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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



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FORM 10-QSB



xQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF
1934



For the quarterly period ended
December 31, 2002



 ̈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 0-23031



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DYNAMIC HEALTH PRODUCTS, INC.

(Exact name of small business issuer as specified in its charter)



|Florida                                                        |  | 34-1711778                          
|-------------------------------------------------------------- |  | ------------------------------------
|(State or other jurisdiction of incorporation or organization) |  | (I.R.S. Employer Identification No.)
|                                                              
|12399 Belcher Road South, Suite 160, Largo, Florida            |  | 33773                               
|(Address of principal executive offices)                       |  | (Zip Code)                          



Issuers telephone number (727) 324-6667



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



The number of shares outstanding of the
Issuers common stock at $.01 par value as of February 10, 2003 was 3,082,875.



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PART IFINANCIAL INFORMATION



Item 1.    CONSOLIDATED FINANCIAL STATEMENTS.



DYNAMIC HEALTH PRODUCTS, INC. AND
SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS



|                                                                                                                                                                 |  | December 31, 2002 |            |   | March 31, 2002 |  
|---------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------- | ---------- | - | -------------- | -
|                                                                                                                                                                 |  | (Unaudited)       |            |   | (Audited)      |  
|ASSETS                                                                                                                                                           |  |                   |            |   |                |  
|Current assets:                                                                                                                                                  |  |                   |            |   |                |  
|Cash and cash equivalents                                                                                                                                        |  | $                 | 120,572    |   |                | $
|Certificate of deposit                                                                                                                                           |  |                   | 45,613     |   |                |  
|Marketable equity securities, net                                                                                                                                |  |                   | 4,920      |   |                |  
|Accounts receivable, net                                                                                                                                         |  |                   | 75,554     |   |                |  
|Inventories                                                                                                                                                      |  |                   | 96,276     |   |                |  
|Prepaid expenses                                                                                                                                                 |  |                   | 51,448     |   |                |  
|Other current assets                                                                                                                                             |  |                   | 28,684     |   |                |  
|Due from affiliates                                                                                                                                              |  |                   | 365        |   |                |  
|Due from related parties                                                                                                                                         |  |                   |           |   |                |  
|Notes receivable from affiliates                                                                                                                                 |  |                   | 36,675     |   |                |  
|                                                                                                                                                                 |  |                   |            |   |                |  
|Total current assets                                                                                                                                             |  |                   | 460,107    |   |                |  
|                                                                                                                                                                
|Property, plant and equipment, net                                                                                                                               |  |                   | 1,398,511  |   |                |  
|                                                                                                                                                                
|Intangible assets, net                                                                                                                                           |  |                   | 24,894     |   |                |  
|Investments in unconsolidated affiliates                                                                                                                         |  |                   | 525,025    |   |                |  
|Notes receivable                                                                                                                                                 |  |                   |           |   |                |  
|Note receivable from affiliate                                                                                                                                   |  |                   |           |   |                |  
|Other assets, net                                                                                                                                                |  |                   | 15,489     |   |                |  
|                                                                                                                                                                 |  |                   |            |   |                |  
|Total assets                                                                                                                                                     |  | $                 | 2,424,026  |   |                | $
|                                                                                                                                                                 |  |                   |            |   |                |  
|LIABILITIES AND SHAREHOLDERS
EQUITY                                                                                                                             |  |                   |            |   |                |  
|Current liabilities:                                                                                                                                             |  |                   |            |   |                |  
|Accounts payable                                                                                                                                                 |  | $                 | 220,154    |   |                | $
|Other payables                                                                                                                                                   |  |                   | 111,532    |   |                |  
|Current portion of long-term obligations                                                                                                                         |  |                   | 61,451     |   |                |  
|Accrued expenses                                                                                                                                                 |  |                   | 37,261     |   |                |  
|Accrued income taxes                                                                                                                                             |  |                   | 72,863     |   |                |  
|Obligations to affiliates                                                                                                                                        |  |                   | 47,953     |   |                |  
|                                                                                                                                                                 |  |                   |            |   |                |  
|Total current liabilities                                                                                                                                        |  |                   | 551,214    |   |                |  
|                                                                                                                                                                
|Deferred income taxes                                                                                                                                            |  |                   |           |   |                |  
|Long-term obligations, less current portion                                                                                                                      |  |                   | 839,968    |   |                |  
|                                                                                                                                                                 |  |                   |            |   |                |  
|Total liabilities                                                                                                                                                |  |                   | 1,391,182  |   |                |  
|                                                                                                                                                                 |  |                   |            |   |                |  
|                                                                                                                                                                
|Commitments and contingencies                                                                                                                                    |  |                   |            |   |                |  
|                                                                                                                                                                
|Shareholders equity:                                                                                                                                            |  |                   |            |   |                |  
|Series A Convertible Preferred stock, $.01 par value; 400,000 shares authorized; no
shares issued or outstanding                                                 |  |                   |           |   |                |  
|Series B 6% Cumulative Convertible Preferred stock, $.01 par value; 800,000 shares
authorized; no shares and 20,000 shares issued and outstanding, at face value |  |                   |           |   |                |  
|Common stock, $.01 par value; 20,000,000 shares authorized; 3,082,875 and 3,052,141
shares issued and outstanding                                                |  |                   | 30,828     |   |                |  
|Additional paid-in capital                                                                                                                                       |  |                   | 2,538,144  |   |                |  
|Retained earnings (deficit)                                                                                                                                      |  |                   | (1,470,660 | ) |                |  
|Accumulated other comprehensive income:                                                                                                                          |  |                   |            |   |                |  
|Unrealized losses on marketable equity securities                                                                                                                |  |                   | (65,468    | ) |                |  
|                                                                                                                                                                 |  |                   |            |   |                |  
|Total shareholders equity                                                                                                                                       |  |                   | 1,032,844  |   |                |  
|                                                                                                                                                                 |  |                   |            |   |                |  
|Total liabilities and shareholders equity                                                                                                                       |  | $                 | 2,424,026  |   |                | $
|                                                                                                                                                                 |  |                   |            |   |                |  

See accompanying notes to condensed consolidated financial statements.



-2-



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DYNAMIC HEALTH PRODUCTS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)



|                                                             |  | Three Months Ended December 31, |            |   | Nine Months Ended December 31, |  
|------------------------------------------------------------ |  | ------------------------------- | ---------- | - | ------------------------------ | -
|                                                             |  | 2002                            |            |   | 2001                           |  
|Revenues                                                     |  | $                               | 148,225    |   |                                | $
|Cost of goods sold                                           |  |                                 | 71,420     |   |                                |  
|                                                             |  |                                 |            |   |                                |  
|Gross profit                                                 |  |                                 | 76,805     |   |                                |  
|Operating expenses:                                          |  |                                 |            |   |                                |  
|Selling, general and administrative expenses                 |  |                                 | 227,854    |   |                                |  
|Amortization expense                                         |  |                                 | 311        |   |                                |  
|Depreciation expense                                         |  |                                 | 23,769     |   |                                |  
|Bad debt expense                                             |  |                                 | 1,115,474  |   |                                |  
|Impairment of intangible assets                              |  |                                 |           |   |                                |  
|                                                             |  |                                 |            |   |                                |  
|Total operating expenses                                     |  |                                 | 1,367,408  |   |                                |  
|                                                             |  |                                 |            |   |                                |  
|Operating income (loss) before other income and expense      |  |                                 | (1,290,603 | ) |                                |  
|Other income (expense):                                      |  |                                 |            |   |                                |  
|Interest income                                              |  |                                 | (41,362    | ) |                                |  
|Gain on sale of subsidiary                                   |  |                                 |           |   |                                |  
|Gain on transfer of equity securities                        |  |                                 |           |   |                                |  
|Loss on distribution of investment                           |  |                                 | (1,388,088 | ) |                                |  
|Losses on marketable equity securities, net                  |  |                                 |           |   |                                |  
|Other income and expenses, net                               |  |                                 | 61,815     |   |                                |  
|Equity in income (loss) of affiliated companies              |  |                                 | (46,456    | ) |                                |  
|Equity in loss of subsidiary through date of sale            |  |                                 |           |   |                                |  
|Interest expense                                             |  |                                 | (18,013    | ) |                                |  
|                                                             |  |                                 |            |   |                                |  
|Total other income (expense)                                 |  |                                 | (1,432,104 | ) |                                |  
|                                                             |  |                                 |            |   |                                |  
|Income (loss) before income taxes                            |  |                                 | (2,722,707 | ) |                                |  
|                                                            
|Income tax expense (benefit)                                 |  |                                 | (1,024,180 | ) |                                |  
|                                                             |  |                                 |            |   |                                |  
|Net income (loss)                                            |  |                                 | (1,698,527 | ) |                                |  
|                                                            
|Preferred stock dividends                                    |  |                                 |           |   |                                |  
|                                                             |  |                                 |            |   |                                |  
|Net income (loss) available to common shareholders           |  | $                               | (1,698,527 | ) |                                | $
|                                                             |  |                                 |            |   |                                |  
|Basic income (loss) per share                                |  | $                               | (0.55      | ) |                                | $
|                                                             |  |                                 |            |   |                                |  
|Basic weighted average number of common shares outstanding   |  |                                 | 3,082,875  |   |                                |  
|                                                             |  |                                 |            |   |                                |  
|Diluted income (loss) per share                              |  | $                               | (0.55      | ) |                                | $
|                                                             |  |                                 |            |   |                                |  
|Diluted weighted average number of common shares outstanding |  |                                 | 3,082,875  |   |                                |  
|                                                             |  |                                 |            |   |                                |  



See
accompanying notes to condensed consolidated financial statements.



-3-



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DYNAMIC HEALTH PRODUCTS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS EQUITY

Nine Months Ended December 31, 2002



|                                                                                         |  |                          |  |                          |   |        |              |   |                            |   |                             |        |  |                               |  |   |                            |  |   |           | Accumulated Other Comprehensive Income |   |            |   | 
|---------------------------------------------------------------------------------------- |  | ------------------------ |  | ------------------------ | - | ------ | ------------ | - | -------------------------- | - | --------------------------- | ------ |  | ----------------------------- |  | - | -------------------------- |  | - | --------- | -------------------------------------- | - | ---------- | - | 
|                                                                                         |  | Series A Preferred Stock |  | Series B Preferred Stock |   |        | Common Stock |   | Additional Paid-in Capital |   | Retained Earnings (Deficit) |        |  | UnrealizedLosses onSecurities |  |   | Total Shareholders Equity | 
|                                                                                         |  | Shares                   |  | Dollars                  |   | Shares |              |   | Dollars                    |   |                             | Shares |  | Dollars                       |  |   |                            | 
|Balances at March 31, 2002 (Audited)                                                     |  |                         |  | $                        |  |        | 20,000       |   |                            | $ | 50,000                      |        |  | 3,052,141                     |  | $ | 30,521                     |  | $ | 2,472,727 |                                        | $ | 5,017,791  |   | 
|COMPREHENSIVE INCOME (LOSS)                                                              |  |                          |  |                          |   |        |              |   |                            |   |                             |        |  |                               |  |   |                            |  |   |           |                                        |   |            |   | 
|Net income (loss)                                                                        |  |                         |  |                          |  |        |             |   |                            |   |                            |        |  |                              |  |   |                           |  |   |          |                                        |   | (4,072,201 | ) | 
|Unrealized gains (losses) on marketable equity securities (net of tax of
$6,533)         |  |                         |  |                          |  |        |             |   |                            |   |                            |        |  |                              |  |   |                           |  |   |          |                                        |   |           |   | 
|                                                                                         |  |                          |  |                          |   |        |              |   |                            |   |                             |        |  |                               |  |   |                            |  |   |           |                                        |   |            |   | 
|Comprehensive income (loss)                                                              |  |                          |  |                          |   |        |              |   |                            |   |                             |        |  |                               |  |   |                            |  |   |           |                                        |   |            |   | 
|Conversion of 20,000 shares of Series B preferred stock to 20,000 shares of common
stock |  |                         |  |                          |  |        | (20,000      | ) |                            |   | (50,000                     | )      |  | 20,000                        |  |   | 200                        |  |   | 49,800    |                                        |   |           |   | 
|Issuance of 10,734 shares of commonstock in payment of accrued preferred share
dividends |  |                         |  |                          |  |        |             |   |                            |   |                            |        |  | 10,734                        |  |   | 107                        |  |   | 15,617    |                                        |   |           |   | 
|Dividend distribution of 1,933,000 shares of DrugMax, Inc. at $1.25 per
share            |  |                         |  |                          |  |        |             |   |                            |   |                            |        |  |                              |  |   |                           |  |   |          |                                        |   | (2,416,250 | ) | 
|                                                                                         |  |                          |  |                          |   |        |              |   |                            |   |                             |        |  |                               |  |   |                            |  |   |           |                                        |   |            |   | 
|Balances at December 31, 2002 (Unaudited)                                                |  |                         |  | $                        |  |        |             |   |                            | $ |                            |        |  | 3,082,875                     |  | $ | 30,828                     |  | $ | 2,538,144 |                                        | $ | (1,470,660 | ) | 
|                                                                                         |  |                          |  |                          |   |        |              |   |                            |   |                             |        |  |                               |  |   |                            |  |   |           |                                        |   |            |   | 



See
accompanying notes to condensed consolidated financial statements.



-4-



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DYNAMIC HEALTH PRODUCTS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)



|                                                                                     |  | Nine Months EndedDecember 31, |           
|------------------------------------------------------------------------------------ |  | ----------------------------- | ----------
|                                                                                     |  | 2002                          |           
|Cash flows from operating activities:                                                |  |                               |           
|Net income (loss)                                                                    |  | $                             | (4,072,201
|Adjustments to reconcile net income (loss) to net cash used in operating
activities: |  |                               |           
|Depreciation and amortization                                                        |  |                               | 71,391    
|Impairment of intangible assets                                                      |  |                               |          
|Write off of uncollectible note receivable                                           |  |                               | 1,028,411 
|Write off of uncollectible other receivables                                         |  |                               | 87,063    
|Equity in (income) loss of affiliated companies                                      |  |                               | 3,585,186 
|Equity in loss of subsidiary through date of sale                                    |  |                               |          
|Gain on sale of subsidiary                                                           |  |                               |          
|Gain on transfer of equity securities                                                |  |                               |          
|Loss on distribution of investment                                                   |  |                               | 1,388,088 
|Losses on sales of marketable equity securities, net                                 |  |                               | 21,570    
|Changes in operating assets and liabilities:                                         |  |                               |           
|Accounts receivable                                                                  |  |                               | (61,408   
|Inventories                                                                          |  |                               | 627       
|Due to/from affiliates, net                                                          |  |                               | (104,214  
|Prepaid expenses                                                                     |  |                               | (10,014   
|Other current assets                                                                 |  |                               | (86,004   
|Other assets                                                                         |  |                               | (3,743    
|Accounts payable                                                                     |  |                               | 1,419     
|Other payables                                                                       |  |                               | 14,009    
|Accrued expenses                                                                     |  |                               | (6,117    
|Accrued income taxes                                                                 |  |                               | 72,863    
|Deferred income taxes                                                                |  |                               | (2,446,774
|                                                                                     |  |                               |           
|Net cash used in operating activities                                                |  |                               | (519,848  
|                                                                                     |  |                               |           
|                                                                                    
|Cash flows from investing activities:                                                |  |                               |           
|Purchases of property and equipment                                                  |  |                               | (45,950   
|Cash transferred with sale of subsidiary                                             |  |                               |          
|Purchase of certificate of deposit                                                   |  |                               | (46,151   
|Redemption of certificate of deposit                                                 |  |                               | 51,999    
|Purchase of investment in common stock                                               |  |                               |          
|Proceeds from sale of marketable equity securities                                   |  |                               |          
|Proceeds from related party receivables                                              |  |                               | 20,460    
|                                                                                     |  |                               |           
|Net cash used in investing activities                                                |  |                               | (19,642   
|                                                                                     |  |                               |           
|Cash flows from financing activities:                                                |  |                               |           
|Proceeds from issuance of long-term obligations                                      |  |                               | 34,651    
|Payments of long-term obligations                                                    |  |                               | (40,802   
|Proceeds from issuance of related party obligations                                  |  |                               |          
|                                                                                     |  |                               |           
|Net cash used in financing activities                                                |  |                               | (6,151    
|                                                                                     |  |                               |           
|Net increase (decrease) in cash                                                      |  |                               | (545,641  
|Cash and cash equivalents at beginning of period                                     |  |                               | 666,213   
|                                                                                     |  |                               |           
|Cash and cash equivalents at end of period                                           |  | $                             | 120,572   
|                                                                                     |  |                               |           



See
accompanying notes to condensed consolidated financial statements.



-5-



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DYNAMIC HEALTH PRODUCTS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)(Continued)



|                                                                                               |  | Nine Months Ended December 31,
|---------------------------------------------------------------------------------------------- |  | ------------------------------
|                                                                                               |  | 2002                          
|Supplemental disclosure of cash flow information:                                              |  |                               
|Cash paid during the period for interest                                                       |  | $                             
|                                                                                               |  |                               
|Cash paid during the period for income taxes                                                   |  | $                             
|                                                                                               |  |                               
|Supplemental schedule of non-cash investing activities:                                        |  |                               
|Exchange of notes receivable from affiliate to investment in preferred stock of
affiliate      |  | $                             
|                                                                                               |  |                               
|Note received from sale of subsidiary                                                          |  | $                             
|                                                                                               |  |                               
|                                                                                              
|Supplemental schedule of non-cash financing activities:                                        |  |                               
|Distribution of investment                                                                     |  | $                             
|                                                                                               |  |                               
|Dividend distribution of 1,933,000 shares of DrugMax, Inc.                                     |  | $                             
|                                                                                               |  |                               
|Conversion of Series B 6% Cumulative Convertible Preferred stock into common
stock             |  | $                             
|                                                                                               |  |                               
|Accrual of preferred stock dividends                                                           |  | $                             
|                                                                                               |  |                               
|Issuance of common stock in payment of accrued preferred share
dividends                       |  | $                             
|                                                                                               |  |                               
|Transfer of equity securities in exchange for settlement of notes payable and accrued
interest |  | $                             
|                                                                                               |  |                               
|Obligation to affiliate incurred for purchase of investment in common
stock                    |  | $                             
|                                                                                               |  |                               



See
accompanying notes to condensed consolidated financial statements.



-6-



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DYNAMIC HEALTH PRODUCTS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

FOR THE THREE AND NINE MONTHS ENDED

DECEMBER
31, 2002 AND DECEMBER 31, 2001



NOTE A-BASIS OF
PRESENTATION



The accompanying unaudited
condensed consolidated financial statements have been prepared in accordance with U.S. Generally Accepted Accounting Principles for interim financial information and with the instruction to Form 10-QSB and Article 10 of Regulation S-X. Accordingly,
they do not include all of the information and footnotes required by U.S. Generally Accepted Accounting Principles for complete consolidated financial statements. In the opinion of management, all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation have been included. Operating results for the three and nine months ended December 31, 2002 and 2001 are not necessarily indicative of the results that may be expected for the year ending March
31, 2003. For further information, refer to the consolidated financial statements and footnotes included in the Companys Form 10-KSB for the year ended March 31, 2002.



Certain reclassifications have been made to the financial statements as of and for the three and nine months
ended December 31, 2001, and as of March 31, 2002, to conform to the presentation as of and for the three and nine months ended December 31, 2002.



NOTE B-PRINCIPLES OF CONSOLIDATION



The condensed consolidated financial statements as of and for the three and nine months ended December 31, 2002 include the
accounts of Dynamic Health Products, Inc. and its principally wholly-owned subsidiaries (collectively the Company), J. Labs, Inc., Dynamic Life Products, Inc., Herbal Health Products, Inc. (Herbal), Dynamic Life, Inc. and its
subsidiary Dynamic Life Asia, LLC, Dynamic Financials Corporation and its subsidiary Bryan Capital Limited Partnership, and Todays Drug, Inc. Significant intercompany balances and transactions have been eliminated in consolidation.



The condensed consolidated financial statements
as of and for the three and nine months ended December 31, 2001 include the accounts of Dynamic Health Products, Inc. and its principally wholly-owned subsidiaries, J. Labs, Inc., Dynamic Life Products, Inc., Herbal Health Products, Inc., Dynamic
Life, Inc. and its subsidiaries Dynamic Life Asia, LLC and Dynamic Life Korea Ltd., Dynamic Financials Corporation and its subsidiary Bryan Capital Limited Partnership, and Todays Drug, Inc. Effective November 30, 2001, the Company sold
Dynamic Life Korea Ltd. (Dynamic Korea). Dynamic Korea has a year end of December 31. Accordingly, the condensed consolidated financial statements as of and for the three and nine months ended December 31, 2001 include the results of
operations of Dynamic Korea from July 1, 2001 through September 30, 2001 and January 1, 2001 through September 30, 2001. Significant intercompany balances and transactions have been eliminated in consolidation.



-7-



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NOTE C-INVESTMENTS IN
UNCONSOLIDATED AFFILIATES



Investments in
companies in which the Company has a 20% to 50% interest are accounted for using the equity method. Accordingly, the investments are carried at cost, adjusted for the Companys proportionate share of their undistributed earnings and losses.



Investment in net assets of an affiliated
company, DrugMax, Inc. (DrugMax), was accounted for under the equity method until November 22, 2002, at which time the Company distributed all of its shares of common stock of DrugMax to its shareholders (see Note G). For the period from
October 1, 2002 through November 21, 2002, $4,264 was recorded as the Companys share of DrugMaxs income. For the period from April 1, 2002 through November 21, 2002, $3,490,001 was recorded as the Companys share of DrugMaxs
loss. For the three and nine months ended December 31, 2001, $50,708 and $600,235 were recorded as the Companys share of DrugMaxs income, respectively. At December 31, 2002 and 2001, the Company owned zero and approximately 30% of
DrugMax, respectively.



The consolidated results
of operations of DrugMax for the three and nine months ended December 31, 2002 and 2001 are summarized below:



|                                        |  | Three Months December 31, |            | Nine Months December 31,
|--------------------------------------- |  | ------------------------- | ---------- | ------------------------
|                                        |  | 2002                      |            | 2001                    
|                                        |  | (Unaudited)               |            | (Unaudited)             
|Condensed Income Statement Information: |  |                           |            |                         
|Net sales                               |  | $                         | 85,233,822 |                         
|Gross profit                            |  |                           | 1,883,182  |                         
|Net income (loss)                       |  |                           | 10,333     |                         



Investment in net assets of an affiliated company, Vertical Health Solutions, Inc. (Vertical), was accounted for under the equity method until December 31, 2002, at which time the Companys percentage of ownership in
Vertical was reduced from approximately 21.0% to approximately 19.5%. As of December 31, 2002, the investment amounted to $357,602. For the three and nine months ended December 31, 2002, $47,206 and $81,444 were recorded as the Companys share
of Verticals loss. As of December 31, 2001, the Company owned approximately 4% of Vertical and its investment in net assets of Vertical amounted to $9,500. Upon the Company entering into a Conversion Agreement with Vertical, effective June 30,
2002, whereby the Company received 429,846 shares of Series A Preferred stock of Vertical, the Company began accounting for the investment under the equity method (see Note D). As the investment was not accounted for under the equity method during
the comparable December 31, 2001 periods presented, no financial information is provided for the three and nine months ended December 31, 2001.



-8-



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The
consolidated results of operations of Vertical for the three and nine months ended December 31, 2002 are summarized below:



|                                        |  | Three Months Ended December 31, 2002 |          |   | Nine Months Ended December 31, 2002 |  
|--------------------------------------- |  | ------------------------------------ | -------- | - | ----------------------------------- | -
|                                        |  | (Unaudited)                          |          |   | (Unaudited)                         |  
|Condensed Income Statement Information: |  |                                      |          |   |                                     |  
|Net sales                               |  | $                                    | 339,647  |   |                                     | $
|Gross profit                            |  |                                      | 159,455  |   |                                     |  
|Net loss                                |  |                                      | (225,365 | ) |                                     |  



Investment in net assets of an affiliated company, Tribeca Beverage Company (Tribeca), accounted for under the equity method amounted to $167,123 as of December 31, 2002, with $3,514 and $13,741, and $8,576 and $9,965
being recorded as the Companys share of Tribecas loss for the three and nine months ended December 31, 2002 and 2001, respectively. On December 18, 2002, the Company purchased an additional 100,000 shares, or 10% of Tribeca for $1. At
December 31, 2002 and 2001, the Company owned 30% and 20%, respectively, of Tribeca.



The results of operations for the three and nine months ended December 31, 2002 and 2001, and the financial position of the Companys equity-basis affiliate, Tribeca, as of December 31, 2002 are
summarized below:



|                                        |  | Three Months Ended December 31, |         |   | Nine Months Ended December 31, |  
|--------------------------------------- |  | ------------------------------- | ------- | - | ------------------------------ | -
|                                        |  | 2002                            |         |   | 2001                           |  
|                                        |  | Unaudited)                      |         |   | (Unaudited)                    |  
|Condensed Income Statement Information: |  |                                 |         |   |                                |  
|Net sales                               |  | $                               | (3,518  | ) |                                | $
|Gross profit                            |  |                                 | (1,357  | ) |                                |  
|Net loss                                |  |                                 | (16,327 | ) |                                |  
|                                       
|                                        |  |                                 |         |   |                                |  
|                                        |  |                                 |         |   |                                |  
|Condensed Balance Sheet Information:    |  |                                 |         |   |                                |  
|Current assets                          |  |                                 |         |   |                                |  
|Non-current assets                      |  |                                 |         |   |                                |  
|Current liabilities                     |  |                                 |         |   |                                |  
|Non-current liabilities                 |  |                                 |         |   |                                |  
|Total shareholders equity              |  |                                 |         |   |                                |  





-9-



---



NOTE D-CONVERSION OF NOTES
RECEIVABLE FROM AFFILIATE



In July 2000,
certain notes receivable totaling $425,000 arose pursuant to Herbals sale of substantially all of its assets relating to the distribution of veterinary products to Vertical Health Solutions, Inc., an affiliate of the Company. Effective June
30, 2002, the Company entered into a Conversion Agreement with Vertical whereby the parties agreed to convert the Companys notes receivable from Vertical, with a balance of unpaid principal and interest due of $429,846, into 429,846 shares of
Series A preferred stock of Vertical. As of December 31, 2002, the investment in Vertical amounted to $357,902 and is included in investments in unconsolidated affiliates.



NOTE E-COMPREHENSIVE INCOME



The Company utilizes the guidance provided by Statement of Financial Accounting Standards No. 130 (SFAS 130), Reporting
Comprehensive Income, which became effective for the Company for the fiscal year ended March 31, 1999. SFAS 130 establishes standards for reporting and display of comprehensive income within the general purpose financial statements and requires
reclassification of applicable financial statement components for any prior period comparative financial statement components. The Company has implemented SFAS 130 as of and for the three and nine months ended December 31, 2002 based on
comprehensive income transactions being present. The Company has elected to present the comprehensive income items within the shareholders equity section of the balance sheet in addition to presenting a consolidated statement of changes in
shareholders equity statement. The following presents comprehensive income as of December 31, 2002:



|                                                                       |  | Before-Tax Amount |         |   | Tax (Expense) Benefit |   | Net-of-Tax Amount | 
|---------------------------------------------------------------------- |  | ----------------- | ------- | - | --------------------- | - | ----------------- | 
|Unrealized losses (gains) on marketableequity securities held for
sale |  | $                 | (18,149 | ) |                       | $ | 6,533             | 
|                                                                       |  |                   |         |   |                       |   |                   | 
|Other comprehensive income                                             |  | $                 | (18,149 | ) |                       | $ | 6,533             | 
|                                                                       |  |                   |         |   |                       |   |                   | 



NOTE F-INCOME TAXES



The Company utilizes the guidance provided
by Statement of Financial Accounting Standards No. 109 (SFAS 109), Accounting for Income Taxes. Under SFAS 109, the Company uses the asset and liability method which recognizes the amount of current and deferred taxes payable or
refundable based on transactions recorded as of and for the periods presented in the consolidated financial statements as determined by the enacted tax laws and tax rates. As of December 31, 2002, the Company had an accrued income tax liability of
$72,863 and no net deferred income tax asset or liability.



-10-



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NOTE G-RELATED PARTY
TRANSACTIONS



On October 1, 1999, the
Company entered into a triple-net lease agreement with Innovative Companies, Inc., formerly Go2Pharmacy, Inc. (Innovative), an affiliate of the Company, whereby Innovative agreed to lease the Companys land and 33,222 square foot
building in Largo, Florida for a term of ten years. The initial rental under the lease was approximately $192,000 annually. The lease provides for an annual cost-of-living increase. This facility serves as Innovatives corporate headquarters
and also serves as part of Innovatives offices, manufacturing, warehousing and shipping operations. Jugal K. Taneja, a principal shareholder and Chairman of the Board of the Company is also a principal shareholder, and Chairman of the Board of
Innovative.



On March 22, 2002, the Company
entered into a Sublease and Consent agreement with Innovative Health Products, Inc., a wholly-owned subsidiary of Innovative, whereby the Company agreed to sublease approximately 5,200 square feet of office and warehouse space for its executive
offices and its operations in Largo, Florida. This facility serves as the Companys corporate headquarters and is also used for offices, warehousing and shipping operations. The facility is sublet for a term of approximately one year, ending on
March 31, 2003. The sublease contains an option to continue the sublease subsequent to March 31, 2003, on a month-to-month basis through January 10, 2004, unless terminated earlier. The rental under the sublease is $33,384 annually.



For the three and nine months ended December 31, 2002 and
2001, purchases of products from subsidiaries of Innovative were approximately $29,104 and $123,226, and $113,154 and $212,728, respectively. For the three and nine months ended December 31, 2002, sales of products to a subsidiary of Innovative were
zero and approximately $3,573, respectively. There were no sales of products to subsidiaries of Innovative for the three and nine months ended December 31, 2001. As of March 31, 2002 and December 31, 2002, approximately $74,701 and $34,675,
respectively, were due to subsidiaries of Innovative, and are included in obligations to affiliates.



For the three and nine months ended December 31, 2002, sales of products to a subsidiary of DrugMax, an affiliate of the Company, were
zero and $5,760, respectively. There were no sales of products to subsidiaries of DrugMax for the three and nine months ended December 31, 2001. As of March 31, 2002 and December 31, 2002, $113 and $86, respectively, were due from DrugMax, and are
included in due from affiliates. Jugal K. Taneja, a principal shareholder and Chairman of the Board of the Company is also a principal shareholder, Chairman of the Board and Chief Executive Officer of DrugMax. William L. LaGamba, the Chief Operating
Officer and President of DrugMax is also a principal shareholder of the Company.



Amounts due from affiliates and amounts due to affiliates represent amounts owed to or amounts owed by the Company for sales or purchases occurring in the normal course of business. Amounts due from
and to these affiliates are in the nature of trade payables or receivables and fluctuate based on sales and purchasing volume and payments received.



In May 2002, the Company issued 20,000 shares of common stock of the Company. The 20,000 shares of common stock were issued in exchange
for 20,000 shares of Series B 6% Cumulative Convertible Preferred stock of the Company, which shares were issued in conjunction with a private placement undertaken in 1998.





-11-



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In July 2002, the Company declared a dividend distribution of 23,709 shares of its
investment in Innovatives common stock to the holders of record of Series B 6% Cumulative Convertible Preferred stock of the Company, as of December 31, 2001.



On October 10, 2002, the Board of Directors of the Company approved the declaration of a dividend
distribution to holders of record of its issued and outstanding common shares as of October 10, 2002, in the form of approximately 1,933,000 shares of DrugMax, Inc., a Nevada corporation, which the Company owned. On November 22, 2002, the Company
distributed 1,933,000 shares of DrugMax to its shareholders. The payment rate was .626882 shares of DrugMax common stock for each share of the Companys common stock held on October 10, 2002. The Company only distributed whole shares and any
fractional shares to which shareholders would otherwise be entitled were rounded down to the nearest whole share.



NOTE H-SHAREHOLDERS EQUITY



In May 2002, the Company issued 20,000 shares of its common stock. The 20,000 shares of common stock were issued in exchange for 20,000
shares of Series B 6% Cumulative Convertible Preferred stock of the Company, which shares were issued in conjunction with a private placement undertaken in 1998.



In July 2002, the Company obtained clearance of its Form 211 with NASD Regulation for listing of the
Companys common stock on the OTC Bulletin Board.



In September 2002, the Company issued 10,734 shares of its common stock in payment of $16,101 of accrued preferred share dividends.



-12-



---



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



The following management discussion and analysis should be read in conjunction with the Condensed Consolidated Financial Statements and
Notes thereto presented elsewhere in this Form 10-QSB. The discussion is based upon such condensed consolidated financial statements that have been prepared in accordance with U.S. Generally Accepted Accounting Principles.



The statements contained in this Report that are not
historical are forward-looking statements, including statements regarding the Companys expectations, intentions, beliefs or strategies regarding the future. Forward-looking statements include the Companys statements regarding liquidity,
anticipated cash needs and availability and anticipated expense levels. All forward-looking statements included in this Report are based on information available to the Company on the date hereof, and the Company assumes no obligation to update any
such forward-looking statements. It is important to note that the Companys actual results could differ materially from those in such forward-looking statements. Additionally, the following discussion and analysis should be read in conjunction
with the Condensed Consolidated Financial Statements and notes thereto appearing elsewhere in this Report. The discussion is based upon such condensed consolidated financial statements, which have been prepared in accordance with U.S. Generally
Accepted Accounting Principles.



Overview



The Company derives its revenues from developing, wholesaling
and distributing a wide variety of non-prescription dietary supplements, and health and beauty care products. Revenues are billed and recognized as product is shipped, net of discounts, allowances, returns and credits.



Cost of goods sold is comprised of direct product costs,
direct personnel compensation and other statutory benefits and indirect costs relating to labor to support the warehousing of product and other warehousing overhead. Research and development expenses are charged against cost of goods sold as
incurred and are not material to the Companys operations. Selling, general and administrative costs include management and general office salaries, advertising and promotional expenses, sales and marketing and other indirect operating costs.
Interest and other income (expense) consist primarily of interest income associated with notes receivable, and interest expense associated with borrowings to finance capital and other working capital needs.



In February 2000, the Company formed Dynamic Life Korea Ltd.,
as a Korean corporation, to market the Companys products to distributors in Korea. On November 30, 2001, the Company subsequently sold Dynamic Korea. Dynamic Korea has a year end of December 31. Accordingly, the condensed consolidated
financial statements as of and for the three and nine months ended December 31, 2001 include the results of operations of Dynamic Korea from July 1, 2001 through September 30, 2001 and January 1, 2001 through September 30, 2001.



Results of Operations



Three And Nine Months Ended December 31, 2002 Compared To Three And
Nine Months Ended December 31, 2001



Revenues.    The Company generated revenues of $148,225 and $568,607, respectively, for the three and nine months ended December 31, 2002, a decrease of $238,392 or 61.7% and



-13-



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$449,188 or 44.1%, compared to
$386,617 and $1,017,795, respectively, for the three and nine months ended December 31, 2001. The decrease in revenues was primarily attributable to the absence of revenues associated with Dynamic Korea, the Companys foreign subsidiary, due to
the sale of Dynamic Korea in November 2001, and was partially offset by an increase in revenues associated with Herbal, due to increased sales to existing customers with the introduction of new products, and the expansion of Herbals customer
base.



Gross
profit.    The Company achieved a gross profit of $76,805 and $330,706, respectively, for the three and nine months ended December 31, 2002, a decrease of $55,867 or 42.1% and $94,118 or 22.2%, compared to $132,672 and
$424,824, respectively, for the three and nine months ended December 31, 2001. Gross margin, as a percentage of revenues, increased from 34.3% and 41.7%, respectively, for the three and nine months ended December 31, 2001, to 51.8% and 58.2%,
respectively, for the three and nine months ended December 31, 2002. The increase was primarily attributable to increased revenues and related cost of goods sold associated with Herbal, which yield higher gross margins than that of Dynamic Korea,
whose revenues and related cost of goods sold were reflected in the three and nine months ended December 31, 2001.



Operating expenses.    The Company incurred operating expenses of $1,367,408 and $1,886,084, respectively, for
the three and nine months ended December 31, 2002, compared to $579,957 and $1,540,228, respectively, for the three and nine months ended December 31, 2001. For the three months ended December 31, 2002, these expenses include various administrative,
sales, marketing and other direct operating expenses of $227,854, depreciation and amortization expenses of $24,080, and bad debt expense of $1,115,474, compared to $440,919 in various administrative, sales, marketing and other direct operating
expenses, depreciation and amortization expenses of $23,953, bad debt expense of $20,000 and an impairment of intangible assets charge of $95,085, net of amortization expenses, for the three months ended December 31, 2001. For the nine months ended
December 31, 2002, these expenses include various administrative, sales, marketing and other direct operating expenses of $698,851, depreciation and amortization expenses of $71,391, and bad debt expense of $1,115,842, compared to $1,345,157 in
various administrative, sales, marketing and other direct operating expenses, depreciation and amortization expenses of $79,965, bad debt expense of $20,021 and an impairment of intangible assets charge of $95,085, net of amortization expenses, for
the nine months ended December 31, 2001. In November 2001, a note was received in conjunction with the sale of Dynamic Korea. In November 2002, the purchaser defaulted on the note. It has been determined by management of the Company that all further
amounts due under this note will be uncollectible. This resulted in an increase in bad debt expense for the three months and nine months ended December 31, 2002 of approximately $1 million.



Operating expenses, excluding amortization expense,
depreciation expense, bad debt expense and the impairment of intangible assets charge, increased from 114.0% of revenues for the three months ended December 31, 2001, to 153.7% of revenues for the three months ended December 31, 2002, and decreased
to 122.9% of revenues for the nine months ended December 31, 2002, from 132.2% of revenues for the nine months ended December 31, 2001. If you eliminated revenues, and selling, general and administrative expenses associated with Dynamic Korea for
the three and nine months ended December 31, 2001, and recalculated selling, general and administrative expenses as a percentage of revenues to reflect a more comparative presentation of the selling, general and administrative expenses, the result
would have been a decrease to 153.7% and 122.9% of revenues, respectively, for the three and nine months ended



-14-



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December 31, 2002, from 195.6% and 236.4% of revenues, respectively, for the three and nine months ended
December 31, 2001. The decrease was primarily attributable to decreased legal expenses, and was partially offset by an increase in accounting, rent and insurance expenses.



Interest income.    Interest income was ($41,362) and $16,319, respectively, for
the three and nine months ended December 31, 2002, compared to $23,811 and $63,794, respectively, for the three and nine months ended December 31, 2001. The decrease in interest income was a result of a decrease in notes receivable, and a decrease
in cash and cash equivalents.



Interest
expense.    Interest expense was $18,013 and $52,056, respectively, for the three and nine months ended December 31, 2002, compared to $34,498 and $125,867, respectively, for the three and nine months ended December 31, 2001.
The decrease in interest expense was primarily a result of a decrease in the Companys outstanding obligations, as well as favorable interest rate changes.



Income taxes.    The Company had an estimated deferred income tax liability of
$2,440,241 as of the fiscal year ended March 31, 2002, which primarily represented the potential future tax expense associated with the gain resulting from the Companys sale of its subsidiary, Becan Distributors, Inc., in November 1999. The
distribution of the Companys investment in DrugMax to its shareholders in November 2002 resulted in a reduction of the estimated future tax expense associated with that gain. During the three and nine months ended December 31, 2002, the
Company recorded a deferred income tax benefit of $1,024,180 and $2,352,580, respectively, which represented the reversal of $1,096,782 and $2,440,241 of the deferred income tax liability, respectively, offset by $72,602 and $87,661 income tax
expense, respectively. As of December 31, 2002, the Company had an accrued income tax liability of $72,863 and no net deferred income tax asset or liability.



Net income (loss) per share.Net loss per share for the three months ended December 31, 2002 was $0.55,
compared to net income per share of $0.28 for the three months ended December 31, 2001. Net loss per share for the nine months ended December 31, 2002 was $1.33, compared to net income per share of $0.30 for the nine months ended December 31, 2001.
The decrease in net income per share was primarily a result of the loss on distribution of investment of $1,388,088 for the three and nine months ended December 31, 2002, as well as the equity in loss of affiliated companies of $46,456 and
$3,585,186, respectively, for the three and nine months ended December 31, 2002, compared to equity in income of affiliated companies of $42,132 and $590,270, respectively, for the three and nine months ended December 31, 2001.



Inflation;
Seasonality.Management believes that there was no material effect on operations or the financial condition of the Company as a result of inflation for the three and nine months ended December 31, 2002 and 2001. Management
also believes that its business is not seasonal; however, significant promotional activities can have a direct impact on sales volume in any given quarter.



Financial Condition, Liquidity and Capital Resources



The Company has financed its operations through the usage of available cash reserves. The Company had a working capital deficit of $91,107
at December 31, 2002, compared to working capital of $430,074 at March 31, 2002.



-15-



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Net cash used
in operating activities was $519,848 for the nine months ended December 31, 2002, as compared to net cash used in operating activities of $405,299 for the nine months ended December 31, 2001. The usage of cash was primarily attributable to an
increase in accounts receivable of $61,408, an increase in amounts due to/from affiliates, net, of $104,214, an increase in prepaid expenses of $10,014, an increase in other current assets of $86,004, an increase in other assets of $3,743, a
decrease in accrued expenses of $6,117 and a decrease in deferred income taxes of $2,446,774, partially offset by a decrease in inventories of $627, an increase in accounts payable of $1,419, an increase in other payables of $14,009 and an increase
in accrued income taxes of $72,863.



Net cash
used in investing activities was $19,642, representing purchases of property and equipment of $45,950, and the purchase of a certificate of deposit of $46,151, partially offset by the redemption of a certificate of deposit of $51,999 and proceeds
from related party receivables of $20,460.



Net
cash used in financing activities was $6,151, representing payments of long-term obligations of $40,802 and was partially offset by the proceeds from the issuance of long-term obligations of $34,651.



At December 31, 2002, the Company had $120,572 in cash and
cash equivalents, as compared to $651,605 at December 31, 2001.



Management believes that cash expected to be generated from operations and current cash reserves will be sufficient for the Company to meet its capital expenditures and working capital needs for its operations as presently conducted.
The Companys future liquidity and cash requirements will depend on a wide range of factors, including the level of business in existing operations, expansion of facilities and possible acquisitions. In particular, if cash flows from operations
are not sufficient, it will be necessary for the Company to seek additional financing. While there can be no assurance that such financing would be available in amounts and on terms acceptable to the Company, management believes that such financing
would likely be available on acceptable terms.



In July 2000, certain notes receivable totaling $425,000 arose pursuant to Herbals sale of substantially all of its assets relating to the distribution of veterinary products to Vertical Health Solutions, Inc., an affiliate of
the Company. Effective June 30, 2002, the Company entered into a Conversion Agreement with Vertical whereby the parties agreed to convert the Companys notes receivable from Vertical with a balance of unpaid principal and interest due of
$429,846, into 429,846 shares of Series A preferred stock of Vertical.



In September 2002, the Company issued 10,734 shares of common stock of the Company in payment of $16,101 of accrued preferred share dividends.



In November 2002, the Company distributed 1,933,000 shares of DrugMax as a dividend to its shareholders. The
payment rate was .626882 shares of DrugMax common stock for each share of the Companys common stock held on October 10, 2002.



-16-



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Item
3.    CONTROLS AND PROCEDURES.



Within the 90 days prior to the date of filing of this quarterly report on Form 10-QSB, the Companys management carried out an evaluation, under the supervision and with the participation of the Companys Disclosure
Committee, including the Companys Chief Executive Officer and its Chief Financial Officer, of the effectiveness of the design and operation of the Companys disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and
15d-14). Based upon that evaluation, the Companys Chief Executive Officer and Chief Financial Officer have concluded that the Companys disclosure controls and procedures are effective to ensure that information required to be disclosed
by the Company in the reports that it files or submits under the Securities Exchange Act of 1934, as amended, is accumulated and communicated to the Companys management, including its principal executive officer and principal financial
officer, as appropriate to allow timely decisions regarding required disclosure and are effective to ensure that such information is recorded, processed, summarized and reported within the time periods specified in the SECs rules and forms.
There were no significant changes in the Companys internal controls or in other factors that could significantly affect those controls subsequent to the date of their evaluation.



-17-



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PART IIOTHER INFORMATION



Item 1.    LEGAL PROCEEDINGS.



From time to time the company is subject to litigation
incidental to its business including possible product liability claims. Such claims, if successful, could exceed applicable insurance coverage. The Company is not currently a party to any material legal proceedings.



Item 2.    CHANGES IN SECURITIES AND USE OF PROCEEDS.



In May 2002, the Company issued 20,000
shares of common stock of the Company. The 20,000 shares of common stock were issued in exchange for 20,000 shares of Series B 6% Cumulative Convertible Preferred stock of the Company, which shares were issued in conjunction with a private placement
undertaken in 1998.



In September 2002, the
Company issued 10,734 shares of common stock of the Company in payment of $16,101 of accrued preferred share dividends.



Item 3.    DEFAULTS UPON SENIOR SECURITIES.



Not applicable.



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



The Annual Meeting of Stockholders of the Company was held on December 20, 2002. At the meeting, the
following actions were taken by the shareholders:



Jugal K. Taneja, Mandeep K. Taneja, Cani I. Shuman, Kotha S. Sekharam, Rakesh K. Sharma, M.D. and Morton L. Stone were elected as Directors to serve until the next annual meeting and until their respective successors are elected and
qualified or until their earlier resignation, removal from office or death. The votes cast for and against each were as follows:



|                       |  | For       |  | Against |  | Withheld
|---------------------- |  | --------- |  | ------- |  | --------
|Jugal K. Taneja        |  | 2,726,335 |  | -0-     |  | 35,430  
|Mandeep K. Taneja      |  | 2,726,335 |  | -0-     |  | 35,430  
|Cani I. Shuman         |  | 2,725,468 |  | -0-     |  | 36,297  
|Kotha S. Sekharam      |  | 2,759,800 |  | -0-     |  | 1,965   
|Rakesh K. Sharma, M.D. |  | 2,758,867 |  | -0-     |  | 2,898   
|Morton L. Stone        |  | 2,759,800 |  | -0-     |  | 1,965   



Item
5.    OTHER INFORMATION.



In July 2002, the Company obtained clearance of its Form 211 with NASD Regulation for listing of the Companys common stock on the OTC Bulletin Board.



In July 2002, the Company declared a dividend distribution of 23,709 shares of its investment in
Innovatives common stock to the holders of record of Series B 6% Cumulative Convertible Preferred stock of the Company, as of December 31, 2001.





-18-



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On October 10,
2002, the Board of Directors of the Company approved the declaration of a dividend distribution to holders of record of its issued and outstanding common shares as of October 10, 2002, in the form of approximately 1,933,000 shares of DrugMax, Inc.,
a Nevada corporation, which the Company owned. On November 22, 2002, the Company distributed 1,933,000 shares of DrugMax to its shareholders. The payment rate was .626882 shares of DrugMax common stock for each share of the Companys common
stock held on October 10, 2002. The Company only distributed whole shares and any fractional shares to which shareholders would otherwise be entitled were rounded down to the nearest whole share.



Item 6.    EXHIBITS AND REPORTS ON FORM 8-K.



|(a) |  | Exhibits.
|--- |  | ---------



The following exhibits are filed with this report:



|10.1 |  | Conversion Agreement, effective June 30, 2002, between Dynamic Health Products, Inc. and Vertical Health Solutions, Inc., dated July 29, 2002. (1)
|---- |  | --------------------------------------------------------------------------------------------------------------------------------------------------



|99.1 |  | Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|---- |  | -----------------------------------------------------------------------------------------------------------------------



|99.2 |  | Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|---- |  | -----------------------------------------------------------------------------------------------------------------------



---

| | (1) |  | Incorporated by reference to the Companys Quarterly Report on Form 10-QSB for the quarterly period ended June 30, 2002, file number 0-23031, filed in
Washington, D.C.
| | --- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(b) |  | Reports on Form 8-K.
|--- |  | --------------------



During the three months ended December 31, 2002, the Company filed one report on Form 8-K.



Form 8-K dated November 22, 2002, filed November 26, 2002,
with respect to the dividend distribution of the Companys shares of DrugMax.



-19-



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SIGNATURES



In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.



|                        |  | Dynamic Health Products, Inc.
|----------------------- |  | -----------------------------
|                       
|Date: February 14, 2003 |  | By:                          
|                        |  |                              



|                       
|-----------------------
|Date: February 14, 2003
|                       



-20-



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CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO SECTION 302 OF THE

SARBANES-OXLEY ACT OF 2002



I, Mandeep K. Taneja, Chief Executive Officer and President of Dynamic Health Products, Inc., certify that:



| | 1. |  | I have reviewed this quarterly report on Form 10-QSB of Dynamic Health Products, Inc.;
| | -- |  | --------------------------------------------------------------------------------------



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



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



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



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



| | b) |  | evaluated the effectiveness of the registrants disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly
report (the Evaluation Date); and
| | -- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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



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



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



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





-21-



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



|                       
|-----------------------
|Date: February 14, 2003
|                       



-22-



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CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

PURSUANT TO SECTION 302 OF THE

SARBANES-OXLEY ACT OF 2002



I, Cani I. Shuman, Chief Financial Officer of Dynamic Health Products, Inc., certify that:



| | 1. |  | I have reviewed this quarterly report on Form 10-QSB of Dynamic Health Products, Inc.;
| | -- |  | --------------------------------------------------------------------------------------



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



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



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



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



| | b) |  | evaluated the effectiveness of the registrants disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly
report (the Evaluation Date); and
| | -- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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



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



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



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



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



|                       
|-----------------------
|Date: February 14, 2003
|                       



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