**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


**WASHINGTON,
      DC 20549**





**FORM
      10-QSB**





(Mark
      One)





ý
            **QUARTERLY
                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                ACT OF
                1934**





For
      the
      quarterly period ended September
      30, 2006




 ̈
            **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  000-51887




NEURO-HITECH,
      INC.


**(Exact
      name of Small Business Issuer as Specified in its Charter)**





Delaware
            
            20-4121393**(State
                or Other Jurisdiction of**
            
            **(I.R.S.
                Employer****Incorporation
                or Organization)**
            
            **Identification
                No.)**





One
      Penn Plaza, Suite 1503, New York, NY 10119


**(Address
      of Principal Executive Offices)**




(212)
      594-1215


**(Issuer’s
      Telephone Number, Including Area Code)**





(Former
      Name, Former Address and Former Fiscal Year


If
      Changed Since Last Report)




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





Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act).  oYes   
 x No


State
      the
      number of shares outstanding of each of the issuer’s classes of common equity,
      as of the latest practicable date: October 10, 2006





Common
      Stock    9,441,506


Class
      A
      Common
      Stock 100





Transitional
      Small Business Disclosure Format (check one):


o
      Yes   
 x No








**PART
      I. FINANCIAL INFORMATION**





**Item
      1.**  **Financial
      Statements**





**Neuro-HiTech,
      Inc**


**Balance
      Sheets**





**ASSETS**
            
            (Unaudited)
              **9/30/2006**
            
            **12/31/2005****Current
                Assets****Cash
                & Cash Equivalents**
            
            **$**
            **2,827,753**
            
            **$**
            **90,606****Accounts
                Receivable**
            
            
            **158,150**
            
            
            **52,125****Inventory**
            
            
            **20,995**
            
            
            **—****Prepaid
                Expenses**
            
            
            **42,797**
            
            
            **—****Deferred
                Charges**
            
            
            **274,052**
            
            
            **—****Total
                Current Assets**
            
            
            **3,323,747**
            
            
            **142,731****Furniture
                & Fixtures, net**
            
            
            **7,996**
            
            
            **—****Total
                Assets**
            
            **$**
            **3,331,743**
            
            **$**
            **142,731****LIABILITIES
                AND STOCKHOLDERS’ EQUITY****Current
                Liabilities****Accounts
                Payable & Accrued Expenses**
            
            **$**
            **819,348**
            
            **$**
            **192,257****Total
                current Liabilities**
            
            
            **819,348**
            
            
            **192,257****Stockholders’
                Equity****Preferred
                Stock:**Authorized:
                5,000,000, Issued & Outstanding: 0 &1,200,500 $.01 Par
                Value
            
            
            **—**
            
            
            **12,005****Common
                Stock Class A:**Authorized:
                100, Issued & Outstanding: 100 & 0 $.001 Par Value
            
            
            **—**
            
            
            **—****Common
                Stock:**Authorized:
                44,999,900, Issued & Outstanding: 9,441,606 & 0 $.001 Par Value
            
            
            **9,441**
            
            
            **—****Common
                Stock:**Authorized:
                8,654,112, Issued & Outstanding: 0 & 8,654,112 $.01 Par
                Value
            
            
            **—**
            
            
            **86,541****Paid
                in Capital**
            
            
            **7,888,001**
            
            
            **2,478,373****Accumulated
                Deficit**
            
            
            **(5,385,047**
            **)**
            
            **(2,626,445**
            **)****Total
                Stockholders’ Equity**
            
            
            **2,512,395**
            
            
            **(49,526**
            **)****Total
                Liabilities and Stockholders’ Equity**
            
            **$**
            **3,331,743**
            
            **$**
            **142,731**




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





**Neuro-HiTech,
      Inc**


**Statements
      of Operations**





**Three
                Months Ended**
              **September**
            
            **Nine
                Months Ended**
              **September**(Unaudited)
            
            (Unaudited)
            
            (Unaudited)
            
            (Unaudited)**2006**
            
            **2005**
            
            **2006**
            
            **2005****Sales**
            
            **$**
            **182,800**
            
            **$**
            **6,300**
            
            **$**
            **260,140**
            
            **$**
            **156,366****Cost
                of Goods Sold**
            
            
            **(95,111**
            **)**
            
            **(2,525**
            **)**
            
            **(124,637**
            **)**
            
            **(53,625**
            **)****Gross
                Profit**
            
            
            **87,689**
            
            
            **3,775**
            
            
            **135,503**
            
            
            **102,741****Operating
                (Expenses)****Selling
                General & Administrative**
            
            
            **(326,269**
            **)**
            
            **(100,268**
            **)**
            
            **(822,635**
            **)**
            
            **(295,054**
            **)****Research
                and Development**
            
            
            **(685,401**
            **)**
            
            **(97,116**
            **)**
            
            **(1,879,020**
            **)**
            
            **(294,553**
            **)****Stock
                Based Compensation**
            
            
            **(106,815**
            **)**
            
            **—**
            
            
            **(302,642**
            **)**
            
            **—****Total
                Operating Expenses**
            
            
            **(1,118,485**
            **)**
            
            **(197,384**
            **)**
            
            **(3,004,297**
            **)**
            
            **(589,607**
            **)****Operating
                (Loss)**
            
            
            **(1,030,796**
            **)**
            
            **(193,609**
            **)**
            
            **(2,868,794**
            **)**
            
            **(486,866**
            **)****Other
                Income****Interest/Dividend
                Income**
            
            
            **37,254**
            
            
            **2,608**
            
            
            **110,192**
            
            
            **7,033****Total
                Other Income**
            
            
            **37,254**
            
            
            **2,608**
            
            
            **110,192**
            
            
            **7,033****(Loss)
                before Provisions for IncomeTaxes**
            
            
            **(993,542**
            **)**
            
            **(191,001**
            **)**
            
            **(2,758,602**
            **)**
            
            **(479,833**
            **)****Provisions
                for Income Taxes**
            
            
            **—**
            
            
            **—**
            
            
            **—**
            
            
            **—****Net
                (Loss)**
            
            
            **(993,542**
            **)**
            
            **(191,001**
            **)**
            
            **(2,758,602**
            **)**
            
            **(479,833**
            **)****Basic
                and Diluted (Loss) per common share**
            
            
            **(0.11**
            **)**
            
            **(0.02**
            **)**
            
            **(0.30**
            **)**
            
            **(0.06**
            **)****Weighted
                Average Number of Common Shares**
            
            
            **9,441,606**
            
            
            **8,654,112**
            
            
            **9,339,232**
            
            
            **8,654,112**





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





**Neuro-HiTech,
      Inc**


**Statement
      of Changes in Stockholders’ Equity**





**Preferred
                Stock**
            
            **Common
                Stock**
            
            **Paid
                In Capital**
            
            **Accumulated**
              **(Deficit)**
            
            **Total****Balance
                at January 1, 2005**
            
            **$**
            **12,005**
            
            **$**
            **86,541**
            
            **$**
            **2,478,373**
            
            **$**
            **(1,671,604**
            **)**
            **$**
            **905,315**Net
                (Loss)
            
            
            **—**
            
            
            **—**
            
            
            **—**
            
            
            (954,841
            )
            
            (954,841
            )**Balance
                at December 31, 2005**
            
            
            **12,005**
            
            
            **86,541**
            
            
            **2,478,373**
            
            
            **(2,626,445**
            **)**
            
            **(49,526**
            **)**Reorganization
                of Common Stock related to merger with Northern Way
            
            
            (12,005
            )
            
            (79,514
            )
            
            89,106
            
            
            **—**
            
            
            (2,413
            )Issuance
                of common stock - Net
            
            
            **—**
            
            
            2,414
            
            
            5,017,880
            
            
            **—**
            
            
            5,020,294Stock
                Options
            
            
            **—**
            
            
            **—**
            
            
            302,642
            
            
            **—**
            
            
            302,642Net
                (Loss)
            
            
            **—**
            
            
            **—**
            
            
            **—**
            
            
            (2,758,602
            )
            
            (2,758,602
            )**Balance
                at September 30, 2006**
            
            **$**
            **—**
            
            **$**
            **9,441**
            
            **$**
            **7,888,001**
            
            **$**
            **(5,385,047**
            **)**
            **$**
            **2,512,395**





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





**Neuro-HiTech,
      Inc**


**Statement
      of Cash Flows**


**The
      nine months ended September 30, 2006-2005**


(Unaudited)
            
            (Unaudited)**9/30/2006**
            
            **9/30/2005****Cash
                flows used in operating activities:****Net
                loss**
            
            **$**
            **(2,758,602**
            **)**
            **$**
            **(479,833**
            **)****Adjustments
                to Reconcile Net loss to net cash used in Operating
                Activities:****Stock
                Based Compensation Expense**
            
            
            **302,642**
            
            
            **—****Depreciation
                Expense**
            
            
            **999**
            
            
            **—****Change
                in operating assets and liabilities:****(Increase)
                Decrease in Assets:****Accounts
                Receivable**
            
            
            **(106,025**
            **)**
            
            **10,080****Prepaid
                Expenses**
            
            
            **(319,144**
            **)**
            
            **273,119****Inventory**
            
            
            **(22,711**
            **)**
            
            **(10,650**
            **)****Increase
                (Decrease) in Liabilities:****Accounts
                Payable and Accrued Expenses**
            
            
            **631,103**
            
            
            **(3,694**
            **)****Total
                adjustments**
            
            
            **486,864**
            
            
            **268,855****Net
                cash used in operating activities**
            
            
            **(2,271,738**
            **)**
            
            **(210,978**
            **)****Cash
                flows used in investing activities:****Capital
                Expenditures**
            
            
            **(8,995**
            **)**
            
            **—****Net
                cash from Investing activities**
            
            
            **(8,995**
            **)**
            
            **—****Cash
                flows from financing activities:****Net
                Proceed From Sale of Stock**
            
            
            **5,020,294**
            
            
            **—****Net
                cash used in Financing activities**
            
            
            **5,020,294**
            
            
            **—****Net
                increase (decrease) in cash and cash equivalents**
            
            
            **2,739,561**
            
            
            **(210,978**
            **)****Cash
                and cash equivalents, beginning of period**
            
            
            **88,192**
            
            
            **504,692****Cash
                and cash equivalents, end of period**
            
            **$**
            **2,827,753**
            
            **$**
            **293,714****Supplemental
                cash flow information****Cash
                paid for taxes**
            
            **$**
            **—**
            
            **$**
            **—****Cash
                paid for interest**
            
            **$**
            **—**
            
            **$**
            **—**




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





NOTES
      TO
      THE INTERIM FINANCIAL STATEMENTS


September
      30, 2006


(Unaudited)





**(1)**
            **Nature
                and Continuance of
                Operations**





Neuro-Hitech,
      Inc. (the “Company” or “Neuro-Hitech”) is an early stage pharmaceutical company
      engaged in the development and commercialization of huperzine A for Alzheimer’s
      disease and other degenerative neurological disorders .
      Through
      a collaboration with the Alzheimer’s Disease Cooperative Study (“ADCS”), formed
      in 1991 as a cooperative agreement between the National Institute of Aging
      and
      the University of California San Diego, for advancing the research of drugs
      for
      treating patients with Alzheimer’s disease (“AD”), the National Institutes of
      Health (“NIH”) and Georgetown University Medical Center (“Georgetown”), the
      Company has completed two Phase I studies and is currently conducting a Phase
      II
      clinical trial for huperzine A. Huperzine A is a cholinesterase inhibitor that
      the Company believes may be effective in the treatment of AD and Mild Cognitive
      Impairment (“MCI”), although, to date, its efforts have been focused upon
      huperzine A’s effectiveness in AD.





**Basis
      of Presentation**





The
      accompanying unaudited interim financial statements have been prepared in
      accordance with United States generally accepted accounting principles for
      interim financial information. They may not include all information and
      footnotes required by United States generally accepted accounting principles
      for
      complete financial statements. In the opinion of Management, all adjustments
      considered necessary to make the interim financials not misleading, consisting
      solely of normal recurring adjustments, have been made.





The
      results of operations for such interim periods are not necessarily indicative
      of
      results of operations for a full year. The unaudited financial statements should
      be read in conjunction with the audited financial statements and notes thereto
      and management’s discussion and analysis of financial condition and results of
      operations included in the Annual Report on Form 10-KSB for the year ended
      December 31, 2005.




**(2)**
            **Summary
                of Significant Accounting
                Policies**





**Accounting
      Policies**




The
      accounting policies followed by the Company are set forth in Note 1 to the
      Company’s financial statements in the December 31, 2005 Form
      10-KSB.




**Basic
      and Diluted Loss Per Share**




Basic
      earnings (loss) per share reflect the amount of earnings (loss) for the period
      attributable to each share of common stock outstanding during the reporting
      period. For the three and nine month periods ended September 30, 2006 the
      Company recorded a loss and as a result, the average number of common shares
      used in the calculation of basic and diluted loss per share have not been
      adjusted for the effects of potential common shares from unexercised stock
      options and warrants.




As
      of
      September 30, 2006 options and warrants issued to employees and consultants
      pursuant to the Company’s long-term stock incentive plan to purchase an
      aggregate of 800,000 shares of common stock at $2.50 per share were authorized.
      Approximately 625,000 options are outstanding to date. In connection with a
      private placement of its securities, in January 2006, the Company granted
      warrants to purchase an aggregate of 537,500 shares of common stock at prices
      ranging from $2.50 to $5.00. In June 1997 the Company granted warrants to
      purchase an aggregate of 48,000 shares of common stock for approximately $.92
      per share.




**Stock-Based
      Compensation**




In
      2006,
      the Company began to recognize expense of options or similar instruments issued
      to employees using the fair-value-based method of accounting for stock-based
      payments in compliance with SFAS 123(R) “Share-Based Payment.” For the nine
      months ended September 30, 2006, the Company recognized $302,642 of stock
      compensation expense. As of September 30, 2006, there was approximately $979,143
      of total unrecognized compensation cost related to nonvested stock-based
      compensation arrangements granted. That cost is expected to be recognized over
      a
      weighted-average period of 2.6 years.





**Use
      of Estimates and Assumptions**





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





**Income
      Taxes**





The
      Company follows the liability method of accounting for income taxes. Under
      this
      method, deferred income tax assets and liabilities are recognized for the
      estimated tax consequences attributable to differences between the financial
      statement carrying values and their respective income tax basis (temporary
      differences). The effect on deferred income tax assets and liabilities of a
      change in tax rates is recognized in income in the period that includes the
      enactment date. At December 31, 2005 and September 30, 2006, a full deferred
      tax
      asset valuation allowance has been provided and no deferred tax asset has been
      recorded.





**(3)**
            **Capital
                Stock**





On
      January 17, 2006, Northern Way Resources, Inc., a Nevada corporation
      (“Northern-NV”) was merged with and into Northern Way Resources Inc., a Delaware
      corporation (“Northern-DE”) for the sole purpose of changing its state of
      incorporation from Nevada to Delaware pursuant to an Agreement and Plan of
      Merger dated January 12, 2006 (“Reincorporation Merger Agreement”), which was
      approved through an action by written consent of a majority of the stockholders
      on January 12, 2006 (“Reincorporation Merger”). Under the terms of the
      Reincorporation Merger, each share of Northern-NV was exchanged for one share
      of
      Northern-DE. In connection with the Reincorporation Merger, Northern-DE changed
      its name to Neurotech Pharmaceuticals, Inc. (“Neurotech”).




On
      January 24, 2006 Neurotech entered into an Agreement of Merger and Plan of
      Reorganization by and among Neurotech, Marco Hi-Tech JV Ltd., a privately held
      New York corporation, and Marco Acquisition I, Inc., (“Acquisition Sub”) a newly
      formed wholly-owned Delaware subsidiary of Neurotech. Upon closing of the merger
      transactions contemplated under the Merger Agreement Acquisition Sub was merged
      with and into Marco, and Marco became a wholly-owned subsidiary of
      Neurotech.





On
      January 25, 2006, Neurotech filed a Certificate of Amendment to its Certificate
      of Incorporation in the State of Delaware in order to change its name to
      Neuro-Hitech Pharmaceuticals, Inc.





Immediately
      after the closing of the Merger on January 24, 2006, there were 7,691,506 shares
      of Neuro-Hitech Common Stock issued and outstanding and 100 shares of
      Neuro-Hitech Class A Common Stock issued and outstanding.





Subsequent
      to the closing of the Merger, Neuro-Hitech completed a private offering to
      accredited investors of units, with each unit consisting of (i)10,000 shares
      of
      Neuro-Hitech Common Stock and (ii) a detachable, transferable three-year warrant
      to purchase 2,500 shares of Neuro-Hitech Common Stock, and received gross
      proceeds of $4,375,000 at the completion of the private offering. $3,250,000
      of
      the proceeds were accepted by Neuro-Hitech on January 24, 2006, $862,500 of
      proceeds were accepted by Neuro-Hitech on January 27, 2006, $237,500 of proceeds
      were accepted by Neuro-Hitech on February 2, 2006 and $25,000 of proceeds were
      accepted by Neuro-Hitech on March 2, 2006.




**(4)**
            **Material
                  Definitive
                  Agreements**





On
      March
      15, 2006, the Company entered into a Development Agreement with Xel
      Herbaceuticals, Inc. (“XEL”) for XEL to develop a huperzine A Transdermal
      Delivery System (the “Product”). Under the terms of the Agreement, the Company
      paid XEL a $250,000 fee upon the execution of the Agreement and will pay XEL
      $92,500 per month during the development of the Product, which development
      is
      estimated to take approximately 16 months. The monthly payment is subject to
      quarterly adjustment and subject to a limit on aggregate development cost
      overruns of $250,000. **** XEL
      has
      agreed to pay any cost overruns in excess of $250,000.





On
      February 1, 2006, the Company entered into an exclusive development agreement
      with Org Syn Laboratory, Inc. (“Org Syn”) for the development by Org Syn of
      synthetic huperzine A, in accordance with the terms of the Agreement. Org Syn
      is
      entitled to receive an aggregate of $175,894 upon the execution of the
      Agreement, $175,916 six months from the execution date and an additional $67,664
      seven months from the execution date (subject to the achievement of certain
      milestones) for services rendered under the Agreement.








**(5)**
            **New
                Authoritative
                Pronouncements**





In
      February 2006, the Financial Accounting Standards Board (“FASB”) issued
      Statement of Financial Accounting Standard (“SFAS”) 155, Accounting for Certain
      Hybrid Financial Instruments an amendment of SFAS 133, Accounting for Derivative
      Instruments and Hedging Activities, and SFAS 140, Accounting for Transfers
      and
      Servicing of Financial Assets and Extinguishments of Liabilities. SFAS 155,
      provides the framework for fair value remeasurement of any hybrid financial
      instrument that contains an embedded derivative that otherwise would require
      bifurcation as well as establishes a requirement to evaluate interests in
      securitized financial assets to identify interests. SFAS 155 further amends
      FASB
      140 to eliminate the prohibition on a qualifying special-purpose entity from
      holding a derivative financial instrument that pertains to a beneficial interest
      other than another derivative financial instrument. SFAS 155 also clarifies
      which interest-only strips and principal-only strips are not subject to the
      requirements of SFAS 133 and concentrations of credit risk in the form of
      subordination are not embedded derivatives. This Statement is effective for
      all
      financial instruments acquired or issued after the beginning of an entity’s
      first fiscal year that begins after September 15, 2006. SFAS 155 is not expected
      to have a material impact on the Company’s consolidated financial
      statements.





In
      March
      2006, FASB issued SFAS 156, Accounting for Servicing of Financial Assets-an
      amendment of SFAS 140. SFAS 156 requires the recognition of a servicing asset
      or
      servicing liability under certain circumstances when an obligation to service
      a
      financial asset by entering into a servicing contract. SFAS 156 also requires
      all separately recognized servicing assets and servicing liabilities to be
      initially measured at fair value utilizing the amortization method or fair
      market value method. SFAS 156 is effective at the beginning of the first fiscal
      year that begins after September 15, 2006. SFAS 156 is not expected to have
      a
      material impact on the Company’s consolidated financial statements.





**Item
      2. Management’s Discussion and Analysis or Plan of
      Operation**





**FORWARD-LOOKING
      STATEMENTS**




This
      Quarterly Report on Form 10-QSB contains forward-looking statements (as defined
      in Section 27A of the Securities Act and Section 21E of the Exchange Act).
      To
      the extent that any statements made in this Report contain information that
      is
      not historical, these statements are essentially forward-looking.
      Forward-looking statements can be identified by the use of words such as
“expects,” “plans” “will,” “may,” “anticipates,” “believes,” “should,”
“intends,” “estimates,” “projects” and other words of similar meaning. These
      statements are subject to risks and uncertainties that cannot be predicted
      or
      quantified and consequently, actual results may differ materially from those
      expressed or implied by such forward-looking statements. Such risks and
      uncertainties include those outlined in “Risk Factors” found within our Annual
      Report on Form 10-KSB and include, without limitation, the Company’s limited
      cash and ability to raise capital to finance the growth of the Company’s
      operations, the ability of the Company to develop its products and obtain
      necessary governmental approvals, the Company’s ability to protect its
      proprietary information, the Company’s ability to attract or retain qualified
      personnel, including scientific and technical personnel and other risks detailed
      from time to time in the Company’s filings with the SEC, or
      otherwise.





All
      references to the “Company” for periods prior to the closing of the Merger refer
      to Marco, and references to the “Company” for periods subsequent to the closing
      of the Merger refer to Neuro-Hitech and its subsidiaries.





THE
      FOLLOWING DISCUSSION SHOULD BE READ TOGETHER WITH THE INFORMATION CONTAINED
      IN
      THE FINANCIAL STATEMENTS AND RELATED NOTES INCLUDED ELSEWHERE IN THIS QUARTERLY
      REPORT ON FORM 10-QSB .





**History**





We
      were
      originally formed on February 1, 2005, as Northern Way Resources, Inc., a Nevada
      corporation, for the purpose of acquiring exploration and early stage natural
      resource properties. On
      January 24, 2006, we entered into an Agreement and Plan of Reorganization (the
      “Merger Agreement”) by and among us, Marco Hi-Tech JV Ltd., a privately held New
      York corporation (“Marco”), and Marco Acquisition I, Inc., a newly formed
      wholly-owned Delaware subsidiary of ours (“Acquisition Sub”). Upon closing of
      the transactions contemplated under the Merger Agreement (the “Merger”),
      Acquisition Sub was merged with and into Marco, and Marco became a wholly-owned
      subsidiary of ours. The merger was consummated on that date and in connection
      with that merger, we changed our name to Neuro-Hitech Pharmaceuticals, Inc.
      We
      changed the name of our company to Neuro-Hitech, Inc. (“Neuro-Hitech”) effective
      August 11, 2006.





Marco
      was
      incorporated in the State of New York on December 11, 1996. Through 2005, Marco
      conducted analytical work and clinical trials of huperzine A and was focused
      primarily on licensing proprietary HupA technology from independent third-party
      developers and investigators, including the Mayo Foundation, and until such
      time
      operated with no full-time employees and minimal internal resources. In
      addition, from time to time, Marco has imported and sold inventories of natural
      huperzine and other dietary supplement ingredients to vitamin and supplement
      suppliers to generate revenues. In 2005, Marco decided to raise additional
      capital to pursue additional approvals and undertake necessary studies for
      the
      development and commercialization of HupA, including funding development and
      securing rights to third-party transdermal patch technology and may change
      its
      manner of operations to reflect increased activity, including personnel needs.





**Overall
      Operating Results**





The
      following discussion provides a comparison of our results from operations for
      the quarter ended September 30, 2006 to the quarter ended September 30, 2005,
      and the nine months ended September 30, 2006 and September 30, 2005.





We
      had
      revenues from operations of $182,800 in the quarter ended September 30, 2006,
      a
      2,802% increase from the $6,300 in revenue achieved from quarter ended September
      30, 2005. The increase in revenue was a result of an increase in product sales
      of natural huperzine. We had revenues from operations of $260,140 for the nine
      months ended September 30, 2006, a 66% increase from $156,366 in revenue
      achieved during the nine months ended September 30, 2005. The revenue increase
      is due solely to the sale of natural huperzine.





Cost
      of
      goods sold as a percentage of our revenue was 52% for the quarter ended
      September 30, 2006, compared with 40% for the quarter ended September 30, 2005.
      Cost of goods sold as a percentage of our revenue was 48% for the nine months
      ended September 30, 2006, compared with 34% for the nine months ended September
      30, 2005. Our total selling, general and administrative expenses increased
      225%
      from $100,268 in the quarter ended September 30, 2005 to $326,269 in the quarter
      ended September 30, 2006. Our total selling general and administrative expenses
      increased 179% from $295,054 at September 30, 2005 to $822,635 for the nine
      months ended September 30, 2006 . The increase in these expenses is attributable
      to an increase in compliance expenses associated with being a public company,
      consulting and employee costs and legal costs.





Our
      research and development costs increased 606% from $97,116 in the quarter ended
      September 30, 2005 to $685,401 in the quarter ended September 30, 2006. Research
      and development increased 538% from $294,533 for the nine months ended September
      30, 2005 to $1,879,020 for the nine months ended September 30, 2006. The
      increase in our research and development expenses is attributable to developing
      our transdermal patch, developing synthetic huperzine A and expenses related
      to
      our clinical trials.





**Plan
      of Operation**





The
      Company is an early stage pharmaceutical company engaged in the development
      and
      commercialization of huperzine A for Alzheimer’s disease and other degenerative
      neurological disorders. Through a collaboration with ADCS, and Georgetown,
      the
      Company has completed two Phase I studies and is currently conducting a Phase
      II
      clinical trial for huperzine A. Huperzine A is a cholinesterase inhibitor that
      the Company believes may be effective in the treatment of AD and MCI, although,
      to date, its efforts have been focused upon huperzine A’s effectiveness in AD.
      Subject to the Company’s ability to recruit participants for the study at the
      specified recruitment level the Company presently anticipates that the current
      recruitment of participants will be completed in the first quarter of 2007,
      with
      data compilation expected to be completed in the third quarter of 2007. However,
      the Company is considering increasing the number of subjects in the study,
      which
      if implemented, would require additional recruitment. The results of recruitment
      are difficult to forecast and recruitment at a slower rate than anticipated
      could delay conclusion of such studies.





The
      Company’s current strategy is to make huperzine A available in both oral and
      transdermal form. As part of these efforts, on March 15, 2006, the Company
      entered into a development agreement with XEL to develop a transdermally
      delivered product. The Company believes that huperzine A can effectively be
      delivered transdermally because of its low dosage requirement, and low molecular
      weight. The Company currently intends to focus upon the development of
      collaborative, joint and strategic alliances and licensing arrangements with
      various pharmaceutical companies for marketing the Company’s products once FDA
      approval is obtained although there is no assurance that FDA approval will
      be
      obtained. The Company presently believes the estimated additional costs to
      bring
      the product to market as an oral dose drug, after completing two Phase III
      clinical trials, will be substantial and no assurances as to future cost can
      be
      made.





Upon
      obtaining FDA approval for huperzine A, it is anticipated that the Company’s
      collaborative partners, if the Company is successful in obtaining collaborative
      partners, will be primarily responsible for the sale and distribution of
      huperzine A products. Efforts will be made to reach licensing agreements with
      collaborative partners to participate in earlier phases of the drug development
      process for the Company’s products, reducing the likelihood of the need for it
      to obtain financing for the additional development costs. This strategy may
      enable the Company to gain access to the marketing expertise and resources
      of
      the Company’s potential partners, and to lower its capital requirements.





A
      marketing study funded by the Company has shown patient compliance is a crucial
      factor in determining patient and doctor choice in choosing a medication for
      AD.
      Often it is the responsibility of a caregiver to remind the patient to take
      the
      orally given medications. Recognizing this, the Company hopes to develop and
      license a multi-day transdermal patch, which, if successfully realized, will
      be
      able to be applied to the patient for more than one day. Although the Company’s
      primary focus is the commercialization of huperzine A, the Company may also
      investigate and consider other drugs and compounds with neurological
      applications.





**Capital
      Resources and Cash Requirements**





Between
      January 2006 and March 2006, the Company received total gross proceeds of
      $4,375,000 from a private placement of securities to certain accredited
      investors that purchased an aggregate of 1,750,000 shares of the Company’s
      common stock and warrants to purchase 437,500 shares of the Company’s common
      stock (the “Offering”).





The
      principal purposes of the funding from the Offering are to continue clinical
      trials, development of transdermal technologies, synthetic processes of
      huperzine A and general working capital. The Company may also use funds from
      the
      Offering to acquire additional products or technologies and for other working
      capital needs, such as the costs related to being a public company including
      SEC
      compliance. The proceeds of the Offering are not expected to be sufficient
      to
      provide funding to pursue many avenues of investigation of the technology,
      and
      are planned to be primarily devoted to clinical testing and development of
      transdermal patch technology.





On
      February 1, 2006, Neuro-Hitech, Inc. entered into an exclusive development
      agreement with Org Syn for the development by Org Syn of synthetic huperzine
      A,
      in accordance with the terms of the Agreement. Org Syn is entitled to receive
      an
      aggregate of $175,894 upon the execution of the Agreement, $175,916 six months
      from the execution date and an additional $67,664 seven months from the
      execution date (subject to the achievement of certain milestones) for services
      rendered under the Agreement.





On
      March
      15, 2006, the Company entered into a Development Agreement with XEL for XEL
      to
      develop a huperzine A Transdermal Delivery System (the “Product”). Under the
      terms of the Agreement, the Company paid XEL a $250,000 fee upon the execution
      of the Agreement and will pay XEL $92,500 per month during the development
      of
      the Product, which development is estimated to take approximately 16 months.
      The
      monthly payment is subject to quarterly adjustment and subject to a limit on
      aggregate development cost overruns of $250,000. **** XEL
      has
      agreed to pay any cost overruns in excess of $250,000.





Although
      the Company has developed initial plans and assumptions related to its
      operations, management retains significant flexibility in applying a substantial
      portion of the net proceeds of the Offering. Pending use of the net proceeds,
      the Company may invest the net proceeds of the Offering in short-term,
      interest-bearing, investment-grade securities or accounts.





The
      amounts and timing of the Company’s actual expenditures will depend upon
      numerous factors, including the progress of the Company’s efforts. The foregoing
      discussion represents the Company’s best estimate of its allocation of the net
      proceeds of the Offering based upon current plans and estimates regarding
      anticipated expenditures. Actual expenditures may vary substantially from these
      estimates, and the Company may find it necessary or advisable to reallocate
      the
      net proceeds within the above-described uses or for other purposes.





The
      Company anticipates, based on current plans and assumptions relating to
      operations, that its cash and cash equivalents are sufficient to satisfy its
      contemplated cash requirements to implement its business plan for at least
      the
      next twelve months. In the event that the Company’s cash and cash equivalents
      prove to be insufficient to fund the implementation of its business plan (due
      to
      a change in the Company’s plans or a material inaccuracy in its assumptions, or
      as a result of unanticipated expenses, technical difficulties or other
      unanticipated problems), the Company will be required to seek additional
      financing sooner than currently anticipated in order to proceed with such
      implementation. Additional funds may not be available on acceptable terms,
      if at
      all. If adequate funds are unavailable from any available source, the Company
      may have to delay, reduce the scope of or eliminate one or more of its research
      or development programs or product launches or marketing efforts which may
      materially harm the Company’s business, financial condition and results of
      operations.





**Critical
      Accounting Policies**





Our
      financial statements are prepared in accordance with accounting principles
      generally accepted in the United States of America. Preparing financial
      statements in accordance with generally accepted accounting principles requires
      management to make estimates and assumptions which affect the reported amounts
      of assets and liabilities and the disclosure of contingent assets and
      liabilities at the balance sheet dates, and the recognition of revenues and
      expenses for the reporting periods. These estimates and assumptions are affected
      by management’s application of accounting policies.





**Item
      3.**  **Controls
      and Procedures**





The
      Company maintains disclosure controls and procedures that are designed to ensure
      that information required to be disclosed in the Company’s reports under the
      Securities Exchange Act of 1934, as amended, is recorded, processed, summarized
      and reported within the time periods specified in the SEC’s rules and forms, and
      that such information is accumulated and communicated to the Company’s
      management, including its Chief Executive Officer and Chief Financial Officer,
      as appropriate, to allow timely decisions regarding required disclosure. In
      designing and evaluating the disclosure controls and procedures, management
      recognized that any controls and procedures, no matter how well designed and
      operated, can provide only reasonable assurance of achieving the desired control
      objectives, and management necessarily was required to apply its judgment in
      evaluating the cost-benefit relationship of possible controls and
      procedures.





Evaluation





The
      Company carried out an evaluation, under the supervision, and with the
      participation, of the Company’s management, including the Company’s Chief
      Executive Officer and the Company’s Chief Financial Officer, of the
      effectiveness of the Company’s disclosure controls and procedures as of
      September 30, 2006. Based on the foregoing, the Company’s Chief Executive
      Officer and principal financial officer concluded that the Company’s disclosure
      controls and procedures were effective as of September 30, 2006.





There
      have been no significant changes during the quarter covered by this report
      in
      the Company’s internal control over financial reporting or in other factors that
      could significantly affect the internal control over financial
      reporting.





**PART
      II**  **OTHER
      INFORMATION**





**Item
      6.**  **Exhibits.**




**Exhibit
      List**




Exhibit
                No.
            Description31.1
            Certification
                of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley
                Act of 2002.31.2
            Certification
                of the Chief Financial Officer Pursuant to Section 302 of the
                Sarbanes-Oxley Act of 2002.32.1
            Certification
                of the Chief Executive Officer and Chief Financial Officer Pursuant
                to 18
                U.S.C. 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley
                Act
                of 2002.







**SIGNATURES**





Pursuant
      to the requirements of the Securities Exchange Act of 1934, the registrant
      has
      duly caused this report to be signed on its behalf by the undersigned thereunto
      duly authorized.




**Neuro-Hitech,
              Inc.**(Registrant)Date:
              November 14,
              2006
            
            
            /s/ Reuben
              SeltzerReuben
              SeltzerPresident
              and
              Chief Executive Officer


Date:
              November 14,
              2006
            
            
            /s/ 
David
              BarrettDavid
              BarrettChief
                Financial Officer