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SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549



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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 June 30, 2003.



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



For the transition period from
 to



Commission file number 0-26476



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GLYCOGENESYS, INC.

(Exact name of Registrant as specified in its charter.)



|Nevada                                                         |  | 33-0231238                          
|-------------------------------------------------------------- |  | ------------------------------------
|(State or other jurisdiction of incorporation or organization) |  | (I.R.S. Employer Identification No.)



Park Square Building

31 St. James Avenue, 8th Floor

Boston, Massachusetts 02116

(Address of principal executive offices, including zip code.)



(617) 422-0674

Registrants telephone number, including area code.



---



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



Indicate by checkmark whether the Registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).  Yes ̈No  x



The number of shares outstanding of the Registrants common stock, $.01 par value per share, at August 14, 2003 was 37,805,740 shares.



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GLYCOGENESYS, INC.



INDEX



|                             |  | Page   
|---------------------------- |  | -------
|Part IFinancial Information |  |        
|                             |  | Item 1.
|                             |  |        
|                             |  |        
|                             |  |        
|                             |  |        
|                             |  | Item 2.
|                             |  | Item 3.
|                             |  | Item 4.
|Part IIOther Information    |  |        
|                             |  | Item 2.
|                             |  | Item 4.
|                             |  | Item 6.
|Signatures                   |  | 21     



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##### Table of Contents

PART I  FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)



GLYCOGENESYS, INC.

CONSOLIDATED BALANCE SHEETS



ASSETS



(Unaudited)



|                                          |  | June 30,2003 |           |   | December 31,2002 |  
|----------------------------------------- |  | ------------ | --------- | - | ---------------- | -
|Current assets:                           |  |              |           |   |                  |  
|Cash and cash equivalents                 |  | $            | 3,039,939 |   |                  | $
|Prepaid expenses and other current assets |  |              | 193,506   |   |                  |  
|                                          |  |              |           |   |                  |  
|Total current assets                      |  |              | 3,233,445 |   |                  |  
|                                          |  |              |           |   |                  |  
|Property and equipment, at cost:          |  |              |           |   |                  |  
|Computer, office and laboratory equipment |  |              | 787,173   |   |                  |  
|Furniture and fixtures                    |  |              | 294,291   |   |                  |  
|Motor vehicles                            |  |              | 25,026    |   |                  |  
|                                          |  |              |           |   |                  |  
|                                          |  |              | 1,106,490 |   |                  |  
|Less-accumulated depreciation             |  |              | (652,739  | ) |                  |  
|                                          |  |              |           |   |                  |  
|Property and equipment, net               |  |              | 453,751   |   |                  |  
|                                          |  |              |           |   |                  |  
|Other assets:                             |  |              |           |   |                  |  
|Restricted cash                           |  |              | 108,128   |   |                  |  
|Other                                     |  |              | 11,670    |   |                  |  
|                                          |  |              |           |   |                  |  
|Total other assets                        |  |              | 119,798   |   |                  |  
|                                          |  |              |           |   |                  |  
|Total assets                              |  | $            | 3,806,994 |   |                  | $
|                                          |  |              |           |   |                  |  



The accompanying notes
are an integral part of these consolidated financial statements.



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GLYCOGENESYS, INC.

CONSOLIDATED BALANCE SHEETS



LIABILITIES AND STOCKHOLDERS EQUITY



(Unaudited)



|                                                                                                                                                                               |  | June 30, 2003 |             |   | December 31, 2002 |  
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | ------------- | ----------- | - | ----------------- | -
|Current liabilities:                                                                                                                                                           |  |               |             |   |                   |  
|Accounts payable                                                                                                                                                               |  | $             | 630,033     |   |                   | $
|Accrued liabilities                                                                                                                                                            |  |               | 390,391     |   |                   |  
|Net liabilities of discontinued operations                                                                                                                                     |  |               | 102,155     |   |                   |  
|                                                                                                                                                                               |  |               |             |   |                   |  
|Total current liabilities                                                                                                                                                      |  |               | 1,122,579   |   |                   |  
|                                                                                                                                                                               |  |               |             |   |                   |  
|Commitments and contingencies                                                                                                                                                  |  |               |             |   |                   |  
|Stockholders equity:                                                                                                                                                          |  |               |             |   |                   |  
|Preferred stock, $0.01 par value (liquidation value $21,251,341 and $21,045,626 as of June 30, 2003 and December 31, 2002,
respectively)                                       |  |               | 108         |   |                   |  
|Common stock, $0.01 par value; Authorized  200,000,000 shares; Issued and outstanding  37,786,847 and 37,251,457
shares at June 30, 2003 and December 31, 2002, respectively |  |               | 377,869     |   |                   |  
|Additional paid-in capital                                                                                                                                                     |  |               | 85,143,484  |   |                   |  
|Note receivable from former officer                                                                                                                                            |  |               | (2,675,000  | ) |                   |  
|Accumulated deficit                                                                                                                                                            |  |               | (80,162,046 | ) |                   |  
|                                                                                                                                                                               |  |               |             |   |                   |  
|Total stockholders equity                                                                                                                                                     |  |               | 2,684,415   |   |                   |  
|                                                                                                                                                                               |  |               |             |   |                   |  
|Total liabilities and stockholders equity                                                                                                                                     |  | $             | 3,806,994   |   |                   | $
|                                                                                                                                                                               |  |               |             |   |                   |  



The accompanying notes
are an integral part of these consolidated financial statements.



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GLYCOGENESYS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS



(Unaudited)



|                                                     |  | Three Months Ended June 30, |            |   | Six Months Ended June 30, |  
|---------------------------------------------------- |  | --------------------------- | ---------- | - | ------------------------- | -
|                                                     |  | 2003                        |            |   | 2002                      |  
|Operating expenses:                                  |  |                             |            |   |                           |  
|Research and development                             |  | $                           | 655,858    |   |                           | $
|General and administrative                           |  |                             | 904,076    |   |                           |  
|                                                     |  |                             |            |   |                           |  
|Total operating expenses                             |  |                             | 1,559,934  |   |                           |  
|                                                     |  |                             |            |   |                           |  
|Operating loss                                       |  |                             | (1,559,934 | ) |                           |  
|                                                     |  |                             |            |   |                           |  
|Other income (expense):                              |  |                             |            |   |                           |  
|Equity in loss of SafeScience Newco, Ltd.            |  |                             |           |   |                           |  
|Interest income                                      |  |                             | 6,856      |   |                           |  
|Other income                                         |  |                             | 1,404      |   |                           |  
|                                                     |  |                             |            |   |                           |  
|Total other income (expense)                         |  |                             | 8,260      |   |                           |  
|                                                     |  |                             |            |   |                           |  
|Net loss                                             |  |                             | (1,551,674 | ) |                           |  
|Accretion of preferred stock dividends               |  |                             | (103,426   | ) |                           |  
|                                                     |  |                             |            |   |                           |  
|Net loss applicable to common stock                  |  | $                           | (1,655,100 | ) |                           | $
|                                                     |  |                             |            |   |                           |  
|Basic and diluted net loss per common stock          |  | $                           | (0.04      | ) |                           | $
|                                                     |  |                             |            |   |                           |  
|Weighted average number of common shares outstanding |  |                             | 37,511,805 |   |                           |  
|                                                     |  |                             |            |   |                           |  



The accompanying notes
are an integral part of these consolidated financial statements.



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GLYCOGENESYS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS



(Unaudited)



|                                                                                             |  | Six Months EndedJune 30, |           
|-------------------------------------------------------------------------------------------- |  | ------------------------ | ----------
|                                                                                             |  | 2003                     |           
|Cash flows from operating activities:                                                        |  |                          |           
|Net loss                                                                                     |  | $                        | (3,359,288
|Adjustments to reconcile net loss to net cash used in operating and discontinued activities: |  |                          |           
|Operating expenses paid with common stock, options and warrants                              |  |                          |          
|Amortization of value of warrants issued for license                                         |  |                          |          
|Equity adjustment in SafeScience Newco, Ltd.                                                 |  |                          |          
|Depreciation and amortization                                                                |  |                          | 74,237    
|Changes in assets and liabilities:                                                           |  |                          |           
|Due from SafeScience Newco, Ltd.                                                             |  |                          |          
|Prepaid expenses and other current assets                                                    |  |                          | 138,891   
|Accounts payable                                                                             |  |                          | 38,248    
|Accrued liabilities                                                                          |  |                          | 38,633    
|Net liabilities of discontinued operations                                                   |  |                          | (44,457   
|                                                                                             |  |                          |           
|Net cash used in operating and discontinued activities                                       |  |                          | (3,113,736
|                                                                                             |  |                          |           
|Cash flows from investing activities:                                                        |  |                          |           
|Purchase of property and equipment                                                           |  |                          | (149,801  
|Other                                                                                        |  |                          | 175       
|                                                                                             |  |                          |           
|Net cash used in investing activities                                                        |  |                          | (149,626  
|                                                                                             |  |                          |           
|Cash flows from financing activities:                                                        |  |                          |           
|Proceeds from sale of common stock, net of issuance costs                                    |  |                          | 4,295     
|Proceeds from exercise of warrants                                                           |  |                          |          
|                                                                                             |  |                          |           
|Net cash provided by financing activities                                                    |  |                          | 4,295     
|                                                                                             |  |                          |           
|Net (decrease) increase in cash and cash equivalents                                         |  |                          | (3,259,067
|Cash and cash equivalents, beginning balance                                                 |  |                          | 6,299,006 
|                                                                                             |  |                          |           
|Cash and cash equivalents, ending balance                                                    |  | $                        | 3,039,939 
|                                                                                             |  |                          |           
|Supplemental disclosure of non-cash financing activities:                                    |  |                          |           
|Series B preferred stock issued to fund SafeScience Newco                                    |  | $                        |          
|                                                                                             |  |                          |           
|Dividends accreted on Series A and Series B preferred stock                                  |  | $                        | 205,715   
|                                                                                             |  |                          |           



The accompanying notes
are an integral part of these consolidated financial statements.



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GLYCOGENESYS, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2003



(1) Basis of Presentation



The accompanying unaudited consolidated financial statements of GlycoGenesys, Inc. (together with its subsidiaries, the Company), have been prepared by the
Company in accordance with accounting principles generally accepted in the United States of America applicable to interim periods, and with the rules and regulations of the Securities and Exchange Commission. In the opinion of management, such
financial statements reflect all adjustments, consisting of only normal recurring adjustments, which are necessary for a fair presentation of the results of the interim periods presented. The results of operations for the interim periods shown in
this report are not necessarily indicative of results expected for the full year. These financial statements do not include disclosures associated with the annual financial statements and, accordingly, should be read in conjunction with the
Managements Discussion and Analysis of Financial Condition and Results of Operations and the financial statements and footnotes for the year ended December 31, 2002, included in the Companys Annual Report on Form 10-K.



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



(2) Operations



As of June 30, 2003, the
Company had an accumulated deficit of $80,162,046. Despite this accumulated deficit, the Company had a net working capital position (current assets less current liabilities) of $2,110,866 at June 30, 2003. The Company believes that its existing
funds and commitments will be sufficient to fund its operating expenses and capital requirements into the first quarter of 2004, allowing the Company to initiate the Phase I dose escalation monotherapy trial. The Company intends to raise additional
capital through equity financings to support its planned Phase I dose escalation trials and continued operations. To the extent the Company is unable to raise sufficient funding for Phase I dose escalation trials, it will need to accelerate its
efforts to repartnering with a large biotechnology or pharmaceutical company. Since inception, the Company has funded its operations primarily through the proceeds from the sale of equity securities. From the inception of the Company through June
30, 2003, the Company has been successful in raising $63.2 million from the sales of equity securities.



The Companys future is dependent upon its ability to obtain financing to fund its operations. As of August 18, 2003, the Company has obtained commitments from existing or potential investors to provide
additional financing of approximately $4.0 million, of which the Company has received approximately $2.4 million. The Company will need to raise significant additional funding. The Company expects to incur substantial additional operating costs,
including costs related to ongoing research and development activities, preclinical studies and clinical trials. To the extent that the Company is unable to raise additional capital on a timely basis, management plans to slow down research activity
to conserve cash. In the event additional financing is not obtained, the Company may be required to significantly reduce or curtail operations.



In its Annual Report on Form 10-K for the year ended December 31, 2002, the Company reported that there is substantial doubt that the Company will have the ability to
continue as a going concern and, therefore, may be unable to realize its assets and discharge its liabilities in the normal course of business. The accompanying financial statements do not include any adjustments relating to the recoverability and
classification of recorded asset amounts or to amounts and classification of liabilities that may be necessary should the Company be unable to continue as a going concern.



Principal risks to the Company include the need to obtain adequate financing to fund future operations, the successful development and
marketing of pharmaceutical products, dependence on collaborative partners, United States Food and Drug Administration approval, dependence on key individuals and competition from substitute products and larger companies.



(3) Joint Venture with Elan



In July 2001, the Company, Elan International Services, Ltd. (EIS) and Elan
Corporation plc (together with EIS, Elan) formed a joint venture in Bermuda (SafeScience Newco, Ltd.) for



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GLYCOGENESYS, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2003



the purpose of furthering the development of the Companys drug candidate, GCS-100, in the field of oncology. The joint venture agreement was terminated
on December 18, 2002.



During the period the joint venture was in operation,
the Company accounted for its investment in SafeScience Newco using the equity method. Because the Company obtained control of SafeScience Newco on December 18, 2002, SafeScience Newco has been consolidated with the Companys consolidated
financial statements since that date. Accordingly, for the three months and six months ended June 30, 2003, SafeScience Newco has been fully consolidated.



(4) Net Loss Per Common Stock



Basic loss per share is computed using the weighted-average number of common shares outstanding. The dilutive effect of the potential common shares consisting of
outstanding stock options and warrants is determined using the treasury stock method. Diluted weighted average shares outstanding for the three month and six month periods ended June 30, 2003 and 2002 excluded the potential common shares from
convertible preferred stock, warrants and stock options because to do so would be anti-dilutive. At June 30, 2003 and 2002, there were 10,792,457 and 11,345,065 warrants outstanding, respectively, and 1,761,115 and 1,547,042 stock options
outstanding, respectively, which were omitted from the net loss per common stock calculations, and 10,792,457 and 6,923,945 shares, respectively, issuable upon conversion of outstanding shares of preferred stock which were also omitted.



(5) Equity



(a) Issuance of Common Stock



In the three months and six months ended June 30, 2003, the Company issued 413,067 and 429,567 shares of common stock in connection with the exercise of warrants for
consideration of $4,131 and $4,296, respectively. In addition, during the three months ended June 30, 2003 the Company issued 105,823 shares of common stockdue to the delay in filing of a registration statement in 2002.



(b) Stock, Stock Options, and Warrants



The Company has authorized 5,000,000 shares of preferred stock, $0.01 par value. Such
preferred stock consists of:



| |  | Series A convertible preferred stock, 7,500 shares authorized; 6,153.51 shares issued and outstanding as of June 30, 2003 and December 31, 2002 (liquidation value $14,953,041).
|- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Series B convertible preferred stock, 6,000 authorized; 3,471.15 shares issued and outstanding as of June 30, 2003 and December 31, 2002 (liquidation value $6,298,300 and
$6,092,585, respectively).
|- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Series C convertible, preferred stock, 1,117 authorized; 1,116.79 shares issued and outstanding as of June 30, 2003 and December 31, 2002.
|- |  | ------------------------------------------------------------------------------------------------------------------------------------------



The Company has entered into agreements with various employees and consultants for the grant
of stock options and shares of common stock at prices determined by the Compensation Committee of the Companys Board of Directors. During the six months ended June 30, 2002, the Company issued 92,038 shares of common stock to various employees
and consultants as compensation for services rendered or for licensing fees and recorded a charge to operations of $174,870 relating to these issuances. No shares of common stock were issued as compensation for services rendered or for licensing
fees during the six months ended June 30, 2003.



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GLYCOGENESYS, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2003



During the three months ended June 30, 2003 and 2002, the Company granted options to purchase 40,000 and 107,100
shares of common stock, respectively, at a weighted average exercise price of $0.40 and $1.53, respectively, per share to employees and others. Options to purchase 253,715 shares of common stock at a weighted average exercise price of $13.38 expired
and were cancelled during the three months ended June 30, 2002. No options expired or were exercised during the three months ended June 30, 2003.



During the six months ended June 30, 2003 and 2002, the Company granted options to purchase 344,000 and 551,700 shares of common stock, respectively, at a weighted
average exercise price of $0.29 and $1.98, respectively, per share to employees and others. Options to purchase 16,100 shares of common stock were exercised during the six months ended June 30, 2002. No options were exercised during the six months
ended June 30, 2003



During the three months ended June 30, 2003 and 2002,
warrants to purchase 413,067 and 179,738 shares, respectively, were exercised at a price of $0.01 per share. No warrants were issued during the three months ended June 30, 2003 and 2002.



During the six months ended June 30, 2002, the Company issued warrants to purchase 3,352,869 shares of common stock at a weighted average
exercise price of $1.65 per share, of which warrants to purchase 414,771 shares were exercised at a price of $0.01 per share. No warrants were issued during the six months ended June 30, 2003. Warrants to purchase 429,567 shares were exercised at a
price of $0.01 per share during the six months ended June 30, 2003.



Total
non-cash expense related to stock, stock option and warrant grants recorded in the accompanying consolidated statements of operations for the six months ended June 30, 2002 amounted to $476,567. No such expense was charged to operations during the
six months ended June 30, 2003.



(c) Stock-based compensation plans



The Company has stock-based employee compensation plans that are described more fully in
Note 6 to the Companys consolidated financial statements included in its Annual Report on Form 10-K for the year ended December 31, 2002. The Company accounts for these plans under the recognition and measurement principles of APB Opinion No.
25, Accounting for Stock Issued to Employees, and related interpretations. No stock-based employee compensation cost is reflected in the Consolidated Statements of Operations, as all options granted under these plans had an exercise
price equal to or greater than the market value of the underlying common stock on the dates of grant. The following table illustrates the effect on net loss and net loss per common share if the Company had applied the fair value recognition
provisions of SFAS No. 123, Accounting for Stock-Based Compensation to stock-based employee compensation.



Had the compensation cost for the plans been determined based on the fair value at the grant dates for awards under the plans consistent with the method described in SFAS
No. 123, the Companys net loss and basic and diluted net loss per common share on a pro forma basis would have been:



|                                                                                                        |  | Three Months Ended June 30, |            |   | Six Months Ended June 30, |  
|------------------------------------------------------------------------------------------------------- |  | --------------------------- | ---------- | - | ------------------------- | -
|                                                                                                        |  | 2003                        |            |   | 2002                      |  
|Net loss applicable to common stock, as reported                                                        |  | $                           | (1,655,100 | ) |                           | $
|Total stock-based employee compensation expense determined under fair value based method for all awards |  |                             | (146,078   | ) |                           |  
|                                                                                                        |  |                             |            |   |                           |  
|Pro forma net loss applicable to common stock                                                           |  | $                           | (1,801,178 | ) |                           | $
|                                                                                                        |  |                             |            |   |                           |  
|Basic and diluted net loss per common stock, as reported                                                |  | $                           | (0.04      | ) |                           | $
|                                                                                                        |  |                             |            |   |                           |  
|Pro forma basic and diluted net loss per common stock                                                   |  | $                           | (0.05      | ) |                           | $
|                                                                                                        |  |                             |            |   |                           |  



The preceding pro forma results were
calculated using the Black-Scholes option-pricing model. The following assumptions were used for options granted during the three months ended June 30, 2003 and 2002, respectively: (1) risk-free interest rates of 5.1% and 3.6%, respectively; (2)
dividend yields of 0.0%; (3) expected lives of 10 years; and (4) volatility of 102.1% and 135.3%, respectively. The weighted average fair value of options granted during the three months ended June 30, 2003 and 2002 was $1.53 and $0.40,
respectively. The following assumptions were used for options granted during the six months ended June 30, 2003 and 2002, respectively: (1) risk-free interest rates of 5.1% and 3.8%, respectively; (2) dividend yields of 0.0%; (3) expected lives of
10 years; and (4) volatility of 85.2% and 145.8%, respectively. The weighted average fair value of options granted during the six months ended June 30, 2003 and 2002 was $0.29 and $1.98, respectively. Results may vary depending on the assumptions
applied within the model.



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GLYCOGENESYS, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2003



Stock or other equity-based compensation for non-employees is accounted for under the fair value-based method as
required by SFAS No. 123 and Emerging Issues Task Force (EITF) Issue No. 96-18, Accounting for Equity Instruments That Are Issued to Other Than Employees for Acquiring, or in Conjunction with Selling, Goods or Services and
other related interpretations. Under this method, the equity-based instrument is valued at either the fair value of the consideration received or the equity instrument issued on the date of grant. The resulting compensation cost is recognized and
charged to operations over the service period, which is usually the vesting period.



(6) Subsequent Event



In August 2003, the Company engaged in a
private placement of securities to institutions and accredited investors in which the Company received commitments to purchase a total of 7,487,037 shares of Common Stock and warrants to purchase 2,246,112 shares of Common Stock at an average
weighted exercise price of $0.86 per share for total consideration of $4,043,000. As of August 18, 2003, the Company has received $2,437,100 for the purchase of 4,513,148 shares of Common Stock and warrants to purchase 1,353,944 shares of Common
Stock at a weighted average exercise price of $0.84 per share.



ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS



The following discussion should be read in conjunction with the consolidated financial statements and the notes thereto.



The following contains certain forward-looking statements within the meaning of Section 27A
of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are intended to be covered by the safe harbors created thereby. All forward-looking statements involve risks and uncertainty.
Although we believe that the assumptions underlying the forward-looking statements contained herein are reasonable, any of the assumptions could be inaccurate, and therefore, there can be no assurance that the forward-looking statements included in
this report will prove to be accurate. Our actual results may differ materially from the results anticipated in the forward-looking statements. Any statements contained in this Quarterly Report on Form 10-Q that relate to future plans, events or
performance are forward-looking statements that involve risks and uncertainties, including but not limited to, risks of product development (such as failure to demonstrate efficacy or safety), risk related to FDA and other regulatory procedures,
market acceptance risks, the impact of competitive products and pricing, the results of current and future licensing, joint ventures and other collaborative relationships, the results of financing efforts, developments regarding intellectual
property rights and litigation, and other risks identified in the section titled Quantitative and Qualitative Disclosures about Market RiskCertain Factors that May Affect Future Results included herein which discuss factors that
could contribute to such material differences. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by the Company or any
other person that the objectives and plans of the Company will be achieved. We undertake no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the
date hereof or to reflect the occurrence of unanticipated events.



Overview



GlycoGenesys, Inc. (together with its subsidiaries, as the context requires,
the Company) is a biotechnology company developing novel drug candidates primarily based on glycobiology. Our lead drug candidate GCS-100, a potential treatment for multiple forms of cancer, completed a Phase II(a) clinical trial for
pancreatic cancer in April 2002 and completed a Phase II(a) clinical trial for colorectal cancer in March 2001. We began a Phase I dose escalation trial in February 2002 dosing in patients at up to 80mg/m2 which was completed in late 2002.



The Companys near-term objectives are to continue to proceed through the
various phases of United States Food and Drug Administration (FDA) clinical trials for GCS-100 and to secure the necessary financial resources to conduct such trials, either through repartnering with a large biotechnology or
pharmaceutical company or raising funds in the capital market or a combination of both. In addition, the Company plans to sell its agricultural products area, consisting of two products (Elexa, a registered trademark of the Company and Bb447).



Assuming the necessary financial resources are available, the Company
plans to commence the first of three Phase I dose escalation studies in late 2003 with a substantially ethanol-free formulation. Thirty patients will be included in a monotherapy trial and a total of 30 patients will be included in two trials
testing GCS-100 in combination with a standard chemotherapy. Two Phase II pivotal trials with GCS-100 as a monotherapy and two Phase II trials of GCS-100 in combination with standard cancer therapies are planned to begin in 2004 and will enroll
cancer patients whose indications will be chosen based on results of the Phase I dose escalation trials. These Phase II trials are planned to enroll 55 patients each. These four planned Phase II trials may enroll additional patients beyond the
planned 55 patients and/or additional Phase II trials may be initiated. The Company plans to file for an NDA using the data from the Phase II monotherapy trials in 2005 if the results support an NDA. The Company plans to initiate a Phase III
combination therapy clinical trial in 2005 toward an NDA for additional indications.



GlycoGenesys has three wholly-owned subsidiaries, International Gene Group, Inc. (IGG), and SafeScience Products, Inc. (SafeScience Products) and SafeScience Newco, Ltd. (SafeScience Newco).



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GlycoGenesys, along with IGG and SafeScience Newco, develops human therapeutics, primarily GCS-100, which it exclusively
licenses from Dr. David Platt and Wayne State University and the Barbara Ann Karmanos Cancer Institute. Historically, SafeScience Products, Inc. developed agriculture products and developed, marketed, and distributed chemically safe consumer and
commercial products.



The Companys principal executive offices are
located at 31 St. James Avenue, 8th Floor, Boston, MA 02116 and the telephone number is (617) 422-0674. The Companys home page is located on the worldwide web at http://www.glycogenesys.com.



Critical Accounting Policies



Our significant accounting policies are described in the Notes to the Consolidated Financial Statements included in our Annual Report on
Form 10-K for the year ended December 31, 2002. The accounting policies used in preparing our interim consolidated financial statements for the six months ended June 30, 2003 are the same as those described in our Annual Report on Form 10-K.



The Companys critical accounting policies are those that are important
to the portrayal of the Companys financial condition and operating results and require managements most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are
inherently uncertain. The Company believes that its most critical accounting policy relates to the accounting for its accrued liabilities, specifically clinical research organization costs. While the Company bases its judgments and estimates on
historical experience and other assumptions that management believes are appropriate and reasonable under current circumstances, actual results may differ from those estimates.



Accrued liabilities, specifically clinical research organization costs The preparation of financial statements requires
management to make estimates and assumptions that affect the reported amount of assets and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reported period.
Specifically, management must make estimates of costs incurred to date but not yet invoiced in relation to external clinical research organization, or CRO, costs. Management analyzes the progress of clinical trials, invoices received and budgeted
costs when evaluating the adequacy of the accrued liability. Significant management judgments and estimates must be made and used in connection with the accrued balance in any accounting period. Material differences may result in the amount and
timing of the accrued balance for any period if management made different judgments or utilized different estimates.



Results of Operations: Three Months Ended June 30, 2003 versus June 30, 2002



We had a net loss of $1,551,674 for the three months ended June 30, 2003 versus $2,564,682 for the three months ended June 30, 2002.



Research and Development Expenses Developing carbohydrate-based therapeutic
compounds is our primary business focus, which is in the research and development phase. To a lesser extent, we have developed nontoxic agricultural products, which are at the research and development phase. We plan to sell the agricultural products
area. Explanations of the changes in both areas from quarter-to-quarter are described in this section.



In July 2001, the Company transferred its rights to GCS-100 in the field of oncology to SafeScience Newco in connection with the formation of a joint venture with Elan. Costs related to GCS-100, incurred after the
transfer to SafeScience Newco, which were on behalf of SafeScience Newco, were expensed by SafeScience Newco. These research and development costs were incurred either by the Company or EIS on behalf of SafeScience Newco. The Company reported its
share of such expenses as a component of its equity in loss of SafeScience Newco. Following the termination of the joint venture with Elan on December 18, 2002, SafeScience Newco is consolidated in our financial statements and all expenses
associated with the development of GCS-100 are recorded in the line item Research and Development (R&D) in the Consolidated Statements of Operations.



Our research and development expenses for the three months ended June 30, 2003 and 2002 were reported in the following financial statement
captions:



|                                      |  | Three Months Ended June 30,
|------------------------------------- |  | ---------------------------
|                                      |  | 2003                       
|GCS-100:                              |  |                            
|Equity in loss of SafeScience Newco   |  | $                          
|                                      |  |                            
|R&D                                   |  |                            
|                                      |  |                            
|Total GCS-100                         |  |                            
|                                      |  |                            
|Other Products  R&D                  |  |                            
|                                      |  |                            
|Total Research & Development expenses |  | $                          
|                                      |  |                            



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Total research and development expenses of $655,858 for the three months ended June 30, 2003 decreased $842,802, or 56%,
from $1,498,660 of expenses for the three months ended June 30, 2002.



Total
GCS-100 development expenses of $599,912 for the three months ended June 30, 2003 decreased $813,204, or 58%, from $1,413,116 of expenses for the three months ended June 30, 2002. This decrease is primarily due to reductions in expenses of
approximately (i) $404,000 for clinical trials and clinical research organization services, (ii) $162,000 in non-cash compensation related to warrants granted to Wayne State University and the Barbara Ann Karmanos Cancer Institute as compensation
for a license, (iii) $131,000 in consulting fees, (iv) $99,000 for analytical and other development costs,(v) $86,000 in staffing-related costs, and (vi) $80,000 in GCS-100 production costs. These reductions were partially offset by an overall
increase in GCS-100 development expenses resulting from the termination of our joint venture agreement with Elan in December 2002. Prior to the termination, Elan reimbursed us for 19.9% of SafeScience Newcos expenses.



Research and development expenses for Elexa-4 and Bb-447, our agricultural compounds, which
consisted primarily of wages, consulting, registration and license fees, decreased approximately $30,000, or 35%, to approximately $56,000 for the three months ended June 30, 2003 from approximately $86,000 for the three months ended June 30, 2002.
The decrease reflects decreased payroll and consulting expenses, partially offset by increased license fees. We plan to sell our agricultural products area.



We may seek to expand our drug compound pipeline under development. Any new product candidates will either be developed jointly or licensed by us. The cost related to the
development of new product candidates is projected to be in the range of $25,000-$75,000 during the next twelve months, but could vary significantly based on the actual product candidates.



General and administrative expenses decreased to $904,076 for the three months ended June 30,
2003 from $1,048,382 for the three months ended June 30, 2002, a decrease of $144,306, or 14%. This decrease is primarily attributable to decreases in (i) professional fees of approximately $158,000, (ii) stock-based compensation for recruiting
services of approximately $43,000 and (iii) annual report costs of approximately $40,000, paritally offset by increased directors and officers insurance costs of approximately $48,000 and expenses charged to SafeScience Newco in 2002 of
approximately $52,000. The Companys 80.1% share of the expenses charged to SafeScience Newco in 2002 were included in the equity in loss of SafeScience Newco in 2002.



Interest income decreased to $6,856 for the three months ended June 30, 2003 from $30,048 for the three months ended June 30, 2002, a
decrease of $23,192, or 77%. This decrease is attributable to a reduction in cash available for investment and lower rates of return on those investments.



Equity in loss of SafeScience Newco, Ltd. is attributable to the recognition of 80.1% of the losses of SafeScience Newco, Ltd. for the three months ended June 30, 2002.
Substantially all of SafeScience Newcos expenses were related to research and development.



Results of Operations: Six Months Ended June 30, 2003 versus June 30, 2002



We had a net loss of $3,359,288 for the six months ended June 30, 2003 versus $5,215,393 for the six months ended June 30, 2002.



Research and Development Expenses 



Our research and development expenses for the six months ended June 30, 2003 and 2002 were reported in the following financial statement captions:



|                                      |  | Six Months Ended June 30,
|------------------------------------- |  | -------------------------
|                                      |  | 2003                     
|GCS-100:                              |  |                          
|Equity in loss of SafeScience Newco   |  | $                        
|                                      |  |                          
|R&D                                   |  |                          
|                                      |  |                          
|Total GCS-100                         |  |                          
|                                      |  |                          
|Other Products  R&D                  |  |                          
|                                      |  |                          
|Total Research & Development expenses |  | $                        
|                                      |  |                          



Total research and development
expenses of $1,497,284 for the six months ended June 30, 2003 decreased $2,006,509, or 57%, from $3,503,793 of expenses for the six months ended June 30, 2002.



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Total GCS-100 development expenses of $1,371,895 for the six months ended June 30, 2003 decreased $1,984,987, or 59%,
from $3,356,882 of expenses for the six months ended June 30, 2002. This decrease is primarily due to reductions in expenses of approximately (i) $795,000 in license fees paid to Wayne State University and the Barbara Ann Karmanos Cancer Institute,
(ii) $434,000 in non-cash compensation related to warrants granted to Wayne State University and the Barbara Ann Karmanos Cancer Institute as compensation for a license, (iii) $ 412,000 for clinical trials and clinical research organization
services, (iv) $219,000 in GCS-100 production costs, (v) $215,000 for consulting, (vi) $159,000 for pre-clincal studies and (vii) $102,000 for regulatory and other development costs. These reductions were partially offset by an increase in
laboratory facility costs of $52,000 and an overall increase in GCS-100 development expenses resulting from the termination of our joint venture agreement with Elan in December 2002. Prior to the termination, Elan reimbursed us for 19.9% of
SafeScience Newcos expenses.



Research and development expenses for
Elexa-4 and Bb-447, our agricultural compounds, which consisted primarily of wages, consulting, registration and license fees, decreased approximately $22,000, or 15%, to approximately $125,000 for the six months ended June 30, 2003 from
approximately $147,000 for the six months ended June 30, 2002. The decrease reflects reduced consulting expense partially offset by increased license fees. We plan to sell our agricultural products area.



General and administrative expenses increased to $1,880,919 for the six months ended June 30,
2003 from $1,666,378 for the six months ended June 30, 2002, an increase of $215,541, or 13%. This increase is primarily attributable to increased payroll-related costs of approximately $167,000, reduced expenses charged to SafeScience Newco of
$120,000 and increased directors and officers insurance costs of approximately $94,000, partially offset by decreases in stock-based compensation for recruiting services of $43,000, annual report expenses of $41,000, consulting expenses of $24,000
and travel expenses of $17,000.



Interest income decreased to $16,173 for the
six months ended June 30, 2003 from $57,871 for the six months ended June 30, 2002, a decrease of $41,698, or 72%. This decrease is attributable to a reduction in cash available for investment and lower rates of return on those investments.



Equity in loss of SafeScience Newco, Ltd. is attributable to the recognition
of 80.1% of the losses of SafeScience Newco, Ltd. for the six months ended June 30, 2002. Substantially all of SafeScience Newcos expenses were related to research and development.



Liquidity and Capital Resources



For the six months ended June 30, 2003, our operations utilized cash of $3,113,736 primarily to fund our operating loss, partially offset by an increase in accounts
payable. We also invested $149,801 in purchases of property and equipment. We intend to raise additional funds through sales of our securities and possibly through partnering arrangements with pharmaceutical or mature biotechnology companies.



As of June 30, 2003, our accumulated deficit was $80,162,046 and as of August
18, 2003, our cash balances were $4,904,792.



On December 18, 2002, the Company
and Elan terminated their joint venture, SafeScience Newco, and the Company acquired Elans equity interest in SafeScience Newco. From inception on July 10, 2001 through December 18, 2002, Elan provided $7.3 million in research and development
funding for GCS-100. The Company will not receive any additional funding from Elan.



We believe that our existing funds and commitments will be sufficient to fund our operating expenses and capital requirements into the first quarter of 2004, allowing us to initiate the Phase I dose escalation monotherapy trial. We intend
to raise additional capital through equity financings to support our planned Phase I dose escalation trials and continued operations. To the extent we are unable to raise sufficient funding for Phase I dose escalation trials, we will need to
accelerate our efforts to repartner with a large biotechnology or pharmaceutical company. Since inception, we have funded our operations primarily through the proceeds from the sale of equity securities; however, there can be no assurance that
additional equity financing will be available.



Our future is dependent upon
our ability to obtain financing to fund our operations. As of August 18, 2003, we have obtained commitments from existing or potential investors to provide additional financing of $4,043,000, of which we have received $2,437,100. We will need to
raise significant additional funding. We expect to incur substantial additional operating costs, including costs related to ongoing research and development activities, preclinical studies and clinical trials. To the extent that we are unable to
raise additional capital on a timely basis, management plans to prioritize research activities to conserve cash. In the event additional financing is not obtained, we may be required to significantly reduce, curtail or cease operations.



ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK



Market Risk



We are not exposed to significant
market risk related to changes in currency exchange rates as measured against the U.S. dollar. As of June 30, 2003, we have evaluated our risk and determined that any exposure to currency exchange is not significant to our overall consolidated
financial results. There can be no assurance that our exposure will remain at these levels, especially in the event of significant and sudden fluctuations in the value of local currencies. We do not use derivative financial instruments for
speculative or trading purposes.



Interest Rate Sensitivity



We maintain short-term investments in an overnight money market account comprised of U.S.
treasury bills. If market interest rates were to increase immediately and uniformly by 10% from levels that existed at June 30, 2003, the fair value of the portfolio would change by an immaterial amount.



Certain Factors That May Affect Future Results



You should carefully consider the risks described below before making an investment
decision. If any of the following risks actually occur, our business, financial condition or results of operations could be materially and adversely affected. In such case, the trading price of our common stock could decline, and you may lose all or
part of your investment.



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WE HAVE EXPERIENCED SIGNIFICANT LOSSES THROUGHOUT OUR HISTORY, WE EXPECT THESE LOSSES TO CONTINUE AND WE MAY NOT ACHIEVE
PROFITABILITY IN THE FUTURE.



We began operations more than
ten years ago and have not generated revenue from human therapeutic products. We previously generated limited revenues from the sale of consumer and commercial cleaning products, however, we discontinued our consumer and commercial product business
in early 2001. We do not expect to generate product revenue for several years, if at all. We will not generate funds unless we are able to sell our consumer and commercial and/or agricultural business areas, or generate revenues through the receipt
of payments in connection with any potential licensing, marketing or other partnering arrangement with other pharmaceutical or biotechnology companies, or bringing to market pharmaceutical products. Excluding dividends accreted to preferred stock,
we have incurred approximately $80.2 million of losses since our inception, including approximately $10.1 million for the year ended December 31, 2002 and approximately $3.4 million for the six months ended June 30, 2003. Extensive losses can be
expected to continue for the foreseeable future.



We also
expect to continue to incur significant operating expenses and capital expenditures and anticipate that our expenses will increase substantially in the foreseeable future as we:



| |  | conduct clinical trials;
|- |  | ------------------------



| |  | conduct research and development on existing and new product candidates;
|- |  | ------------------------------------------------------------------------



| |  | make milestone and royalty payments;
|- |  | ------------------------------------



| |  | seek regulatory approvals for our product candidates;
|- |  | -----------------------------------------------------



| |  | commercialize our product candidates, if approved;
|- |  | --------------------------------------------------



| |  | prosecute and maintain existing and future patent applications and patents;
|- |  | ---------------------------------------------------------------------------



| |  | hire additional clinical, scientific and management personnel;
|- |  | --------------------------------------------------------------



| |  | add operational, financial and management information systems and personnel; and
|- |  | --------------------------------------------------------------------------------



| |  | identify and in-license additional compounds or product candidates.
|- |  | -------------------------------------------------------------------



WE MAY NOT BE ABLE TO OBTAIN ADDITIONAL FUNDING, WHICH COULD REDUCE OUR ABILITY TO FUND, EXPAND OR CONTINUE OPERATIONS.



We believe that our existing funds and commitments will be sufficient to
fund our operating expenses and capital requirements into the first quarter of 2004, allowing us to initiate the Phase I dose escalation monotherapy trial. We intend to raise additional capital through the sale of equity securities to support our
planned Phase I dose escalation trials and continued operations. To the extent we are unable to raise sufficient funding for Phase I dose escalation trials, we will need to accelerate our efforts to repartnering with a large biotechnology or
pharmaceutical company.



Our future is dependent on our ability
to obtain additional financing to fund our operations. We expect to incur substantial additional operating costs, including costs related to ongoing research and development activities, preclinical studies and clinical trials. Additional equity
financing may result in dilution to our shareholders. At our current stock price or if the market price of our common stock declines, some potential investors may either refuse to offer us any financing or will offer financing at unacceptable rates
or on unfavorable terms. If we are unable to obtain financing necessary to fund our operations, we may have to sell or liquidate GlycoGenesys or significantly reduce, curtail or cease our operations.



WE HAVE RECEIVED A GOING CONCERN OPINION FROM OUR INDEPENDENT AUDITORS.



Our consolidated financial statements included in our Annual Report on Form
10-K for the year ended December 31, 2002 have been prepared on the assumption that we will continue as a going concern. Deloitte & Touche LLP issued a report dated March 28, 2003 that includes an explanatory paragraph stating that our recurring
losses from operations, accumulated deficit of $76.8 million as of December 31, 2002, and our expectation that we will incur substantial additional operating costs, including costs related to ongoing research and development activities, preclinical
studies and clinical trials, among other things, raise substantial doubt about our ability to continue as a going concern.



OUR FUTURE PROSPECTS ARE HEAVILY DEPENDENT ON THE RESULTS OF GCS-100.



While we seek to increase our portfolio of potential products, currently we are not developing a wide array of products. A substantial majority of our
attention and resources are directed to the development of GCS-100. If GCS-100 is ultimately ineffective in treating cancer, does not receive the necessary regulatory approvals or does not obtain commercial acceptance, we will be materially
adversely affected.



WE ARE DEPENDENT ON THE SUCCESSFUL OUTCOME OF CLINICAL
TRIALS FOR GCS-100



GCS-100 is not currently approved for sale
by the FDA or by any other regulatory agency in the world, and GCS-100 may never receive approval for sale or become commercially viable. Before obtaining regulatory approval for the sale of GCS-100 or other product candidates, they must be
subjected to extensive preclinical and clinical testing to demonstrate safety and efficacy for a particular indication for humans in addition to meeting other regulatory standards. Our success will depend on the successful outcome of our clinical
trials.



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There are a number of difficulties and risks associated with clinical trials. The possibility exists that:



| |  | we may discover that GCS-100 or another product candidate may cause harmful side effects;
|- |  | -----------------------------------------------------------------------------------------



| |  | we may discover that GCS-100 or another product candidate does not exhibit the expected therapeutic results in humans;
|- |  | ----------------------------------------------------------------------------------------------------------------------



| |  | results from early trials may not be statistically significant or predictive of results that will be obtained from large-scale, advanced clinical trials;
|- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | we or the FDA may suspend the clinical trials of GCS-100 or another product candidate;
|- |  | --------------------------------------------------------------------------------------



| |  | patient recruitment may be slower than expected;
|- |  | ------------------------------------------------



| |  | patients may drop out of our clinical trials; and
|- |  | -------------------------------------------------



| |  | we may be unable to timely produce sufficient supplies of GCS-100 or other product candidates for clinical trials.
|- |  | ------------------------------------------------------------------------------------------------------------------



Given the uncertainty surrounding the regulatory and clinical trial process,
we may not be able to develop safety and efficacy data or manufacturing data necessary for approval. In addition, even if we receive approval, such approval may be limited in scope and hurt the commercial viability of such product. If we are unable
to successfully obtain approval of and commercialize any product candidate, this would materially harm our business, impair our ability to generate revenues and adversely impact our stock price.



OUR ABILITY TO DEVELOP GCS-100 MAY BE HARMED IF WE ARE UNABLE TO FIND A NEW DEVELOPMENT
PARTNER.



On December 18, 2002, we and EIS mutually terminated
our joint venture and we acquired all outstanding capital stock of SafeScience Newco. SafeScience Newco received a total of approximately $7.3 million of research funds over the course of our joint venture with EIS. We must either fund the
development of GCS-100 ourselves or replace EIS with a new development partner. If we are unable to find a partner to replace EIS, our ability to develop and commercialize GCS-100, and our prospects as a whole, could be materially harmed.



OUR FAILURE TO PROTECT OUR INTELLECTUAL PROPERTY OR OUR INFRINGEMENT ON THE
PROPERTY RIGHTS OF OTHERS MAY IMPEDE OUR ABILITY TO OPERATE FREELY.



We rely significantly upon proprietary technology and protect our intellectual property through patents, copyrights, trademarks and contractual agreements as appropriate. We own or exclusively license 11 issued U.S. patents having
expiration dates ranging from 2013 to 2018. Four of these 11 issued patents relate to GCS-100. We own or exclusively license five foreign patents having expiration dates ranging from 2016 to 2017. Four of these five foreign patents relate to
GCS-100. We own or exclusively license 13 pending U.S. patent applications, of which nine relate to GCS-100 and 28 pending foreign patent applications, of which 18 relate to GCS-100. As we develop GCS-100, we may discover more about its
characteristics and manufacturing which will require additional patent prosecution. Thus, we continually evaluate our technology to determine whether to make further patent filings.



To the extent aspects of our technology may be unpatentable, we may determine to maintain such technology as trade secrets
or we may protect such unpatented technology by contractual agreements. Our unpatented technology or similar technology could be independently developed by others. In addition, the contractual agreements by which we protect our unpatented technology
and trade secrets may be breached. If technology similar to ours is independently developed or our contractual agreements are breached, our technology will be less valuable and our business will be harmed.



There is always a risk that issued patents may be subsequently invalidated,
either in whole or in part, and this could diminish or extinguish our patent protection for key elements of our technology. We are not involved in any such litigation or proceedings, nor are we aware of any basis for such litigation or proceedings.
The patents we exclusively license from Wayne State University and the Karmanos Cancer Institute and the patent application we exclusively license from Dr. David Platt could become subject to a proceeding at the U.S. Patent and Trademark Office to
determine priority between them. We cannot be certain as to the scope of patent protection, if any, which may be granted on our patent applications.



Our potential products or business activities could be determined to infringe intellectual rights of third parties despite our issued patents. Any claims
against us or any purchaser or user of our potential products, including GCS-100, asserting that such product or process infringes intellectual property rights of third parties, if determined adversely to us could have a material effect on our
business, financial condition or future operations. Any asserted claims of infringement, with or without merit, could be time consuming, result in costly litigation, divert the efforts of our technical and management personnel, or require us to
enter into royalty or licensing agreements, any of which could materially adversely affect our operating results. Such royalty or licensing agreements, if required, may not be available on terms acceptable to us, if at all. In the event a claim is
successful against us and we cannot obtain a license to the relevant technology on acceptable terms, license a substitute technology or redesign our products to avoid infringement, our business, financial condition and operating results would be
materially adversely affected.



WE DEPEND ON TECHNOLOGY LICENSED TO US BY THIRD
PARTIES AND IF WE ARE UNABLE TO CONTINUE LICENSING THIS TECHNOLOGY OUR FUTURE PROSPECTS MAY BE MATERIALLY ADVERSELY AFFECTED.



We license technology, including GCS-100, from third parties. We anticipate that we will continue to license technology from third parties in the future.
To maintain our license with Wayne State University and the Karmanos Cancer Institute we must, among other things, pay Wayne State University and the Karmanos Cancer Institute 2% royalties on product sales and up to $3 million in milestone payments
and receive FDA or equivalent agency approval to sell GCS-100 by January 1, 2006. To maintain our license with Dr. Platt we must pay an annual license fee equal to the greater of $50,000 or 2% of product sales.



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The technology we license from third parties would be difficult to replace. The loss of any of these
technology licenses would result in delays in the development of our products until equivalent technology, if available, is identified, licensed and integrated and could materially adversely affect our future prospects. The use of replacement
technology from other third parties would require us to enter into license agreements with these third parties, which could result in higher royalty payments and a loss of product differentiation.



WE EXPECT TO REMAIN DEPENDENT ON THIRD PARTIES FOR RESEARCH AND DEVELOPMENT ACTIVITIES
NECESSARY TO COMMERCIALIZE OUR PRODUCTS.



We do not maintain
our own laboratories; however, we employ three full-time scientific personnel and utilize the services of several scientific consultants to oversee various aspects of our protocol design, clinical trial oversight and other research and development
functions. We do utilize laboratory space, which we rent on a short-term basis. However, we contract out most of our research and development operations for GCS-100, utilizing third-party contract manufacturers such as Hollister-Stier Laboratories
LLC to manufacture GCS-100, Incell Corporation, LLC and TGA Sciences, Inc. for assay development and third-party contract research organizations, such as Beardsworth Consulting Group, Inc. to perform pre-clinical and/or clinical studies in
accordance with our designed protocols, as well as sponsoring research at medical and academic centers, such as the University of Arizona and St. Bartholomews and the Royal London School of Medicine.



Because we rely on third parties for much of our research and development
work, we have less direct control over our research and development. We face risks that these third parties may not be appropriately responsive to our timeframes and development needs and could devote resources to other customers.



IF WE ARE UNABLE TO FIND A PURCHASER OF THE AGRICULTURAL AREA OF OUR BUSINESS OR IF OUR
AGRICULTURE PRODUCTS ARE NOT ACCEPTED BY THE AGRICULTURAL COMMUNITY, THIS PORTION OF OUR BUSINESS WILL SUFFER.



Our focus is primarily pharmaceuticals and to a much lesser extent agricultural products, which product area we plan to sell. If we sell our agricultural
products area, we would seek to receive royalties on future sales of such products. Commercial sales of our proposed agricultural products will substantially depend upon the products efficacy and on their acceptance by the agricultural
community. For example, Elexa works by a different mode of action than current fungicides because it increases a plants natural resistance to disease instead of killing the fungus directly. Widespread acceptance of Elexa in the agricultural
field will require educating the agricultural community as to the benefits and reliability of Elexa. Our proposed products may not be accepted, and, even if accepted, we are unable to estimate the length of time it would take for a purchaser of our
agriculture business to gain such acceptance.



IF THE THIRD PARTIES WE RELY ON
FOR MANUFACTURING OUR PRODUCTS ARE UNABLE TO PRODUCE THE NECESSARY AMOUNTS OF OUR PRODUCTS, DO NOT MEET OUR QUALITY NEEDS OR TERMINATE THEIR RELATIONSHIPS WITH US, OUR BUSINESS WILL SUFFER.



We do not presently have our own manufacturing operations, nor do we intend
to establish any unless and until, in the opinion of management, the size and scope of our business so warrants. While we have established a manufacturing relationship with Hollister-Stier Laboratories LLC and others to provide us with GCS-100 that
we believe will provide the capability to meet our anticipated requirements for the foreseeable future, we have not entered into any long-term arrangements for manufacturing and such arrangements may not be obtained on desirable terms. For the
foreseeable future, we will be dependent upon third parties to manufacture our products.



Our reliance on independent manufacturers involves a number of risks, including the absence of adequate capacity, the unavailability of, or interruptions in, access to necessary manufacturing processes and reduced
control over delivery schedules. Because our manufacturing process is still in a development stage, any changes made to a final commercial manufacturing process may present technical problems to an independent manufacturer. Third-party manufacturers
may not comply with FDA regulations, or other regulatory requirements relating to the manufacturing of our products, including compliance with good manufacturing practice, or GMP. We do not have control over, other than through contract, third-party
manufacturers compliance with these regulations and standards. If our manufacturers are unable or unwilling to continue manufacturing our products in required volumes, we will have to identify acceptable alternative manufacturers. If we need
to change manufacturers, the FDA and corresponding foreign regulatory agencies must approve these manufacturers in advance, which will involve testing and additional inspections to ensure compliance with FDA regulations and standards. The use of a
new manufacturer may cause significant expense and interruptions in supply if the new manufacturer has difficulty manufacturing products to our specifications. Further, the introduction of a new manufacturer may increase the variation in the quality
of our products.



MANY OF OUR COMPETITORS HAVE SUBSTANTIALLY GREATER RESOURCES
THAN WE DO AND MAY BE ABLE TO DEVELOP AND COMMERCIALIZE PRODUCTS THAT MAKE OUR POTENTIAL PRODUCTS OBSOLETE OR NON-COMPETITIVE.



A biotechnology company such as ours must keep pace with rapid technological change and faces intense competition. We compete with biotechnology and
pharmaceutical companies for funding, access to new technology, research personnel and in product research and development. Many of these companies have greater financial resources and more experience than we do in developing drugs, obtaining
regulatory approvals, manufacturing and marketing. We also face competition from academic and research institutions and government agencies pursuing alternatives to our products and technologies. We expect that our products under development,
including GCS-100, will face intense competition from existing or future drugs. In addition, our product candidates may face increasing competition from generic formulations or existing drugs whose active components are no longer covered by patents.



According to industry surveys, there are nearly 400 new drug
candidates in development to treat various types of cancer, many of them for multiple indications. This research is being conducted by approximately 180 pharmaceutical and biotechnology companies and the National Cancer Institute. We have completed
two Phase I clinical trials, the first enrolled late stage patients with differing types of cancer (all comers) and the second enrolled patients with late stage prostate cancer. We also conducted two Phase II(a) clinical trials, one in patients with
refractory or relapsing pancreatic cancer and the other in refractory or relapsing colorectal cancer. In addition, we have completed patient enrollment in a dose escalation Phase I trial in which 12 patients were dosed at up to 80 mg/m2 twice a
week.



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In the two cancer types in which we have conducted Phase II(a) clinical trials, pancreatic and
colorectal, there are many drugs being developed. We believe, based on industry studies there are, including GCS-100, approximately 7 drugs in Phase I, 15 drugs in Phase II, 6 drugs in Phase III or pre-registration for treatment of pancreatic
cancer. In addition, GCS-100, if it receives FDA approval for pancreatic cancer, will face competition from existing drugs approved or used to treat pancreatic cancer. These drugs are fluorouracil (5-FU), Eli Lillys gemcitabine (Gemzar) and
Supergens Mitozytrex. Combination studies utilizing new drug candidates and Gemzar are ongoing and combination therapies of new drug candidates and Gemzar may present future competition.



We believe, based on industry studies, there are, including GCS-100,
approximately 12 drugs in Phase I, 24 drugs in Phase II, and 10 drugs in Phase III or in pre-registration for treatment of colorectal cancer. In addition, GCS-100, if it receives FDA approval for colorectal cancer, will face competition from
existing drugs approved or used to treat colorectal cancer. These drugs include Roche Pharmaceuticals capecitabine (Xeloda), flourouracil (Adrucil or 5-FU), leucovorin, in combination with 5-FU, Janssens levamisole (Ergamisol) in
combination with 5-FU and Pharmacias irinotecan (Camptosar).



Our competitors may:



| |  | successfully identify drug candidates or develop products earlier than we do;
|- |  | -----------------------------------------------------------------------------



| |  | obtain approvals from the FDA or foreign regulatory bodies more rapidly than we do;
|- |  | -----------------------------------------------------------------------------------



| |  | develop products that are more effective, have fewer side effects or cost less than our products; or
|- |  | ----------------------------------------------------------------------------------------------------



| |  | successfully market products that may compete with our product candidates.
|- |  | --------------------------------------------------------------------------



The success of our competitors in any of these efforts would adversely affect our ability to develop, commercialize and market our product candidates.



OUR BUSINESSES ARE SUBJECT TO SIGNIFICANT GOVERNMENT REGULATION AND FAILURE TO
ACHIEVE REGULATORY APPROVAL OF OUR PRODUCTS WOULD SEVERELY HARM OUR BUSINESS.



The FDA regulates the development, testing, manufacture, distribution, labeling and promotion of pharmaceutical products in the United States pursuant to the Federal Food, Drug, and Cosmetic Act and related
regulations. We must receive premarket approval by the FDA prior to any commercial sale of our pharmaceutical products. Before receiving such approval we must provide proof in human clinical trials of the nontoxicity, safety and efficacy of our
pharmaceutical products, which trials can take several years. In addition, we must show that we can produce the pharmaceutical product consistently at quality levels sufficient for administration in humans. Premarket approval is a lengthy and
expensive process. We may not be able to obtain FDA approval for any commercial sale of our products. By statute and regulation, the FDA has 180 days to review an application for approval to market a pharmaceutical product; however, the FDA
frequently exceeds the 180-day time period, at times taking up to 18 months. In addition, based on its review, the FDA may determine that additional clinical trials are required. Except for any potential licensing or marketing arrangements with
other pharmaceutical or biotechnology companies, we will not generate any revenues in connection with our pharmaceutical products unless and until we obtain FDA approval to sell our products in commercial quantities for human application.



The investigation, manufacture and sale of agricultural
products are subject to regulation by the EPA, including the need for approval before marketing, and by comparable foreign and state agencies. Our agricultural products will be able to be commercially marketed for use either in the United States or
other countries only by first obtaining the necessary approvals. While we hope to obtain all regulatory approvals for our proposed products, we may not obtain these approvals on a timely basis, if at all. We have received approval from the EPA,
California and other states for Elexa 4%. In addition, Bb447 has received conditional approval from the EPA.



REIMBURSEMENT PROCEDURES AND FUTURE HEALTHCARE REFORM MEASURES ARE UNCERTAIN AND MAY ADVERSELY IMPACT OUR ABILITY TO SUCCESSFULLY SELL OR LICENSE ANY PHARMACEUTICAL PRODUCT.



Our ability to successfully sell or license any pharmaceutical product will
depend in part on the extent to which government health administration authorities, private health insurers and other organizations will reimburse patients or providers for the costs of our future pharmaceutical products and related treatments. In
the United States, government and other third-party payers have sought to contain healthcare costs by limiting both coverage and the level of reimbursement for new pharmaceutical products approved for marketing by the FDA. In some cases, these
payers may refuse to provide any coverage for uses of approved products to treat medical conditions even though the FDA has granted marketing approval. Healthcare reform may increase these cost containment efforts. We believe that managed care
organizations may seek to restrict the use of new products, delay authorization to use new products or limit coverage and the level of reimbursement for new products. Internationally, where national healthcare systems are prevalent, little if any
funding may be available for new products, and cost containment and cost reduction efforts can be more pronounced than in the United States.



IF WE ARE UNABLE TO ENTER INTO AGREEMENTS WITH THIRD PARTIES TO PROVIDE SALES, MARKETING AND DISTRIBUTION CAPABILITIES, OR TO CREATE THESE FUNCTIONS OURSELVES, WE WILL
NOT BE ABLE TO COMMERCIALIZE OUR PRODUCT CANDIDATES.



We do
not have any sales, marketing or distribution capabilities. In order to commercialize GCS-100 or other product candidates, if any are approved, we must either make arrangements with third parties to provide sales, marketing and distribution
capabilities or acquire or internally develop these functions ourselves. If we obtain FDA approval for GCS-100 or other product candidates, we intend to rely on relationships with one or more pharmaceutical companies or other third parties with
established distribution systems and direct sales forces to market GCS-100 or other product candidates. If we decide to market any of our product candidates directly, we must either acquire or internally develop a marketing and sales



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force with technical expertise and with supporting distribution capabilities. The acquisition or development of a sales and distribution infrastructure would
require substantial resources, which may divert the attention of our management and key personnel, and negatively impact our product development efforts. Moreover, we may not be able to establish in-house sales and distribution capabilities or
relationships with third parties. To the extent we enter into co-promotion or other licensing agreements, our product revenues are likely to be lower than if we directly marketed and sold our product candidates, and any revenue we receive will
depend upon the efforts of third parties, which may not be successful.



OUR
GROWTH MAY BE LIMITED IF WE ARE UNABLE TO RETAIN AND HIRE ADDITIONAL QUALIFIED PERSONNEL AS NECESSARY.



Our success will depend on our ability to retain key employees and our continuing ability to attract and retain highly qualified scientific, technical and
managerial personnel. Under our current clinical trial and business plan, we may add up to an additional 30 employees over the course of the next two years, primarily technical or scientific personnel, as needs develop. Competition for such
personnel is intense and we may not be able to retain existing personnel or attract qualified employees in the future. Our current financial position, limited drug pipeline and small size make it more difficult to compete for such personnel against
larger, more diversified companies. At present, we employ 12 full-time employees and one part-time worker. We depend upon the personal efforts and abilities of our officers and directors, including Bradley J Carver, our President, CEO and Interim
Chairman of the Board and John W. Burns, our Senior Vice President, Chief Financial Officer and a director and would be materially adversely affected if their services ceased to be available for any reason and comparable replacement personnel were
not employed.



THE BUSINESSES IN WHICH WE ENGAGE HAVE A RISK OF PRODUCT
LIABILITY, AND IN THE EVENT OF A SUIT AGAINST US, OUR BUSINESS COULD BE SEVERELY HARMED.



The testing, marketing and sale of pharmaceutical and agricultural products entails a risk of product liability claims by patients and others. While we currently maintain product liability insurance, such insurance
may not be available at reasonable cost and in the event of a significant adverse event with a patient or customer such insurance would likely be insufficient to cover the full amount of the liability incurred. In the event of a successful suit
against us, payments and damage to our reputation could have a material adverse effect on our business and financial condition. Even if such a suit is unsuccessful, our reputation could be damaged and litigation costs and expenditures of management
time on such matters could adversely affect our business and financial condition.



WE ARE CONTRACTUALLY OBLIGATED TO ISSUE SHARES IN THE FUTURE, INCLUDING SHARES TO BE ISSUED UPON THE CONVERSION OF OUTSTANDING PREFERRED STOCK AND WARRANTS HELD BY EIS, WHICH WILL CAUSE DILUTION OF YOUR INTEREST IN US.



As of July 31, 2003, there were outstanding options to purchase 1,707,426
shares of common stock, at a weighted average exercise price of $2.09 per share and warrants to purchase 10,774,547 shares of common stock at a weighted average exercise price of $2.35 per share. Moreover, we may in the future issue additional
shares to raise capital, acquire other companies or technologies, to pay for services, or for other corporate purposes. Any such issuances will have the effect of further diluting the interest of shareholders.



In July 2001, in connection with a business venture and financing
transaction, we issued to EIS 1,116.79 shares of our Series C convertible non-voting preferred stock, 4,944.44 shares of our Series A convertible non-voting preferred stock and a warrant to purchase 381,679 shares of our common stock. Between the
formation of the joint venture with EIS and its termination in December 2002, we sold 3,471.14862 shares of our Series B convertible non-voting preferred stock to EIS. In addition, in December 2002, we issued 1,209.07035 shares of Series A preferred
stock to EIS in exchange for the cancellation of mandatory dividends and the redemption feature. Each share of our Series A preferred stock and Series C preferred stock is convertible into 1,000 shares of our common stock, subject to anti-dilution
adjustments. Each share of our Series B preferred stock is presently convertible after December 31, 2003 into 1,000 shares of our common stock, subject to anti-dilution adjustments. The Series B preferred stock bears a 7% dividend payable in Series
B preferred stock, which compounds annually. In January 2002, we sold to EIS warrants to purchase a total of 597,205 shares of common stock in connection with a private placement. Accordingly, a total of 11,720,333 shares of our common stock could
be issued to EIS, assuming the exercise of the warrants and the conversion into common stock of all shares of Series A, Series B and Series C preferred stock currently outstanding, but not including any dividends to be issued on the Series B
preferred stock. This amount of shares represents 31.0% of our common stock outstanding as of August 8, 2003. Pursuant to provisions in our agreement with EIS, if the exercise or conversion of any of our securities held by EIS would result in EIS
owning more than 9.9% of our common stock at any time EIS may opt to receive non-voting securities instead of common stock.



WE MUST COMPLY WITH THE LISTING REQUIREMENTS OF THE NASDAQ SMALLCAP MARKET OR OUR COMMON STOCK MAY BE DELISTED AND THE LIQUIDITY OF AN INVESTMENT IN OUR SECURITIES WOULD
DECREASE.



Our common stock could be delisted from The Nasdaq
SmallCap Market for the following reasons, among others:



| |  | if the bid price of our common stock falls below $1.00 per share for thirty (30) consecutive business days;
|- |  | -----------------------------------------------------------------------------------------------------------



| |  | if our market capitalization falls below $35 million and we have less than $2,500,000 in stockholders equity; or
|- |  | -----------------------------------------------------------------------------------------------------------------



| |  | if the value of our common stock held by our stockholders (other than our directors, executive officers and 10% stockholders) is less than $1,000,000.
|- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------



There are other quantitative and qualitative criteria of the Nasdaq SmallCap
Market which if violated could lead to delisting of our common stock.



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We may not be able to maintain our compliance with Nasdaq continued listing requirements in the future.
On July 23, 2002, we received a letter from Nasdaq that the bid price of our common stock had been below $1.00 for 30 consecutive business days and that we had a 180-day grace period, to January 21, 2003, to achieve a bid price of at least $1.00 for
a period of 10 consecutive business days or face delisting. In January 2003, Nasdaq granted us an additional 180 day grace period ending July 18, 2003 to correct our minimum bid price deficiency because we had in excess of $5,000,000 in
stockholders equity. In June 2003, we received a letter from Nasdaq that we complied with the minimum bid price requirement. Our stockholders equity was approximately $2.7 million as of June 30, 2003. Our market capitalization has been
below $35 million since June 30, 2003.Our closing bid price has been below $1.00 since June 26, 2003 and we received a letter from Nasdaq on August 8, 2003 that the bid price of our common stock had been below $1.00 for 30 consecutive
business days and that we had a 180-day grace period until February 4, 2004 to achieve a bid price of at least $1.00 for a period of 10 consecutive business days or face delisting. If we meet initital listing requirements at the end of the grace
period, we will be eligible for an additional 180-day grace period.



If Nasdaq delisted our common stock, we would likely seek to list our common stock for quotation on a regional stock exchange. However, if we were unable to obtain listing or quotation on such market or exchange, trading of our common stock
would occur in the over-the-counter market on an electronic bulletin board for unlisted securities or in what are commonly known as the pink sheet. In addition, delisting from Nasdaq and failure to obtain listing or quotation on such
market or exchange would subject our common stock to so-called penny stock rules. These rules impose additional sales practice and market making requirements on broker-dealers who sell and/or make a market in such securities, such as
disclosing offer and bid prices and compensation received from a trade to a purchaser and sending monthly account statements to purchasers. Consequently, broker-dealers may be less willing or able to sell and/or make a market in our common stock.
These rules also require that purchasers be accredited investors, which would reduce the number of investors who could purchase our shares. Additionally, an investor would find it more difficult to dispose of, or to obtain accurate quotations for
the price of, our common stock. As a result of delisting, it may become more difficult for us to raise funds through the sale of our securities.



OUR STOCK PRICE COULD DECLINE IF A SIGNIFICANT NUMBER OF SHARES BECOME AVAILABLE FOR SALE.



As of July 31, 2003, approximately 15,126,128 shares of common stock presently issued and outstanding are Restricted
Securities as that term is defined in Rule 144 promulgated under the Act. In general, a person (or persons whose shares are aggregated) who has satisfied a one year holding period may sell, within any three month period, an amount of
restricted securities which does not exceed the greater of 1% of the then outstanding shares of common stock or the average weekly trading volume during the four calendar weeks prior to such sale. Persons who are not affiliates of GlycoGenesys and
who have beneficially owned the shares for a minimum period of two years can sell restricted securities, under certain circumstances, without any quantity limitation. The sale of these restricted shares including restricted shares that may be sold
pursuant to our seven effective registration statements, shall increase the number of free-trading shares and may have a depressive effect on the price of our securities. Moreover, such sales, if substantial, might also adversely affect our ability
to raise additional equity capital.



BECAUSE OUR CURRENT AND POTENTIAL MEMBERS
OF OUR BOARD OF DIRECTORS COULD CONTROL A SIGNIFICANT PERCENTAGE OF OUR COMMON STOCK, THEY COULD EXERCISE SUBSTANTIAL CONTROL OVER US.



The holders of the common stock do not have cumulative voting rights. Our directors, two of whom are executive officers of GlycoGenesys, own approximately
7.1% collectively of our common stock outstanding as of August 8, 2003. One of the conditions of the transactions between us, Elan and EIS required that we expand our board of directors at our 2002 annual stockholders meeting at which time EIS
could appoint one director. EIS decided not to appoint a director at our 2002 annual stockholders meeting but may choose to do so in the future as long as they own at least 10% of our common stock (assuming exercise or conversion of
convertible or exercisable securities held by EIS). If EIS appoints a director, members of the board of directors and their affiliates would own approximately 15.8% of our common stock outstanding as of August 8, 2003, assuming EIS has not converted
or exercised any of our securities held by it, and the same number of shares are outstanding at such time as are currently outstanding. If EIS and our directors were to have converted or exercised all of our securities held by them, the members of
our board of directors and their affiliates would own approximately 36.4% of the common stock outstanding as of August 8, 2003, assuming the number of shares outstanding at such time equals the number of shares currently outstanding plus the number
of shares issued on exercise or conversion of securities held by EIS and our directors. This concentration of ownership would allow these stockholders to substantially influence all matters requiring stockholder approval and could have the effect of
delaying or preventing a change in control or otherwise discouraging a potential acquirer from attempting to obtain control of us, which in turn could materially adversely affect our stock price.



THE PRICE OF OUR COMMON STOCK HAS BEEN VOLATILE, WHICH COULD RESULT IN SUBSTANTIAL LOSSES BY
YOU.



The market price of our common stock, which is traded on
the National Association of Securities Dealers Automated Quotation (NASDAQSmall Cap) has been, and may continue to be, highly volatile. During the twelve months ending July 31, 2003, our common stock has traded at prices ranging from $0.18 to
$1.39 per share. Factors such as announcements of clinical trial results, financings, technological innovations or new products, either by us or by our competitors or third parties, as well as market conditions within the biotechnology and
pharmaceutical industries, may have a significant impact on the market price of our common stock.



In addition, the stock market has from time to time, and especially in the last few years, experienced extreme price and volume fluctuations, particularly
in the biotechnology sector, which have often been unrelated to the operating performance of particular companies. Current market conditions are particularly unstable and there is a large degree of uncertainty at this time. In general, biotechnology
stocks tend to be volatile even during periods of relative market stability because of the high rates of failure and substantial funding requirements associated with biotechnology companies. Market conditions and conditions of the biotechnology
sector could negatively impact the price of our common stock.



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ITEM 4. CONTROLS AND PROCEDURES



Our Chief Executive
Officer and Chief Financial Officer have concluded, based on their evaluation as of the end of the period covered by this Form 10-Q that the Companys disclosure controls and procedures (as defined in the Securities Exchange Act of
1934 Rules 13a-15(e) and 15d-15(e)) are effective to ensure that information required to be disclosed in the report that the Company files or submits under the Securities Exchange Act is recorded, processed, summarized and reported within the time
periods specified in the Securities and Exchange Commissions rules and forms.



PART II  OTHER INFORMATION



ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS



(c)
Set forth below is information regarding the sale of unregistered shares of equity securities sold by the Company during the three months ended June 30, 2003.



| | 1. |  | On April 14, 2003, the Company issued 105,823 shares of Common Stock in connection with the delay in filing a registration statement for certain accredited investors in a prior
private placement.
| | -- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 2. |  | On May 6, 2003, the Company issued 1,008 shares of Common Stock upon the exercise of warrants by an accredited investor for a total of $10.
| | -- |  | -------------------------------------------------------------------------------------------------------------------------------------------



| | 3. |  | On June 3, 2003, the Company issued 50,805 shares of Common Stock upon the exercise of warrants by an accredited investor for a total of $508.
| | -- |  | ----------------------------------------------------------------------------------------------------------------------------------------------



| | 4. |  | On June 9, 2003, the Company issued 32,895 shares of Common Stock upon the exercise of warrants by an accredited investor for a total of $329.
| | -- |  | ----------------------------------------------------------------------------------------------------------------------------------------------



| | 5. |  | On June 30, 2003, the Company issued 328,359 shares of Common Stock upon the exercise of warrants by an accredited investor for a total of $3,284.
| | -- |  | --------------------------------------------------------------------------------------------------------------------------------------------------



These securities were issued in reliance upon the exemption from registration pursuant to
Section 4(2) under the Securities Act of 1933, as amended.



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



On June 27, 2003, the Company held its Annual Meeting of Stockholders. Three items were voted upon: (1) the election of one director; (2) the approval of the 2003 Omnibus Incentive Plan; and (3) the ratification of the appointment of
auditors.



1. The nominee for director approved by the shareholders was
Michael E. Hanson. The following table indicates the term expiration date and the number of votes cast with respect to the nominee, the number of votes in favor and the number of votes withheld:



|Nominee           |  | Term Expiration |  | Total Votes Cast |  | Total Votes in Favor |  | Total Votes Withheld
|----------------- |  | --------------- |  | ---------------- |  | -------------------- |  | --------------------
|Michael E. Hanson |  | 2006            |  | 31,707,745       |  | 29,142,563           |  | 2,565,182           



Messrs. Carver, Burns, Dube and Host
continued their respective terms of office as directors.



2. The 2003 Omnibus
Incentive Plan was approved by a vote of 27,397,854 in favor, 3,295,299 against with 1,014,592 abstentions out of a total of 31,707,745 votes cast.



3. The appointment of Deloitte & Touche LLP as auditors for the Company for the year ended December 31, 2003 was approved by a vote of 29,144,800 in favor, 2,505,413
against and 57,532 abstentions out of a total of 31,707,745 votes cast.



ITEM 6. EXHIBITS AND REPORT ON FORM 8-K.



(a)
Exhibits



|31.1 |  | Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes Oxley Act of 2002.
|---- |  | ---------------------------------------------------------------------------------------------------



|31.2 |  | Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes Oxley Act of 2002.
|---- |  | ---------------------------------------------------------------------------------------------------



|32.1 |  | Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 906 of the Sarbanes Oxley Act of 2002.
|---- |  | -------------------------------------------------------------------------------------------------------------------------------



(b) Reports on Form 8-K.



|1) |  | Current Report on Form 8-K filed with the Securities and Exchange Commission on June 3, 2003 reporting the issuance of a press release regarding the presentation of pre-clinical
studies on GCS-100 at the American Society of Clinical Oncology Industry Sponsored Symposium.
|-- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|2) |  | Current Report on Form 8-K filed with the Securities and Exchange Commission on June 25, 2003 reporting the issuance of a press release regarding the presentation of results of in
vitro studies on GCS-100 at the BIO 2003 Conference in Washington, D.C.
|-- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





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SIGNATURES



Pursuant to the requirements 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.



Dated this 19th day of August 2003.



GLYCOGENESYS, INC.

(the Registrant)



/s/ Bradley J CarverBradley J Carver, Chief Executive Officer President and Treasurer/s/ John W. BurnsJohn W. Burns, Senior Vice President, Chief Financial Officer and Secretary/s/ Patrick J. JoycePatrick J. Joyce, Principal AccountingOfficer




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