deficit during development stage                   (28,178,837)
                                                                   -------------

                                 TOTAL SHAREHOLDERS' EQUITY           5,078,992
                                                                   -------------

                                                                   $  5,249,159
                                                                   =============






        See accompanying notes to the consolidated financial statements.



                                       F-3

<PAGE>

                         SAMARITAN PHARMACEUTICALS, INC.
                          (A DEVELOPMENT STAGE COMPANY)

          CONSOLIDATED STATEMENTS OF OPERATIONS & COMPREHENSIVE INCOME

             FROM INCEPTION (SEPTEMBER 5, 1994) TO DECEMBER 31, 2004
               AND FOR THE YEARS ENDED DECEMBER 31, 2004 AND 2003



<TABLE>
<CAPTION>


                                                             From
                                                          Inception
                                                     (September 5, 1994)                            December 31,
                                                             To                   ---------------------- ------------------
                                                       December 31, 2004                   2004                    2003
                                                 ----------------------------     ---------------------- ------------------
                                                         (Unaudited)
<S>                                              <C>                              <C>                    <C>
REVENUES                                         $                   300,000      $  -                   $         250,000
                                                 ----------------------------     ---------------------- ------------------

EXPENSES:

Research and development                                           6,283,470                  1,543,921            838,208
Interest, net                                                         13,276                    (36,730)             6,334
General and administrative                                        21,403,387                  3,561,302          4,902,213
Depreciation and amortization                                      1,147,834                     27,218             23,776

Other income                                                        (369,130)                  (231,350)                 -
                                                 ----------------------------     ---------------------- ------------------
                                                                  28,478,837                  4,864,361          5,770,531
                                                 ----------------------------     ---------------------- ------------------


NET LOSS                                                         (28,178,837)                (4,864,361)        (5,520,531)

Other Comprehensive Income

   Unrealized loss on marketable securities                          (16,580)                   (16,580)                 -
                                                 ----------------------------     ----------------------  -----------------
Total Comprehensive Income                       $               (28,195,417)     $          (4,880,941)  $     (5,520,531)
                                                 ============================     ======================  =================


Loss per share, basic and diluted                $                     (0.86)     $               (0.04)  $          (0.07)
                                                 ============================     ======================  =================





Weighted average number of shares outstanding:

                        Basic and diluted                         32,931,183                124,483,372         79,767,085
                                                 ============================     ======================  =================


</TABLE>


         See accompanying notes to the consolidated financial statements



                                       F-4

<PAGE>

                         SAMARITAN PHARMACEUTICALS, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                CONSOLIDATED STATEMENTS OF SHAREHOLDERS' DEFICIT
                                   (UNAUDITED)
            FROM INCEPTION (SEPTEMBER 5, 1994) TO September 30, 2004


<TABLE>
<CAPTION>
                                                              Shares
                                   Number       Par Value    Reserved     Additional
                                     of          Common         for         Paid in
                                   Shares         Stock      Conversion     Capital       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                  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                  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                 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                 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                 21,534,807       21,535            -      9,390,184             -

         See accompanying notes to the consolidated financial statements

                                       F-5

<PAGE>

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                 37,736,699        37,736            -     12,903,173             -

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                              -             -            -                            -
Shares issued in cancellation
 of notes payable                          -             -            -              -             -
Stock options issued for
  services                                 -             -            -        225,000             -
Net loss                                   -             -            -              -             -
                                 ------------    ----------   ----------   ------------   -----------

December 31, 2002                 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 cancellation
of notes payable                           0             0            -              0             -
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                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                132,030,199     $ 132,030    $       -    $33,697,043    $        -
                                 ============    ==========   ==========   ============   ===========

         See accompanying notes to the consolidated financial statements

                                       F-5

<PAGE>

                         SAMARITAN PHARMACEUTICALS, INC.
                          (A DEVELOPMENT STATE COMPANY)

                CONSOLIDATED STATEMENTS OF SHAREHOLDERS' DEFICIT

            FROM INCEPTION (SEPTEMBER 5, 1994) TO September 30, 2004

                                               Accumulated
                                                  Other          Stock                                       Total
                                    Deferred    Comprehensive Subscriptions  Treasury    Accumulated     Shareholders'
                                   Compensation   Income      Receivable     Shares       Deficit          Deficit
                                  ------------- ------------ ------------  -----------  -------------   ---------------
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                           -             -            -            -     (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                           -             -            -            -     (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                           -             -            -            -     (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                           -             -            -            -     (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                    (759,560)            -            -            -     (9,656,986)       (1,004,827)



         See accompanying notes to the consolidated financial statements

                                       F-5

<PAGE>

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                    (495,036)            -            -            -    (13,736,792)       (1,290,919)

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
Shares issued in cancellation
 of notes payable                           -             -            -            -              -                 -
Stock options issued for
 services                                   -             -            -            -              -           225,000
Net loss                                    -             -            -            -     (4,057,153)       (4,057,153)
                                   ----------- ------------- ------------  -----------  -------------   ---------------
December 31, 2002                           -             -            -            -    (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 cancellation
 of notes payable                           -             -                                                      -
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                           -             -   (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                 $  (304,416) $    (16,580) $       0     $(250,248)  $(28,178,837)   $     5,078,992
                                  ============ ============= ===========   ==========   ============   ================

</TABLE>


         See accompanying notes to the consolidated financial statements

                                       F-5



                         SAMARITAN PHARMACEUTICALS, INC.

                          (A DEVELOPMENT STAGE COMPANY)

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

              FROM INCEPTION (SEPTEMBER 5, 1994) AND FOR THE YEARS
                        ENDED DECEMBER 31, 2004 AND 2003

<TABLE>
<CAPTION>

                                                        From                     For the Years
                                                      Inception                      Ended
                                                 (September 5, 1994)               December 31,
                                                         To           ------------------------------------
CASH FLOWS FROM OPERATING ACTIVITIES:             DECEMBER 31, 2004           2004              2003
                                                  -----------------          -----              -----
<S>                                               <C>                 <C>                 <C>
Net loss                                          $    (28,178,837)   $    (4,864,361)    $    (5,520,531)
Adjustments to reconcile net loss to net cash
    used in operating activities:
        Depreciation and amortization                    1,147,834             27,218              23,776
        Stock based compensation                         9,590,130          1,246,062           2,859,705
        Stock options issued for services                1,377,315            567,771             145,000
        Amortization of deferred compensation            1,230,072            240,000                   -
        Other income                                      (231,350)          (231,350)                  -
(Increase) decrease in assets:
        Interest receivable and prepaids                   (89,589)           (55,092)            (18,256)
        Deposits                                            12,941                  -              12,941
Increase (decrease) in liabilities:
        Deferred revenue                                         -                  -            (250,000)
        Accounts payable and accrued expenses            2,030,980           (218,144)            513,524
                                                  -----------------   ----------------    ----------------

NET CASH USED IN OPERATING ACTIVITIES                  (13,110,504)        (3,287,896)         (2,233,841)
                                                  -----------------   ----------------    ----------------


CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of technology                                    (108,969)                 -                   -
Purchase of furniture and equipment                       (115,963)           (17,316)            (13,902)
Note receivable                                           (250,000)          (250,000)                  -
Purchase of marketable securities                       (2,000,000)        (2,000,000)                  -
Patent registration costs                                 (439,479)          (227,862)             (4,832)
                                                  -----------------   ----------------    ----------------

NET CASH USED IN INVESTING ACTIVITIES                   (2,914,411)        (2,495,178)            (18,734)
                                                  -----------------   ----------------    ----------------


CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from warrants                                     607,125            450,000                   -
Proceeds from debentures                                   642,120                  -                   -
Proceeds from stock issued for cash                     12,583,570          4,300,939           2,409,790
Proceeds from equity financing                           3,100,001          3,100,001
Proceeds from common stock to be issued                    206,050                  -              12,500
Short-term loan repayments                                (288,422)                 -            (156,955)
Short-term loan proceeds                                 1,612,922                  -                   -
                                                  -----------------   ----------------    ----------------

NET CASH PROVIDED BY FINANCING ACTIVITIES               18,463,366          7,850,940           2,265,335
                                                  -----------------   ----------------    ----------------

CHANGE IN CASH                                           2,438,451          2,067,866              12,760
CASH AT BEGINNING OF YEAR                                        -            370,585             357,825
                                                  -----------------   ----------------    ----------------

CASH AT END OF YEAR                               $      2,438,451    $     2,438,451     $       370,585
                                                  =================   ================    ================

NON-CASH FINANCING AND INVESTING ACTIVITIES:

Purchase of net, non-cash assets of  subsidiary
     for stock                                    $            195    $             -     $             -
Short-term debt retired through issuance
    of stock                                      $      1,890,695    $             -     $             -
Issuance of common stock, previously subscribed   $        180,000    $        12,500     $       162,500
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)    $             -
Stock received in settlement                      $       (231,350)   $      (231,350)    $             -
Stock as compensation for services                $      5,175,792    $     1,246,062     $     3,929,730
Stock issued in cancellation of accounts payable  $      4,248,938    $             -     $     1,815,203
Exercise of stock options                         $      4,858,820    $     4,858,820     $             -

</TABLE>

         See accompanying notes to the consolidated financial statements


                                       F-6

<PAGE>

                         SAMARITAN PHARMACEUTICALS, INC.
                          (A DEVELOPMENT STAGE COMPANY)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                     YEARS ENDED DECEMBER 31, 2004 AND 2003


1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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

Samaritan Pharmaceuticals is working to ensure a longer and better life, for
patients suffering with AIDS, Alzheimer's, Cancer, and Cardiovascular disease.
Samaritan is a pipeline-driven Biopharmaceutical company, with a clear focus on
advancing early stage innovative drugs through clinical development, to become
commercially valuable compounds.

         B. Basis of Consolidation

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

         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.

         D. 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.

         E.  Intangibles

1) Legal fees associated with filing patents are recorded at cost. Amortization,
once the patent is approved, will be calculated using the straight-line method,
over the estimated useful lives of the patents.

The Company has 1 issued U.S. patent and had 13 pending patent applications in
the U.S. to protect its proprietary methods and processes. The Company also
filed corresponding foreign patent applications for certain of these U.S. patent
applications. As of December 31, 2004, its patent portfolio outside the U.S.
comprised 1 issued patent and over 13 pending patent applications. The issued
U.S. patent and pending patent applications relate to Alzheimer's, Cancer,
Cardiovascular, and HIV indications. 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.

                                       F-7

<PAGE>

The Company reviews patent costs for impairment by comparing the carrying value
of the patents with the fair value. Fair value is estimated using the present
value of expected future cash flows. 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.

2) 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 was approximately $10,896 for the years ended December 31, 2004 and
2003. Accumulated amortization at December 31, 2004 was $78,090. Amortization
expense associated with these technology rights for the next five years will be
$10,896 per year.

             F. 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 per
share effects of potential common shares such as warrants, options, convertible
debt and convertible preferred stock have not been included, as the effect would
be antidilutive. The Company has 20,942,930 options outstanding at December 31,
2004, which were not included.

             G. Use of Estimates

The preparation of financial statements in conformity with 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.

             H. 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.

             I. Research and Development Costs

Research and development costs are expensed when incurred.

             J. 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, 2004, the Company does not believe that any
impairment has occurred.


                                       F-8

<PAGE>

             K.  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.

             L. Stock Based Compensation

Statement of Financial Accounting Standards No. 123, "Accounting for Stock-Based
Compensation," ("SFAS 123"), encourages, but does not require, companies to
record compensation cost for stock-based employee compensation plans at fair
value. The Company has chosen to account for stock-based compensation using the
intrinsic value method prescribed in Accounting Principles Board Opinion No. 25,
"Accounting for Stock Issued to Employees", and related Interpretations.
Accordingly, compensation cost for the Company's stock at the date of the grant
over the amount of an employee must pay to acquire the stock. The Company has
adopted the "disclosure only" alternative described in SFAS 123 and SFAS 148,
which require pro forma disclosures of net income and earnings per share as if
the fair value method of accounting had been applied.

         M. Marketable Securities

At December 31, 2004, the Company holds three brokered Certificates of Deposit
with a total market value of $1,983,420. 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.

           N. New Accounting Pronouncements

In April 2003, the FASB issued Statement of Financial Accounting Standards No.
149 ("SFAS 149"), "Amendment of Statement 133 on Derivative Instruments and
Hedging Activities". This statement amends SFAS 133 to provide clarification on
the financial accounting and reporting of derivative instruments and hedging
activities and requires contracts with similar characteristics to be accounted
for on a comparable basis. The Company is in the process of assessing the effect
of SFAS 149 and does not expect the adoption of this statement, which will be
effective for contracts entered into or modified after June 30, 2003, to have a
material effect on its financial position or results of operations.

In May 2003, the FASB issued Statement of Financial Accounting Standards No. 150
("SFAS 150"), "Accounting for Certain Financial Instruments and Characteristics
of both Liabilities and Equity". SFAS 150 establishes standards on the
classification and measurement of financial instruments with characteristics of
both liabilities and equity. SFAS 150 became effective for financial instruments
entered into or modified after May 31, 2003. The adoption of SFAS 150 is not
expected to have a material effect on the Company's financial position or
results of operations.

                                       F-9

<PAGE>

In December 2004, the FASB issued FASB Statement No. 123R, "Share-Based Payment,
an Amendment of FASB Statement No. 123" ("FAS No. 123R").  FAS No. 123R requires
companies to recognize in the statement of operations the grant- date fair value
of stock options and other equity-based  compensation  issued to employees.  FAS
No. 123R is effective  beginning in the Company's second quarter of fiscal 2006.
The Company is in process of evaluating the impact of this  pronouncement on its
financial position.

In December 2004, the FASB issued SFAS Statement No. 153, "Exchanges of
Nonmonetary Assets." The Statement is an amendment of APB Opinion No. 29 to
eliminate the exception for nonmonetary exchanges of similar productive assets
and replaces it with a general exception for exchanges of nonmonetary assets
that do not have commercial substance. The Company believes that the adoption of
this standard will have no material impact on its financial statements.

Management does not believe that any recently issued but not yet effective
accounting pronouncements if currently adopted would have a material effect on
the accompanying financial statements.

2. PROPERTY AND EQUIPMENT

Property and equipment, at cost, consist of the following as of December 31,
2004:
                                        Estimated Useful Life
                                              (Years)
                                        ---------------------
          Furniture and Fixtures                  3-7                 $106,494
          Software                                  3                    9,470
          Accumulated depreciation                                     (78,743)
                                                                      ---------
                                                                      $ 37,221
                                                                      =========
Depreciation expense for the years ended December 31, 2004 and 2003 was $16,322
and $12,880 respectively.

3. SHAREHOLDERS' EQUITY

On June 27, 2003, the Company amended its articles of incorporation to increase
the authorized number of shares to 200 million and on April 24, 2001, a class of
5 million shares of preferred stock. There are no outstanding preferred stock
shares at December 31, 2004.

         A. 2001 Stock Option Plan (the "2001 Plan").

The short and long-term compensation program includes stock options granted
under the Stock Incentive Plan as well as non-qualified stock options. The
Option Plan is 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-10

<PAGE>

Shares Available under the 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 25,000,806 options granted and 20,924,930 options remaining
outstanding pursuant to the plan as of December 31, 2004.

The following table summarizes the Company's stock options outstanding at
December 31, 2004:
                                                          Weighted average
                                     Shares                exercise price
                                   -----------            -----------------
Outstanding and exercisable
at December 31, 2002                8,994,208             $            .25
Granted                            14,758,942                          .22
Exercised                          (7,770,892)                        (.14)
Expired                               (20,000)                        (.10)
                                -----------------         -----------------
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
                                =================         ==================

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 has been recognized for employee and director stock
options. Had the Company determined compensation cost based on the fair value at
the grant date for its stock options under SFAS No. 123, "Accounting for
Stock-Based Compensation," the Company's net loss would have been reported as
follows:

                                       December 31,
                                    2004           2003
                                -------------  -------------
Net Loss:
            As reported         $ (4,864,361)  $ (5,520,531)
            Pro Forma           $ (8,927,246)  $ (7,796,531)
Basic and diluted loss per
common share:
            As reported         $     (0.04)          (0.07)
            Pro Forma           $     (0.07)          (0.10)



                                      F-11

<PAGE>

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, 2004 and 2003. The per-share
weighted average fair value of stock options granted during 2004 and 2003 was
$0.24 and $0.19, respectively, on the date of grant using the Black Scholes
pricing model and the following assumptions for the year ended December 31, 2004
and 2003:

                                            2004     2003
                                        ---------- ---------
         Expected dividend yield            0%          0%
         Risk-free interest rate            5%          5%
         Annualized volatility             82%        122%

At December 31, 2004 the range of exercise price for all of the Company's
outstanding stock options was $.10 - $1.26, with an average remaining life of
five years and an average exercise price of $.56.

         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, 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, 2003, the Company issued an aggregate of
4,062,833 shares of common stock in consideration of services rendered or to be
rendered to the Company. Such shares were valued at an aggregate of $553,842
ranging from $.16-$.71 per share, representing the fair value of the shares
issued. The issuances were recorded as non-cash compensation expense. During the
year ended December 31, 2003 the Company exchanged 12,740,870 shares of the
Company's common stock in settlement of accounts payable, accrued salaries for
officers and equity financing totaling $1,152,703. To the extent that the market
value of shares issued as payment of accrued salaries exceeded the recorded
amount of accrued salaries, such amount was recognized as additional
compensation. The amount of additional compensation recorded at December 31,
2003 was $2,305,863.

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, 2004, through various private placements, the
Company sold 11,426,733 shares for $4,300,938. During the year 2003, through
various private placements, the Company sold 17,493,664 shares for $2,409,789.


                                      F-12

<PAGE>

4. INCOME TAXES

The Company has net operating losses at December 31, 2004 of approximately
$15,200,000 expiring through 2024. Utilization of these losses may be limited by
the "change of ownership" rules as set forth in section 382 of the Internal
Revenue Code.

Deferred income tax assets as of December 31, 2004 of $5,320,000 as a result of
net operating losses, have been fully offset by valuation allowances. 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.

A reconciliation of the statutory U.S. Federal rate (35%) and effective rates is
as follows:

                                              Years Ended December 31,
                                        --------------------------------------
                                             2004                   2003
                                        ---------------         --------------
     Expected income tax benefit at
       Federal statutory rate           $    1,732,000          $   1,932,000
     Permanent differences                    (647,000)            (1,052,000)
     Benefit not recognized                 (1,085,000)              (880,000)
                                        ---------------         --------------
                                        $            -          $           -
                                        ===============         ==============

5. COMMITMENTS AND CONTINGENCIES

A. The Company leases various facilities under operating lease agreements
expiring through April 2005. Rental expense for the years ended December 31,
2004 and 2003 was $49,883 and $40,006 respectively. Future minimum annual lease
payments under the facilities lease agreements for agreements lasting more than
one year are as follows:

                                  2005      $11,120

B. During the year ended December 31, 2004, the Company amended its research
collaboration and licensing agreement with Georgetown University ("Georgetown"),
which terminates in 2014. As consideration for Georgetown's performance under
this Agreement the Company shall pay Georgetown $1,000,000 per year in quarterly
installments commencing with the quarter ended March 31, 2004.

C. The Company has entered into employment agreements with two officers. These
agreements started January 1, 2001 and are for five years with annual
compensation for both at $780,000, with an annual increase not less than 5% per
year. Each officer at their option can receive payment in Company common stock
calculated at the lowest closing price of the stock quoted for the period for
which the salary has been earned, divided by the current discount rate for
restricted stock offered by the Company.



                                      F-13

<PAGE>

Each officer is entitled to a bonus payable in ten year warrants based on a
calculation of the Company's market capitalization. In addition each officer is
guaranteed annual incentive stock options of the greater of $250,000 or a
percentage of the issued and outstanding shares on the anniversary date of the
agreement. The percentage ranges from 1% to 4%. Such options vest 25% each
quarter and are priced at the lowest closing price of the Company's common stock
in the quarter preceding the grant. The options terminate after ten years.

6. LITIGATION

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

7. 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 12% per annum. The note receivable is secured
by pledge of common stock in Samaritan owned by CCH. CCH is also an affiliate of
Nevada Gold and Casinos through CCH ownership of over 10% of Nevada Gold and
Casinos common stock. A Director of the Company is the CEO of Nevada Gold and
Casinos but is not a shareholder of CCH.

8. OTHER INCOME

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.

9. FUSION TRANSACTION

On April 22, 2003, the Company entered into a common stock purchase agreement
with Fusion Capital Fund II, LLC, pursuant to which Fusion Capital has agreed to
purchase shares our common stock from time to time at the Company's option up to
an aggregate amount of $10,000,000. The SEC declared effective the Company's
registration statement on Form SB-2, Commission Registration No. 333-105818 on
October 9, 2003. In the year ended December 31, 2004, the Company sold 8,758,240
shares of common stock to Fusion Capital for gross proceeds of $3,100,000. The
proceeds from these sales were used for general corporate purposes and working
capital.

10. 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.



                                      F-14