U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                                    FORM 10-Q


           [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                  For the quarterly period ended March 31, 2004

                                       OR

             [ ] TRANSITION REPORT UNDER SECTION 13 OF 15(d) OF THE
                              EXCHANGE ACT OF 1934

            From the transition period from __________ to ___________

                        Commissions file number 00030074
                                                --------

                                APO HEALTH, INC.
             ------------------------------------------------------
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)


                 NEVADA                                  86-0871787
    -------------------------------               ----------------------
    (STATE OR OTHER JURISDICTION OF                    (IRS EMPLOYER
     INCORPORATION OR ORGANIZATION)               IDENTIFICATION NUMBER)


                 3590 OCEANSIDE ROAD, OCEANSIDE, NEW YORK 11575
                 ----------------------------------------------
                    (Address of principal executive offices)


                                 (800) 365-2839
                           ---------------------------
                           (Issuer's Telephone Number)



         Check whether the issuer (1) filed all reports  required to be filed by
Section 13 or 15(d) of the  Exchange  Act during the past 12 months (or for such
shorter period that the  registrant was required to file such reports),  and (2)
has been subject to such filing requirements for the past 90 days:

                                  Yes _X_   No


As of April 26,  2004,  34,106,045  shares of Common  Stock of the  issuer  were
issued.

<PAGE>


                                APO HEALTH, INC.

                                    FORM 10-Q
                          QUARTER ENDED MARCH 31, 2004


                                TABLE OF CONTENTS


                                                                         Page
                                                                         ----
PART I - FINANCIAL INFORMATION

     ITEM 1   FINANCIAL STATEMENT.

                 Consolidated Balance Sheet as of
                 March 31, 2004 and September 30, 2003.                    3

                 Consolidated Statement of Income for the three and
                 six Months ended March 31, 2004 and 2003.                 4

                 Consolidated Statement of Cash Flows for the
                 Six months ended March 31, 2004 and 2003.                 5

                 Notes to Consolidated Financial Statements.             6 - 10

     ITEM 2      Management's Discussion and Analysis
                 Or Plan of Operations.                                  11-12


PART II - OTHER INFORMATION

     ITEM 1      Legal Proceeding.                                       12

     ITEM 2      Changes in Securities and Use of Proceeds.              12-13

     ITEM 3      Default upon Senior Securities.                         13

     ITEM 4      Submission of Matters to a Vote of Security Holders.    13

     ITEM 5      Other Information.                                      13

     ITEM 6      Exhibits and Reports on Form 8-K.                       13

SIGNATURES                                                               13


                                      - 2 -

                         PART I - FINANCIAL INFORMATION

                                APO HEALTH, INC.
                           CONSOLIDATED BALANCE SHEET

<TABLE>
<CAPTION>
                                                                 MARCH 31,      SEPTEMBER 30,
                                                                   2004             2003
                                                               -----------      -----------
                                                               (UNAUDITED)
<S>                                                            <C>              <C>
                                     ASSETS

CURRENT ASSETS:
   Cash                                                        $   268,787      $   405,153
   Accounts Receivable, net of allowance
      for doubtful accounts of $50,000 and
      $50,000                                                    1,470,040        1,702,741
   Inventory                                                     2,668,444        1,396,205
   Note receivable                                                      --            4,566
   Due from Officers                                                60,000          108,905
   Other Current Assets                                            161,712           55,013
                                                               -----------      -----------
         Total Current Assets                                    4,628,983        3,672,583
                                                               -----------      -----------
Property and Equipment, net of accumulated
   depreciation of $78,566 and $98,992                              13,063           18,003
Deposits                                                             7,500            7,500
                                                               -----------      -----------
         Total Assets                                          $ 4,649,546      $ 3,698,086
                                                               ===========      ===========

                      LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
   Bank Notes Payable                                          $ 1,011,212      $ 1,008,123
    Cash Overdraft                                                 186,651               --
   Accounts Payable                                              1,313,542          924,029
   Accrued Compensation                                            198,790          248,483
   Customer Deposits                                               446,893          294,587
                                                               -----------      -----------
         Total Current Liabilities                               3,157,088        2,475,222
                                                               -----------      -----------
STOCKHOLDERS' EQUITY:
Common stock, $.0002 par value,
     125,000,000 shares authorized, 34,106,045
     and 32,106,045 shares issued and outstanding                    6,725            6,325
   Paid-in Capital                                               2,040,368        1,920,768
   Retained Earnings (Deficit)                                    (554,635)        (704,229)
                                                               -----------      -----------
         Total Stockholders' Equity                              1,492,458        1,222,864
                                                               -----------      -----------

         Total Liabilities and Stockholders' Equity            $ 4,649,546      $ 3,698,086
                                                               ===========      ===========
</TABLE>


                                      - 3 -

                                APO HEALTH, INC.
                      CONSOLIDATED STATEMENT OF OPERATIONS
                       FOR THE THREE AND SIX MONTHS ENDED
                       MARCH 31, 2003 AND 2002 (UNAUDITED)

<TABLE>
<CAPTION>
                                                  THREE MONTHS                     SIX MONTHS
                                         ----------------------------    ----------------------------
                                              2004            2003           2004             2003
                                         ------------    ------------    ------------    ------------
<S>                                      <C>             <C>             <C>             <C>
Revenue                                  $ 13,859,543    $ 10,570,735    $ 21,243,530    $ 22,235,501
Cost of Revenue                            13,255,203       9,996,141      20,002,019      21,101,277
                                         ------------    ------------    ------------    ------------
Gross Margin                                  604,340         574,594       1,241,511       1,134,224
                                         ------------    ------------    ------------    ------------

Operating Expenses
   Selling Expense                            210,766         111,189         374,611         267,288
   General and Administrative Expenses        420,168         533,546         759,999         860,406
                                         ------------    ------------    ------------    ------------
                                              630,934         644,735       1,134,610       1,127,694
                                         ------------    ------------    ------------    ------------

Income (Loss) from Operations                 (26,594)        (70,141)        106,901           6,530

Other Income (Expense)
Recovery of Litigation Expense                 92,755              --          92,755              --
Interest Expense                              (27,332)        (28,280)        (50,062)        (55,406)
                                         ------------    ------------    ------------    ------------
                                               64,423         (28,280)         42,693         (55,406)
                                         ------------    ------------    ------------    ------------
Income (loss) before Provision for
Income Taxes                                   37,829         (98,421)        149,594         (48,876)
Provision for Income Taxes                         --         (19,818)             --              --
                                         ------------    ------------    ------------    ------------

Net Income                               $     37,289    $    (78,683)   $    149,594    $    (48,876)
                                         ============    ============    ============    ============
Basic and Diluted Earnings
   Per Common Share:
Total                                    $        .00    $       (.00)   $        .00    $       (.00)
                                         ============    ============    ============    ============
Weighted Average Common Shares
   Outstanding                             33,439,378      25,441,560      32,772,712      24,997,893
                                         ============    ============    ============    ============
</TABLE>


                                      - 4 -

                                APO HEALTH, INC.
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                            FOR THE SIX MONTHS ENDED
                       MARCH 31, 2004 AND 2003 (UNAUDITED)


                                                      2004             2003
                                                  -----------      -----------

CASH FLOW FROM OPERATING ACTIVITIES:
Net Income                                        $   149,594      $   (48,876)
Adjustments to Reconcile Net Income to
Net Cash Flows from Operating Activities:
Depreciation and Amortization                           4,940            5,248
Allowance For Doubtful Accounts                            --           20,000
Stock Issued for Services                                  --           55,500
Changes In:
  Accounts Receivable                                 232,701         (613,810)
  Other Receivables                                        --          152,515
  Inventory                                        (1,272,239)         710,064
  Other Current Assets                                 13,301          (17,446)
  Accounts Payable                                    389,513          622,575
  Accrued Expenses                                       (788)          68,924
Customer Deposits Payable                             152,306         (538,928)
                                                  -----------      -----------
Cash Flows from Operating Activities                 (330,672)         415,766
                                                  -----------      -----------

CASH FLOWS FROM INVESTING ACTIVITIES:


CASH FLOWS FROM FINANCING ACTIVITIES:
Cash Overdraft                                        186,651               --
Notes Receivable                                        4,566               --
Proceeds (Payment) on Bank Notes Payable, Net           3,089         (686,941)
                                                  -----------      -----------
Cash Flows from Financing Activities                  194,306         (686,941)
                                                  -----------      -----------
Net (Decrease) in Cash                               (136,366)        (271,175)
                                                                   -----------

CASH BALANCES:
Beginning of Period                                   405,153          520,618
                                                  -----------      -----------

End of Period                                     $   268,787      $   249,443
                                                  ===========      ===========


                                      - 5 -
<PAGE>

                                APO HEALTH, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


The following financial information is submitted in response to the requirements
of Form  10-Q  and does not  purport  to be  financial  statements  prepared  in
accordance with generally  accepted does not purport to be financial  statements
prepared in accordance with generally accepted  accounting  principles.  Certain
information and footnote  disclosures  normally included in financial statements
prepared in accordance with generally accepted  accounting  principles have been
condensed or omitted,  although the Company  believes the  disclosures  that are
made are adequate to make the information presented not misleading.  Further, in
the opinion of the management,  the interim financial  statements reflect fairly
the financial position and results of operations for the periods indicated.

It is suggested that these interim consolidated  financial statements be read in
conjunction  with the financial  statements  and notes  thereto  included in the
Company's Form 10K containing the Company's audited  financial  statements as of
and for the year ended September 30, 2003 filed with the Securities and Exchange
Commission.

The  results of  Operations  for the six  months  ended  March 31,  2004 are not
necessarily  indicative  of results  expected  for the entire  fiscal year ended
September 30, 2004.


NOTE 1 ACCOUNTING POLICIES

Nature of business  and basis of  consolidation.  APO Health,  Inc.  ("APO") was
incorporated under the laws of the state of New York in August 1978. The APO and
its wholly-owned subsidiary,  Universal Medical Distributors, Inc. ("Universal")
distribute  disposable  medical  products  principally  to dental,  medical  and
veterinary  professionals  and wholesalers in the United States,  principally on
the East  Coast.  Effective  June  13,  2001,  InternetFinancialCorp.com,  Inc.,
("IFAN"),  a Nevada  corporation,  which is an inactive public company  acquired
APO,  (collectively,  the  "Company"),  pursuant  to a  tax-free  reorganization
agreement.  The  acquisition  was  accounted  for by the  purchase  method under
business combinations in a reverse acquisition transaction.  Concurrently,  IFAN
changed its name to APO Health, Inc., a Nevada corporation.

Cash and cash  equivalents.  For purposes of the statements of cash flows,  cash
equivalents  include all highly liquid  investments with original  maturities of
three month or less.

Revenue recognition occurs when products are shipped.

Merchandise  inventory  is  stated  at the  lower  of  cost or  market.  Cost is
determined using the first-in, first-out method.

Property and  equipment is stated at cost.  Depreciation  is provided for on the
straight-line method over the useful estimated life. The cost of maintenance and
repairs is expensed as incurred.


                                       -6-
<PAGE>

                                APO HEALTH, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Income taxes are computed using the tax liability method of accounting,  whereby
deferred  income taxes are  determined  based on differences  between  financial
reporting  and tax bases of assets and  liabilities  and are measured  using the
enacted tax rates that will be in effect when the differences reverse.

Earnings Per Share, Basic .Net income per share has been calculated based on the
weighted average number of shares of common stock outstanding during the period.
Diluted  net  income per share is  computed  by  dividing  the net income by the
weighted  average number of common shares  outstanding  plus potential  dilutive
securities.

Reclassifications.  Certain reclassifications of certain prior year amounts were
made to conform to the current year presentation.

Estimates and  assumptions.  Preparing  financial  statements in conformity with
generally accepted  accounting  principles requires management to make estimates
and assumptions that affect the reported amounts of assets, liabilities, revenue
and  expenses  at the balance  sheet date and for the period then ended.  Actual
results could differ from these estimates.


NOTE 2 - SUPPLEMENTAL CASH FLOW STATEMENT DISCLOSURES

                                                        2003         2003
                                                      --------     --------
Cash paid during the year for:
         Interest                                     $ 50,062     $ 55,406

Non-cash transaction:

         Common Stock Issued for Consulting
           And Professional Fees                      $120,000     $ 55,500
         Repayment of Officers' Loan by reduction
           In Accrued Compensation                      60,000


NOTE 3 - BANK NOTES PAYABLE

On October  29,  2002,  the Company  entered  into a  financing  agreement  with
Rosenthal & Rosenthal,  Inc. The financing agreement provides the Company with a
maximum  credit  facility  not to exceed  $3,000,000.  The  credit  facility  is
collateralized  by  substantially  all the Company's  assets and $500,000 of the
facility is  personally  guaranteed  by Dr. Jan Stahl,  Chairman  and CEO of the
Company.  Interest is payable  monthly on the average  daily loan balance at the
announced  prime rate of JP Morgan Chase bank plus 2.5%. This agreement is for a
period of three years through  October 31, 2005 and may be extended on a year to
year basis thereafter unless terminated as provided in the agreement.


                                       -7-
<PAGE>

                                 APO HEALTH INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 4 - INCOME TAXES

Income taxes (benefit) consist of the following:

                                                           2004        2003
                                                         --------    --------
         Current                                         $ 59,850    $     --
         Utilization of net operating loss                (59,850)         --
         Deferred                                              --          --
                                                         --------    --------
         Total                                           $     --    $     --
                                                         ========    ========

A  reconciliation  of income taxes at the federal  statutory  income tax rate to
total income taxes is as follows:

         Computed at federal statutory rate of 34%       $ 50,862    $     --
         State income tax                                   8,988          --
         Utilization of net operating loss                (59,850)         --
                                                         --------    --------


         Total                                           $     --    $     --
                                                         --------    --------

The components of deferred taxes are as follows:

                                                         March 31, September 30,
                                                           2004        2003
                                                         --------  -------------
         Deferred tax assets
            Allowance for doubtful accounts              $ 20,000    $ 20,000
            Depreciation                                   12,000      12,000
            Net operating loss carryover, less valuation
              allowance of $176,900 and $221,200               --          --
            Reversal of valuation allowance               (32,000)    (32,000)
                                                         --------    --------
         Total deferred tax assets                       $     --    $     --
                                                         ========    ========


The Company has a net  operating  loss  carryover of  approximately  $265,000 to
offset future taxable income. The carryover expires 2018. The Company has offset
the deferred tax asset by a valuation allowance of $176,900,  since it cannot be
determined more likely than not whether the Company will be able to utilize such
net operating loss carryover.

NOTE 5 - COMMON STOCK

On January 29, 2004, the Company  entered into an Investment  Banking  agreement
with Sloan  Securities  Corp.  ("SSC") to provide  financing  and  advisory  and
investment  banking  services  for a  period  of one  year  from the date of the
agreement.  In  consideration  for  these  services,  the  Company  issued to an
affiliate  of SSC  2,000,000  share of  restricted  common  stock in the Company
valued at $120,000.


                                       -8-
<PAGE>

                                APO HEALTH, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 5 - COMMON STOCK (CONTINUED)

In  January  of  2004,  the  Company  adopted  a  Special  Compensation  Warrant
Agreement,  whereby  the  Company  would  issue  warrants  under  the  following
circumstances:  (i) in exchange for consulting  services;  (ii) as consideration
for accepting additional corporate  responsibilities;  or (iii) as consideration
in special circumstances to be determined and pre-approved by the Board. A total
of 3,500,000 Special Compensation  Warrants were created,  exercisable at $0.025
per share,  for an exercise  period of three years.  In 2003, Dr. Stahl accepted
the additional responsibility of acting as Chief Financial Officer. Also, during
2003,  Dr. Stahl reduced the  percentage by which his bonus was to be calculated
from 1 1/2% to 1%. On January 9, 2004,  the Board  authorized  the  issuance  of
2,300,000  of  the  special  compensation   warrants  to  various  officers  and
professionals for services rendered.

On July 22 2002, the Company  adopted a Bonus  Compensation  Warrant  Agreement,
whereby,  the Company would issue Bonus Compensation  Warrants equivalent to 10%
of the price of any merger or  acquisition  brought to the  Company.  All of the
warrants  being  exercisable  into  shares of common  stock at 80% of the 20 day
average bid and ask price of the Company's common stock. The Company  authorized
up to a maximum  aggregate of 3,000,000 shares of common stock available for any
Bonus Compensation Warrants. To date none of these shares have been issued.

On July 22 2002 the Company issued a common stock  purchase  warrant for 260,000
shares of common stock  exercisable at $.10 per share and on September 27, 2002,
a common stock  purchase  warrant for 1,875,000  shares  exercisable at $.04 per
share, both expiring on August 31, 2007.

In April,  2001,  investors in a private placement  received warrants to acquire
1,500,000  shares of Common stock at $1.00 per share.  These warrants  expire on
April 24, 2004.  To date none of these  warrants have been  exercised.  In June,
2001,  consultants received warrants to acquire 1,350,000 shares of Common stock
at prices ranging from $1.00 to $2.00 that expire on September 14, 2004. To date
none of these warrants have been exercised.
In June,  2001. a consultant  received  warrants to acquire  1,000,000 shares of
Common stock at prices  ranging from $1.00 to $2.00 that expire on June 5, 2006.
To date none of these warrants have been exercised.

NOTE 6 - LEASES

The  Company  leases  12,000  square  feet  in  New  York.  The  lease  is  on a
month-to-month  basis with an affiliated company owned by the Company's officers
and  shareholders.  The  affiliate's  underlying New York lease expires in 2004.
Lease  payments  made  by  the  Company  approximate  the  payments  due  by the
affiliated  companies.  On December 1, 2002 the Company  entered into a sublease
agreement  to lease  approximately  2,000 square feet of its  warehouse  through
November 30, 2005.

Future minimum lease payments are as follows:
   Year ended December 31, 2004                      $54,500


                                       -9-

<PAGE>

                                APO HEALTH, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 7 - COMMITMENTS AND CONTINGENCIES

Litigation
----------
There was an  action in the  Circuit/Superior  Court of Marion  County;  Indiana
entitled  "Kenro,  Inc., on behalf of itself and all others  similarly  situated
against APO Health,  Inc.,  Cause No.  490120101CP000016."  The lawsuit involved
unsolicited  broadcast faxes sent in the state and had been certified as a class
action suit.

On January 28, 2004,  the Company  announced that it had reached an out of court
settlement in the unsolicited  broadcast fax class action lawsuit by Kenro, Inc.
The Company's  attorneys  agreed to settle the litigation for up to $4.5 million
that will be placed in a settlement  fund created and completely  covered by the
Company's insurer.  As a result of the settlement,  the Company will have no out
of pocket expenses related to the creation or management of the Settlement Fund.


Employment Agreement
--------------------
Effective October 1, 2001, the Company has entered into a three-year  employment
agreement  with its chief  executive  officer that provides for a minimum annual
salary  of  $250,000  with  incentives  based  on the  Company's  attainment  of
specified  levels  of sales  and  earnings  as  defined  in the  agreement.  The
employment  agreement  expires  September  30,  2004 and shall be  automatically
renewed for  successive  periods of one year unless  either party gives  written
notice to terminate the agreement.

NOTE 8 - CONCENTRATION OF CREDIT RISK

The Company maintains cash balances at various financial institutions.  At times
such  balances  exceed the  insured  limits of the  financial  institution.  The
Company has not  experienced any losses in such accounts and does not believe it
is exposed to any  significant  credit  risk on cash  balances.  As of March 31,
2004,  the Company had  $168,903 on deposit,  in excess of the  $100,000 in each
bank, which is insured under federal law.


                                      -10-

<PAGE>

ITEM 2   MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

RESULTS OF OPERATIONS
---------------------

Revenue for the six months ended March 31, 2004 was  $21,243,530,  a decrease of
$991,971 or 4.5%  compared to the six months ended March 31, 2003.  The decrease
was  attributable  to a reduction  in the sale of health,  beauty aids and other
pharmaceutical  products to wholesale  distributors as margins on these products
decreased.  Where  product was available for sale but the margins were such that
the Company would not be able to generate a profit, the Company declined to sell
those  products.  Cost of sales for the six  months  ended  March  31,  2004 was
$20,002,019,  a decrease of  $1,099,258 or 5.8% compared to the six months ended
March 31,  2003.The  gross  profit for the six months  ended  March 31, 2004 was
$1,241,511  or  approximately  5.8%  compared to  $1,134,224 or 5.1% for the six
months  ended March 31,  2003.  The Company is in the process of preparing a new
medical catalogue for medical  supplies.  It anticipates that this new catalogue
will aid in the increase of the sale of medical supplies which have higher gross
profit  margins than many of the other  products and increase the overall  gross
profit margin of the Company.

Selling  expenses  for the six months  ended  March 31, 2004 were  $374,611,  an
increase  of $107,323 or 40.2%  compared  to $267,288  for the six months  ended
March 31, 2003. Freight costs increased by $43,312 and commissions  increased by
$70,526 while advertising and related costs decreased by approximately  $19,277.
Other selling costs increased by approximately  $12,762.  Advertising costs over
the next  three  to six  months  will  increase  as the  Company  completes  and
distributes its new medical supply catalogue.

General and administrative expenses for the six months ended March 31, 2004 were
$759,999 a decrease of $100,407 or 11.7%  compared to the six months ended March
31, 2003. Included in general and administrative expenses in 2003 was a bonus of
$152,500 to one of the officers for attaining  certain sales levels  included in
his employment  agreement.  For the six months ended March 31, 2004,  this bonus
has been waived.  Exclusive of the prior year's bonus, payroll and related costs
increased by approximately  $27,000.  Professional fees,  including  accounting,
consulting and legal expenses  declined by approximately  $18,500 in 2004. There
were no other material increases or decreases in any one category of general and
administrative expenses.

There was a final  settlement of litigation  against the Company in January 2004
and as a result the Company was reimbursed all legal expenses  incurred in prior
years by its insurance company.

Interest expense for the six months ended March 31, 2004 was $50,062, a decrease
of  $5,344  form the six  month  period  ended  March 31,  2003.  The  financing
agreement  provides for all collections to be applied against the line of credit
on a daily basis and proceeds from the line of credit are only taken when needed
to pay down  liabilities.  As a result the average daily balance  outstanding on
the line of credit has been reduced.  The financing agreement allows the Company
greater  flexibility  in its ability to finance  increased  sales and additional
inventory.


                                      -11-

<PAGE>

FINANCIAL CONDITION
-------------------

As of March 31,  2004,  The Company had net working  capital of  $1,471,895,  an
increase  of  $275,534  from  September  30,  2003 as a result of the net income
generated  during the period.  At March 31,  2004,  the Company had a $3,000,000
credit  facility of which  approximately  $1,620,000  was unused which gives the
Company the ability to finance additional revenue and inventory.

For fiscal 2004, the Company has reduced its budget for both selling and general
and administrative  expenses by approximately  $250,000 eliminating  unnecessary
expenses and revising some of the operations. The above reductions will increase
the Company's profitability based on current sales volume.


Based upon the above factors,  the Company believes that it has sufficient funds
for operations for the next fiscal year.


                           PART II - OTHER INFORMATION

                                APO HEALTH, INC.

ITEM 1 - LEGAL PROCEEDINGS
--------------------------

There was an  action in the  Circuit/Superior  Court of Marion  County;  Indiana
entitled  "Kenro,  Inc., on behalf of itself and all others  similarly  situated
against APO Health,  Inc.,  Cause No.  490120101CP000016."  The lawsuit involved
unsolicited  broadcast faxes sent in the state and had been certified as a class
action suit.

On January 28, 2004,  the Company  announced that it had reached an out of court
settlement in the unsolicited  broadcast fax class action lawsuit by Kenro, Inc.
The Company's  attorneys  agreed to settle the litigation for up to $4.5 million
that will be placed in a settlement  fund created and completely  covered by the
Company's insurer.  As a result of the settlement,  the Company will have no out
of pocket expenses related to the creation or management of the Settlement Fund.

ITEM 2 - CHANGES IN SECURITIES AND USE OF PROCEEDS
--------------------------------------------------
Sales of Unregistered Securities during the Quarter ended March 31, 2004.

In  January  of  2004,  the  Company  adopted  a  Special  Compensation  Warrant
Agreement,  whereby  the  Company  would  issue  warrants  under  the  following
circumstances:  (i) in exchange for consulting  services;  (ii) as consideration
for accepting additional corporate  responsibilities;  or (iii) as consideration
for the  reduction by Dr. Stahl in the  percentage  by which his bonus was to be
calculated.  A total of 3,500,000  Special  Compensation  Warrants were created,
exercisable  at $0.025 per share,  for an exercise  period of three  years.  Dr.
Stahl  accepted  the  additional  responsibility  of acting  as Chief  Financial
Officer.  Also, during 2003, Dr. Stahl reduced the percentage by which his bonus
was to be calculated  from 1 1/2% to 1%. In total, on January 9, 2004, the Board
authorized the issuance of 2,300,000 special  compensation  warrants to officers
and consultants for legal services.


                                      -12-

<PAGE>

On January 29, 2004, we issued to an Investment  Banker  2,000,000 shares of the
Company's  Common Stock.  On that date,  the Company  entered into an Investment
Banking  agreement with Sloan Securities Corp.  ("SSC") to provide financing and
advisory and investment  banking services for a period of one year from the date
of the agreement.  The issuance is considered exempt from registration by reason
of Section 4(2) Regulation D of the Securities Act of 1933.

ITEM 3 - DEFAULT UPON SENIOR SECURITIES
---------------------------------------
None.

ITEM  4  -  SUBMISSION   OF  MATTERS  TO  A  VOTE  OF  SECURITY  HOLDERS
------------------------------------------------------------------------
None.

ITEM 5 - CONTROLS AND PROCEDURES
--------------------------------

In the second  quarter of fiscal  2004,  the Company  implemented  controls  and
procedures  (as defined in rule 13a-15(e)  under the Securities  Exchange Act of
1934).  The Chief Financial  Officer  performed an evaluation and concluded that
the disclosure controls and procedures were effective as of March 31, 2004.

ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
-----------------------------------------
None.

                                   SIGNATURES

Pursuant to the  requirements of Section 13 or 15(d) of the Securities  Exchange
Act of 1934,  the  Registrant  has duly  caused  this report to be signed on its
behalf by the undersigned, thereunto duly authorized.

                                               APO HEALTH, INC.

Date:  May 7, 2004                             By: /s/ Dr. Stahl.    Jan Stahl
                                                   ---------------------------
                                                   Dr. Jan Stahl, Chairman
                                                   Chief Executive Officer
                                                      And Secretary
                                                   (Principal Executive Officer)



Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following  persons on behalf of the  Registrant and
in the capacities and on the dates indicated.



Date:  May 7, 2004                             By: /s/ Dr. Stahl
                                                   --------------
                                                   Dr. Jan Stahl, Director


Date:  May 7, 2004                             By: /s/ Kenneth Leventhal
                                                   ---------------------
                                                   Kenneth Leventhal, Director

                                      -13-

<PAGE>

                CERTIFICATION PURSUANT TO RULE 13A-14 AND 15D-14
              UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED


I, Dr. Jan Stahl,  Chief  Executive and Financial  Officer of APO Health,  Inc.,
certify that:

1.    I have reviewed this quarterly report on Form 10 Q of APO Health, Inc.;

2.    Based on my knowledge,  this quarterly  report does not contain any untrue
      statement of a material fact or omit to state a material fact necessary to
      make the statements made, in light of the  circumstances  under which such
      statements were made, not misleading with respect to the period covered by
      this quarterly report;

3.    Based on my  knowledge,  the  financial  statements,  and other  financial
      information  included  in this  quarterly  report,  fairly  present in all
      material respects the financial condition,  results of operations and cash
      flows of the  Registrant  as of, and for,  the periods  presented  in this
      quarterly report;

4.    The  registrant's  other  certifying  officer  and I are  responsible  for
      establishing  and  maintaining  disclosure  controls  and  procedures  (as
      defined in Exchange Act Rules 13a-14 and 15d-14) for the Registrant and we
      have:

      (a)   designed  such  disclosure  controls and  procedures  to ensure that
            material  information  relating  to the  Registrant,  including  its
            consolidated  subsidiaries,  is made  known to us by  others  within
            those entities,  particularly during the period in which this annual
            report is being prepared;

      (b)   evaluated the effectiveness of the registrant's  disclosure controls
            and  procedures  of a date within 45 days of the filing date of this
            quarterly report (the "Evaluation Date"); and

      (c)   presented  in  this  quarterly  report  our  conclusions  about  the
            effectiveness of the disclosure controls and procedures based on our
            evaluation of the Evaluation Date;

5.    The registrant's other certifying  officer and I have disclosed,  based on
      our most recent  evaluation,  to the  registrant's  auditors and the audit
      committee of the  registrant's  board of directors (or persons  performing
      the equivalent function):

      (a)   all significant  deficiencies in the design or operation of internal
            controls which could adversely  affect the  registrant's  ability to
            record,  process  summarize  and  report  financial  data  and  have
            identified for the registrant's  auditors any material weaknesses in
            internal controls; and

      (b)   any fraud,  whether or not  material,  that  involves  management or
            other  employees  who have a  significant  role in the  registrant's
            internal controls; and


                                      -14-

<PAGE>

6.    The  registrant's  other  certifying  officer and I have indicated in this
      quarterly report whether or not there were significant changes in internal
      controls or in other  factors  that could  significantly  affect  internal
      controls  subsequent to the date of our most recent evaluation,  including
      any  corrective  actions  with  regard  to  significant  deficiencies  and
      material weaknesses.


Dated:  May 7, 2004                        By: /s/ Dr. Jan Stahl
                                               ---------------------------------
                                               Dr. Jan Stahl
                                               Chief Executive and Financial
                                               Officer and Director



                                      -15-