|UNITED STATES                                                                                                             
|--------------------------------------------------------------------------------------------------------------------------
|SECURITIES AND EXCHANGE COMMISSION                                                                                        
|Washington, D.C. 20549                                                                                                    
|                                                                                                                          
|<R>Amendment #1                                                                                                           
|to                                                                                                                        
|                                                                                                                          
|FORM 10-QSB/A</R>                                                                                                         
|                                                                                                                          
|(Mark One)                                                                                                                
|                                                                                                                          
|[X]                                                                                                                       
|                                                                                                                          
|For the quarterly period ended: August 31, 2006                                                                           
|Or                                                                                                                        
|                                                                                                                          
|[ ]                                                                                                                       
|                                                                                                                          
|For the transition period from                                                                                            
|                                                                                                                          
|Commission File Number: 000-31431                                                                                         
|                                                                                                                          
|US BIODEFENSE, INC.                                                                                                       
|(Exact name of registrant as specified in its charter)                                                                    
|                                                                                                                          
|Utah                                                                                                                      
|(State of Other Jurisdiction of Incorporation)                                                                            
|                                                                                                                          
|375 South 6th Avenue                                                                                                      
|City of Industry, California                                                                                              
|(Address of Principal Executive Offices)                                                                                  
|                                                                                                                          
|(626) 961-0562                                                                                                            
|(Registrant's telephone number, including area code)                                                                      
|                                                                                                                          
|N/A                                                                                                                       
|(Former name, former address and former fiscal year, if changed since last report)                                        
|                                                                                                                          
|Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the
|Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was        
|required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.                
|Yes [X] No [ ]                                                                                                            
|                                                                                                                          
|APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE                                                  
|PRECEDING FIVE YEARS:                                                                                                     
|Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 
|or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a  
|court.                                                                                                                    
|Yes [ ] No [ ]                                                                                                            
|                                                                                                                          
|APPLICABLE ONLY TO CORPORATE ISSUERS:                                                                                     
|Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable   
|date: 39,059,047                                                                                                          

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|US Biodefense, Inc.                                  
|-----------------------------------------------------
|                                                     
|                                                     
|Table of Contents                                    
|<R>                                                  
|                                                     
|PART I - FINANCIAL INFORMATION                       
|                                                     
|Item 1. Financial Statements                         
|                                                     
|Balance Sheet                                        
|                                                     
|Statements of Operations                             
|                                                     
|Consolidated Statements of Stockholders Equity      
|                                                     
|Statements of Cash Flows                             
|                                                     
|Notes                                                
|                                                     
|Item 2. Management's Discussion and Plan of Operation
|                                                     
|Item 3. Controls and Procedures                      
|                                                     
|PART II - OTHER INFORMATION                          
|                                                     
|Item 2. Unregistered Sales of Equity Securities      
|                                                     
|Item 6. Exhibits                                     
|                                                     
|SIGNATURES                                           
|                                                     
|-2-                                                  

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|PART I - FINANCIAL INFORMATION                                                                                            
|--------------------------------------------------------------------------------------------------------------------------
|Item 1. Unaudited Financial Statements                                                                                    
|                                                                                                                          
|The accompanying unaudited consolidated financial statements have been prepared in accordance with                        
|generally accepted accounting principles for interim financial reporting and pursuant to the rules and regulations of the 
|Securities and Exchange Commission ("Commission"). While these statements reflect all normal recurring adjustments        
|which are, in the opinion of management, necessary for fair presentation of the results of the interim period, they do not
|include all of the information and footnotes required by generally accepted accounting principles for complete financial  
|statements. For further information, refer to the financial statements and footnotes thereto, which are included in the   
|Company's Annual Report on Form 10-KSB previously filed with the Commission on February 24, 2006, and                     
|subsequent amendments made thereto.                                                                                       
|                                                                                                                          
|The accompanying notes are an integral part of these consolidated financial statements.                                   
|                                                                                                                          
|-3-                                                                                                                       

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|<R>                                                                       
|--------------------------------------------------------------------------
|US Biodefense, Inc.                                                       
|Balance Sheet                                                             
|                                                                          
|ASSETS                                                                    
|                                                                          
|                                                                          
|                                                                          
|Current assets                                                            
|Cash and cash equivalents                                                 
|Marketable securities                                                     
|Accounts receivable                                                       
|Inventory                                                                 
|Prepaid expenses                                                          
|                                                                          
|Total current assets                                                      
|                                                                          
|Property and equipment, net of accumulated depreciation of $59 and $-0- at
|August 31, 2006 and November 30, 2005                                     
|Customer list                                                             
|Licenses                                                                  
|Deposits                                                                  
|                                                                          
|Total assets                                                              
|                                                                          
|LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIT)                            
|                                                                          
|Current liabilities                                                       
|Bank overdraft                                                            
|Accounts payable and accrued expenses                                     
|Due to related parties                                                    
|Accrued income taxes                                                      
|Deferred revenues                                                         
|                                                                          
|Total current liabilities                                                 
|                                                                          
|Deferred taxes                                                            
|                                                                          
|Total liabilities                                                         
|                                                                          
|Stockholders equity:                                                     
|Common stock, $0.001 par value, 100,000,000 shares authorized, $.001      
|par value, 39,059,047 and 30,304,047 share issued                         
|and outstanding                                                           
|Additional paid in capital                                                
|Other comprehensive deficit                                               
|Accumulated deficit                                                       
|                                                                          
|Total stockholders equity (deficit)                                      
|                                                                          
|Total liabilities and stockholders equity (deficit)                      
|                                                                          
|                                                                          
|See accompanying notes to financial statements                            
|                                                                          
|F1                                                                        

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|US Biodefense, Inc.                           
|----------------------------------------------
|Statements of Operations                      
|For the three and nine                        
|months ended August 31, 2006 and 2005         
|(Unaudited)                                   
|                                              
|                                              
|                                              
|                                              
|                                              
|                                              
|Revenues                                      
|                                              
|Sales of tangible products                    
|Revenue from services                         
|Revenues  Related parties                    
|                                              
|Total revenues                                
|                                              
|Cost of tangible products sold                
|                                              
|                                              
|                                              
|Expenses                                      
|                                              
|Research and development expenses             
|General and administrative expenses           
|General & administrative expenses            
|Related party                                 
|Stock issued for consulting services          
|Impairment of assets                          
|                                              
|Total expenses                                
|                                              
|Net income (loss)                             
|                                              
|Weighted average number of shares             
|outstanding - basic and fully diluted         
|                                              
|Basic and diluted net income (loss)           
|per common share                              
|                                              
|See accompanying notes to financial statements
|                                              
|F2                                            

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|US Biodefense, Inc.                            
|-----------------------------------------------
|Consolidated Statements of Stockhodlers Equity
|For the period ended August 31, 2006           
|                                               
|                                               
|                                               
|                                               
|                                               
|Balance, November 30, 2003                     
|                                               
|Net loss for the year ended November 30, 2004  
|                                               
|Balance November 30, 2004                      
|                                               
|Three for one stock split                      
|                                               
|Change in unrealized gain on available for sale
|securities, net of tax effects of $ 19,150     
|                                               
|Net loss for the year ended November 30, 2005  
|                                               
|Balance, November 30, 2005                     
|                                               
|Stock issued for cash                          
|                                               
|Stock issued for consulting services           
|                                               
|Capitalization of acquired company             
|                                               
|Net loss for the nine months ended             
|August 31, 2006                                
|                                               
|Balance, August 31, 2006                       
|                                               
|See accompanying notes to financial statements 
|F3                                             

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|US Biodefense, Inc.                                                    
|-----------------------------------------------------------------------
|Statement of Cash Flows                                                
|For the nine months ended August 31, 2006 2005                         
|(Unaudited)                                                            
|                                                                       
|                                                                       
|                                                                       
|                                                                       
|Cash flows from operating activities                                   
|Net income (loss)                                                      
|Adjustments to reconcile net loss to net cash used in                  
|operating activities:                                                  
|Depreciation                                                           
|Impairment of assets                                                   
|Stock issued for consulting services                                   
|Changes in operating assets and liabilities:                           
|Accounts receivable                                                    
|Inventory                                                              
|Prepaid expenses                                                       
|Bank overdraft                                                         
|Accounts payable and accrued expenses                                  
|Deferred revenues                                                      
|                                                                       
|Net cash (used for) provided by operating activities                   
|                                                                       
|Cash flows from financing activities                                   
|Principal advance from (repayment to) related party                    
|Proceeds from sale of common stock                                     
|                                                                       
|Total cash flows from financing activities                             
|                                                                       
|Cash flows from investing activities                                   
|Purchase of investment                                                 
|Purchase of customer list                                              
|Purchase of licenses                                                   
|Purchase of equipment                                                  
|                                                                       
|Total cash flows from (used for) investing activities                  
|                                                                       
|Increase (decrease in) cash and cash equivalents                       
|                                                                       
|Cash and cash equivalents, beginning of year                           
|                                                                       
|Cash and cash equivalents, end of year                                 
|                                                                       
|Income taxes paid                                                      
|Interest expense paid                                                  
|                                                                       
|Supplemental schedule of noncash investing and financing activities:   
|                                                                       
|The Company acquired marketable equity securities with a fair          
|market value of $150,000 in exchange for consulting services.          
|In conjunction with the acquisition, the Company acquired the following
|liabilities:                                                           
|                                                                       
|Deferred income                                                        
|Other comprehensive income to represent the increase in                
|fair value of this marketable equity security                          
|                                                                       
|                                                                       
|                                                                       
|See accompanying notes to financial statements                         
|F4                                                                     

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|US Biodefense, Inc.                                                                                  
|-----------------------------------------------------------------------------------------------------
|Notes to Financial Statements                                                                        
|                                                                                                     
|Note 1 - Background and Summary of Significant Accounting Policies                                   
|                                                                                                     
|Background                                                                                           
|                                                                                                     
|US Biodefense , Inc. (the "Company"), a Utah corporation is headquartered in the City of             
|Industry, California. The Company is a registered government contractor with the Department          
|of Defense Logistics Agency. The Company is focused on designing and developing                      
|homeland security and biodefense products.                                                           
|                                                                                                     
|The Company was originally incorporated under the name Teal Eye, Inc. in the state of                
|Utah on June 29, 1983. The Company then merged with Terzon Corp. and amended its                     
|Articles of Incorporation to change the name to Terzon Corp. On September 7, 1984,                   
|the Company amended its articles of incorporation changing its name to Candy Stripers                
|Corporation, Inc. On January 6, 1998, the Company amended its Articles of Incorporation              
|changing its name to Piedmont, Inc. On May 31, 2003, the Company amended its                         
|articles of Incorporation and changed its name to US Biodefense, Inc.                                
|                                                                                                     
|The accompanying financial statements for the nine months ended August 31, 2006, include the         
|accounts of the Company and its wholly-owned subsidiaries Stem Cell Research Institute, Inc.         
|and Emergency Disaster Systems, Inc. All significant intercompany transactions and balances          
|have been eliminated.                                                                                
|                                                                                                     
|Basis of Presentation                                                                                
|                                                                                                     
|The accompanying financial statements have been prepared in conformity with accounting               
|principles generally accepted in the United States of America, which contemplate continuation        
|of the Company as a going concern. The Company incurred a net loss for the nine months ended         
|August 31, 2006 of $323,256 and at August 31, 2006, had an accumulated deficit                       
|of $4,164,613. In addition, the Company generates minimal revenue from its operations.               
|These conditions raise substantial doubt as to the Company's ability to continue as a growing        
|concern. These financial statements do not include any adjustments that might result from            
|the outcome of this uncertainty. These financial statements do not include any adjustments           
|relating to the recoverability and classification of recorded asset amounts, or amounts and          
|classification of recorded asset amounts, or amounts and classification of liabilities that might    
|be necessary should the Company be unable to continue as a going concern.                            
|                                                                                                     
|Management plans to take the following steps that it believes will be sufficient to provide the      
|Company with the ability to continue in existence.                                                   
|                                                                                                     
|Management intends to raise financing through the issuance of its common stock or other means        
|and interests that it deems necessary, with a view to moving forward with the development of the     
|emergency preparedness, homeland security and biodefense products.                                   
|                                                                                                     
|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 reported amounts of assets and liabilities, 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. Actual results could differ from those estimates.                              
|F5                                                                                                   

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|US Biodefense, Inc.                                                                                         
|------------------------------------------------------------------------------------------------------------
|Notes to Financial Statements                                                                               
|                                                                                                            
|Fair Value of Financial Instruments                                                                         
|                                                                                                            
|For certain of the Company's financial instruments, including cash and cash equivalents, prepaid            
|expenses, accounts payable and deferred revenues, the carrying amounts approximate fair value               
|due to their short maturities.                                                                              
|                                                                                                            
|Revenue Recognition                                                                                         
|                                                                                                            
|The Company recognizes revenue from the sale of products, and from the performance of services to both      
|related and non-related parties. The Company recognizes revenue from the sale of products on the gross      
|amount charged basis. Under this method of recording the sale of products, the cost of goods sold           
|reflects the cost of the goods sold to the customer plus the Company's cost of executing the transaction.   
|the Company has chosen this method since it takes ownership of the products that it purchases for           
|resale and assumes the risks and rewards of ownership of the goods.                                         
|                                                                                                            
|For sale of products, revenue is generally recognized when persuasive evidence of an arrangement exists,    
|delivery has occurred, the contract price is fixed or determinable, title and risk of loss has passed to the
|customer and collection is reasonably assured. The Company's sales are typically not subject to rights      
|of return and, historically, sales returns have not been significant.                                       
|                                                                                                            
|Revenues from services are recognized upon provision of services to the customer. Unearned service          
|revenue is deferred and recognized ratably over the duration of the service term.                           
|                                                                                                            
|Accounts receivable of the Company are reviewed to determine if their carrying value has become             
|impaired. The Company considers the assets to be impaired if the balances are greater than six months       
|old management regularly reviews accounts receivable and will establish an allowance for potentially        
|uncollectible amounts when appropriate. When accounts are written off, they will be charged against the     
|allowance. Receivables are not collateralized and do not bear interest.                                     
|                                                                                                            
|Concentration of Credit Risk                                                                                
|                                                                                                            
|Financial instruments which subject the Company to concentrations of credit risk include cash               
|and cash equivalents.                                                                                       
|                                                                                                            
|The Company maintains its cash in well-known banks selected based upon management's                         
|assessment of the bank's financial stability. Balances may periodically exceed the $100,000                 
|federal depository insurance limit; however, the Company has not experienced any losses on                  
|deposits. The Company extends credit based on an evaluation of the customer's financial condition,          
|generally without collateral. Exposure to losses on receivables is principally dependent on each            
|customer's financial condition. The Company monitors its exposure for credit losses and maintains           
|allowances for anticipated losses, as required.                                                             
|                                                                                                            
|Cash Equivalents                                                                                            
|                                                                                                            
|For purposes of reporting cash flows, the Company considers all short-term investments with an              
|original maturity of three months or less to be cash equivalent.                                            
|                                                                                                            
|F6                                                                                                          

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|US Biodefense, Inc.                                                                                              
|-----------------------------------------------------------------------------------------------------------------
|Notes to Financial Statements                                                                                    
|                                                                                                                 
|Inventory                                                                                                        
|                                                                                                                 
|Inventory is stated at the lower of cost or market. Inventory consists of purchased items held for resale.       
|Inventory will be monitored by Company management for excess and obsolete items, and will make                   
|the necessary valuation adjustment when required.                                                                
|                                                                                                                 
|Fixed Assets                                                                                                     
|                                                                                                                 
|Fixed assets are stated at cost, less accumulated depreciation. Depreciation is provided principally on the      
|straight-line method over the estimated useful lives of the assets, which is generally 3 to 10 years. The cost of
|repairs and maintenance is charged to expense as incurred. Expenditures for property betterments and             
|renewals are capitalized. Upon sale or other disposition of a depreciable asset, cost and accumulated            
|depreciation are removed from the accounts and any gain or loss is reflected in other income (expense).          
|                                                                                                                 
|The Company will periodically evaluate whether events and circumstances have occurred that may warrant           
|revision of the estimated useful lives of fixed assets or whether the remaining balance of fixed assets should be
|evaluated for possible impairment. We use an estimate of the related undiscounted cash flows over the            
|remaining life of the fixed assets in measuring their recoverability.                                            
|                                                                                                                 
|Comprehensive Income                                                                                             
|                                                                                                                 
|Statement of Financial Accounting Standards (SFAS) No. 130, "Reporting Comprehensive                             
|Income," establishes standards for the reporting and display of comprehensive income and its                     
|components in the financial statements. For the years ended November 30, 2005, the Company                       
|has items that represent other comprehensive income, and accordingly, has included a schedule                    
|of comprehensive income in the financial statements.                                                             
|                                                                                                                 
|Advertising Costs                                                                                                
|                                                                                                                 
|Advertising costs are expensed as incurred. There were no advertising costs for the nine month                   
|periods ended August 31, 2006 or 2005.                                                                           
|                                                                                                                 
|Shipping and Handling                                                                                            
|                                                                                                                 
|Costs incurred by the Company for shipping and handling are included in costs of revenues.                       
|                                                                                                                 
|Income Taxes                                                                                                     
|                                                                                                                 
|The Company accounts for income taxes under SFAS 109, "Accounting for Income Taxes." Under                       
|the asset and liability method of SFAS 109, deferred tax assets and liabilities are recognized                   
|for the future tax consequences attributable to differences between the financial statements                     
|carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax                 
|assets and liabilities are measured using enacted tax rates expected to apply to taxable income                  
|in the years in which those temporary differences are expected to be recovered or settled.                       
|                                                                                                                 
|F7                                                                                                               

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|US Biodefense, Inc.                                                                                          
|-------------------------------------------------------------------------------------------------------------
|Notes to Financial Statements                                                                                
|                                                                                                             
|Loss per Share                                                                                               
|                                                                                                             
|In accordance with SFAS No. 128, "Earnings Per Share," the basic income / (loss) per common                  
|share is computed by dividing net income / (loss) available to common stockholders by the                    
|weighted average number of common shares outstanding. Diluted income per common share is                     
|computed similar to basic income per share except that the denominator is increased to include               
|the number of additional common shares that would have been outstanding if the potential common              
|shares had been issued and if the additional common shares were dilutive. As of August 31,                   
|2006 and August 31, 2005, the Company does not have any equity or debt instruments                           
|outstanding that can be converted into common stock.                                                         
|                                                                                                             
|Stock-Based Compensation                                                                                     
|                                                                                                             
|Effective January 1, 2006, the Company prospectively adopted FAS 123 R , Stock -Based Payments, and          
|related Securities and Exchange Commission rules included in Staff Accounting Bulletin No. 107. Under this   
|method, compensation cost recognized beginning January 1, 2006 will include costs related to all share-based 
|payments granted subsequent to December 31, 2005 based on the grant-date fair value estimated in accordance  
|with the provisions of FAS 123 R. Compensation cost for stock options granted to employees is recognized     
|ratably over the vesting period.                                                                             
|                                                                                                             
|Prior to January 1, 2006, the Company measured compensation cost for stock-based employeee compensation      
|plans using the intrinsic value method of accounting as prescribed in Accounting Principles Board Opinion No.
|25, Accounting for Stock Issued to Employees, and related interpretations. For non-employee stock-based      
|compensations, the Company recognizes expense in accordance with FAS 123 and values the equity securities    
|based on the fair value of the security on the date of grant.                                                
|                                                                                                             
|Recent Accounting Pronouncements                                                                             
|                                                                                                             
|In January 2003, the FASB issued Interpretation No 46, "Consolidation of Variable Interest Entities"         
|(an interpretation of Accounting Research Bulletin (ARB) No. 51, Consolidation Financial State-              
|ments). Interpretation 46 addresses consolidation by business enterprises of entities to which the           
|usual condition of consolidation described in ARB-5 does not apply. The Interpretation changes               
|the criteria by which one company includes another entity in its consolidated financial statements.          
|The general requirement to consolidate under ARB-51 is based on the presumption that an enter-               
|prise's financial statement should include all of the entities in which it has a controlling financial       
|interest (i.e., majority voting interest). Interpretation 46 requires a variable interest entity to receive  
|a majority of the entity's residual returns or both. A company that consolidated a variable interest         
|entity is called the primary beneficiary of that entity. In December 2003, the FASB concluded to             
|revise certain elements of FIN 46, primarily to clarify the required accounting for interests in variable    
|interest entities. FIN-46R replaces FIN-46. that was issued in January, 2003. FIN-46R exempts                
|certain entities from its requirements and provides for special effective dates for entities that have       
|fully or partially applied FIN-46 as of December 24, 2003. In certain situations, entities have the          
|option of applying or continuing to apply FIN-46 for a short period of time before applying IN-46R.          
|In general, for all entities that were previously considered special purpose entities, FIN 46 should         
|be applied for registrants who file under Regulation SX in periods ending after March 31, 2004, and          
|for registrants who file under Regulation SB, in periods ending after December 15, 2004. The                 
|Company does not expect the adoption to have a material impact on the Company's financial                    
|position or results of operations.                                                                           
|                                                                                                             
|F8                                                                                                           

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|US Biodefense, Inc.                                                                                    
|-------------------------------------------------------------------------------------------------------
|Notes to Financial Statements                                                                          
|                                                                                                       
|During April 2003, the FASB issued SFAS 149 - "Amendment of Statement 133 on Derivative                
|Instruments and Hedging Activities", effective for contracts entered into or modified after            
|September 30, 2003, except as stated below and for hedging relationships designated after              
|September 30, 2003. In addition, except as stated below, all provisions of this Statement should       
|be applied prospectively. The provisions of this Statement that relate to Statement 133 Implement-     
|ation Issues that have been effective for fiscal quarters that began prior to June 15, 2003, should    
|continue to be applied in accordance with their respective effective dates. In addition, paragraphs    
|7(a) and 23(a), which relate to forward purchases or sales of when-issued securities or other          
|securities that do not yet exist, should be applied to both existing contracts and new contracts       
|entered into after September 30, 2003. The adoption of this statement had no impact on the             
|Company's financial statements.                                                                        
|                                                                                                       
|During May 2003, the FASB issued SFAS 150 - "Accounting for Certain Financial Instruments with         
|Characteristics of both Liabilities and Equity", effective for financial instruments entered into or   
|modified after May 31, 2003, and otherwise is effective for public entities at the beginning of the    
|first interim period beginning after June 15, 2003. This Statement establishes standards for how       
|an issuer classifies and measures certain financial instrument with characteristics of both            
|liabilities and equity. It requires that an issuer classify a freestanding financial instrument that is
|within its scope as a liability (or an asset in some circumstances). Many of those instruments         
|were previously classified as equity. Some of the provisions of this Statement are consistent with     
|the current definition of liabilities in FASB Concepts Statement No. 6, Element of Financial           
|Statements. The adoption of this statement had no impact on the Company's financial statements.        
|                                                                                                       
|In December 2003, the FASB issued a revised SFAS No. 132, Employers Disclosures about                
|Pensions and Other Postretirement Benefits which replaces the previously issued Statement. The        
|revised Statement increases the existing disclosures for defined benefit pension plans and other       
|defined benefit postretirement plans. However, it does not change the measurement or recognition       
|of those plans as required under SFAS No. 88, Employers Accounting for Settlements and               
|Curtailments of Defined Benefit Pension Plans and for Termination Benefits, and SFAS No. 106,         
|Employers Accounting for Postretirement Benefits Other Than Pensions. Specifically, the             
|revised Statement requires companies to provide additional disclosures about pension plan assets,      
|benefit obligations, cash flows, and benefit costs of defined benefit pension plans and other          
|defined benefit postretirement plans. Also, companies are required to provide a breakdown of plan      
|assets by category, such as debt, equity and real estate, and to provide certain expected rates        
|of return and target allocation percentages for these asset categories. The Company has                
|implemented this pronouncement and has concluded that the adoption has no material impact              
|to the financial statements.                                                                           
|                                                                                                       
|In December, 2003, the Securities and Exchange Commission (SEC) issued Staff Accounting              
|Bulletin (SAB) No. 104, Revenue Recognition. SAB 104 supersedes SAB 11, Revenue                   
|Recognition in Financial Statements. SAB 104s primary purpose is to rescind accounting               
|guidance contained in SAB 101 related to multiple element revenue arrangements, superseded             
|as a result of the issuance of EITF 00-21, Accounting for Revenue Arrangements with Multiple          
|Deliverables. Additionally, SAB 104 rescinds the SECs Revenue Recognition in Financial               
|Statements Frequently Asked Questions and Answers (the FAQ) issued with SAB 101 that had               
|been codified in SEC Topic, 13, Revenue Recognition. Selected portions of the FAQ have been            
|incorporated into SAB 104. While the wording of SAB 104 has changed to reflect the issuance            
|of EITF 00-21, the revenue recognition principles of SAB 101 remain largely unchanged by the           
|issuance of SAB 104, which was effective upon issuance. The adoption of SAB 104 did not                
|impact the financial statements.                                                                       
|F9                                                                                                     

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|US Biodefense, Inc.                                                                                  
|-----------------------------------------------------------------------------------------------------
|Notes to Financial Statements                                                                        
|                                                                                                     
|In March, 2004, the FASB approved the consensus reached on the Emerging Issues Task Forces           
|(ETIF) Issue No. 03-1, The Meaning of Other-Than-Temporary Impairment and Its Application to        
|Certain Investments. The objective of this Issue is to provide guidance for identifying impaired    
|investments. EITF 03-1 also provides new disclosure requirements for investments for investments     
|are deemed to be temporarily impaired. In September 204, the FASB issued a FASB Staff                
|Position (FSP) EITF 03-1-1 that delays the effective date of the measurement and recognition         
|are effective only for annual periods ending after June15,2004. The Company has evaluated the        
|impact of the adoption of the disclosure requirements of EITF 03-1 and does not believe it will have 
|an impact to the Companys overall combined results of operations or combined financial position.    
|Once the FASB reaches a final decision on the measurement and recognition provisions, the            
|Company will evaluate the impact of the adoption of EITF 03-1.                                       
|                                                                                                     
|In November 2004, the FASB issued SFAS No. 151 Inventory Costs, an amendment of ARB                 
|No. 43, Chapter 4 (SFAS No. 151. The amendments made by SFAS 151 clarify that abnormal             
|amount of idle facility expense, freight, handling costs, and wasted materials (spoilage) should be  
|recognized as current-period charges and require the allocation of fixed production overheads to     
|inventory based on the normal capacity of the production facilities. The guidance is effective for   
|inventory costs incurred during fiscal years beginning after June 15, 2005. Earlier application is   
|permitted for inventory costs incurred during fiscal years beginning after November 23, 2004. The    
|Company has evaluated the impact of the adoption of SFAS 151, and does not believe the impact        
|will be significant to the Companys overall results of operations or financial position.            
|                                                                                                     
|In December 2004, the FASB issued SFAS No. 152, "Accounting for Real Estate Time-Sharing             
|Transactions-an amendment of FASB Statements No. 66 and 67" ("SFAS 152") SFAS 152                    
|amends SFAS No. 66, "Accounting for Sales of Real Estate", to reference the financial accounting     
|and reporting guidance for real estate time-sharing transactions that is provided in AICPA Statement 
|of Position (SOP) 04-2, "Accounting for Real Estate Time-Sharing Transactions". SFAS 152 also        
|amends SFAS No. 67, "Accounting for Costs and Initial Rental Operations of Real Estate Projects",    
|to state that the guidance for (a) incidental operations and (b) costs incurred to sell real estate  
|projects does not apply to real estate time-sharing transactions. The accounting for those operations
|and costs is subject to the guidance in SOP04-2. SFAS 152 is effective for financial statements      
|for fiscal years beginning after June 15, 2005, with earlier applications encouraged. The Company    
|has evaluated the impact of the adoption of SFAS 152, and does not believe the impact will be        
|significant to the Company's overall results of operations or financial position.                    
|                                                                                                     
|In December 2004, the FASB issued SFAS No. 153, "Exchanges of Nonmonetary Asset, an                  
|amendment of APB Opinion No. 29, Accounting for Nonmonetary Transactions." The amendments            
|made by SFAS 153 are based on the principle that exchanges of nonmonetary assets should be           
|measured based on the fair value of the assets exchanged. Further, the amendments eliminate          
|the narrow exception for nonmonetary exchanges of similar productive assets and replace it with a    
|broader exception for exchanges of nonmonetary assets that do not have commercial substance.         
|Previously, Opinion 29 required that the accounting for an exchange of a productive asset for a      
|similar productive asset or an equivalent interest in the same or similar productive asset should be 
|based on the recorded amount of the asset relinquished. Opinion 29 provided an exception to its      
|basis measurement principle (fair value) for exchanges of similar productive assets. That exception  
|required that some nonmonetary exchanges, although commercially substantive, to be recorded on       
|a carryover basis. By focusing the exception on exchanges that lack commercial substance, the        
|FASB believes SFAS No. 153 is effective for nonmonetary asset exchanges occurring in fiscal          
|periods beginning after June 15, 2005. Earlier application is permitted for nonmonetary asset        
|F10                                                                                                  

---

|US Biodefense, Inc.                                                                                      
|---------------------------------------------------------------------------------------------------------
|Notes to Financial Statements                                                                            
|                                                                                                         
|exchanges occurring in fiscal periods beginning after the date of issuance. The provisions of SFAS       
|No. 153 shall be applied prospectively. The Company has evaluated the impact of the adoption of          
|SFAS 153, and does not believe the impact will be significant to the Company's overall results of        
|operations or financial position.                                                                        
|                                                                                                         
|In December 2004, the FASB issued SFAS No. 123 (revised 2004), "Share-Based Payment"                     
|("SFAS 123R"). SFAS 123R will provide investors and other users of financial statements with             
|more compete and neutral financial information by requiring that the compensation costs relating to      
|share-based payment transactions be recognized in financial statements. That cost will be                
|measured based on the fair value of the equity or liability instruments issued SFAS 123R covers          
|a wide range of share-based compensation arrangements including share options, restricted                
|share plans, performance-based awards, share appreciation rights and employee share purchase             
|plans. SFAS 123R replaces SFAS No. 123, "Accounting for Stock-Based Compensation", and                   
|supercedes APB Opinion No. 25, "Accounting for Stock Issued to Employees". SFAS 123, as                  
|originally issued in 1995, established as preferable a fair-value-based method of accounting for         
|share-based payment transactions with employees. However, that statement permitted entities              
|the option of continuing to apply the guidance in Opinion 25, as long as the footnotes to financial      
|statements disclosed what net income would have been had the preferable fair-value based method          
|been used. Public entities (other than those filing as small business issuers) will be required to       
|apply SFAS 123R as of the first interim or annual reporting period that begins after June 15, 2005.      
|The Company has evaluated the impact of the adoption of SFAS 123R and does not believe the               
|impact will be significant to the Company's overall results of operations or financial position.         
|                                                                                                         
|In June, 2005, the Financial Accounting Standards Board ('FASB") issued SFAS No. 154,Account-            
|ing Changes and Error Corrections - a replacement of APB No. 20 and FAS No. 3" ("SFAS No. 154").         
|SFAS No. 154 provides guidance on the accounting for and reporting of accounting changes and             
|error corrections. It establishes, unless impracticable, retrospective application as the required       
|method for reporting a change in accounting principle in the absence of explicit transition require-     
|mints specify to the newly adopted accounting principle. SFAS No. 154 also provides guidance             
|for determining whether retrospective application of a change in a accounting principle is impractical-  
|able. The correction of an error in previously issued financial statements is not an accounting          
|change. However, the reporting of an error correction involves adjustments to previously issued          
|financial statements similar to those generally applicable to reporting an accounting change retro-      
|spectively. Therefore, the reporting of a correction of an error by restating previously issued financial
|is also addressed by SFAS No. 154. SFAS No. 154 is required to be adopted in fiscal years                
|beginning after December 15, 2005. The Company does not believe its adoption in fiscal year 2007         
|will have a material impact on its results of operations or financial position.                          
|                                                                                                         
|In March, 2005, the SEC issued guidance on FASB SFAS 123R,"Share-Based Payments"("SFAS                   
|No. 123R"). Staff Accounting Bulletin No. 107 ("SAB 107") was issued to assist preparers by simpli-      
|fying some of the implementation challenges of SFAS No. 123R while enhancing the information             
|that investors receive. SAB 107 creates a framework that is premised on two themes: (a) consider-        
|able judgment will be required by preparers to successfully implement SFAS no. 123R, specifically        
|when valuing employee stock options; and (b) reasonable individuals, acting in good faith, may           
|conclude differently on the fair value of employee stock options. Key topics covered by SAB 107          
|include (a) valuation models - SAB 107 reinforces the flexibility allowed by SFAS No. 123R to            
|choose an option-pricing model that meets the standard's fair value measurement objective; (b)           
|expected volatility - SAB 107 provides guidance on when it would be appropriate to rely exclusively      
|on either historical or implied volatility; and ( c) expected term - the new guidance includes examples  
|and some simplified approaches to determining the expected term under certain circumstances.             
|F11                                                                                                      

---

|US Biodefense, Inc.                                                                                     
|--------------------------------------------------------------------------------------------------------
|Notes to Financial Statements                                                                           
|                                                                                                        
|The Company will apply the principles of SAAB 107 in conjunction with its adoption of SOFAS No.         
|123R.                                                                                                   
|                                                                                                        
|In June, 2005, the Emerging Issues Task Force (EAT) issued No. 05-06,"Determining the Abort-            
|inaction Period of Leasehold Improvements Acquired in a Business Combination"(EAT No. 05-06).           
|EAT No. 05-06 provides that the amortization period for leasehold improvements acquired in a            
|business combination or purchased after the inception of a lease to be the shorter of (a) the useful    
|life of the assets or (b) a term that includes required lease periods and renewals that are reason-     
|ably assured upon the acquisition of the purchase. The guidance in EAT No. 05-06 will be applied        
|prospectively and is effective for periods beginning afar June 29, 2005. The Company does not           
|believe its adoption will have a material impact on its consolidated results of operations or           
|financial position.                                                                                     
|                                                                                                        
|Note 2 - Marketable Securities Available For Sale                                                       
|                                                                                                        
|On May 11, 2005, the Company entered into an agreement with a Partner. The Company will assist          
|the Partner in identifying opportunities for commercialization of their listed technologies, while main-
|taining the confidentiality of the Partner.                                                             
|                                                                                                        
|As compensation for providing these services, the Partner gave the Company 5,000,000 shares of          
|Section 144 stock which is restricted from sale for twelve months from date of issue, May 11, 2005.     
|The agreement is for a period of twenty four months.                                                    
|                                                                                                        
|The Company recorded the stock at the value of the services to be provided which is estimated to be     
|$100,000. The Company recorded revenue for the six month period from May through November,              
|2005 in the amount of $25,000, and $37,500 for the nine month period ended August 31, 2006. The         
|balance of $37,500 is included as deferred revenues on the balance sheet.                               
|                                                                                                        
|The Company has adopted SFAS 130 as required by the Financial Accounting Standards Board.               
|SFAS 130 requires that securities that are available for sale be presented at market value on the       
|balance sheet date. Unrealized gains and losses are recognized as a separate component of               
|stockholders' equity. The specific identification method is used in calculating realized gains and      
|losses. SFAS 30 also requires a statement of comprehensive income which adjusts net income              
|for the unrealized activity. At November 30, 2005, the fair market value of common equity securities    
|with a cost of $100,000 was $150,000. The unrealized loss of $50,000, net of the related income tax     
|benefit $19,150 is included as a component of other comprehensive income.                               
|                                                                                                        
|Note 3 - Licenses                                                                                       
|                                                                                                        
|The Company has agreed to exercise options to license stem cell technology through the University       
|of British Columbia under two option agreements.                                                        
|                                                                                                        
|Having passed the initial validation phase, the Company is working toward a full licensing relation-    
|ship and will begin pre-clinical analysis of how the cell line can be utilized. The Company is          
|considering investigating the stem cells applications in combating ALS and Parkinson's disease.         
|                                                                                                        
|The licenses are for periods of ten to twenty years. The Company will review the licenses at least      
|annually. When necessary, we record changes for impairments of long-lived assets for the amount         
|by which the present value of future cash flows, or some other fair value measure, is less than the     
|carrying value of the respective asset.                                                                 
|F12                                                                                                     

---

|US Biodefense, Inc.                                                                                        
|-----------------------------------------------------------------------------------------------------------
|Notes to Financial Statements                                                                              
|                                                                                                           
|As of August 31, 2006, the Company management determined that the value of the licenses had become         
|impaired since the Company was no longer pursuing stem cell research. This determination was based         
|on the resignation of the head of the Company's stem cell research department and the inability to locate  
|a replacement at an economically feasible compensation package. The resignation was effective during       
|the Company's third quarter.                                                                               
|                                                                                                           
|A reconciliation of the license assets to the amount deemed as impaired is as follows:                     
|                                                                                                           
|Balance, August 31, 2006                                                                                   
|Additions                                                                                                  
|License balance due, but cancelled                                                                         
|                                                                                                           
|                                                                                                           
|Note 4 - Deferred Revenues (Including Related Parties)                                                     
|                                                                                                           
|On May 1, 2004, the Company entered into an agreement with Financialnewsusa.com, Inc., to                  
|develop content for its' Biodefense Industry News. Financialnewsusa.com, Inc. is a                         
|related party due to a common officer and director.                                                        
|                                                                                                           
|The deferred portion of the agreement described in Note 2 totals $37,500 at August 31, 2006.               
|                                                                                                           
|Note 5 - Comprehensive income                                                                              
|                                                                                                           
|Accounting principles generally require that recognized revenues, expenses, gains and losses be            
|included in net income. Although certain changes in assets and liabilities, such as unrealized gains       
|and losses on available for sale securities are reported as a separate component of the equity section     
|of the balance sheet, such items, along with net income, are components of comprehensive income.           
|                                                                                                           
|The components of other comprehensive income and related tax effects for the year ended November 30,       
|2005 are unrealized holding gain on available for sale securities, net of tax benefit of $19,150, for a net
|comprehensive loss of $30,850.                                                                             
|                                                                                                           
|Note 6 - Income Taxes                                                                                      
|                                                                                                           
|The income tax provision reflected in the statement of operations consists of the following components     
|for the year ended November 30, 2005:                                                                      
|                                                                                                           
|Current income taxes payable:                                                                              
|Federal                                                                                                    
|State                                                                                                      
|                                                                                                           
|                                                                                                           
|Deferred tax expense relating to change in                                                                 
|unrealized gains (losses) on available                                                                     
|for-sale securities:                                                                                       
|Federal                                                                                                    
|State                                                                                                      
|                                                                                                           
|                                                                                                           
|F13                                                                                                        

---

|US Biodefense, Inc.                                                                                   
|------------------------------------------------------------------------------------------------------
|Notes to Financial Statements                                                                         
|                                                                                                      
|The items accounting for the difference between income taxes computed at the federal statutory        
|rate and the provision for income taxes as follows:                                                   
|                                                                                                      
|                                                                                                      
|Income tax at federal rate                                                                            
|State tax, net of federal effect                                                                      
|Permanent differences                                                                                 
|Net operating loss deduction                                                                          
|                                                                                                      
|                                                                                                      
|                                                                                                      
|Note 7 - Earnings per share                                                                           
|                                                                                                      
|Basic earnings per share are calculated by dividing net income by the weighted average number         
|of common shares outstanding during the period.                                                       
|                                                                                                      
|Note 8  Related parties and Concentrations                                                           
|                                                                                                      
|Financialnewsusa.com, Inc. is a related party due to a common officer and director, and represented   
|40% of the revenues generated by the Company for the nine months period ended August 31, 2006.        
|                                                                                                      
|Note 9 - Acquisition                                                                                  
|                                                                                                      
|On August 7, 2006, the Company acquired 100% of the outstanding stock of Emergency Disaster           
|Systems, Inc. (EDS) a retailer of emergency disaster equipment. EDS was incorporated on July 17,      
|2006, by its majority stockholder who had been in the disaster prepardness industry for over seventeen
|years experience. The Company paid $25,000 in cash for the stock. The Company has recorded the        
|transaction as follows:                                                                               
|                                                                                                      
|Inventory                                                                                             
|Customer list                                                                                         
|                                                                                                      
|                                                                                                      
|Note 10 - Common Stock Transactions                                                                   
|                                                                                                      
|During the nine months ended August 31, 2006, the Company issued 2,000,000 shares of common stock     
|and received proceeds of $200,000.                                                                    
|                                                                                                      
|During the nine months ended August 31, 2006, the Company issued 6,755,000 shares of common stock     
|to three entities as consulting fees totaling $270,200.                                               
|                                                                                                      
|F14                                                                                                   

---

|US Biodefense, Inc.                                                                                      
|---------------------------------------------------------------------------------------------------------
|Notes to Financial Statements                                                                            
|                                                                                                         
|                                                                                                         
|                                                                                                         
|Date Issued                                                                                              
|                                                                                                         
|June 8, 2006                                                                                             
|June 20, 2006                                                                                            
|June 29, 2006                                                                                            
|July 5, 2006                                                                                             
|July 12, 2006                                                                                            
|July 24, 2006                                                                                            
|July 25, 2006                                                                                            
|August 1, 2006                                                                                           
|August 31, 2006                                                                                          
|                                                                                                         
|The Company applies the provisions of EITF 96-18, "Accounting for Equity Instruments that are issued to  
|Other Than Employees for Acquiring , or in conjunction with Selling Goods or Services" (EITF 96-18) for  
|our non-employee stock-based awards. Under EITF 96-18, the measurement date at which the fair value      
|of the stock-based award is measured is equal to the earlier of (1) the date at which a commitment for   
|performance by the counterparty to earn the equity instrument is reached or (2) the date at which the    
|counterparty's performance is complete.  We recognize stock-based compensation expense for the fair      
|value of the vested portion of the non-employee awards in our statements of operations. For the three    
|months period ended August 31, 2006, the performance commitment date was July 18, 2006.                  
|                                                                                                         
|Note 11 - Restatement of Consolidated Financial Statements                                               
|                                                                                                         
|The Company is amending it's quarterly report on Form 10Q for the quarter ended August 31, 2006 to       
|restate it's condensed consolidated financial statements for the three month and nine month periods      
|ended August 31, 2006 and the related disclosures.                                                       
|                                                                                                         
|In December 31, 2006, the Company discovered that there were errors in the accounting records of         
|Emergency Disaster Systems, Inc., the subsidiary that was acquired on August 7, 2006. The Company        
|has corrected the accounting errors, and has inititated internal control procedures to make certain that 
|the types of errors that went undetected previously would be detected and corrected prior to the issuance
|of financial statements.                                                                                 
|                                                                                                         
|The Company is restating the aforementioned financial statements to correct the accounting errors. The   
|restatement impact through August 31, 2006 of these errors are summarized in the table below:            
|                                                                                                         
|                                                                                                         
|F15                                                                                                      

---

|US Biodefense, Inc.                                                                                  
|-----------------------------------------------------------------------------------------------------
|Notes to Financial Statements                                                                        
|                                                                                                     
|The following table summarizes the specific balance sheet accounts as reported and as affected by the
|restatement as of August 31, 2006:                                                                   
|                                                                                                     
|                                                                                                     
|                                                                                                     
|Cash and cash equivalents                                                                            
|Marketable securities                                                                                
|Accounts receivable                                                                                  
|Inventory                                                                                            
|Total current assets                                                                                 
|                                                                                                     
|Property and equipment                                                                               
|Customer list                                                                                        
|Deposits                                                                                             
|Total assets                                                                                         
|                                                                                                     
|Accounts payable and accrued                                                                         
|expenses                                                                                             
|Due to related parties                                                                               
|Accrued income taxes                                                                                 
|Deferred revenues                                                                                    
|Total current liabilities                                                                            
|                                                                                                     
|Deferred taxes                                                                                       
|Total liabilities                                                                                    
|                                                                                                     
|Common stock                                                                                         
|Additional paid-in capital                                                                           
|Other comprehensive income                                                                           
|Accumulated deficit                                                                                  
|Total stockholders' equity                                                                           
|                                                                                                     
|Total liabilities and stock-                                                                         
|holders' equity                                                                                      
|                                                                                                     
|F16                                                                                                  

---

|US Biodefense, Inc.                                                                             
|------------------------------------------------------------------------------------------------
|Notes to Financial Statements                                                                   
|                                                                                                
|The following is a summary of the specific income statement accounts as reported and as affected
|by the restatement for the three month periods ended August 31, 2006:                           
|                                                                                                
|                                                                                                
|                                                                                                
|                                                                                                
|Sales of tangible products                                                                      
|Revenues from services                                                                          
|Revenues - Related parties                                                                      
|Total revenues                                                                                  
|                                                                                                
|Cost of tangible products sold                                                                  
|                                                                                                
|                                                                                                
|                                                                                                
|General and administrative                                                                      
|General and administrative -                                                                    
|Stock issued for consulting                                                                     
|Impairment of assets                                                                            
|Total expenses                                                                                  
|                                                                                                
|Net loss                                                                                        
|                                                                                                
|Basic and diluted net loss per                                                                  
|common share                                                                                    
|                                                                                                
|F17                                                                                             

---

|US Biodefense, Inc.                                                                            
|-----------------------------------------------------------------------------------------------
|Notes to Financial Statements                                                                  
|                                                                                               
|The following is a summary of the specific income statement accountsas reported and as affected
|by the restatement for the nine month periods ended August 31, 2006:                           
|                                                                                               
|                                                                                               
|                                                                                               
|                                                                                               
|Sales of tangible products                                                                     
|Revenues from services                                                                         
|Revenues - Related parties                                                                     
|Total revenues                                                                                 
|                                                                                               
|Cost of tangible products sold                                                                 
|                                                                                               
|                                                                                               
|                                                                                               
|Research and development                                                                       
|General and administrative                                                                     
|General and administrative -                                                                   
|Related parties                                                                                
|Stock issued for consulting                                                                    
|Impairment of assets                                                                           
|Total expenses                                                                                 
|                                                                                               
|Net loss                                                                                       
|                                                                                               
|Basic and diluted net loss per                                                                 
|common share                                                                                   
|                                                                                               
|F18                                                                                            

---

|                                                                                          |  |             |  | US Biodefense, Inc.           |  |             |  |         
|----------------------------------------------------------------------------------------- |  | ----------- |  | ----------------------------- |  | ----------- |  | --------
|                                                                                          |  |             |  | Notes to Financial Statements |  |             |  |         
|                                                                                         
|The following is a summary of the impact of the restatement on our consolidated statement |  |            
|of cash flows for the nine months ended August 31, 2006:                                  |  |             |  |                               |  |            
|                                                                                         
|                                                                                          |  |             |  | As                            |  |             |  |         
|                                                                                          |  |             |  | Previously                    |  |             |  |         
|                                                                                          |  |             |  | Reported                      |  | Adjustment  |  |         
|Cash flows from operating                                                                 |  |             |  |                               |  |             |  |         
|activities:                                                                               |  |             |  |                               |  |             |  |         
|Net loss                                                                                  |  | $ (323,256) |  | $ 30,209                      |  | $ (293,047)
|Adjustments to reconcile net loss                                                         |  |             |  |                               |  |             |  |         
|to net cash used in operating                                                             |  |             |  |                               |  |             |  |         
|activities:                                                                               |  |             |  |                               |  |             |  |         
|Depreciation                                                                              |  |             |  | 59                            |  | --          |  |         
|Impairment of assets                                                                      |  |             |  | 22,500                        |  | --          |  |         
|Stock issued for consulting                                                               |  |             |  | 270,200                       |  | --          |  |         
|Changes in operating assets                                                               |  |             |  |                               |  |             |  |         
|and liabilities:                                                                          |  |             |  |                               |  |             |  |         
|Accounts receivable                                                                       |  |             |  | (15,727)                      |  | 5,094       |  |         
|Inventory                                                                                 |  |             |  | (73,447)                      |  | (17,500)    |  |         
|Prepaid expenses                                                                          |  |             |  | 20,000                        |  | --          |  |         
|Bank overdraft                                                                            |  |             |  | (3,947)                       |  | --          |  |         
|Accounts payable and                                                                      |  |             |  |                               |  |             |  |         
|accrued expenses                                                                          |  |             |  | 7,374                         |  | (1,492)     |  |         
|Deferred revenues                                                                         |  |             |  | (64,167)                      |  | --          |  |         
|Net cash (used for) provided by                                                           |  |             |  |                               |  |             |  |         
|operating activities                                                                      |  |             |  | (160,411)                     |  | 16,311      |  |         
|                                                                                         
|Cash flows from financing activities                                                      |  |             |  |                               |  |             |  |         
|Principal repaid to related party                                                         |  | 17,200      |  | (19,012)                      |  |             |  | (1,812) 
|Proceeds from sale of common                                                              |  |             |  |                               |  |             |  |         
|stock                                                                                     |  |             |  | 200,000                       |  | 1,000       |  |         
|Total cash flows from financing                                                           |  |             |  |                               |  |             |  |         
|activities                                                                                |  |             |  | 217,200                       |  | (18,012)    |  |         
|                                                                                         
|Cash flows used for investing                                                             |  |             |  |                               |  |             |  |         
|activities                                                                                |  |             |  |                               |  |             |  |         
|Purchase of customer list                                                                 |  |             |  |                               |  | (7,500)     |  |         
|Purchase of license                                                                       |  |             |  | (2,500)                       |  | --          |  |         
|Purchase of equipment                                                                     |  |             |  | (2,477)                       |  | --          |  |         
|Total cash flows used for investing                                                       |  |             |  |                               |  |             |  |         
|activities                                                                                |  |             |  | (4,977)                       |  | (7,500)     |  |         
|                                                                                         
|Increase in cash and equivalents                                                          |  | 51,812      |  | (9,201)                       |  |             |  | 42,611  
|                                                                                         
|Cash and cash equivalents,                                                                |  |             |  |                               |  |             |  |         
|beginning of year                                                                         |  |             |  | 17,223                        |  | --          |  |         
|                                                                                         
|Cash and cash equivalents,                                                                |  |             |  |                               |  |             |  |         
|end of year                                                                               |  |             |  | $ 69,035                      |  | $ (9,201)   |  | $ 59,834
|F19                                                                                      
|</R>                                                                                     

---

|Item 2. Management's Discussion and Plan of Operation                                                                     
|--------------------------------------------------------------------------------------------------------------------------
|                                                                                                                          
|Forward-Looking Statements                                                                                                
|                                                                                                                          
|This Quarterly Report contains forward-looking statements about US Biodefense, Inc.s business, financial                 
|condition and prospects that reflect managements assumptions and beliefs based on information currently available.       
|We can give no assurance that the expectations indicated by such forward-looking statements will be realized. If any of   
|our managements assumptions should prove incorrect, or if any of the risks and uncertainties underlying such             
|expectations should materialize, UBDEs actual results may differ materially from those indicated by the forward-         
|looking statements.                                                                                                       
|                                                                                                                          
|The key factors that are not within our control and that may have a direct bearing on operating results include,          
|but are not limited to, acceptance of our services, our ability to expand our customer base, managements ability to raise
|capital in the future, the retention of key employees and changes in the regulation of our industry.                      
|                                                                                                                          
|There may be other risks and circumstances that management may be unable to predict. When used in this                    
|Quarterly Report, words such as,"believes," "expects," "intends," "plans," "anticipates," "estimates"and similar          
|expressions are intended to identify forward-looking statements, although there may be certain forward-looking            
|statements not accompanied by such expressions.                                                                           
|                                                                                                                          
|Overview                                                                                                                  
|                                                                                                                          
|We were incorporated in the State of Utah on June 29, 1983, under the name Teal Eye, Inc. We merged with                  
|Terzon Corporation and changed our name to Terzon Corporation in 1984. We subsequently changed our name to                
|Candy Stripers Candy Corporation. We were engaged in the business of manufacturing and selling candy and gift items       
|to hospital gift shops across the country. We were traded Over-the-Counter Bulletin Board for several years. In 1986      
|we ceased the candy manufacturing operations and filed for Chapter 11 Bankruptcy protection. After emerging from          
|Bankruptcy in 1993, we remained dormant until January 1998, when we changed our name to Piedmont, Inc. On May             
|13, 2003, we filed an amendment to our Articles of Incorporation to change our name from Piedmont, Inc. to US             
|Biodefense, Inc. We are a registered government contractor with the Department of Defense Logistics Agency that is        
|focused on designing ad developing homeland security and biodefense products.                                             
|                                                                                                                          
|<R>On August 7, 2006, we completed the acquisition of Emergency Disaster Systems, Inc., a California                      
|corporation incorporated on July 19, 2006. EDS is engaged in the business of disaster mitigation and emergency            
|preparedness. We purchased a 100% interest in EDS for an aggregate of $25,000 in cash. The EDS system,                    
|encompassing CERT bags, containers and cabinets was initially designed and originated by Charles Wright in 1989 to        
|provide earthquake preparedness supplies to communities in California. EDS currently serves Emergency Medical             
|Services and mass casualty rapid response systems, as well as local communities, government agencies and Fortune 500      
|companies with innovative emergency preparedness technology, systems and services. Charles Wright, with his 18            
|years of experience, currently serves as Vice President and Director of Emergency Disaster Systems, Inc., which is a      
|wholly-owned subsidiary of US Biodefense.                                                                                 
|                                                                                                                          
|Results of Operations                                                                                                     
|                                                                                                                          
|Revenues                                                                                                                  
|                                                                                                                          
|During the three and nine months ended August 31, 2006, we generated revenues from three sources: sales of                
|tangible products, revenue from services and revenues from related parties. Sales of tangible products are attributable   
|solely to Emergency Disaster Systems, Inc., our wholly-owned subsidiary that we acquired on August 7, 2006.               
|Revenue from services is derived from the recognition of deferred revenues from stock received in advance for services    
|to be performed by us to Diamond I. Finally, revenue from related parties is solely from our October 15, 2005 contract    
|with Financialnewsusa.com, a related party, to provide biodefense-related industry news and information to them in        
|exchange for $40,000, for which we were paid in advance the entire balance of the contract.                               
|                                                                                                                          
|-23-                                                                                                                      

---

|Our aggregate revenues for the three months ended August 31, 2006 were $100,493, consisting of sales of                  
|-------------------------------------------------------------------------------------------------------------------------
|tangible products in the amount of $31,326, revenue from services of $37,500 and revenues from related parties totaling  
|$31,667. In the year ago three month period ended August 31, 2005, we generated $25,000 in total revenues, all of        
|which was related party revenues recognized from our agreement with Financialnewsusa.com.                                
|                                                                                                                         
|During the nine month period ended August 31, 2006, we generated total revenues of $140,493, comprised of                
|$31,326 in sales of tangible products, revenue from services of $37,500 and $71,667 in related party revenues. For the   
|nine months ended August 31, 2005, we generated $104,167 in total revenues, all of which is attributed to our            
|agreement with Financialnewsusa.com, a related party.                                                                    
|                                                                                                                         
|Cost of Goods                                                                                                            
|                                                                                                                         
|Due to our acquisition of EDS in August of 2006, we incurred cost of tangible products sold of $28,820 in the            
|three and nine months ended August 31, 2006. During the year ago three and nine month periods ended August 31,           
|2005, we did not incur any cost of goods sold, as revenues earned during those periods in 2005 were related solely to    
|services rendered and not to sales of tangible goods.                                                                    
|                                                                                                                         
|Gross Profit                                                                                                             
|                                                                                                                         
|As a result of cost of tangible products sold in the amount of $28,820 during the three months ended August              
|31, 2006, we realized a gross profit of $71,673. Compared to the year ago three month period ended August 31, 2005,      
|when we realized a gross profit of $25,000, our gross profit increased $46,673, or 187%.                                 
|                                                                                                                         
|During the nine month period ended August 31, 2006, we realized a gross profit of $111,673, which is a 7.2%              
|gain year over year compared to the nine month period ended August 31, 2005, when we had a gross profit of $104,167.     
|                                                                                                                         
|Expenses                                                                                                                 
|                                                                                                                         
|Total expenses for the three months ended August 31, 2006 were $370,848, consisting materially of $270,200               
|for stock issued to consultants for services and $78,147 in general and administrative expenses. Additionally, we have   
|recorded $22,500 as an impairment to our license agreements related to stem cell research. In the comparable year ago    
|three month period ended August 31, 2005, our total expenses were $45,217, consisting primarily of $42,217 in general    
|and administrative expenses and $3,000 in general and administrative expenses paid to a related party. We believe total  
|expenses for the three months ended August 31, 2006 were significantly higher than the comparable period ended           
|August 31, 2005 because of our acquisition of EDS and the hiring of independent consultants in an effort to increase our 
|revenue generating potential and explore additional business ventures.                                                   
|                                                                                                                         
|During the nine months ended August 31, 2006, we incurred $404,720 in total expenses, of which $270,200 is               
|attributable to stock issued for consulting services, $85,349 was paid for general and administrative costs, research and
|development costs of $23,171 was paid, $22,500 was recorded as an impairment of license agreements and $3,500 was        
|paid to a related party for general and administrative fees. In the year ago nine month period ended August 31, 2005,    
|we incurred $114,385 in total expenses, all of which was related to general and administrative expenses in the amount    
|of $111,385 and general and administrative expenses paid to a related party in the amount of $3,000. As was the case     
|during the three months ended August 31, 2006, our acquisition of EDS and the hiring of outside consultants              
|contributed to the significant increase in aggregate expenses.                                                           
|                                                                                                                         
|Net Income (Loss)                                                                                                        
|                                                                                                                         
|We incurred a net loss of $299,175 for the most recent quarter ended August 31, 2006. In comparison, we                  
|incurred a net loss from operations in the amount of $20,217 in the year ago three month period. The key factor          
|providing this change: namely, our expenses were significantly higher in the current period as opposed to a year ago     
|because of stock issued to consultants and the impairment of assets.                                                     
|                                                                                                                         
|For the nine months ended August 31, 2006, we incurred a net loss of $293,047, as opposed to a net loss of               
|$10,218 in the prior nine month period ended August 31, 2005. The difference is attributable mainly to the level of      
|expenditures in the period ended August 31, 2006 being higher in the current period.                                     
|                                                                                                                         
|-24-                                                                                                                     

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|Liquidity and Capital Resources                                                                                         
|------------------------------------------------------------------------------------------------------------------------
|                                                                                                                        
|We have limited cash on hand, in the amount of $59,834 as of August 31, 2006, and may be unable to continue             
|operations for the next at least 12 months if we are unable to generate revenues or obtain capital infusions by issuing 
|equity or debt securities in exchange for cash. If we are unable to obtain capital through issuances of equity or debt, 
|David Chin, a shareholder and President of our company, has verbally agreed to loan us cash, which shall bear no        
|interest and be due upon demand. As of August 31, 2006, David Chin loaned us a total of $4,312 to pay for general and   
|administrative expenses. The loan bears no interest and is due upon demand. As of August 31, 2006, the amount owed      
|is $0. We have no formal written agreement with Mr. Chin for any further loans, and we cannot guarantee you that we     
|will be able to enforce our verbal agreement.                                                                           
|                                                                                                                        
|On August 7, 2006, we sold 2,000,000 shares of our restricted common stock at a price per share of $0.10, for           
|gross cash proceeds of $200,000, to Equity Solutions, Inc., a California corporation. This sale was conducted privately 
|between US Biodefense and Equity Solutions, not involving any solicitation or advertising, and was not underwritten.    
|                                                                                                                        
|Notwithstanding cash provided by our President and received from Equity Solutions, there can be no assurance            
|that we will be able to secure additional funds in the future to stay in business. Our independent registered public    
|accountants have expressed substantial doubt about our ability to continue as a going concern because we have limited   
|operations.                                                                                                             
|                                                                                                                        
|We have also paid outside consultants with our common stock in lieu of cash for services provided to us. As             
|of August 31, 2006, we have issued an aggregate of 6,775,000 shares of our common stock for aggregate consulting        
|fees in the amount of $270,200.                                                                                         
|                                                                                                                        
|There are no known trends, events or uncertainties that have had or that are reasonably expected to have a              
|material impact on our revenues from continuing operations.                                                             
|                                                                                                                        
|Our management does not anticipate the need to hire additional full- or part- time employees over the next 12           
|months, as the services provided by our officers and directors appear sufficient at this time. We believe that our      
|operations are currently on a small scale that is manageable by a few individuals. While we believe that the addition of
|employees is not required over the next 12 months, we intend to hire independent contractors to perform research        
|activities and market any potential products and services we may develop.                                               
|                                                                                                                        
|We do not have any off-balance sheet arrangements.                                                                      
|                                                                                                                        
|We currently do not own any significant plant or equipment that we would seek to sell in the near future.               
|                                                                                                                        
|We have not paid for expenses on behalf of any of our directors. Additionally, we believe that this fact shall          
|not materially change.</R>                                                                                              
|                                                                                                                        
|Item 3. Controls and Procedures                                                                                         
|                                                                                                                        
|We maintain a set of disclosure controls and procedures designed to ensure that information required to be              
|disclosed in our reports filed under the Securities Exchange Act is recorded, processed, summarized and reported within 
|the time periods specified by the SECs rules and forms. Disclosure controls are also designed with the objective of    
|ensuring that this information is accumulated and communicated to our management, including our chief executive         
|officer and chief financial officer, as appropriate, to allow timely decisions regarding required disclosure.           
|                                                                                                                        
|Based upon their evaluation as of the end of the period covered by this report, David Chin, who serves as our           
|chief executive officer and chief financial officer, concluded that our disclosure controls and procedures are not      
|effective to ensure that information required to be included in our periodic SEC filings is recorded, processed,        
|summarized, and reported within the time periods specified in the SEC rules and forms.                                  
|                                                                                                                        
|Our board of directors was advised by E. Randall Gruber, CPA, PC, our independent registered public                     
|accounting firm, that during their performance of audit procedures for 2005 E. Randall Gruber, CPA, PC identified a     
|material weakness as defined in Public Company Accounting Oversight Board Standard No. 2 in our internal control        
|over financial reporting.                                                                                               
|                                                                                                                        
|-25-                                                                                                                    

---

|This deficiency consisted primarily of inadequate staffing and supervision that could lead to the untimely              
|------------------------------------------------------------------------------------------------------------------------
|identification and resolution of accounting and disclosure matters and failure to perform timely and effective reviews. 
|However, our size prevents us from being able to employ sufficient resources to enable us to have adequate segregation  
|of duties within our internal control system. Our management is required to apply their judgment in evaluating the cost-
|benefit relationship of possible controls and procedures.                                                               
|                                                                                                                        
|PART II - OTHER INFORMATION                                                                                             
|                                                                                                                        
|Item 2. Unregistered Sales of Equity Securities                                                                         
|                                                                                                                        
|On August 7, 2006, we sold 2,000,000 shares of our restricted common stock at a price per share of $0.10, for           
|gross cash proceeds of $200,000, to Equity Solutions, Inc., a California corporation, pursuant to a Stock Purchase      
|Agreement.  This sale was conducted privately between US Biodefense and Equity Solutions, not involving any             
|solicitation or advertising, and was not underwritten. At the time of the issuance, Equity Solutions was given, and had 
|fair access to, information about our company. The shares bear a restrictive transfer legend. The issuance of stock to  
|Equity Solutions was made in accordance with an exemption from registration contained in Section 4(2) of the            
|Securities Act of 1933.                                                                                                 
|                                                                                                                        
|Item 6. Exhibits and Reports on Form 8-K                                                                                
|<R>                                                                                                                     
|Exhibit                                                                                                                 
|Number                                                                                                                  
|                                                                                                                        
|3                                                                                                                       
|                                                                                                                        
|                                                                                                                        
|                                                                                                                        
|                                                                                                                        
|                                                                                                                        
|                                                                                                                        
|                                                                                                                        
|10                                                                                                                      
|                                                                                                                        
|                                                                                                                        
|                                                                                                                        
|                                                                                                                        
|                                                                                                                        
|                                                                                                                        
|                                                                                                                        
|31                                                                                                                      
|                                                                                                                        
|                                                                                                                        
|                                                                                                                        
|                                                                                                                        
|32                                                                                                                      
|                                                                                                                        
|*                                                                                                                       
|**                                                                                                                      
|***                                                                                                                     
|</R>                                                                                                                    
|                                                                                                                        
|Date of                                                                                                                 
|Form 8-K                                                                                                                
|                                                                                                                        
|08/14/2006                                                                                                              
|                                                                                                                        
|08/30/2006                                                                                                              
|                                                                                                                        
|-26-                                                                                                                    

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|SIGNATURES                                                                                                              
|------------------------------------------------------------------------------------------------------------------------
|<R>                                                                                                                     
|Pursuant to the requirements of the Exchange Act of 1934, the Registrant has duly caused this report to be signed on its
|behalf by the undersigned, thereunto duly authorized.                                                                   
|                                                                                                                        
|US BIODEFENSE, INC.                                                                                                     
|(Registrant)                                                                                                            
|                                                                                                                        
|February 20, 2007                                                                                                       
|                                                                                                                        
|                                                                                                                        
|Signed:                                                                                                                 
|Print:                                                                                                                  
|                                                                                                                        
|Signed:                                                                                                                 
|Print:                                                                                                                  
|                                                                                                                        
|Signed:                                                                                                                 
|Print:                                                                                                                  
|                                                                                                                        
|                                                                                                                        
|-27-                                                                                                                    
|</R>                                                                                                                    

---