<PAGE>

                                  United States
                       Securities and Exchange Commission
                             Washington, D.C. 20549

                                    Form 10-K

(Mark One)

[X]               Annual  Report  Under  Section  13 or 15(d) of the  Securities
                  Exchange  Act of 1934 For the fiscal year ended  December  31,
                  2000

                                                     Or

[]                 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: 000-21994

                              Glyko Biomedical Ltd.

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

Canada                                                    98-0195569
(State of other jurisdiction of             (I.R.S. Employer Identification No.)
incorporation or organization)

371 Bel Marin Keys Blvd., #210, Novato, California            94949
(Address of principal executive offices)                   (Zip Code)

                  Registrant's telephone number: (415) 884-6700


        Securities registered pursuant to Section 12(b) of the Act: None
                       Securities registered under Section
                               12(g) of the Act:

                           Common Stock, no par value
                                (Title of Class)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the 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
    -----     ----

Indicate by check mark if disclosure  of  delinquent  filers in response to Item
405 of Regulation  S-K is not contained in this form, and will not be contained,
to the best of  registrant's  knowledge,  in  definitive  proxy  or  information
statements  incorporated  by  reference  in  Part  III to the  Form  10-K or any
amendment to this Form 10-K. __

The  aggregate  market value of the voting stock held by  non-affiliates  of the
Registrant  as of March  16,  2001 was  US$76,398,850.  The  number of shares of
common stock, no par value, outstanding on March 16, 2001 was 34,352,823.




<PAGE>
                              GLYKO BIOMEDICAL LTD.

                                     Part I

      This Form 10-K  contains  "forward-looking  statements"  as defined  under
      securities  laws. Many of these statements can be identified by the use of
      terminology such as "believes," "expects,"  "anticipates," "plans," "may,"
      "will," "projects," "continues," "estimates,"  "potential,"  "opportunity"
      and so on. These  forward-looking  statements may be found in the "Factors
      That May Affect Future  Results,"  "Description  of  Business,"  and other
      sections  of this  Annual  Report on Form  10-K..  Our  actual  results or
      experience could differ significantly from the forward-looking statements.
      Factors that could cause or contribute to these differences  include those
      discussed in "Factors That Might Affect Future  Results," as well as those
      discussed  elsewhere in this Form 10-K. You should carefully consider that
      information before you make an investment decision.

      You should not place undue reliance on these statements,  which speak only
      as of the date that they were made. These cautionary  statements should be
      considered  in  connection  with  any  written  or  oral   forward-looking
      statements  that we may  issue  in the  future.  We do not  undertake  any
      obligation  to release  publicly any  revisions  to these  forward-looking
      statements  after  completion  of the  filing of this Form 10-K to reflect
      later  events  or   circumstances   or  to  reflect  the   occurrence   of
      unanticipated events.

Item 1.   Description of Business

We filed our Certificate and Articles of Incorporation  under the laws of Canada
on June 26, 1992. Our registered  office is Box 25, Commerce Court West, 199 Bay
Street, Toronto,  Ontario, Canada M5L 1A9. Our principal executive office is 371
Bel  Marin  Keys  Blvd.,   #210,   Novato,  CA  94949.  On  December  21,  1992,
simultaneously  with the initial public offering of our common stock and listing
on The Toronto Stock  Exchange,  we acquired 100% of the  outstanding  shares of
Glyko, Inc., a company  incorporated under the laws of Delaware.  At the time of
acquisition, Glyko, Inc. was involved with original scientific research aimed at
developing novel analytic and research instrumentation for carbohydrate research
and for human medical  diagnosis.  We were  incorporated for the sole purpose of
acquiring Glyko, Inc.

On October 25, 1996, we formed  BioMarin  Pharmaceutical  Inc.  ("BioMarin"),  a
corporation   incorporated   under  the  laws  of   Delaware,   to  develop  our
pharmaceutical  products.  BioMarin is currently a developer of enzyme therapies
for debilitating,  life-threatening, chronic genetic diseases and other diseases
and conditions. It is currently focusing its research and development efforts on
three potential  products,  AldurazymeTM , rhASB and Vibriolysin.  On October 7,
1998, we sold Glyko, Inc to BioMarin. Glyko, Inc. continues to be a wholly-owned
subsidiary of BioMarin producing certain carbohydrate  analytical products. As a
result  of our  sale  of  Glyko,  Inc.,  we  have  no  operating  activities  or
operational  employees.  Our only  significant  asset,  other  than  cash,  cash
equivalents  and  investments  in certain  short-term  United States  government
securities,  which are less than 9% of our total  assets,  is our  investment in
BioMarin.

The  registered  and  principal  office of BioMarin is 371 Bel Marin Keys Blvd.,
#210, Novato,  California 94949. BioMarin's common stock is listed on the Nasdaq
National  Market  and the Swiss New  Market  under the  symbol  "BMRN".  It is a
reporting company under the Securities  Exchange Act of 1934 and regularly files
reports on Form 10-K and 10-Q. Most recently,  on March 20, 2001, BioMarin filed
its annual report on Form 10-K for the year ended December 31, 2000.

Beginning in October 1997, BioMarin commenced raising capital from third parties
and engaging in other  transaction  which  resulted in BioMarin  issuing  common
stock to entities other than us. As a result, our percentage  ownership interest
in BioMarin has  continued to decrease.  As of December 31, 1999,  our ownership
percentage  had  decreased to 32.6%,  and by December 31,  2000,  our  ownership
percentage has further decreased to 31.0%.

As of December 31, 1997, we began  recording  our share of  BioMarin's  net loss
utilizing the equity method of  accounting.  While  BioMarin has an  accumulated
deficit  of  $80.5  million  at  December  31,  2000  and is  expected  to incur
significant  losses  during  2001 and into 2002 at a minimum,  we do not believe
that there has been any impairment of our investment in BioMarin.

Since our inception,  we have incurred a cumulative deficit of $40.8 million and
we expect to continue to incur losses during 2001 due to our share of BioMarin's
net loss  resulting  from the ongoing  research and  development  of  BioMarin's
pharmaceutical product candidates.

Since October 8, 1998, we have agreed to pay BioMarin a monthly  management  fee
for its services to us primarily relating to management, accounting, finance and
government reporting. BioMarin had accrued receivables from us relating to these
services of $37,500 and $8,800 for the years ended  December  31, 1999 and 2000,
respectively.

For a more complete description of BioMarin's business,  we advise you to review
the reports  filed by BioMarin  with the  Securities  and  Exchange  Commission,
including its annual report on Form 10-K for the year ended December 31, 2000.

                                        1


<PAGE>
                     FACTORS THAT MAY AFFECT FUTURE RESULTS

Dependence on Investment in BioMarin

As of  December  31,  2000,  our  principal  asset  was our 31.0%  ownership  of
BioMarin's outstanding capital stock. Our success is dependent on the successful
operations  of BioMarin  including,  but not limited to,  BioMarin's  ability to
receive FDA approval of existing and future  pharmaceutical  product candidates,
BioMarin's  ability to retain key personnel,  BioMarin's  ability to manufacture
and market products effectively and successfully and BioMarin's ability to raise
additional  cash to fund  future  operations.  BioMarin is a  development  stage
company,  with its only  revenues  currently  being  earned from the sale of its
analytic and diagnostic  products  resulting from the acquisition of Glyko, Inc.
and cost  reimbursement  revenues for services  performed from its joint venture
with Genzyme for development and commercialization of Aldurazyme.

Lack Of Diversification

Our investment assets are not diversified and therefore the market price for our
common stock is directly  dependent on the marked price for shares of BioMarin's
common  stock.  Shares of  BioMarin's  Common  Stock have been highly  volatile.
During the year 2000, the high and low closing prices of BioMarin's common stock
on Nasdaq were $38.75 and $7.16,  respectively.  In order to minimize this risk,
we would need to reduce our reliance on our BioMarin  shareholding,  for example
by selling some of our interest in BioMarin.  At this time,  we do not intend to
diversify our holdings due to tax expenses associated with selling our shares of
BioMarin's common stock.

History of Operating Losses - Uncertainty of Future Profitability

Since our inception,  we have incurred a cumulative deficit of $40.8 million and
we  expect  to  continue  to  incur  losses  through  2002  due to our  share of
BioMarin's  net loss  resulting  from the ongoing  research and  development  of
BioMarin's  pharmaceutical product candidates. As a result of our sale of Glyko,
Inc.  on  October  7,  1998,  we have no  operating  activities  or  operational
employees and our principal asset is our investment in BioMarin.

Item 2.  Description of Property    None.
         -----------------------

Item 3.  Legal Proceedings          None.
        ------------------

Item 4.  Submission of Matters to a Vote of Security-Holders   None.
         ---------------------------------------------------

































                                        2


<PAGE>
                                     PART II

Item 5.  Market For Common Equity and Related Stockholder Matters

As of November  1993,  our common  shares  have been listed on the OTC  Bulletin
Board  under the symbol  "GLYK".  The  trading  of our  common  stock on the OTC
Bulletin Board has been limited and sporadic. Our common shares have been listed
and traded on The Toronto  Stock  Exchange  (TSE) since  December 1992 under the
symbol  "GBL." The  following  table sets forth the sales  prices for our common
shares for the periods noted,  as reported by TSE.  Prices are the closing price
on the TSE during the periods indicated.

                                     Prices
                             (In Canadian Dollars)*

         Year    Period                                  High             Low

         1999   First Quarter                            $7.05           $5.90
         1999   Second Quarter                           $6.30           $5.75
         1999   Third Quarter                            $7.80           $5.70
         1999   Fourth Quarter                           $7.70           $5.00
         2000   First Quarter                           $13.55           $5.30
         2000   Second Quarter                           $9.75           $6.80
         2000   Third Quarter                            $9.00           $7.00
         2000   Fourth Quarter                           $7.90           $3.75

*As of December 29, 2000, the Canadian  dollar to U.S.  dollar exchange rate was
$0.665775.

Holders

As of  February  29,  2001,  there  were 120  holders  of record  of  34,352,823
outstanding common shares.

Dividend Policy

We have not paid any dividends on our common shares in the last two years. We do
not anticipate the payment of dividends in the foreseeable  future.  The payment
of dividends in the future will depend upon, among other factors,  our earnings,
capital requirements and operating and financial condition.













































                                        3


<PAGE>
Item 6.  Selected consolidated financial data

The selected  consolidated  balance  sheet data of Glyko  Biomedical  Ltd. as of
December 31, 1996, 1997, 1998, 1999 and 2000 and the consolidated  statements of
operations data for the years ended December 31, 1996, 1997, 1998, 1999 and 2000
are presented  below.  These  financial  statements  have been audited by Arthur
Andersen LLP, independent public accountants.

The  selected  financial  data set forth below  contain  only a portion of GBL's
financial  statement  information  and  should be read in  conjunction  with the
Consolidated Financial Statements of Glyko Biomedical Ltd. and related Notes and
"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations" included elsewhere herein.
<TABLE>


GBL's Consolidated                                             Year Ended December 31,
Statements of Operations:               --------------------------------------------------------------------
                                           2000            1999          1998         1997           1996
                                        ----------   -----------   -------------   -----------    -----------
<S>                                     <C>          <C>           <C>             <C>            <C>
Revenues                                $       -    $        -    $ 1,159,916     $ 2,036,634    $ 1,330,635
Operating costs and expenses:
Cost of products and services                   -             -        284,860         482,770        509,248
Research and development                        -             -        679,783         605,803      1,014,966
Selling, general and administrative        388,373       199,302       690,950         562,888      1,425,484
Other                                           -             -       (165,880)             -              -
                                        ----------     ----------  -------------   -----------    -----------
   Total costs and expenses                388,373       199,302     1,489,713       1,651,461      2,949,698
                                        ----------     ----------  -------------   -----------    -----------
Profit (loss) from operations             (388,373)     (199,302)     (329,797)        385,173     (1,619,063)
Equity in loss of BioMarin
   Pharmaceutical Inc.                 (11,312,285)   (9,999,581)   (3,803,058)     (2,452,422)            -
Interest income                             65,317       159,352        42,822          12,610         18,367
Other income (loss)                             -             -             -           (1,219)        24,837
                                      ------------    ------------  ------------    ----------    -----------
Net Loss                              $(11,635,341)   $(10,039,531) $(4,090,033)    (2,055,858)    (1,575,859)
                                      ============    ============  ============    ==========    ===========
Net loss per common share, basic
   and diluted                        $      (0.34)   $      (0.32) $     (0.17)    $    (0.10)   $     (0.10)
                                      =============   ============  ===========     ==========    ===========
Weighted average common
    shares outstanding                  33,915,043      31,065,575   23,873,798     20,536,058     16,058,994
                                      =============   ============  ===========     ==========     ==========
</TABLE>
<TABLE>

                                                                        As of December 31,
                                            -------------------------------------------------------------------
<S>                                             <C>            <C>           <C>          <C>           <C>
GBL's Consolidated Balance Sheet Data:          2000           1999          1998         1997          1996
                                            ------------   -----------   -----------   ----------   -----------
Cash, cash equivalents
  and short-term investments                 $ 1,805,350   $   574,648   $ 2,567,824   $  528,280   $   210,992
Total current assets                           1,835,226       574,648     2,667,854      780,412       461,645
Total assets                                  20,855,731    29,483,095    10,342,583    3,927,518       571,890
Total shareholders' equity (deficit)          20,540,293    29,117,526     9,931,444    3,129,314      (296,875)

</TABLE>

























                                        4

<PAGE>
Item 7. Management's  Discussion and Analysis of Financial Condition and Results
of Operations


The following  discussion  of the financial  condition and results of operations
should be read in  conjunction  with our  financial  statements  and their notes
appearing elsewhere in this document.

Overview

As a result of our sale of Glyko,  Inc. to BioMarin,  as of October 7, 1998,  we
have no  operating  activities  and our  principal  asset is our  investment  in
BioMarin. At this time, we have no plans to commence any operating activities or
to diversify our assets.  We are a Canadian holding company that at December 31,
2000 owned 31.0% of the capital stock of BioMarin  Pharmaceutical Inc. We record
BioMarin's  results  of  operations  using  the  equity  method  of  accounting.
Numerical  references  in the  following  discussion  are rounded to the nearest
thousand.

Our net loss for the years ended 2000,  1999 and 1998 was $11.6  million,  $10.0
million and $4.1 million,  respectively.  The primary component of this loss was
our share of the net loss of BioMarin  accounted  for under the equity method of
accounting.  We expect to continue to incur losses through 2002 due to our share
of  BioMarin's  net  loss  resulting  from  BioMarin's   ongoing   research  and
development of  pharmaceutical  product  candidates.  The BioMarin losses do not
have an impact on our cash position.  While BioMarin has an accumulated  deficit
of $80.5  million at December  31,  2000 and is  expected  to incur  significant
losses through 2002, we do not believe that there has been any impairment of our
investment in BioMarin.

Results of Operations

Years Ended December 31, 2000 and 1999

Our general and  administrative  expenses were $388,000 for 2000, an increase of
$189,000 from the general and  administrative  expenses of $199,000  incurred in
1999. The increase was primarily due to the additional legal expenses associated
with the annual  shareholder  meeting and  additional  Board travel  expenses in
connection  with the  election  of a new slate of Board  members  in June  2000.
General  and  administrative   expense  includes  legal  fees,  Board  expenses,
management  fees  billed by BioMarin  for  management,  accounting,  finance and
government reporting, and other outside administrative support expenses.

Our equity in loss of  BioMarin  for 2000 was $11.3  million  compared  to $10.0
million for 1999,  an  increase of $1.3  million.  The  increase  was due to the
increased net loss of BioMarin  resulting from BioMarin's  increased spending on
its product candidates including Aldurazyme, rhASB and Vibriolysin.

Our  interest   income  earned  in  2000  and  1999  of  $65,000  and  $159,000,
respectively,  resulted  from  earnings on cash  invested in short term interest
bearing accounts and, in 1999,  includes interest earned on our convertible note
from  BioMarin  until  its  conversion  on  July  23,  1999,  and  a  note  from
stockholder.  The decrease in interest  income in 2000  resulted from lower cash
balances available for investment due to an additional investment in BioMarin of
$4.4 million in April 1999.

Years Ended December 31, 1999 and 1998

Our principal  operations were the operations of Glyko,  Inc. through October 7,
1998.  For the year ended  December 31, 1998,  the  operations of Glyko are only
included  for the nine month and seven day period from  January 1, 1998  through
October 7, 1998.  For the period  October 8, 1998 through  December 31, 1998 and
for the year  ended  December  31,  1999,  the  operations  of Glyko,  Inc.  are
reflected in the accompanying  financial statements through the Company's equity
in the loss of BioMarin.


















                                        5

<PAGE>
We had no revenues for 1999 due to our sale of the operating entity, Glyko, Inc.
Revenues  for 1998 were $1.2  million  and  consisted  of sales of  products  of
$750,000, sales of services of $115,000 and other revenues of $295,000. Sales of
products and services  consisted of sales of chemical  analysis kits and imaging
systems, and fees for custom analytic services.

We had no costs of sales for 1999 due to our sale of Glyko,  Inc. Costs of sales
of  products  and  services  were 33% of  revenues  from sales of  products  and
services for 1998.

We had no research and  development  expenses for 1999 due to our sale of Glyko,
Inc.  Research  and  development  expenses for 1998 were  $680,000  representing
research expenses for the development of future products,  including  diagnostic
software, new enzymes and improvements on the imaging system.

Selling, general and administrative expense was $199,000 for 1999, a decrease of
$492,000  from the  selling,  general  and  administrative  expense of  $691,000
incurred  in 1998.  The  decrease  is due to our  sale of  Glyko,  Inc.  and the
subsequent  reduction  in  administrative  requirements.  Selling,  general  and
administrative  expense for 1999 represented  management fees billed by BioMarin
for management,  accounting,  finance and government reporting, expenses related
to our special  meeting and annual  meeting on March 10, 1999 and June 24, 1999,
respectively, and legal and other outside administrative support expenses.

Other  operating  expenses  for  1998  of  $166,000  represent  our  gain on the
settlement of a claim at an amount less than we had provided for, which occurred
in the second quarter of 1998.

Equity in loss of BioMarin for 1999 was $10 million compared to $3.8 million for
1998,  an increase of $6.2  million.  The increase was due to the  increased net
loss of BioMarin.

Interest  income earned in 1999 and 1998 of $159,000 and $43,000,  respectively,
resulted from earnings on cash invested in short term interest  bearing accounts
and, in 1999,  includes  interest earned on our  convertible  note from BioMarin
until its conversion on July 23, 1999, and a note from stockholder. The increase
in interest  income in 1999  resulted  from higher cash  balances  available for
investment  due to the exercise of stock  options and warrants in the last three
quarters of 1998 and the first three quarters of 1999 and due to the loan by the
Company to a shareholder and the investment in a convertible note from BioMarin.
Interest expense for 1999 and 1998 was immaterial.

Liquidity and Capital Resources

Our cash position increased by $1.2 million in 2000 to $1.8 million relating to,
primarily,  the  issuance  of common  shares from the  exercise of common  share
options  and  common  share  warrants  offset  by net  cash  used  in  operating
activities of $403,000.

Since our inception,  we have incurred a cumulative deficit of $40.8 million and
we  expect  to  continue  to  incur  losses  through  2002  due to our  share of
BioMarin's  net loss  resulting  from the ongoing  research and  development  of
BioMarin's  pharmaceutical product candidates. As a result of our sale of Glyko,
Inc.  on  October  7,  1998,  we have no  operating  activities  or  operational
employees.  Since  October 8,  1998,  we have  agreed to pay  BioMarin a monthly
management  fee  for  its  services  to us  primarily  relating  to  management,
accounting,  finance and government reporting.  BioMarin had accrued receivables
from us relating to these of $37,500 and $8,800 for the years ended December 31,
1999 and 2000,  respectively.  Accordingly,  without further investment in other
companies or  technologies,  we believe that we have  sufficient cash to sustain
planned  operations  for the  foreseeable  future.  See "Factors That May Effect
Future  Results-  Dependence on Investment in BioMarin,"  "-History of Operating
Losses - Uncertainty of Future Profitability."

Item 7A.  Quantitative and Qualitative Disclosure about Market Risk.
          ---------------------------------------------------------

As of December 31, 2000 we held  11,367,617  shares of  BioMarin's  common stock
representing  31.0% of BioMarin's  outstanding  common stock.  These  securities
represent  substantially our only asset. These securities have been acquired for
investment  purposes rather than for trading  purposes.  The value of our common
stock may be substantially  influenced by the value of BioMarin's  common stock.
Following  BioMarin's  initial public  offering  (IPO) in July 1999,  BioMarin's
common  stock is traded on the NASDAQ and the Swiss  Exchange  (SWX New Market).
There are many risks  associated  with the  listing of these  securities  on two
markets and with BioMarin's  business itself. We are subject to additional risks
as its  investment  portfolio is  non-diversified  and there are no plans in the
foreseeable future to diversify our investment portfolio.

In September  2000, we placed  $1,397,000 in short-term  United States  Treasury
securities.  Our  policy  is to  continue  to own only  United  States  Treasury
securities.

                                        6

<PAGE>
Item 8. Financial Statements.

The information  required to be filed in this item appears on pages 18 to 45 and
is incorporated herein by reference.

Item  9.  Changes  in and  Disagreements  With  Accountants  on  Accounting  and
Financial Disclosure.

None.











































































                                        7


<PAGE>
                                    PART III

Item 10.  Directors, Executive Officers, Promoters and Control Persons.

Directors and Executive Officers

Our directors and executive officers are as follows:



                                                                     Year Joined
Name                    Age     Position                               Company

Erich Sager              43     President and Chief Executive Officer     2000
Joerg Gruber             40     Chairman and Director                     2000
John A. Kolada (1)       36     Secretary and Director                    2000
Jeffrey C. Trossman (1)  40     Director                                  2000
Johannes M. Glaus (1)    48     Director                                  2000
Urs Specker              47     Director                                  2000

(1)      Member of Audit Committee

All directors hold office until the next annual meeting of stockholders or until
their successors are elected and qualified.  Officers are appointed by the Board
of  Directors  and serve at the  discretion  of the  Board.  There are no family
relationships among our officers and directors.

Erich Sager has served as our President and Chief  Executive  Officer since June
2000. Since September 1996, Mr. Sager has served as the Chairman of LaMont Asset
Management SA, a private  investment  management firm. From April 1994 to August
1996,  Mr. Sager served as Senior Vice  President,  Head of Private  Banking for
Dresdner Bank  (Switzerland)  Ltd. From  September 1991 to March 1994, Mr. Sager
served as Vice  President,  Private  Banking-Head  German Desk for Deutsche Bank
(Switzerland)  Ltd.  From 1981 to 1989,  Mr. Sager held  various  positions at a
number of banks in  Switzerland.  Mr.  Sager  serves as a director  of  BioMarin
Pharmaceutical  Inc.,  BioNebraska,  Inc., Comptec Industries Ltd.,  Dentalview,
Inc., LaMont Asset Management,  SA, and Sermont Asset Management,  SA. Mr. Sager
received  a  Business   Degree  from  the  School  of  Economics   and  Business
Administration in Zurich, Switzerland. Mr. Sager has been a director of BioMarin
Pharmaceutical Inc. since November of 1997.

Joerg Gruber has served as our Chairman and one of our directors since June 2000
and is Chairman of Clubb Capital Limited and Clubb BioCapital  Limited,  London,
England. He was co-founder of Clubb Capital in 1995 and founded Clubb BioCapital
in  1999  which   specializes  in  raising   financing  for   biotechnology  and
pharmaceutical  companies.  Clubb  Capital  has  acted  as  agent  to GBL and to
BioMarin in raising substantial amounts of equity capital on a private placement
basis.  Before  joining Clubb  Capital,  Mr. Gruber was an  independent  venture
consultant for five years. Prior to that, he had responsibility for fixed income
sales,  first with Goldman  Sachs and later with  Shearson  Lehman.  Mr.  Gruber
started  his career  with  Union Bank of  Switzerland  where,  over a  nine-year
period,  he moved from its  management-training  program to  responsibility  for
Swiss  equity  sales to a number of  European  countries.  Mr.  Gruber is also a
director of Galenica Pharmaceuticals, Inc.

John A. Kolada has served as our Secretary  and one of our directors  since June
2000.  Mr. Kolada has been a partner in Blake,  Cassels & Graydon LLP since 1996
and a  solicitor  with  that  firm  since  1992,  specializing  in the  areas of
corporate  finance,  mergers and acquisitions and other corporate and commercial
matters  with  extensive  experience  in  advising  on  transactions   involving
participants in the biotechnology and pharmaceutical industries. He was based in
the  London,  England  office of Blake,  Cassels & Graydon LLP from 1996 to July
2000, at which time he returned to the firm's Toronto office.

Jeffrey C.  Trossman  has served as one of our  directors  since June 2000.  Mr.
Trossman  has been a partner  in Blake,  Cassels & Graydon  LLP since 1997 and a
solicitor  with that firm since 1991 whose  practice  focuses on all  aspects of
income tax planning,  including corporate re-organizations,  corporate financing
transactions,  international taxation and the taxation of mutual funds and other
investment  vehicles.  He has acted for a wide  variety  of public  and  private
companies and is based in the firm's head office in Toronto.














                                        8
<PAGE>
Johannes  M.  Glaus has served as one of our  directors  since June 2000 and has
been a partner in the Zurich law firm Wyler  Lustenberger  Glaus since 1999. Mr.
Glaus was a partner in the Zurich law firm Rinderknecht Glaus & Stadelhofer from
1988 to 1998 and prior to that time he was a solicitor  with the Zurich law firm
Pestalozzi  Gmuer & Patry and the U.S. law firm O'Melveny & Myers,  based in New
York.  Mr. Glaus has been  admitted to the Bars of Zurich and New York.  He also
serves on the board of a number of companies  based in Switzerland and elsewhere
including SMS Securities, a licensed Swiss securities dealer.

Urs Specker has served as one of our directors since June 2000 and has served as
Chief Executive Officer of Ansbacher (Switzerland) Limited since 1991. Ansbacher
(Switzerland)   Limited   is  a  member  of  the  Henry   Ansbacher   Group,   a
well-established  private  specialist  banking  organization.  Prior  to that he
worked with a Paribas Group company where he became  Managing  Director in 1989.
From October 1982 to December 1986,  Mr. Specker was with BBC AG Brow,  Boveri &
Cie (now ABB),  undertaking  assignments both in sales of large turnkey projects
and as a  management  consultant.  Prior to that he worked  with  another  Swiss
industrial group with assignments in Geneva and Birmingham, England. Mr. Specker
serves on the board of several other companies.

INFORMATION ABOUT THE BOARD OF DIRECTORS AND COMMITTEES OF THE BOARD

Meetings Of The Board And Its Committees

The Board of  Directors  manages the  business of the  company.  It  establishes
overall  policies and standards for the company and reviews the  performance  of
management.  In addition,  the Board has  established an Audit  Committee  whose
functions  are  briefly  described  below.  The  Board  has  not  established  a
Nominating   Committee.   In  June  2000,   the  Board  decided  to  assume  the
responsibilities  of  the  Compensation   Committee  for  making  determinations
regarding  salaries,  bonuses and other  compensation  and making decisions with
respect to awards,  including  but not  limited  to stock  option  grants to our
directors  and officers.  The  directors are kept informed of our  operations at
meetings of the Board and its committees  through reports and analyses from, and
discussions with, management.

During the fiscal year ended  December 31, 2000,  the Board of Directors  met on
seven (7)  occasions  and took action by  Unanimous  Written  Consent on two (2)
occasions.

Audit Committee

The Audit Committee provides oversight of (a) our financial reporting processes,
system of internal controls and audit process and (b) our independent  auditors.
The Audit Committee also recommends to the Board of Directors the appointment of
the  independent  certified  public  accountants.  As of December 31, 2000,  the
members of the Audit  Committee are Mr. Kolada,  Mr.  Trossman and Mr. Glaus. In
April 2000, the Audit  Committee,  consisting of Mr. Anderson and Mr.  Williams,
met once.

Compensation Of Directors

On February  2, 2000,  each  director of the company as of January 1, 2000,  was
granted  an option to  purchase  5,000  common  shares at an  exercise  price of
Cdn.$5.70  in lieu of  monetary  compensation  for  services  rendered  in their
capacity as directors.  Five of the six directors  were replaced by a new Board.
The five former  directors' stock options expired on September 20, 2000 and were
50% vested on the date of their  termination  from the Board. All five directors
exercised all of their options prior to expiration.  The one director re-elected
to the Board resigned from the Board on November 1, 2000, at which time his 2000
option grant was 75% vested.

On January 26, 2001, each director and officer of the company as of December 31,
2000, was granted an option to purchase 2,500 common shares at an exercise price
of Cdn.$4.50,  in lieu of monetary compensation,  for services rendered in their
capacity as directors/officers for the second half of 2000.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Exchange Act requires our officers and  directors,  as well
as  persons  who own ten  percent  or more of a  registered  class of our equity
securities,  to file with the SEC initial  reports of  ownership  and reports of
changes in ownership of our common shares.  Officers,  directors and ten percent
or more  shareholders  are required by SEC regulations to furnish us with copies
of all Section 16(a) forms they file.

To our knowledge, based solely on review of the copies of such reports furnished
to us or written representations that no other reports were required, during the
fiscal year ended  December 31, 2000, all officers,  directors,  and ten percent
shareholders complied with all Section 16(a) filing requirements.

                                        9
<PAGE>
Item 11.  Executive Compensation.

Executive Compensation

We are  required by the SEC to disclose  compensation  paid by the us during the
last three fiscal years to (a) our Chief  Executive  Officer;  (b) our four most
highly compensated  executive officers,  other than the Chief Executive Officer,
who were serving as executive  officers at the end of Fiscal 2000; and (c) up to
two additional  individuals  for whom such  disclosure  would have been provided
under  clause  (a) and (b) above but for the fact  that the  individual  was not
serving as an executive  officer at the end of Fiscal 2000;  provided,  however,
that no disclosure  need be provided for any executive  officer,  other than the
CEO, whose total annual salary and bonus does not exceed $100,000.

Our officers receive no cash  compensation.  No executive officer received total
compensation,  including  salary,  bonus,  or other  compensation,  in excess of
$100,000  during the year ended  December 31, 2000.  Accordingly,  the following
table  discloses  compensation  paid by us during the last three fiscal years to
(a) Mr. Erich Sager, our Chief Executive Officer beginning in June 2000; and (b)
Dr. John C. Klock, our Chief Executive  Officer until June 2000. We refer to all
of these officers as the "Named Executive Officers."

                           Summary Compensation Table

<TABLE>
                                                                                      Long-term
                                                                                     Compensation
                                                                                    -----------------
                                                  Annual Compensation                  Number of
                                          -------------------------------------     Shares Underlying
                                                                    Other Annual       Options            All Other
Name and Principal Position       Year    Salary($)   Bonus($)    Compensation($)    Granted(#)(1)       Compensation
---------------------------       ----    --------    --------    --------------    -----------------    ------------
<S>         <C>                   <C>                                                    <C>
Erich Sager (2)                   2000        -          -             -                 2,500                 -
President, Chief Executive        1999        -          -             -                  -                    -
Officer and Chief                 1998        -          -             -                  -                    -
Financial
Officer

John C. Klock, M.D. (3)           2000        -          -             -                5,000                  -
Former President and former       1999        -          -             -                4,000                  -
Chief Executive Officer           1998     18,750        -             -               11,290                  -

</TABLE>


     (1)  All dollar values are stated in Canadian  dollars.  As of December 29,
          2000, the Canadian dollar to U.S. dollar exchange rate was $0.665775.

     (2)  Mr. Sager was appointed  President and Chief Executive Officer in June
          2000  following  the election of  directors  at the annual  meeting of
          shareholders.

     (3)  Dr. Klock had served as our President and Chief Executive  Officer and
          a Director since December of 1992. Dr. Klock was replaced by Mr. Sager
          but was re-elected as a Director.  Dr. Klock resigned as a Director in
          November 2000.  Salary for 1998  represents the portion of salary paid
          by Glyko,  Inc. when Glyko, Inc. was our wholly-owned  subsidiary.  In
          October 1998, BioMarin purchased Glyko, Inc. from us. The 1998 options
          issued to Dr.  Klock were  assumed by BioMarin as part of its purchase
          of Glyko, Inc.























                                       10
<PAGE>
STOCK OPTIONS

Stock Option Plan

We have a stock option plan (the "Plan")  under which our Board of Directors may
grant  options  to  purchase  shares  of our  common  shares  to our  directors,
officers,  consultants  and key  employees.  Options  granted under the Plan may
either be  "incentive  stock  options"  under  Section 422 of the United  States
Internal Revenue Code, or non-statutory options. The Plan is administered by the
Board of Directors.  Options  granted under the Plan will have an exercise price
which  will not be less  than the  closing  price of our  common  shares  on The
Toronto Stock Exchange (the "TSE") on the trading day  immediately  prior to the
date of grant or the average of the bid and ask prices if no sales were reported
on the TSE on such trading day.  Options  will be  exercisable  over a number of
years  specified  at the time of the grant which  cannot  exceed ten years.  The
aggregate  number of common  shares  subject to options  granted  under the Plan
cannot exceed three million  common shares without  shareholder  approval and no
one  optionee is entitled to hold options  exceeding  five percent of the common
stock outstanding.  Also, the maximum number of shares which may be reserved for
issuance  under  the  Plan  may not  exceed  10  percent  of the  common  shares
outstanding without shareholder approval.

Incentive stock options  granted under the Plan terminate  within 90 days of the
termination of an optionee's employment. Non-statutory options granted under the
Plan  terminate  within  a  period  of time  following  the  termination  of the
optionee's  employment,  consulting or officer or director relationship which is
determined by the Board of Directors. Options also terminate within 12 months of
the death or total and permanent  disability of the  optionee.  Options  granted
under the Plan are not transferable. As of March 16, 2001 45,000 options (net of
exercised options) had been approved by the Board of Directors.

Options  will  only  be  granted  in  compliance  with   applicable   securities
legislation,  and the Plan will be operated in conformity with the  requirements
of the TSE.

Fiscal 2000 Option Grants

The following  table shows stock option grants to the Named  Executive  Officers
during Fiscal 2000.

<TABLE>
                                                    OPTION / SAR GRANTS IN LAST FISCAL YEAR

                                Number of     Percent of
                               Securities   Total Options    Exercise        Option         Potential Realizable Value at
                               Underlying    Granted to     Price Per         Term          Assumed Annual Rates of Stock
                                Options       Employees       Share        Expiration       Price Appreciation for Option
                                Granted      in 2000 (1)      ($) (2)           Date                 Term ($) (3)
                                --------    -------------    -------       -----------      --------------------------------
                                                                                                  5%                10%
                                                                                            ------------       -------------
<S>                               <C>               <C>         <C>          <C>                 <C>                <C>
Erich Sager                       2,500             6%          4.50         1/25/05             3,108              6,868
John C. Klock, M.D. (4)           5,000            11%          5.70         1/30/01                -                  -
</TABLE>


     (1)  Based on options  granted in January 2000 to former Board plus options
          granted in January  2001 for new Board for their  services  since June
          2000.

     (2)  All dollar values are stated in Canadian  dollars.  As of December 29,
          2000, the Canadian dollar to U.S. dollar exchange rate was $0.665775.

     (3)  We are  required  by  the  SEC to use  5%  and  10%  assumed  rate  of
          appreciation  over  the  option  term.  This  does not  represent  our
          estimate or projection of the future common stock price. If the common
          stock does not appreciate,  the Named Executive  Officers will receive
          no benefit from the options.

     (4)  Dr. Klock's  options  expired on January 30, 2001. He did not exercise
          these  options.  As of December  29,  2000,  the trading  price of our
          common stock was $1.65 below the exercise price of Klock's options.

Option  Exercises/Fiscal  Year End Value. The following table shows stock option
exercises and the value of unexercised stock options held by the Named Executive
Officers during Fiscal 2000.







                                                                       11

<PAGE>
                 AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL
                        YEAR AND FY-END OPTION/SAR VALUES

                Shares     Value
               Acquired   Realized                Unexer-                Unexer-
Name          on Exercise  (Cdn.$)   Exercisable  sizable  Exercisable   cisable
------------- ----------- --------   -----------  -------  -----------  --------
Erich Sager       -            -           -        2,500        -           -
John Klock, MD    -            -         7,750      1,250        -           -



     (1)  Represents  the positive  difference  between the closing price of our
          common shares on Friday, December 29, 2000 (the last stock trading day
          of the Fiscal Year) of Cdn$4.05  per share and the  exercise  price of
          the options.

     (2)  All dollar values are stated in Canadian  dollars.  As of December 29,
          2000, the Canadian dollar to U.S. dollar exchange rate was $0.665775.

Employment  Contracts  And  Termination  Of  Employment  And  Change Of  Control
Arrangements

None of the Named Executive Officers are a party to an employment agreement with
us.

PERFORMANCE GRAPH

The following  graph compares the  cumulative  total  shareholder  return on our
common shares for the last five fiscal years with the cumulative total return on
(a)  the  Toronto  Stock  Exchange  300  Composite  Index  and  (b)  the  Nasdaq
Pharmaceutical Index.

                    COMPARISON OF CUMULATIVE TOTAL RETURN (1)

                                [OBJECT OMITTED]

                        12/31/95  12/31/96  12/31/97 12/31/98  12/31/99 12/31/00
                        --------  --------  -------- --------  -------- --------
The Company               100        62       192      1,038    1,500     623
TSE 300                   100       126       142        138      179     190
Nasdaq Pharmaceutical
    Index                 100       104       104        132      248     308


     (1)  The graph  assumes  that the  value of the  investment  in the  common
          shares and in each index was $100 at December 31, 1995.  Does not give
          effect to fluctuations in the currency  exchange rate between the U.S.
          and Canadian dollar.

The  comparisons in this table are required by the SEC and,  therefore,  are not
intended to forecast or be  indicative  of possible  future  performance  of our
common shares.































                                       12
<PAGE>
Item 12.  Security Ownership of Certain Beneficial Owners and Management.

The following table lists certain information  regarding beneficial ownership of
our common  shares as of March 16, 2001,  by (i) those persons who own more than
5% of our common shares,  (ii) our Chief  Executive  Officer,  (iii) each of our
directors,  and (iv) the total amount of common  shares held by our officers and
directors as a group.

<TABLE>

Name and Address of Beneficial Owner              Number of Shares Held     Percent of Class
------------------------------------------------ ---------------------- ----------------------
<S>                                                          <C>                <C>
New York Life Insurance Company                              3,686,900          10.7%
51 Madison Avenue
New York, NY  10010
------------------------------------------------ ---------------------- -----------------------
Gwynn R. Williams                                            2,981,488           8.7%
c/o Life Science Research Ltd.
3rd Floor Salisbury House
15 Victoria Street
Douglas, Isle of Man
British Isles, UK
------------------------------------------------ ---------------------- -----------------------
Erich Sager                                                 305,500(1)            *
c/o LaMont Asset Management
Baarerstrasse 57
P.O. box 4639
6304 Zug, Switzerland
------------------------------------------------ ---------------------- -----------------------
Joerg Gruber                                                143,441(2)            *
c/o Clubb Capital Ltd.
17 Waterloo Place, 4th floor
London, SW1Y 4AR
UK
------------------------------------------------ ---------------------- -----------------------
John A. Kolada, Esq.                                          5,000(3)            *
c/o Blake, Cassels & Graydon LLP
Box 25, Commerce Court West
199 Bay Street
Toronto, Ontario
Canada M5L 1A9
------------------------------------------------ ---------------------- -----------------------
Jeffrey C. Trossman                                          5,000 (3)            *
c/o Blake, Cassels & Graydon LLP
Box 25, Commerce Court West
199 Bay Street
Toronto, Ontario
Canada M5L 1A9
------------------------------------------------ ---------------------- -----------------------
Urs Specker                                                 15,000 (3)            *
c/o Ansbacher (Switzerland), Limited
PO Box 2071, Muhlebachstasse 54
CH-8032
Zurich, Switzerland

------------------------------------------------ ---------------------- -----------------------
Johannes M. Glaus                                            55,000(3)            *
c/o Wyler Lustenberger Glaus
Sempacherstrasse 15
CH-8032
Zurich, Switzerland
------------------------------------------------ ---------------------- -----------------------
All Officers and Directors                                     528,941           1.5%
================================================ ====================== =======================
</TABLE>

* Less than 1%
     (1)  Includes  300,500  common shares held by LaMont Asset  Management,  of
          which  Mr.  Sager is an  affiliate.  Mr.  Sager  disclaims  beneficial
          ownership  of the  shares  held by LaMont  except to the extent of his
          pecuniary  interest.   Includes  5,000  common  shares  issuable  upon
          exercise of options within 60 days of March 16, 2001.

     (2)  Includes  138,441  common  shares held by Clubb Capital Ltd., of which
          Mr. Gruber is an affiliate.  Mr. Gruber disclaims beneficial ownership
          of the  shares  held by Clubb  except to the  extent of his  pecuniary
          interest.  Includes  5,000 common  shares  issuable  upon  exercise of
          options within 60 days of March 16, 2001.

     (3)  Includes 5,000 common shares  issuable upon exercise of options within
          60 days of March 16, 2001.



                                       13
<PAGE>
Item 13.  Certain Relationships and Related Transactions

From June 2000 to  December  2000,  we paid  legal  fees to Blake,  Cassels  and
Graydon LLP in which two of our new directors,  Mr. Kolada and Mr. Trossman, are
partners. In 2000, we paid $118,000 to Blake, Cassels and Graydon LLP, mostly in
reimbursement  of its fees incurred in  representing  dissident  shareholders in
connection with our annual meeting.

In August 2000, we renewed our  management  agreement  with  BioMarin.  BioMarin
provides  accounting and related financial  reporting services to us in exchange
for a management fee of $7,700 per month.

Item 14.  Exhibits, List and Reports on Form 8-K

(a) Documents are filed as exhibits to this report as enumerated in the Index to
Exhibits hereto, Part IV Item I.

(b)      Reports on Form 8-K

         No reports were filed on Form 8-K during the quarter ended December 31,
2000.

                                     Part IV

Item 1.           Index to Exhibits

   Exhibit
   Number    Description
   -----  ------------------------------------------------------------
   2.1    Share Exchange  Agreement between Glyko Biomedical,  Ltd. and BioMarin
          Pharmaceutical Inc. dated September 15, 1998. (filed as exhibit 2.1 to
          Form 10-QSB dated March 31, 1999).

   3.1    Registrant's  Articles of  Incorporation  and Bylaws (filed as exhibit
          3.1 to Form 10-SB  Registration  Statement No. 0-21994 dated August 6,
          1993 and incorporated herein by reference).

   10.1   Glyko  Biomedical  Share  Option Plan - 1994 (filed as exhibit 10.1 to
          Form 10-QSB dated June 30, 1994 and incorporated herein by reference).














































                                       14
<PAGE>
                                   SIGNATURES

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

                                               GLYKO BIOMEDICAL LTD.
Dated: March 30, 2001                     By:  \s\  Erich Sager
----------------------------------------       ---------------------------------
                                                Erich Sager
                                                President, Director and Chief
                                                Executive Officer

                                POWER OF ATTORNEY

         KNOW  ALL MEN BY THESE  PRESENTS,  that  each  person  whose  signature
appears below constitutes and appoints Erich Sager, his  attorney-in-fact,  with
the  power  of  substitution,  for him in any and all  capacities,  to sign  any
amendments  to the  Report  on Form  10-K and to file the  same,  with  exhibits
thereto and other  documents in connection  therewith,  with the  Securities and
Exchange  Commission,  hereby  ratifying  and  confirming  all that each of said
attorneys-in fact, or his substitute or substitutes,  may do or cause to be done
by virtue hereof.

         In  accordance  with the  Exchange  Act of 1934,  this  report has been
signed below by the  following  persons on behalf of the  Registrant  and in the
capacities and on the dates indicated.
<TABLE>

            Signature                          Title                                             Date
<S>                                 <C>                                                          <C>
\s\ Erich Sager                                                                                  March 30, 2001
-----------------------------------                                                              -------------------
Erich Sager                         President, Chief Executive Officer, Director
                                     and Chief Accounting Officer

\s\ Joerg Gruber                                                                                 March 30, 2001
-----------------------------------                                                              -------------------
Joerg Gruber                        Director and Chairman

\s\ John A. Kolada                                                                               March 30, 2001
-----------------------------------                                                              -------------------
John A. Kolada                      Secretary and Director

\s\ Jeffrey C. Trossman                                                                          March 30, 2001
-----------------------------------                                                              -------------------
Jeffrey C. Trossman                 Director

\s\ Urs Specker                                                                                  March 30, 2001
-----------------------------------                                                              -------------------
Urs Specker                         Director

\s\ Johannes M. Glaus                                                                            March 30, 2001
-----------------------------------                                                              -------------------
Johannes M. Glaus                   Director

</TABLE>




























                                       15
<PAGE>
                          Index to Financial Statements

  Glyko Biomedical Ltd.'s Financial Statements
        Report of Independent Public Accountants                        17
        Balance Sheets                                                  18
        Statements of Operations                                        19
        Statements of Shareholders' Equity                              20
        Statements of Cash Flows                                        21
        Notes to Financial Statements                                   22

  BioMarin Pharmaceutical Inc.'s Consolidated Financial Statements
        Report of Independent Public Accountants                        27
        Consolidated Balance Sheets                                     28
        Consolidated Statements of Operations                           29
        Consolidated Statements of Stockholders' Equity              30-32
        Consolidated Statements of Cash Flows                           33
        Notes to Consolidated Financial Statements                      34




































































                                       16
<PAGE>


                    Report of Independent Public Accountants

To the Shareholders of Glyko Biomedical Ltd.:


We have audited the  accompanying  balance  sheets of Glyko  Biomedical  Ltd. (a
Canadian company) as of December 31, 2000 and 1999 and the related statements of
operations, shareholders' equity and cash flows for the years ended December 31,
2000, 1999 and 1998. These financial  statements are the  responsibility  of the
company's  management.  Our  responsibility  is to  express  an opinion on these
financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable  assurance about whether the financial  statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting  the amounts and  disclosures in the financial  statements.  An audit
also includes assessing the accounting principles used and significant estimates
made by  management,  as well as  evaluating  the  overall  financial  statement
presentation.  We believe  that our audits  provide a  reasonable  basis for our
opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material  respects,  the financial  position of Glyko  Biomedical Ltd. as of
December 31, 2000 and 1999, and the results of its operations and its cash flows
for the  years  ended  December  31,  2000,  1999  and 1998 in  conformity  with
accounting principles generally accepted in the United States.

                                                    /s/ ARTHUR ANDERSEN LLP

San Francisco California
February 20, 2001



















































                                       17
<PAGE>
                              Glyko Biomedical Ltd.

                 Balance Sheets as of December 31, 2000 and 1999

                                (In U.S. dollars)

                                            December 31,
                                   ----------------------------
                                       2000            1999
Assets                             -----------      -----------
Current assets:
  Cash and cash equivalents        $   408,133      $   574,648
  Short-term investments             1,397,217               -
  Interest receivable                   29,876               -
                                   -----------      -----------
     Total current assets            1,835,226          574,648

Investment in BioMarin
  Pharmaceutical Inc.               19,020,505       28,908,447
                                   -----------      -----------
     Total assets                  $20,855,731      $29,483,095
                                   ===========      ===========

Liabilities and Shareholders'
Equity Current liabilities:
Accrued liabilities               $   315,438       $   365,569
                                  -----------       -----------
  Total current liabilities           315,438           365,569

Shareholders' equity:
 Common shares,  no par value,
 unlimited  shares  authorized,
 34,352,823 and 31,835,322
 shares issued and outstanding
 at December 31, 2000
 and December 31, 1999,
 respectively                      22,535,096        20,772,469

Additional paid in capital         39,561,634        38,064,481
Common share warrants and options       2,934           149,406
Note receivable from shareholder     (804,771)         (749,571)
Accumulated deficit               (40,754,600)      (29,119,259)
                                 -------------     -------------
  Total shareholders' equity       20,540,293        29,117,526
                                 -------------     -------------
  Total liabilities and
    shareholders' equity          $20,855,731       $29,483,095
                                 ============      =============

The accompanying notes are an integral part of these statements.



































                                       18
<PAGE>
                              Glyko Biomedical Ltd.

  Statements of Operations for the Years Ended December 31, 2000, 1999 and 1998
                                (In U.S. dollars)

                                               Year Ended December 31,
                                ------------------------------------------------
                                     2000          1999                 1998
                                -------------   ------------       -------------
Revenues:
 Sales of products                        -              -             750,145
 Sales of services                        -              -             115,019
 Other revenues                           -              -             294,752
                                -------------   ------------       -------------
      Total revenues                      -              -           1,159,916

Expenses:
 Cost of products                         -              -             231,423
 Cost of services                         -              -              53,437
 Research and development                 -              -             679,783
 General and administrative          388,373        199,302            690,950
 Other                                    -              -            (165,880)
                                -------------   ------------       -------------
      Total expenses                 388,373        199,302          1,489,713
                                -------------   ------------       -------------
Loss from operations                (388,373)      (199,302)          (329,797)

Equity in loss of
  BioMarin Pharmaceutical Inc.   (11,312,285)    (9,999,581)        (3,803,058)
Interest income                       65,317        159,352             42,822
                                -------------   ------------       -------------
Net loss                        $(11,635,341)  $(10,039,531)       $(4,090,033)
                                =============  =============       =============
Net loss per common share,
  basic and diluted             $      (0.34)  $      (0.32)       $     (0.17)
                                =============  =============       =============
Weighted average number of
  shares used in computing
  per share amounts               33,915,043     31,065,575         23,873,798
                                =============  ==============      =============











































The accompanying notes are an integral part of these statements.

                                       19
<PAGE>
<TABLE>
                                                                     Glyko Biomedical Ltd.

                                      Statement of Shareholders' Equity for the Year Ended December 31, 2000

                                                                        (In U.S. dollars)


                                        Common Shares         Additional   Common               Note
                                    ------------------------    Paid in     Share     Def.    Receivable    Accum.
                                      Shares       Amount       Capital    Warrants   Comp.   from Shrld.   Deficit       Total
                                    ----------   -----------  ----------   --------  --------   --------  ------------  ------------
<S>                                 <C>          <C>          <C>          <C>       <C>        <C>       <C>           <C>
Balance at December 31, 1997        21,573,044   $13,154,224  $4,068,564   $929,585  $(33,364)  $     -   $(14,989,695) $ 3,129,314
Net loss                                    -              -          -           -         -         -     (4,090,033)  (4,090,033)
Exercise of stock options            1,467,516     1,469,081          -           -         -         -              -    1,469,081
Exercise of stock warrants           4,825,643     3,269,122          -    (382,300)        -         -              -    2,886,822
Issuance of note receivable
  to shareholder                             -            -           -           -         -   (721,971)            -     (721,971)
Issuance of stock pursuant
  to licensing contract                100,000        70,740          -           -         -         -              -       70,740
Issuance of stock pursuant
  to a consulting agreement             54,031            -           -           -         -         -              -            -
Amortization of deferred compensation        -            -           -           -    33,364         -              -       33,364
Additional paid in capital resulting
  from the sale of common stock by
  BioMarin Pharmaceutical, Inc.              -            -    7,154,127          -         -         -              -    7,154,127
                                     ----------   ----------- -----------   --------  --------   --------  ------------  -----------
Balance at December 31, 1998         28,020,234   $17,963,167  $11,222,691  $547,285  $     -   $(721,971) $(19,079,728) $9,931,444
Net loss                                     -             -          -           -         -         -     (10,039,531)(10,039,531)
Exercise of stock options               280,560       161,633         -           -         -         -              -      161,633
Exercise of stock warrants            3,534,528     2,647,669         -     (397,879)       -         -              -    2,249,790
Reclassification of interest on note
  receivable from shareholder                  -           -        27,600        -         -     (27,600)           -           -
Additional paid in capital resulting
  from the sale of common stock
  by BioMarin Pharmaceutical Inc.              -           -    26,814,190        -         -         -              -   26,814,190
                                     ----------   -----------  ----------   --------  --------   --------  ------------ ------------
Balance at December 31, 1999         31,835,322  $20,772,469  $38,064,481   $149,406  $    -   $(749,571) $(29,119,259) $29,117,526
Net loss                                      -           -           -          -         -         -     (11,635,341) (11,635,341)
Exercise of common share options        299,500     269,092           -          -         -         -            -         269,092
Exercise of common share warrants     2,218,001   1,493,535        17,609   (146,472)      -         -            -       1,364,672
Interest accrued on note rec-
  eivable from shareholder                    -          -         55,200        -         -     (55,200)         -              -
Additional paid-in capital
  from the sale of common stock
  by BioMarin Pharmaceutical Inc.             -          -      1,424,344        -         -         -            -       1,424,344
                                     ----------   -----------  ----------   --------  --------  ---------  ------------  -----------
Balance at December 31, 2000         34,352,823   $22,535,096  $39,561,634  $  2,934  $     -   $(804,771) $(40,754,600) $20,540,293
                                      ==========   =========== ==========   ========  ========  =========  ============  ===========
</TABLE>































The accompanying notes are an integral part of these statements.

                                       20
<PAGE>
                              Glyko Biomedical Ltd.

  Statements of Cash Flows for the Years Ended December 31, 2000, 1999 and 1998
                                (In U.S. dollars)

<TABLE>
                                                               Year Ended December 31,
                                                 -----------------------------------------------
                                                    2000              1999              1998
                                                 -------------     -------------    ------------
<S>                                              <C>               <C>              <C>
Cash flows from operating activities:
       Net loss                                  $(11,635,341)     $(10,039,531)    $(4,090,033)
 Adjustments to reconcile net loss to
  net cash used in operating activities:
      Equity in the loss of BioMarin
        Pharmaceutical Inc.                        11,312,285         9,999,581       3,803,058
      Amortization of deferred compensation                -                 -           33,364
      Change in assets and liabilities:
           Interest receivable                        (29,876)               -               -
           Other current assets                            -                 -           (9,710)
           Accrued liabilities                        (50,131)           15,461          27,556
                                                  -------------     -------------    ------------
      Total adjustments                            11,232,278        10,015,042       3,854,268
                                                  -------------     -------------    ------------
           Net cash used in operating activities     (403,063)          (24,489)       (235,765)

Cash flows from investing activities:
      Investment in BioMarin Pharmaceutical Inc.            -        (4,419,110)     (1,000,002)
      Deconsolidation of Glyko, Inc. assets                 -                 -        (267,347)
      Settlement of amounts due from Glyko, Inc.            -                 -       1,212,278
      Purchase of short-term investments           (1,397,217)                -              -

           Net cash used in investing activities   (1,397,217)       (4,419,110)        (55,071)

Cash flows from financing activities:
      Proceeds from the exercise of common
        share options and common
        share warrants                              1,633,765         2,350,423       2,359,640
      Net proceeds from the issuance
        of common stock pursuant to a
        technology and license agreement                   -                  -          70,740
      Notes receivable                                     -            100,000        (100,000)
                                                  ------------      -------------    ------------
        Net cash provided by
             financing activities                   1,633,765         2,450,423       2,330,380
                                                  -------------     -------------    ------------
Net decrease in cash and cash equivalents            (166,515)       (1,993,176)      2,039,544
Cash and cash equivalents, beginning of year          574,648         2,567,824         528,280
                                                   -------------     -------------   ------------
Cash and cash equivalents, end of year             $  408,133         $ 574,648      $2,567,824
                                                   =============      ============   ============


</TABLE>






















The accompanying notes are an integral part of these statements.

                                       21
<PAGE>
                              GLYKO BIOMEDICAL LTD.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.      The Company and Description of the Business

Glyko  Biomedical  Ltd.  (the  Company or GBL) is a Canadian  company  which was
established  in 1992 to acquire all of the  outstanding  capital stock of Glyko,
Inc., a Delaware  corporation.  Since its inception in October 1990, Glyko, Inc.
engaged in research and  development of new techniques to analyze and manipulate
carbohydrates for research,  diagnostic and pharmaceutical purposes. Glyko, Inc.
developed a line of analytic instrumentation laboratory products that include an
imaging system, analysis software and chemical analysis kits.

In October 1996, GBL formed BioMarin Pharmaceutical Inc. (BioMarin),  a Delaware
corporation in the development  stage,  to develop the Company's  pharmaceutical
products. BioMarin began business on March 21, 1997 (inception) and subsequently
issued  1.5  million  shares  of  common  stock  to GBL  for  $1.5  million.  As
consideration for a certain license  agreement dated June 1997,  BioMarin issued
GBL 7 million  shares of  BioMarin  common  stock.  Beginning  in October  1997,
BioMarin raised capital from third parties. As of December 31, 1997, the Company
began  recording its share of BioMarin's net loss utilizing the equity method of
accounting.  On June 30, 1998,  GBL made an additional $1 million  investment in
BioMarin.

On October 7, 1998, GBL sold to BioMarin 100% of the  outstanding  capital stock
of Glyko,  Inc. in exchange for 2,259,039 shares of BioMarin's  common stock. In
addition,  BioMarin agreed to assume options,  previously issued to employees of
Glyko, Inc., to purchase up to 585,969 shares of GBL's common stock (exercisable
into 255,540 shares of BioMarin common stock) and BioMarin paid $500 in cash.

While GBL was not  obligated to provide  this  capital,  on April 13, 1999,  the
Company entered into a convertible  note arrangement with BioMarin in the amount
of $4.3 million, as part of a $26 million convertible note financing.

BioMarin  completed its initial  public  offering (IPO) of 4.5 million shares of
common  stock  at $13 per  share on July  23,  1999,  raising  net  proceeds  of
approximately  $51.8 million.  In a private  placement  concurrent with the IPO,
Genzyme  invested in BioMarin  $10 million at the IPO price  (769,230  shares of
common  stock).  In  addition,  the $26  million  of  convertible  notes sold by
BioMarin on April 13, 1999, plus accrued interest, were converted into 2,672,020
shares of common  stock at $10 per share.  GBL's $4.3 million  convertible  note
from  BioMarin  plus accrued  interest  was  converted  into  441,911  shares of
BioMarin common stock. The exercise of the underwriters'  over-allotment  option
in August 1999 raised  additional  net proceeds of $8.1 million at the IPO price
(675,000  shares of common stock).  As a result of the IPO,  concurrent with the
conversion  of the note from GBL and the exercise of BioMarin  stock options and
warrants by third  parties,  GBL's  ownership of BioMarin's  outstanding  common
stock on December 31, 2000, was 31.0%.

Since its inception,  GBL has incurred a cumulative deficit of $40.8 million and
the Company  expects to continue to incur losses  through 2002 from its share of
BioMarin's  net loss  resulting  from the ongoing  research and  development  of
BioMarin's  pharmaceutical  product  candidates.  As a result  of GBL's  sale of
Glyko,  Inc. on October 7, 1998,  GBL has limited  operating  activities and its
principal  asset is its  investment in BioMarin.  Accordingly,  without  further
investment in other companies or technologies,  management believes that GBL has
sufficient cash to sustain planned operations for the foreseeable future.  While
BioMarin has an accumulated deficit of $80.5 million at December 31, 2000 and is
expected to incur  significant  losses through 2002,  management of GBL does not
believe that there has been any impairment of its investment in BioMarin.

2.      Summary of Significant Accounting Policies

The accompanying  financial  statements and related footnotes have been prepared
in conformity with U.S.  generally  accepted  accounting  principles  using U.S.
dollars.  The financial  statements  include the accounts and  operations of the
Company and Glyko,  Inc for the period from January 1, 1998  through  October 7,
1998, the date of the sale of Glyko,  Inc. The results of operations of BioMarin
have been reported in the  Company's  financial  statements  for the years ended
December 31, 2000 and 1999, based on the equity method of accounting. Subsequent
to  October  7,  1998,  the  results  of  operations  of Glyko,  Inc.  have been
consolidated into the results of operations of BioMarin.






                                       22


<PAGE>
Use of Estimates:

The  preparation  of the  Company's  financial  statements  in  conformity  with
accounting   principles   generally  accepted  in  the  United  States  requires
management to make certain  estimates and  assumptions  that effect the reported
amounts of assets and  liabilities  and the disclosure of contingent  assets and
liabilities at the dates of the financial statements and the reported amounts of
revenues and expenses during the reporting periods.  Actual results could differ
from those estimates.

Cash and Cash Equivalents:

Cash and cash  equivalents  consist  of amounts  held with banks and  short-term
investments with original maturities of less than three months when purchased.

Short-term Investments:

Short-term  investments  are  considered  to be held to maturity  and consist of
A1/P1 grade commercial paper. These investments are recorded at cost at December
31, 2000, which approximates fair market value.

Sale of Glyko, Inc. and Investment in BioMarin Pharmaceutical Inc.:

BioMarin  acquired  Glyko,  Inc. from GBL through the exchange of BioMarin stock
for Glyko,  Inc.  stock and  accounted for the  acquisition  based upon the fair
market  value of the  BioMarin  stock  issued.  In  consolidating  Glyko,  Inc.,
BioMarin recorded intangible assets,  including goodwill, to the extent that the
fair market  value of the stock  issued  exceeded  the fair market  value of the
tangible  assets  of  Glyko,  Inc.  acquired.  However,  as  GBL  exchanged  one
investment  for  another,  it  recorded  the stock of  BioMarin  received at the
historical  cost basis of its  investment  in Glyko,  Inc.  GBL accounts for its
investment in BioMarin using the equity method of accounting.  However, GBL does
not  record  its  share  of the  losses  recorded  by  BioMarin  related  to the
amortization of intangible assets recorded on acquisition of Glyko, Inc. For the
years ended December 31, 1999 and 2000,  BioMarin recoded a charge to operations
for the amortization of goodwill and other intangible assets of $1.1 million and
$1.6 million, respectively.

In  addition,  to the extent  that the  issuance  of stock by  BioMarin to third
parties  results  in a change in the  Company's  ownership  interest  in the net
assets of BioMarin,  the Company reflects this change in its paid-in capital and
its investment in BioMarin.  At December 31, 2000 and 1999, the Company recorded
an increase to its additional  paid in capital by $1.4 million and $7.2 million,
respectively, as a result of the sale of common stock by BioMarin.

Foreign Exchange:

As all of the Company's operations are located in the United States, the Company
has adopted the U.S.  dollar as its  functional  currency.  In  accordance  with
Statement  of  Financial   Accounting   Standard  No.  52,   "Foreign   Currency
Translation",  any assets and liabilities  denominated in foreign currency, have
been  translated into U.S.  dollars at the current rate of exchange  existing at
year end and  revenues  and  expenses  are  translated  at the  average  monthly
exchange  rates.  Transaction  gains and  losses  included  in the  consolidated
statements of operations are not material.

Net Loss per Share:

Potentially dilutive securities outstanding at December 31, 2000, 1999 and 1998,
respectively,  include  options for the  purchase of 7,750,  291,000 and 548,290
shares of common stock and  warrants  for the purchase of zero,  2.2 million and
5.8 million shares of common stock.  These securities were not considered in the
computation   of  diluted  loss  per  share   because   their  effect  would  be
anti-dilutive for the years ended December 31, 2000, 1999 and 1998.

3.      New Accounting Standards

During the year ended  December  31,  1999,  the Company  adopted  SFAS No. 131,
"Disclosures  about  Segments of an  Enterprise  and Related  Information".  The
Company concluded that it has only one operating segment.

In June  1998,  the  FASB  issued  SFAS  No.  133,  "Accounting  for  Derivative
Instruments and Hedging Activities." SFAS No. 133, which is effective for fiscal
years  beginning  after  June 15,  1999 does not have a  material  impact on the
Company's financial position or results of operations.


                                  23
<PAGE>

In December 1999, the Securities and Exchange Commission issued Staff Accounting
Bulletin No. 101 ("SAB 101"), "Revenue Recognition in Financial Statements." SAB
101 provides guidance on applying  generally accepted  accounting  principles to
revenue recognition issues in financial statements.  The Company adopted SAB 101
as  required  in the first  quarter of 2000 and such  adoption  has no  material
effect on the Company's results of operations and financial position.

4.     Income Taxes

In connection with the sale of Glyko,  Inc., the U.S.  federal and state net tax
operating  loss   carryforwards  and  the  related  valuation   allowances  were
consolidated into the financial statements of BioMarin.

At December 31,  2000,  the Company has net  operating  loss  carryforwards  for
Canadian  income tax  purposes of  approximately  $1.8  million,  which begin to
expire in 2000 A valuation allowance is placed on the net deferred tax assets to
reduce them to an assumed net realizable value of zero.

5.        Note Receivable

In November 1998,  GBL loaned  $712,261 to an officer of the Company to exercise
expiring stock options.  The loan is secured by the stock and is a full recourse
note.

6.        Stock Option Plan

The Company has a stock  option plan (the Plan) under which  options to purchase
common stock may be granted by the Board of Directors  to  directors,  officers,
consultants  and key  employees  at not less than fair  market  value,  less any
permissible discounts,  on the date of grant. Options granted under the Plan may
be incentive  stock options (as defined  under Section 422 of the U.S.  Internal
Revenue Code) or  non-statutory  stock options.  Options are exercisable  over a
number of years  specified  at the time of the grant  which  cannot  exceed  ten
years.  The  maximum  aggregate  number of shares  which may be granted and sold
under the Plan is 3 million shares.

The  Company  accounts  for the Plan under APB  Opinion  No. 25,  under which no
compensation   cost  has  been   recognized,   except  for  options  granted  to
consultants,  because,  under the Option Plan, the option  exercise price equals
the market  value of stock on the date of grant.  In general,  the Plan  options
vest  over 48  months  and all  options  expire  after 5 years or 90 days  after
employee termination.

Had  compensation  cost  for the  Plan  been  determined  consistent  with  FASB
Statement  No. 123,  the  Company's  net loss would have been  increased  to the
following pro forma amounts:

                                              2000                  1999
                                              ----                  ----
Net loss              As reported         $(11,635,341)        $(10,039,531)
                      Pro forma
                                          (11,829,182)          (10,324,435)

Net loss per          As reported            $(0.34)              $(0.32)
  common              Pro forma              $(0.35)              $(0.33)
share

The fair value of each option  granted is  estimated  on the date of grant using
the  Black-Scholes  option  pricing  model with the  following  weighted-average
assumptions used for grants in 2000 and 1999,  respectively:  risk-free weighted
average  interest  rates  of 5.8%  and  4.6%;  expected  dividend  yield of zero
percent;  expected life of 1 year and 4 years for the Plans'  options;  expected
volatility of 193% and 26%.

Because the Statement  123 method of accounting  has not been applied to options
granted prior to January 1, 1995, the resulting pro forma  compensation cost may
not be representative of that to be expected in future years.




                                       24
<PAGE>
A summary of the status of the Company's  Plan at December 31, 2000 and 1999 and
changes  during  the years then ended is  presented  in the table and  narrative
below:
<TABLE>


                                              2000                             1999
                                 -------------------------------- -------------------------------
                                     Shares        Wtd. Avg. ex        Shares       Wtd. Avg. ex
                                                     price (1)                        price (1)
                                 ---------------- ---------------- ---------------- --------------
<S>                                  <C>             <C>                <C>           <C>
Outstanding beginning
   of year                               291,000     Cdn.$1.24             548,290    Cdn.$0.85
Granted                                   30,000     Cdn.$5.70              24,000    Cdn.$6.00
Exercised                              (299,500)     Cdn.$1.37           (280,560)    Cdn.$1.14
Canceled                                (13,750)     Cdn.$5.70               (730)    Cdn.$1.14
                                 ----------------                  ----------------
Outstanding at end of
    Year                                   7,750     Cdn.$5.85             291,000    Cdn.$1.24
                                 ----------------                  ----------------
Exercisable at end of year                 7,750                           291,000
Weighted average fair
    value of options granted           Cdn.$8.08                         Cdn.$2.24
</TABLE>

            (1) The US$  equivalent  of Canadian  $1.00 at December 31, 2000 was
approximately $0.665775.

There are 894,574  options  available  for grant under the plan at December  31,
2000.  The average  remaining  contractual  life of the options  outstanding  at
December 31, 2000 is 3.5 years.

7.     Related Party Transactions

From June 2000 to  December  2000,  we paid  legal  fees to Blake,  Cassels  and
Graydon LLP in which two of our new directors,  Mr. Kolada and Mr.  Trossman are
partners. In 2000, we paid $117,811 to Blake, Cassels and Graydon LLP, mostly in
reimbursement  of its fees incurred in  representing  dissident  shareholders in
connection with our annual meeting.

Since October 8, 1998,  GBL has agreed to pay BioMarin a monthly  management fee
for its services to GBL primarily  relating to management,  accounting,  finance
and government reporting. GBL had accrued payables to BioMarin relating to these
services of $8,765 and $37,500 for the years ended  December  31, 2000 and 1999,
respectively.



































                                       25
<PAGE>
8.   Quarterly Financial Data (unaudited)

The Company's  quarterly  operating  results have fluctuated in the past and may
continue  to do so in the future as a result of a number of  factors  including,
but not limited to, our share of BioMarin's  net losses,  which could  fluctuate
due to the  completion  of  development  projects  and  variations  in levels of
production and our ownership  share of BioMarin due to BioMarin's sale of common
stock in the future.

The Company's common shares have been traded on the Toronto Stock Exchange since
1992.  There were 120 common  shareholders  of record at December 31,  2000.  No
dividends were paid for the years ended December 31, 2000 and 1999.
<TABLE>

                                                                  Quarter Ended
                                        ---------------------------------------------------------------
2000                                       March 31,        June 30,      September 30,    December 31,
                                        ------------     -----------     -------------    ------------
<S>                                     <C>              <C>              <C>              <C>
Total revenue                           $        -       $        -       $        -       $        -
Loss from operations                        (52,605)          80,266)        (150,500)        (105,002)
Net loss                                 (3,736,387)      (2,246,263)      (2,498,602)      (3,154,089)
Net loss per share, basic and diluted   $     (0.11)     $      (.07)     $     (0.07)     $     (0.09)
Common share price per share:
  High                                  $     13.55      $      9.75      $      9.00      $      7.90
  Low                                   $      5.30      $      6.80      $      7.00      $      3.75
----------------------------------------------------------------------------------------------------------

                                                                  Quarter Ended
                                        --------------------------------------------------------------
1999                                       March 31,        June 30,      September 30,    December 31,
                                        ------------     -----------     -------------    ------------
Total revenue                           $        -       $        -       $        -       $        -
Loss from operations                        (66,914)         (66,088)         (62,481)          (3,818)
Net loss                                 (1,744,705)      (2,759,023)      (2,650,009)      (2,885,793)
Net loss per share, basic and diluted   $     (0.06)     $     (0.09)     $     (0.08)     $     (0.09)
Common share price per share:
  High                                  $      7.05      $      6.30      $      7.80      $      7.70
  Low                                   $      5.90      $      5.75      $      5.70      $      5.00
----------------------------------------------------------------------------------------------------------
</TABLE>











































                                       26
<PAGE>
  REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Stockholders of
BioMarin Pharmaceutical Inc.:

We have  audited  the  accompanying  consolidated  balance  sheets  of  BioMarin
Pharmaceutical  Inc.  (a  Delaware  corporation  in the  development  stage) and
subsidiaries  as of  December  31,  1999 and 2000 and the  related  consolidated
statements of operations,  changes in stockholders'  equity,  and cash flows for
the years ended  December 31, 1998,  1999 and 2000 and the period from March 21,
1997  (inception)  to December  31, 2000.  These  financial  statements  are the
responsibility of the Company's management.  Our responsibility is to express an
opinion on these financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable  assurance about whether the financial  statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting  the amounts and  disclosures in the financial  statements.  An audit
also includes assessing the accounting principles used and significant estimates
made by  management,  as well as  evaluating  the  overall  financial  statement
presentation.  We believe  that our audits  provide a  reasonable  basis for our
opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects,  the financial position of BioMarin  Pharmaceutical  Inc.
and  subsidiaries  as of  December  31,  1999 and 2000 and the  results of their
operations and their cash flows for the years ended December 31, 1998,  1999 and
2000 and the period from March 21, 1997  (inception)  to December 31,  2000,  in
conformity with accounting principles generally accepted in the United States.

                                                         /s/ ARTHUR ANDERSEN LLP


San Francisco, California,
February 20, 2001

















































                                       27
<PAGE>
<TABLE>                       BioMarin Pharmaceutical Inc. and Subsidiaries
                                     (a development-stage company)

                       Consolidated Balance Sheets as of December 31, 1999 and 2000

                           (In thousands, except for share and per share data)

                                                                          December 31,

                                                             ----------------------------------------
                                                                     1999                2000
                                                             ----------------------------------------
      <S>                                                     <C>                  <C>
      Assets
      Current assets:
       Cash and cash equivalents                              $    23,413          $   16,530
       Short-term investments                                      39,573              23,671
       Accounts receivable, net                                     1,186               1,135
       Due from BioMarin/Genzyme LLC                                1,280               1,799
        Inventories                                                   676                 436
        Prepaid expenses                                              294                 970
                                                             ----------------------------------------
         Total current assets                                      66,422              44,541
      Property and equipment, net                                  25,093              20,715
      Goodwill and other intangible assets, net                    11,462               9,862
      Investment in BioMarin/Genzyme LLC                              421               1,482
      Deposits                                                        151                 333
                                                             ----------------------------------------
        Total assets                                          $   103,549          $   76,933
                                                             ========================================

      Liabilities and Stockholders' Equity
      Current liabilities:
       Accounts payable                                       $     3,095          $    4,747
       Accrued liabilities                                          1,966               2,109
        Short-term portion of notes payable                            26                  27
                                                             ----------------------------------------
        Total current liabilities                                   5,087               6,883
      Long-term liabilities:
        Long term portion of notes payable                             85                  56
                                                             ----------------------------------------
        Total liabilities                                           5,172               6,939
                                                             ----------------------------------------
      Stockholders' equity:
       Common stock, $0.001 par value: 75,000,000 shares
          authorized, 34,832,578 and 36,921,966 shares
          issued and outstanding at December 31, 1999
          and 2000, respectively                                       35                  37

       Additional paid-in capital                                 146,592             153,940
        Warrants                                                      128                  -
       Deferred compensation                                       (2,591)             (1,530)
       Notes receivable from stockholders                          (2,638)             (1,940)
       Deficit accumulated during the development stage           (43,149)            (80,513)
                                                             ----------------------------------------
        Total stockholders' equity                                 98,377              69,994
                                                             ----------------------------------------
        Total liabilities and stockholders' equity            $   103,549          $   76,933
                                                             ========================================
</TABLE>

The accompanying notes are an integral part of these statements.




























                                       28
<PAGE>
<TABLE>                       BioMarin Pharmaceutical Inc. and Subsidiaries
                                    (a development-stage company)

                                Consolidated Statements of Operations for
                        the Years Ended December 31, 1998, 1999 and 2000 and for
                     the Period from March 21, 1997 (inception) to December 31, 2000

                                (In thousands, except for per share data)



                                                                                                  Period from
                                                                                                 March 21, 1997
                                                                December 31,                    (inception) to
                                                     ------------------------------------------   December 31,
                                                         1998          1999          2000           2000
                                                     ----------------------------------------------------------
<S>                                                   <C>         <C>            <C>             <C>
Revenues:

     Product sales                                    $    138    $    1,401     $    2,345      $    3,884
     Service revenue                                       112            85            250             447
     BioMarin/Genzyme LLC                                  837         5,300          9,731          15,868
     Other revenues                                        103           190             -              293
                                                     ----------------------------------------------------------
           Total revenues                                1,190         6,976         12,326          20,492


Operating costs and expenses:

     Cost of products                                       49           362            635           1,046
     Cost of services                                       59           102             84             245
     Research and development                           10,502        27,206         35,794          75,416
     Selling, general and administrative                 3,532         6,805          8,814          20,065
     Carson Street closure                                  -             -           4,423           4,423
                                                     ----------------------------------------------------------
           Total operating costs and expenses           14,142        34,475        49,750          101,195
                                                     ----------------------------------------------------------
           Loss from operations                        (12,952)      (27,499)      (37,424)         (80,703)




Interest income                                            685         1,832         2,979            5,561
Interest expense                                            -           (732)           (7)            (739)
Equity in loss of BioMarin/Genzyme LLC                     (47)       (1,673)       (2,912)          (4,632)
                                                     -----------------------------------------------------------
           Net loss                                   $(12,314)   $  (28,072)    $ (37,364)      $  (80,513)
                                                     ==========================================================
Net loss per share, basic and diluted                 $  (0.55)   $    (0.94)    $   (1.04)      $    (3.21)
                                                     ==========================================================
Weighted average common shares outstanding              22,488        29,944        35,859           25,057
                                                     ==========================================================
</TABLE>

The accompanying notes are an integral part of these statements.


































                                       29
<PAGE>
                  BioMarin Pharmaceutical Inc. and Subsidiaries
                          (a development stage company)

       Consolidated Statements of Changes in Stockholders' Equity for the
                  Years ended December 31, 1998, 1999 and 2000

                      (In thousands, except per share data)

<TABLE>


                                                                                                                 Deficit
                                                                                                    Notes       Accumulated
                                                              Additional                           Receivable    During       Total
                                             Common Stock      Paid-in      Warrants     Deferred    from      Development     SH's
                                           Shares   Amount     Capital   Shares   Amount   Comp.  Stockholders    Stage      Equity
                                           ------   ------     -------   ------   ------  ------  ------------  -------     --------
<S>                                        <C>        <C>     <C>          <C>    <C>     <C>       <C>         <C>         <C>
Balance, January 1, 1998                   20,567     $ 21    $ 12,549     802    $ 128   $ (217)   $(2,338)    $(2,763)    $ 7,380
 Issuance of common stock on June 30,
  1998, for cash, $6.00 per share (net of
  issuance costs of $263 including the is-
  suance of 31 shares of common stock,
  $6.00 per share, for brokerage services)... 599        1       3,327      --       --       --         --           --      3,328

 Issuance of common stock on July 14,
  1998,for cash, $6.00 per share (net of
  issuance costs of $387, including the is-
  suance of 65 shares of common stock,
  $6.00 per share, for brokerage services)..1,385        1       7,924      --       --       --         --           --      7,925

 Issuance of common stock on August 3,
  1998, for cash, $6.00 per share (net
  of issuance costs of $12, including the is-
  suance of 2 shares of common stock,
  $6.00 per share, for brokerage
  services)................................    31       --         176      --       --       --         --           --        176

 Issuance of common stock to Genzyme Cor-
  poration on September 4, 1998, for
  cash, $6.00 per share.................... 1,333        1       7,999      --       --       --         --           --      8,000

 Issuance of common stock to Glyko
  Biomedical, Ltd. for the purchase of
  Glyko, Inc. on October 7, 1998, for
  common shares, $6.00 per share and
  the assumption of options of Glyko,
  Inc. employees (see Note 1)...            2,259        2      14,859      --       --       --         --           --     14,861
 Exercise of common stock options.......        2       --           2      --       --       --         --           --          2
 Interest on notes receivable...........       --       --          --      --       --       --       (150)          --       (150)
 Deferred compensation on stock options.       --       --       3,222      --       --   (3,222)        --           --         --
 Amortization of deferred compensation.        --       --          --      --       --      186         --           --        186
Net loss...............................        --       --          --      --       --       --         --      (12,314)   (12,314)
                                           ------   ------     -------   ------   ------  ------  ------------  -------     --------
Balance, December 31, 1998...............   26,176    $ 26      $50,058    802    $ 128   $(3,253)   $(2,488)   $(15,077)   $29,394
                                           ======   ======    =========  ======  ======   =========  =========  =========   ========

                                   The  accompanying  notes are an integral part of these statements.

</TABLE>






























                                       30
<PAGE>
                  BioMarin Pharmaceutical Inc. and Subsidiaries
                          (a development stage company)

       Consolidated Statements of Changes in Stockholders' Equity for the
                  Years ended December 31, 1998, 1999 and 2000

                      (In thousands, except per share data)


<TABLE>

                                                                                                                 Deficit
                                                                                                    Notes       Accumulated
                                                              Additional                           Receivable    During       Total
                                             Common Stock      Paid-in      Warrants     Deferred    from      Development     SH's
                                           Shares   Amount     Capital   Shares   Amount   Comp.  Stockholders    Stage      Equity
                                           ------   ------     -------   ------   ------  ------  ------------  -------     --------

<S>                                        <C>        <C>      <C>         <C>    <C>     <C>        <C>        <C>        <C>
Balance, January 1, 1999...............    26,176     $ 26     $ 50,058    802    $ 128   $(3,253)   $(2,488)   $(15,077)  $ 29,394
 Issuance of common  stock on July 23,
  1999, in an initial  public  offering
  (IPO) for cash at $13.00 per share
  (net of issuance costs of $7) ........    4,500        4       51,805     --       --        --         --          --     51,809

 Issuance of common stock on July 23,
  1999 to Genzyme Corporation in a
  private placement concurrent with the
  IPO for cash at $13.00 per share.....       769        1        9,999     --       --        --         --          --     10,000

 Issuance  of  common  stock  on July  23,
  1999  concurrent  with the IPO upon con-
  version of promissory  notes plus accrued
  interest of $720 at $10.00 pershare
  (net of issuance costs of $1).......      2,672        3       25,612     --       --        --         --          --     25,615

 Issuance of common  stock on August  3,
  1999 and  August  25,  1999 from the over-
  allotment exercise by underwriters at
  $13.00 per share (net of issuance costs
  of $1)........................              675        1        8,141     --       --        --         --          --      8,142

 Exercise of common stock options.......       40       --          148     --       --        --         --          --        148

 Interest on notes receivable from
  stockholders..........................       --       --          150     --       --        --       (150)         --         --

 Deferred compensation related to stock
  options..............................        --       --          679     --       --      (679)        --          --         --
 Amortization of deferred compensation.        --       --           --     --       --     1,341         --          --      1,341
 Net loss...............................       --       --           --     --       --        --         --     (28,072)   (28,072)
                                           ------   ------     -------   ------   ------  ------  ------------  -------     --------
Balance, December 31, 1999..............   34,832     $ 35     $146,592    802    $ 128   $(2,591)   $(2,638)   $(43,149)   $ 98,377
                                           ======   ======    =========  ======  ======   =========  =========  =========   ========
                                   The  accompanying  notes are an integral part of these statements.

</TABLE>

































                                       31
<PAGE>
                  BioMarin Pharmaceutical Inc. and Subsidiaries
                          (a development stage company)

       Consolidated Statements of Changes in Stockholders' Equity for the
                  Years ended December 31, 1998, 1999 and 2000

                      (In thousands, except per share data)

<TABLE>

                                                                                                               Deficit
                                                                                                    Notes       Accumulated
                                                              Additional                           Receivable    During       Total
                                             Common Stock      Paid-in      Warrants     Deferred    from      Development     SH's
                                           Shares   Amount     Capital   Shares   Amount   Comp.  Stockholders    Stage      Equity
                                           ------   ------     -------   ------   ------  ------  ------------  -------     --------
<S>                                        <C>       <C>       <C>        <C>     <C>     <C>       <C>         <C>         <C>
Balance at December 31, 1999               34,832    $35       $146,592   802     $128    $(2,591)  $ (2,638)   $(43,149)   $98,377
 Issuance of common stock on April 30,
  2000 pursuant to the Employee Stock
  Purchase Plan at $11.05 per share...         18       -            199     -       -          -          -           -        199

 Issuance of common stock on October 31,
  2000 pursuant to the Employee Stock
  Purchase Plan at $11.05 per share....        10       -            115     -       -          -           -           -       115

 Exercise of common stock options.......    1,301       1          5,674     -       -          -           -           -     5,675

 Exercise of common stock warrants......      802       1            929  (802)   (128)         -           -           -       802

 Common stock surrendered by stockholders
  for payment of principal and interest...    (41)      -          (170)     -       -          -         170           -         -

 Repayment of notes from stockholders......     -       -             -      -       -          -         804           -       804

 Interest on notes receivable..............     -       -           276      -       -          -        (276)          -         -

 Amortization of deferred compensation.....     -       -             -      -       -          1,386       -           -     1,386

 Deferred compensation related to stock and
  option issuances, net of terminations...      -       -           325      -       -           (325)     -            -        -

Net loss.................................       -       -             -      -       -              -      -      (37,364)  (37,364)
                                            ------   ------    --------   ------  ------   --------   ---------  ---------  --------
Balance at December 31, 2000                36,922   $ 37      $153,940      -     $ -     $(1,530)   $(1,940)   $(80,513)  $69,994
                                            ======   ======    =========  ======  ======   =========  =========  =========  ========
                                                    The accompanying notes are an integral part of these statements.
</TABLE>










































                                       32
<PAGE>
<TABLE>
                                     BioMarin Pharmaceutical Inc. and Subsidiaries
                                              (a development-stage company)

                                          Consolidated Statements of Cash Flows
                                 the Years Ended December 31, 1998, 1999 and 2000 and for

                             the Period from March 21, 1997 (inception) to December 31, 2000

                                                      (In thousands)



                                                                                                        Period from March 21,
                                                                        December 31,                    1997 (inception) to
                                                         --------------------------------------------    December 31,
                                                              1998           1999          2000              2000
                                                         ------------------------------------------------------------------
Cash flows from operating activities:
<S>                                                     <C>            <C>            <C>               <C>
Net loss                                                $  (12,314)    $ (28,072)     $  (37,364)       $   (80,513)
 Adjustments to reconcile net loss to net
  cash used in operating activities:
  Depreciation                                                  308         4,074           4,347              8,734
  Amortization of deferred compensation                         185         1,341           1,386              2,912
  Amortization of goodwill                                      271         1,143           1,600              3,014
  Compensation in the form of common stock
   and common stock options                                      -             -               -                  18


  Loss from BioMarin/Genzyme LLC                                 47         6,973          12,635             19,655
  Write-off of in-process technology                          2,625            -               -               2,625
  Carson Street closure                                          -             -            3,791              3,791
 Changes in operating assets and liabilities:
  Accounts receivable, net                                    (148)          (899)             51               (996)
  Due from Glyko Biomedical, Ltd.                              (34)           (25)             -                (138)
  Due from BioMarin/Genzyme LLC                               (419)          (861)           (519)            (1,799)
  Inventories                                                  (72)            (5)            240                163
  Prepaid expenses                                            (137)           383            (676)              (969)
  Deposits                                                     (79)           (72)           (182)              (333)
  Accounts payable                                           1,172          1,754           1,652              4,746
  Accrued liabilities                                          597          1,326             143              2,109
  Due to Glyko, Inc.                                           (61)            -               -                  -
                                                         ------------------------------------------------------------------
  Net cash used in operating activities                    (8,059)        (12,940)        (12,896)           (36,981)
                                                         ------------------------------------------------------------------
Cash flows from investing activities:
 Purchase of property and equipment                        (6,385)        (22,944)         (3,760)           (33,239)
 Purchase of Biochemical Research Reagent
 Division of Oxford Glycosciences                              -           (1,500)             -              (1,500)
 Investment in BioMarin/Genzyme LLC                          (732)         (6,709)        (13,696)           (21,137)
 (Purchase) sale of short-term investments                 (1,075)        (37,597)         15,902            (23,671)
                                                         ------------------------------------------------------------------
 Net cash used in investing activities                     (8,192)        (68,750)         (1,554)           (79,547)
                                                         ------------------------------------------------------------------
Cash flows from financing activities:
Proceeds from note payable                                    134              -               -                 134
 Proceeds from issuance of convertible notes
 payable                                                       -           25,615              -              25,615
 Proceeds from exercise of common
 stock options and warrants                                    -              148           6,477              6,625
 Repayment of equipment loan                                   -              (24)            (28)               (52)
 Repayment of notes from stockholders                          -               -              804                804
 Issuance of commons stock for ESPP                            -               -              314                314
 Proceeds from sale of common stock, net of
 issuance costs                                            19,692          69,951              -              98,926
 Other                                                       (150)             -               -                 692
                                                         ------------------------------------------------------------------
 Net cash provided by financing activities                 19,676          95,690           7,567            133,058
                                                         ------------------------------------------------------------------
 Net increase (decrease) in cash and cash equivalents       3,425          14,000          (6,883)            16,530
Cash and cash equivalents:
 Beginning of period                                        5,988           9,413          23,413                 -
                                                         ------------------------------------------------------------------
 End of period                                            $ 9,413       $  23,413      $   16,530        $   16,530
                                                         ==================================================================
</TABLE>

The accompanying notes are an integral part of these statements.











                                       33
<PAGE>
                  BioMarin Pharmaceutical Inc. and Subsidiaries
                          (a development-stage company)

                   Notes to Consolidated Financial Statements

1.   NATURE OF OPERATIONS AND BUSINESS RISKS:


BioMarin  Pharmaceutical  Inc.  (the  Company)  is a  biopharmaceutical  company
specializing   in  the   development  of  enzyme   therapies  for   debilitating
life-threatening  chronic  genetic  diseases and other diseases and conditions.
Since  inception,  the Company has devoted  substantially  all of its efforts to
research and development activities,  including preclinical studies and clinical
trials,   the  establishment  of  laboratory,   clinical  and  commercial  scale
manufacturing  facilities,  clinical  manufacturing,  and related administrative
activities.

The Company was  incorporated  on October 25, 1996 in the state of Delaware  and
first began business on March 21, 1997 (inception) as a wholly-owned  subsidiary
of Glyko  Biomedical  Ltd.  (GBL).  Subsequently,  BioMarin  has issued stock to
outside  investors in a series of transactions,  resulting in GBL's ownership of
BioMarin's  outstanding common stock being reduced to 31 percent at December 31,
2000.

On October 7, 1998, the Company acquired Glyko, Inc., a wholly-owned  subsidiary
of GBL, in a transaction valued at $14.5 million.  The transaction was accounted
for as a purchase and resulted in Glyko, Inc. becoming a wholly-owned subsidiary
of the  Company.  Glyko,  Inc.  provides  products  and  services  that  perform
sophisticated  carbohydrate  analysis for research  institutions  and commercial
laboratories.

Through  December  31,  2000,  the Company  had  accumulated  losses  during its
development  stage of  approximately  $80.5  million.  Based on  current  plans,
management  expects to incur further  losses at least  through 2002.  Management
believes that the Company's cash and cash equivalents and short-term  investment
balances  at  December  31,  2000  will  be  sufficient  to meet  the  Company's
obligations at least through 2001.

Business Risks - The Company is exposed to the following risks:

o        There can be no assurance that the Company's  research and  development
         efforts will be successfully  completed or that its product  candidates
         will be shown to be safe and effective.

o        There can be no assurance that its product  candidates will be approved
         for  marketing by the U.S.  Food and Drug  Administration  (FDA) or any
         equivalent  foreign  government  agency or that its product  candidates
         will be successfully  commercialized or achieve any significant  degree
         of market acceptance.

o        Certain  of the  Company's  products  and  product  candidates  rely on
         proprietary  technology and patents owned by certain  universities  and
         other  institutions and licensed to BioMarin.  These  universities also
         provide research and development  services.  Cessation of relationships
         with these universities could significantly affect the Company's future
         operations.

o        In order to grow significantly,  the Company must expand its efforts to
         develop new products in pharmaceutical  applications.  The Company will
         also need to enhance manufacturing  capabilities,  to develop marketing
         capabilities,  and/or enter into collaborative  arrangements with third
         parties having the capacity for such manufacturing or marketing.

o        There can be no assurance  that any of the Company's  current or future
         product  candidates  will  be  successfully  developed,   prove  to  be
         effective in clinical trials, receive required regulatory approvals, be
         capable of being produced in commercial quantities at reasonable costs,
         gain reasonable reimbursement levels, or be successfully marketed.

In addition, the Company is subject to a number of risks, including the need for
additional  financing,  dependence on key personnel,  small patient  population,
patent protection, significant competition from larger organizations, dependence
on  corporate   partners  and  collaborators,   and  expected   restrictions  on
reimbursement, as well as other changes in the healthcare industry.

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

Basis of  Presentation--These  consolidated  financial  statements  include  the
accounts of BioMarin,  Glyko, Inc., a wholly-owned subsidiary of BioMarin (since
October 7, 1998),  and BioMarin  Genetics,  Inc., a  wholly-owned  subsidiary of
BioMarin  formed for the purpose of the joint  venture  discussed in Note 8. All
significant intercompany transactions have been eliminated.

Concentration of Credit Risk--Financial instruments that may potentially subject
the Company to  concentration  of credit risk consist  principally of cash, cash
equivalents,  and  short-term  investments.  All  cash,  cash  equivalents,  and
short-term  investments are placed in financial  institutions with strong credit
ratings, which minimizes the risk of loss due to nonpayment. The Company has not
experienced any losses due to credit  impairment or other factors related to its
financial instruments.
                                       34
<PAGE>
Use of  Estimates--The  preparation of financial  statements in conformity  with
generally accepted  accounting  principles  requires  management to make certain
estimates  and  assumptions  that  affect  the  reported  amounts  of assets and
liabilities, disclosure of contingent assets and liabilities at the dates of the
financial  statements,  and the reported amounts of revenues and expenses during
the  reporting  period.  Actual  results  could  differ  from  those  estimates.
Significant  estimates made by management  include  determination of progress to
date of research and development projects in-process, the amortization period of
goodwill and other intangibles, and asset impairment reserves related to certain
leasehold improvements and equipment.

Cash and Cash  Equivalents--For  the consolidated  statements of cash flows, the
Company treats liquid  investments  with original  maturities of less than three
months as cash and cash equivalents.

Short-Term Investments--The Company records its investments as held-to-maturity.
These investments are recorded at cost at December 31, 2000, which  approximates
fair market  value.  These  securities  are comprised  mainly of Federal  Agency
investments,   including   Freddie  Macs  and  Federal  Home  Loans,   and  bank
certificates of deposit.

Inventories--Inventories  consist of analytic kits and instrument-based  systems
held for sale. Inventories are stated at the lower of cost (first-in,  first-out
method) or estimated market value. All inventories at December 31, 1999 and 2000
belonged to Glyko, Inc.

Investment in BioMarin/Genzyme  LLC and Related  Revenue--Under the terms of the
Company's joint venture  agreement with Genzyme (the Agreement - see notes 7 and
8),  the  Company  and  Genzyme  have each  agreed to  provide 50 percent of the
funding  for  the  joint  venture.  All  research  and  development,  sales  and
marketing,  and other activities  performed by Genzyme and the Company on behalf
of the joint  venture  are billed to the joint  venture at cost.  Any profits or
losses of the joint venture are shared equally by the two parties. Losses of the
joint venture ($1.7 million,  $14.0 million, $25.3 million and $41.0 million for
the years ended  December 31,  1998,  1999 and 2000 and for the period March 21,
1997  (inception)  through  December 31, 2000,  respectively)  are  allocated in
proportion  to the funding  provided  by each joint  venture  partner.  BioMarin
provided $22.0 million in funding to the joint venture through 2000.

During the years ended  December  31, 1999 and 2000,  the Company  billed  $10.6
million  and  $19.4  million,  respectively,  to the  joint  venture  under  the
Agreement.  Of these amounts, $5.3 million and $9.7 million respectively,  or 50
percent,  was recognized as revenue in accordance  with the Company's  policy of
recognizing  revenue to the extent that research and development costs billed to
the joint  venture  have been funded by Genzyme.  At December 31, 1999 and 2000,
the Company had  receivables  of $1.3  million and $1.8  million,  respectively,
related to these billings.

The Company  accounts for its  investment  in the joint venture using the equity
method.  Accordingly,  the Company recorded a reduction in its investment in the
joint  venture of $7.0 and $12.7  million,  during the years ended  December 31,
1999 and 2000,  respectively,  representing  its 50 percent share of the loss of
the joint venture. The percentage of the research and development costs incurred
by the  Company and billed to the joint  venture  that was funded by the Company
(50 percent,  or $5.3 million and $9.7 million for the years ended  December 31,
1999 and 2000, respectively) was recorded as a credit to the Company's equity in
the loss of the joint venture.

At December 31, 2000 the summarized  assets and liabilities of the joint venture
and its results of operations from inception to December 31, 2000 are as follows
(in thousands):

 Assets                          $ 3,368
                                 =+=====
Liabilities                      $ 2,890
Net equity                           478
                                 -------
                                 $ 3,368

Cumulative net loss              $40,971
                                 =======

Research and Development--Research and development expenses include the expenses
associated  with contract  research and  development  provided by third parties,
research and development provided in connection with the joint venture including
manufacturing,   clinical  and  regulatory  costs,  and  internal  research  and
development  costs.  All  research and  development  costs  discussed  above are
expensed as incurred.

Property and  Equipment--Property and equipment are stated at cost. Depreciation
is computed using the straight-line method. Leasehold improvements are amortized
over the life of the  assets or the term of the  lease,  whichever  is  shorter.
Significant  additions  and  improvements  are  capitalized,  while  repairs and
maintenance are charged to expense as incurred.

As of December  31,  1999 and 2000,  property  and  equipment  consisted  of the
following (in thousands):



                                       35
<PAGE>
<TABLE>
                                                  December 31,
                                         -------------------------------
Category                                      1999           2000             Estimated Useful Lives
-------------------------------------    -------------------------------  --------------------------------
<S>                                      <C>            <C>                      <C>
Computer hardware and software           $    426       $    678                 3 years
Office furniture and equipment              1,017          1,056                 5 years
Manufacturing/Laboratory equipment          8,254          9,323                 5 years
Leasehold improvements                     18,889         16,685            Shorter of life of assets
                                                                                or lease term
Construction in progress                      879          1,048
                                         -------------------------------
                                           29,465         28,790
Less:  Accumulated depreciation            (4,372)        (8,075)
                                         -------------------------------
Total property and equipment, net        $ 25,093       $ 20,715
                                        ===============================
</TABLE>

Depreciation  expense for the years ended  December 31, 1998,  1999 and 2000 and
for the period  March 21,  1997  (inception)  to  December  31,  2000,  was $0.3
million, $4.1 million, $4.3 million and $8.7 million, respectively.

Goodwill and Other  Intangible  Assets--In  connection  with the  acquisition of
Glyko, Inc., the Company acquired certain intangible assets including  developed
technology,  customer  relationships  and  goodwill.  In this  acquisition,  the
Company  obtained  Glyko  Inc.'s  ongoing  business of  providing  products  and
services to research institutions and commercial laboratories. Additionally, the
Company secured ongoing access to Glyko,  Inc.'s proprietary  technologies which
assist the Company in supporting the manufacturing  process testing and clinical
testing  for our two lead drug  candidates,  Aldurazyme  for MPS-I and rhASB for
MPS-VI.

The  purchase  price of $14.5  million was  allocated  to the net  tangible  and
intangible assets acquired, based on the relative fair value of these assets. In
connection with this  allocation,  $2.6 million was expensed as a charge for the
purchase of in-process research and development. Of the $11.7 million designated
as  intangible   assets   (after  the  write-off  of  in-process   research  and
development),  $1.2 million was allocated to developed  technology and amortized
over six years, $73,000 was allocated to assembled work force and amortized over
seven  years,   and  $10.4   million  was   allocated   to  goodwill   (customer
relationships,  trade name, pure business goodwill) and initially amortized over
twelve years. In performing this allocation, the Company considered, among other
factors,   Glyko,  Inc.'s  technology  and  research  and  development  projects
in-process at the date of  acquisition.  With regard to the in-process  research
and development  projects,  the Company  considered factors such as the stage of
development of the technology at the time of acquisition, the importance of each
project  to  the  overall  development  plan,  alternative  future  uses  of the
technology  and the  projected  incremental  cash flows from the  projects  when
completed and any associated risks.

During 2000 the Company changed its estimate of the useful life of this goodwill
from 12 years to 7 years.  The effect of this change in estimate was to increase
the Company's net loss by $466,000.

Amortization expense related to the acquisition of Glyko, Inc. was $0.3 million,
$1.1  million  and $1.6  million  for the period  from  October 7, 1998 (date of
acquisition)  to December  31, 1998,  and the years ended  December 31, 1999 and
2000, respectively.

In connection  with the purchase of the key assets of the  Biochemical  Research
Reagent  Division  of Oxford  GlycoSciences  Plc. (OGS),  the  Company  recorded
goodwill in the amount $891,000 which is being amortized over seven years. Total
amortization expense for the year ended December 31, 2000, was $139,000.

Impairment of Long-Lived Assets--The Company regularly reviews long-lived assets
and identifiable  intangibles whenever events or circumstances indicate that the
carrying  amount  of such  assets  may not be  fully  recoverable.  The  Company
evaluates  the  recoverability  of  long-lived  assets by measuring the carrying
amount of the  assets  against  the  estimated  undiscounted  future  cash flows
associated  with them.  At the time such  evaluations  indicate  that the future
undiscounted  cash flows of certain  long-lived  assets  are not  sufficient  to
recover the carrying value of such assets, the assets are adjusted to their fair
values (based on discounted cash flows). Except for the Carson Street closure as
discussed  in Note 11 no such  adjustments  have been  made  during  any  period
presented.













                                       36
<PAGE>
Accrued  Liabilities--As  of  December  31, 1999 and 2000,  accrued  liabilities
consisted of the following (in thousands):

                                         December 31,
                                   --------------------------
                                       1999         2000
                                   ------------- ------------
Vacation                            $     286     $     411
Construction in progress                  882           225
Carson Street                              -            348
Other                                     798         1,125
                                   ------------- ------------
               Total                $  1,966      $  2,109
                                   ============= ============

Revenue  Recognition--The  Company recognizes Glyko, Inc.'s product revenues and
related cost of sales upon shipment of products.  Glyko, Inc.'s service revenues
are recognized upon  completion of services as evidenced by the  transmission of
reports  to  customers.  Other  Glyko,  Inc.  revenues,  principally  licensing,
distribution  and  development   fees,  are  recognized  upon   satisfaction  of
contractual obligations such as 1) execution of contract; 2) certain milestones;
and 3) certain anniversary dates from the effective date of the contract.

Revenue from the joint  venture is  recognized  to the extent that  research and
development costs billed by the Company have been funded by Genzyme.

Net Income (Loss) per  Share--Basic net income (loss) per share is calculated by
dividing net income (loss) by the weighted  average  common  shares  outstanding
during the period.  Diluted net income per share is  calculated  by dividing net
income by the weighted  average common shares  outstanding and potential  common
shares  during the period.  Potential  common  shares  include  dilutive  shares
issuable upon the exercise of outstanding  common stock options,  warrants,  and
contingent  issuances  of common  stock.  For  periods in which the  Company has
losses (all periods  presented),  such potential common shares are excluded from
the computation of diluted net loss per share, as their effect is antidilutive.

Potentially dilutive securities include (in thousands):
                                                         December 31,
                                      ----------------------------------------
                                        1998             1999           2000
                                      ----------------------------------------
Options to purchase common stock       2,801             5,450          5,539
Warrants to purchase common stock        802               802             -
                                      ----------------------------------------
                                       3,603             6,252          5,539
                                      ========================================

Segment Reporting--For the year ended December 31, 1998, the Company adopted the
provisions of SFAS No. 131,  "Disclosures  about  Segments of an Enterprise  and
Related  Information."  The Company  operates  two  segments.  The  Analytic and
Diagnostic  segment  represents the operations of Glyko,  Inc. which involve the
manufacture  and sale of analytic and diagnostic  products.  The  Pharmaceutical
segment  represents  the  research  and  development  activities  related to the
development  and   commercialization   of  carbohydrate   enzyme   therapeutics.
Management of the Company has concluded  that the operations of the Analytic and
Diagnostic  segment are, and will continue to be, immaterial with respect to the
Company's overall activities and, thus, disclosure of segment information is not
required.

New  Accounting   Standards--In  June  1998,  the  FASB  issued  SFAS  No.  133,
"Accounting for Derivative  Instruments and Hedging Activities." SFAS No. 133 is
not expected to have a material impact on the Company's  consolidated  financial
position or results of operations.

In December 1999, the Securities and Exchange Commission issued Staff Accounting
Bulletin No. 101 ("SAB 101"), "Revenue Recognition in Financial Statements." SAB
101 provides guidance on applying  generally accepted  accounting  principles to
revenue recognition issues in financial statements.  The Company adopted SAB 101
as  required  in the  first  quarter  of 2000  and such  adoption  has not had a
material effect on the Company's  consolidated  financial position or results of
operations.

3.   STOCKHOLDERS' EQUITY:

Common  Stock and  Warrants  - As  disclosed  in the  accompanying  consolidated
statements of changes in  stockholders'  equity,  the Company closed a number of
private  placements in 1997 and 1998. In connection  with these  placements,  an
entity with which the former chief  executive  officer and chairman of the board
is affiliated  (see Note 7) was issued a total of 899,500 shares (valued at $1.4
million) and warrants (valued at $0.1 million) to purchase an additional 801,500
shares of common  stock at an exercise  price of $1 per share.  These  issuances
were made for brokerage  services  rendered in connection with these  placements
and were accounted for as a cost of raising capital. The warrants were exercised
in October 2000.






                                       37
<PAGE>
Notes Receivable from Stockholders--Notes receivable from stockholders relate to
2.5 million  shares of common stock  issued in October  1997 to three  executive
officers  under  the  terms  of the  Founder's  Stock  Purchase  Agreement  (the
Agreement).  These notes bear  interest  at 6 percent per annum,  and are due on
March 31,  2001,  or on the date of the  employee's  termination,  whichever  is
earlier.  The  notes  are  secured  by the  underlying  stock  and are with full
recourse.  Interest  was  imputed  at nine  percent,  resulting  in an  interest
discount and related deferred compensation of $200,000, which is being amortized
over the life of the notes. In the event that their  employment is terminated by
the Company,  the Company has the  obligation,  if requested by the officer,  to
repurchase  any or all of the shares  issued under the Agreement at the lower of
the original  purchase price or the current  market value of the shares.  In the
event one of these officers ceases to be an employee, the Company has the right,
but not the  obligation,  to  repurchase  the unvested  portion of the shares at
their original  purchase price.  Pursuant to the terms of the Agreement,  50% of
the shares vest after one year from the date of  employment,  with the remainder
vesting at a rate of 1/24th per month  thereafter.  Upon the former  President's
resignation from the Company in July 2000, the Company repurchased 33,334 shares
at his original  purchase price and concurrently  reduced his promissory note to
the Company for the same amount.  In August 2000, the former  President paid the
balance of his  promissory  note plus accrued  interest to the  Company.  During
October 2000 the Company's  Chief  Executive  Officer  resigned.  His promissory
note, plus accrued interest, is due in full on March 31, 2001.

Deferred Compensation--In  connection with certain stock option and stock grants
during the years ended December 31, 1998,  1999 and 2000,  the Company  recorded
deferred  compensation  totaling  $3.2  million,  $0.7 million and $0.3 million,
respectively, which is being amortized over the estimated service periods of the
grantees.  Amortization  expense  recognized during the years ended December 31,
1998,  1999  and  2000,  was  $0.2  million,  $1.3  million  and  $1.4  million,
respectively.

4.   INCOME TAXES:

The Company  utilizes the asset and liability  method of  accounting  for income
taxes. Under the asset and liability method, deferred taxes are determined based
on the  difference  between the financial  statement and tax bases of assets and
liabilities  using  enacted  tax  rates in  effect  in the  years  in which  the
differences are expected to reverse.

The  Company's  primary  temporary  differences  relate  to items  expensed  for
financial  reporting  purposes  but not  currently  deductible  for  income  tax
purposes, consisting primarily of depreciable lives for property and equipment.

As of December 31, 2000,  net operating  loss  carryforwards  are  approximately
$74.9 million and $66.1 million for federal and California  income tax purposes,
respectively.  These net operating loss  carryforwards,  including net operating
losses of $12.6  million and $2.9 million for federal and  California  purposes,
respectively,  related to Glyko,  Inc.  These  federal  and state  carryforwards
expire beginning in the year 2011 and 2004, respectively.

The Company also has research and development credits available to reduce future
federal and California  income taxes, if any, of approximately  $2.8 million and
$2.8 million,  respectively, at December 31, 2000. These credits include credits
related to Glyko,  Inc.  of  approximately  $0.6  million  and $0.3  million for
federal  and  California  purposes,   respectively.   These  federal  and  state
carryforwards expire beginning in 2012 and 2013, respectively.

The Company also has orphan drug  credits  available  to reduce  future  federal
income taxes, if any, of approximately $7.3 million at December 31, 2000.

The net  operating  loss  carryforwards  and  research and  development  credits
related to Glyko,  Inc.  as of October 7, 1998,  can only be  utilized to offset
future taxable income and tax, respectively, if any, of Glyko, Inc. In addition,
the Tax Reform Act of 1986 contains  provisions that may limit the net operating
loss carryforwards and research and development  credits available to be used in
any given year should certain events occur,  including sale of equity securities
and other changes in ownership.  The acquisition of Glyko,  Inc. and the related
issuance of stock  represented  a change of  ownership  under these  provisions.
There can be no assurance that the Company will be able to utilize net operating
loss carryforwards and credits before expiration.

Deferred  income  taxes are recorded to reflect the tax  consequences  on future
years of differences  between the tax basis of assets and  liabilities and their
financial reporting amounts at each period-end. The Company has a cumulative net
operating  loss  carryforward  since  inception,  resulting  in net deferred tax
assets. A valuation allowance is placed on the net deferred tax assets to reduce
them to an assumed net realizable value of zero.

5.   STOCK OPTION PLANS:

1997 Stock Plan--In  November  1997,  the Board adopted,  and in April 1998, the
stockholders  approved,  the 1997 Stock Plan (the 1997 Plan), which provided for
the  reservation  of a total of  3,000,000  shares of common  stock for issuance
under the 1997 Plan. In December 1998,  the Board adopted,  and in January 1999,
the stockholders  approved, an amendment to the 1997 Plan to increase the number




                                       38
<PAGE>
of shares reserved for issuance under it to an aggregate of 5,000,000 and to add
an  "evergreen  provision"  providing  for an annual  increase  in the number of
shares  which may be  optioned  or sold  under the 1997  Plan  without  need for
additional Board or stockholder  action to approve such increase (which increase
shall  be the  lesser  of 4  percent  of  the  then-outstanding  capital  stock,
2,000,000  shares, or a lower amount set by the Board). As of December 31, 2000,
the number of shares  reserved for issuance was an aggregate of 7,695,572  under
the 1997 Plan.  The 1997 Plan  provides  for the grant of stock  options and the
issuance of common stock by the Company to its employees,  officers,  directors,
and consultants.

1998 Director Option Plan--The 1998 Director Option Plan (the Director Plan) was
adopted  by the Board in  December  1998 and  approved  by the  stockholders  in
January 1999.  The Director Plan  provides for the grant of  nonstatutory  stock
options to  non-employee  directors.  A total of 200,000 shares of the Company's
common stock,  plus an annual  increase  equal to the number of shares needed to
restore  the maximum  aggregate  number of shares  available  for sale under the
Director  Plan or the lesser of 0.5 percent of the  outstanding  capital  stock,
200,000  shares,  or a lesser  amount set by the Board,  have been  reserved for
issuance under the Director  Plan. As of December 31, 2000,  options to purchase
165,000  shares were  granted  under the  Director  Plan and options to purchase
400,000 shares were authorized under the Director Plan.

 Options  currently  outstanding  under the Company's 1997 Stock Option Plan and
1998 Director Plan (the Plans)  generally  have vesting  schedules of up to four
years and options terminate after five to ten years or 90 days after termination
of employment or contract.

The  Company  accounts  for  option  grants  in  accordance  with  APB  25.  Had
compensation cost for option grants to employees under the Plans been determined
consistent  with the fair value  provisions  of SFAS No. 123,  the effect on the
Company's  net loss  would have been as follows  (in  thousands,  except for per
share data):
<TABLE>
                                                                                                        Period from
                                                                                                      March 21, 1997
                                         Years ended December 31,                                       (Inception)
                          ---------------------------------------------------------------------       to December 31,
                                 1998                     1999                  2000                        2000
                        -----------------------    --------------------  --------------------  -----------------------------
<S>                       <C>                        <C>                     <C>                     <C>
Net loss as reported      $    (12,314)              $    (28,072)           $  (37,364)             $     (80,513)
Pro  forma  effect  of
SFAS No. 123                      (183)                    (1,074)               (5,412)                    (6,669)
                         ----------------------    --------------------  --------------------  -----------------------------
Pro forma net loss        $    (12,497)              $    (29,146)           $  (42,776)             $     (87,182)
                         ======================    ====================  ====================  =============================
Net  loss  per  common
share as reported         $      (0.55)              $      (0.94)           $    (1.04)             $       (3.21)
                         ======================    ====================  ====================  =============================
Pro  forma   loss  per
common share              $      (0.56)              $      (0.97)           $    (1.19)             $       (3.48)
                         ======================    ====================  ====================  =============================
</TABLE>
<TABLE>
A summary of the status of the Company's Plans is as follows:

                                                             Weighted
                                                             Average      Exercisable   Weighted Average
                                                            Exercise      at End of      Fair Value of
                                            Option Shares    Price          Year       Options Granted
                                          ------------------------------ ------------- -------------------
<S>                                            <C>              <C>         <C>               <C>
Outstanding at March 21, 1997
    Granted                                    297,000          $1.00                          $0.22
    Exercised                                       -              -
    Canceled                                        -              -
                                          ----------------
Outstanding at December 31, 1997               297,000           1.00       232,000
                                                                         =============
    Granted                                  2,507,660           4.18                          $2.40
    Exercised                                   (1,973)          1.00
    Canceled                                    (1,447)          1.00
                                          ----------------
Outstanding at December 31, 1998             2,801,240           3.85       761,609
                                                                         =============
                                                                                               $8.80
    Granted                                  2,877,430          11.35
    Exercised                                  (40,148)          3.69
    Canceled                                  (188,536)          9.28
                                          ----------------
Outstanding at December 31, 1999             5,449,986           7.59     1,922,041
                                                                         =============
    Granted                                  1,881,310          15.83                          $13.27
    Exercised                               (1,300,532)          4.36
    Canceled                                  (491,506)         11.70
                                          ----------------
Outstanding at December 31, 2000             5,539,258          10.92     2,067,302
                                                                         =============
</TABLE>
                                       39
<PAGE>
There were 900,510 and 1,048,661  options available for grant under the Plans at
December 31, 1999 and 2000, respectively.

As of December 31, 2000,  the  5,539,258  options  outstanding  consisted of the
following:
<TABLE>

Options Outstanding                                                                                  Options Exercisable
--------------------------------------------------------------------------------------   -------------------------------------------
Range of Exercise  Number of Options      Weighted Average          Weighted Average         Number of Options     Weighted  Average
     Prices          Outstanding          Contractual Life          Exercise Price            Exercisable            Exercise Price
--------------------------------------------------------------------------------------   -------------------------------------------

<S>                     <C>                     <C>                      <C>                     <C>                    <C>
 $0.00 to $3.50         266,939                 1.8                      $1.03                   254,654                $ 1.03
 $3.51 to $7.00       1,930,998                 4.8                      $5.38                 1,073,652                $ 5.23
 $7.01 to $10.50        175,900                 8.9                      $9.45                    13,446                $ 8.50
 $10.51 to $14.00     1,774,658                 6.6                     $12.78                   431,597                $12.86
 $14.01 to $17.50       781,556                 5.5                     $15.82                   199,654                $15.79
 $17.51 to $21.00       330,749                 7.9                     $19.46                    39,407                $19.65
 $21.01 to $24.50       166,000                 9.0                     $21.95                    28,124                $21.95
 $24.51 to $28.00        96,000                 4.9                     $25.88                    21,873                $25.92
 $28.01 to $31.50        15,000                 4.2                     $31.25                     3,437                $31.25
 $31.51 to $35.00         1,458                 0.1                     $35.00                    1,458                 $35.00
                    ---------------                                                        ------------------
                      5,539,258                                                                2,067,302
                    ===============                                                        ==================
</TABLE>

The fair value of each option  grant in 1997,  1998 and through July 22, 1999 is
estimated on the date of grant using the Black-Scholes option pricing model with
the  following  assumptions:  risk-free  interest  rates ranging from 4.6 to 5.7
percent;  expected dividend yield of 0 percent;  expected life of four years for
the Plan's options; and expected volatility of 0 percent.

The fair value of each option grant from July 22, 1999 through December 31, 1999
is estimated on the date of grant using the  Black-Scholes  option pricing model
with the following assumptions: risk-free interest rates ranging from 5.8 to 6.1
percent;  expected dividend yield of 0 percent;  expected life of four years for
the Plan's options; and expected volatility of 38 percent.

The fair value of each option  grant in 2000 is  estimated  on the date of grant
using the Black-Scholes option pricing model with the following assumptions used
for grants : risk-free interest rates ranging from 4.6 to 6.8 percent;  expected
dividend yield of 0 percent; expected life of four years for the Plan's options;
and expected volatility of 105 percent.

6.   COMMITMENTS AND CONTINGENCIES:

Lease  Commitments--The  Company  leases  office  space and research and testing
laboratory space in various  facilities under operating  agreements  expiring at
various dates through 2010.  Future  minimum lease  payments for the years ended
December 31 are as follows (in thousands):

            2001.................        $  1,888
            2002..................          1,754
            2003..................          1,627
            2004.................           1,563
            2005..................          1,563
            Thereafter...........           6,953
                                         ---------
                      Total.....         $ 15,348
                                         =========

Rent expense for the years ended  December 31, 1998,  1999 and 2000, and for the
period from March 21, 1997 (inception),  to December 31, 2000, was $0.4 million,
$1.1 million, $1.5 million and $3.0 million, respectively.

Research  and  Development  Funding and  Technology  Licenses--The  Company uses
experts and  laboratories  at  universities  and other  institutions  to perform
research and development  activities.  Funding commitments to these institutions
for the year ended December 31 are as follows (in thousands):

            2001..................           504
            2002..................           100
            2003..................           100
            2004..................           100
            2005..................           100
                                           ------
                      Total.....           $ 904
                                           ======

The Company has also licensed technology from certain institutions, for which it
is  required  to pay a royalty  upon  future  sales,  subject to certain  annual
minimums.





                                       40
<PAGE>
Product Liability and Lack of  Insurance--The  Company is subject to the risk of
exposure to product  liability claims in the event that the use of Aldurazyme or
rhASB  results  in  adverse  effects  during  testing or  commercial  sale.  The
BioMarin/Genzyme  LLC and the Company do carry  product  liability  insurance to
cover the clinical trials of Aldurazyme and rhASB, respectively. There can be no
assurance  that the Company will be able to obtain product  liability  insurance
coverage at  economically  reasonable  rates or that such insurance will provide
adequate coverage against all possible claims.

7.   RELATED-PARTY TRANSACTIONS:

The  Company  had   contractual   agreements   for  office   space  and  certain
administrative,  research,  and development  functions with Glyko, Inc. prior to
the acquisition date of October 7, 1998.  BioMarin  reimburses  Glyko,  Inc. for
rent, salaries and related benefits, and other administrative costs. Glyko, Inc.
also reimburses BioMarin for salaries and related benefits.

Reimbursement of expenses (in thousands):
<TABLE>

                                                    Paid from         Paid from
                                                  Glyko, Inc. to     BioMarin to
                                                    BioMarin         Glyko, Inc.     Net, to Glyko, Inc.
                                                 ---------------- ---------------  ---------------------

<S>                                               <C>              <C>                <C>
Year ended December 31, 1998                      $   75           $     298          $   223
Year ended December 31, 1999                          68                 335              267
Year ended December 31, 2000                           -                 155              155
March 21, 1997 (inception) to December 31, 2000      276               1,162              886

</TABLE>


During  1997  801,500  warrants  were  issued to an entity with which the former
Chief Executive Officer and Chairman of the Board is affiliated (see Note 3).

Since  October 8, 1998,  GBL has agreed to pay the Company a monthly  management
fee for its  services  to GBL  primarily  relating  to  management,  accounting,
finance and government  reporting.  The Company had accrued receivables relating
to these services for GBL of $37,500 and $8,765 for the years ended December 31,
1999 and 2000, respectively.

On April 13,  1999,  the Company  entered  into a  convertible  note  financing
agreement  in the amount of $26.0  million.  Of this amount GBL  purchased  $4.3
million worth of such notes and LaMont Asset  Management SA (LAM) purchased $9.7
million. A director of the Company is also the chairman of LAM. The Company also
entered into an agency  agreement  with LAM pursuant to which the Company agreed
to pay LAM a five percent cash  commission on sales to certain note  purchasers.
On July 23, 1999,  concurrent with the Company's IPO, the Company's  convertible
notes payable  (including accrued interest) were converted into 2,672,020 shares
of the Company's common stock at $10 per share.  GBL's $4.3 million  convertible
note plus  interest  was  converted  to 441,911  shares  and LAM's $9.7  million
convertible note plus interest was converted to 996,869 shares.

Due to the terms of the collaborative agreement with Genzyme outlined in Note 8,
Genzyme is considered to be a related party.  See also Notes 1 and 8 for Genzyme
related-party transactions.

8.   COLLABORATIVE AGREEMENTS:

Genzyme--Effective September 4, 1998, the Company entered into an agreement (the
Collaboration   Agreement)   with   Genzyme  to   establish   a  joint   venture
(BioMarin/Genzyme  LLC) for the worldwide  development and  commercialization of
Aldurazyme  to treat  MPS-I.  In  conjunction  with the  formation  of the joint
venture,  the Company established a wholly-owned subsidiary,  BioMarin Genetics,
Inc.  The  Company  has a 49 percent  interest  in the joint  venture,  BioMarin
Genetics,  Inc.  has a 1 percent  interest,  and  Genzyme has the  remaining  50
percent interest.

Under the Collaboration  Agreement, the Company and Genzyme are each required to
make capital contributions to the joint venture in an amount equal to 50 percent
of costs and expenses associated with the development and  commercialization  of
Aldurazyme.  The  parties  also  agree to share the  profits  equally  from such
commercialization.  In  addition,  Genzyme  purchased  1,333,333  shares  of the
Company's  common stock at $6 per share in a private  placement  for proceeds of
$8.0 million and,  concurrent  with the IPO,  purchased  an  additional  769,230
shares of the Company's  common stock at the IPO price for an  additional  $10.0
million.  Genzyme has also agreed to pay the Company  $12.1 million in cash upon
FDA approval of the biologics license application for Aldurazyme.

Other   Agreements--The   Company  is  engaged  in  research   and   development
collaborations with various academic  institutions,  commercial research groups,
and other  entities.  The  agreements  provide for  sponsorship  of research and
development  by the Company and may also provide for  exclusive  royalty-bearing
intellectual property licenses or rights of first negotiation regarding licenses
to intellectual property development under the collaborations.  Typically, these
agreements are terminable for cause by either party upon 90 days written notice.

                                       41
<PAGE>
9.   COMPENSATION PLANS:

Employment  Agreements--The  Company has entered into employment agreements with
eight officers of the Company.  Seven of these agreements are terminable without
cause by the Company upon six months prior notice,  or by the officer upon three
months prior written  notice to the Company,  with the Company  obligated to pay
salary  and  benefits  hereunder  until  such  termination.  In  the  employment
agreement  with the Company's  Chief  Executive  Officer the agreement  shall be
renewed  after three years for one  additional  three-year  period unless either
party gives nine months notice prior to the expiration of the initial three-year
period.   The  annual  salaries   committed  to  under  these  agreements  total
approximately $2 million.  In addition,  three of the agreements provide for the
payment of an annual cash bonus of up to 100  percent of the base annual  salary
of the three officers  based upon the Company's  market  capitalization  through
June 30, 2000. Bonuses for the three officers totaled $294,000 in 2000.

401(k) Plan--The Company  participates in the BioMarin  Retirement Savings Plan.
Most employees (Participants) are eligible to participate following the start of
their employment,  on the earlier of the next occurring January 1, April 1, July
1 or October 1.  Participants  may  contribute up to 15 percent of their current
compensation  to the  401(k)  Plan or an amount up to a  statutorily  prescribed
annual  limit.  The  Company  pays the direct  expenses  of the 401(k)  Plan and
matches 25% of the first 2% contributed to the employee accounts.  The Company's
matching contribution vests over four years from employment commencement.

1998 Employee Stock Purchase  Plan--In  December 1998 the Board adopted,  and in
January 1999 the  stockholders  approved,  the 1998 Employee Stock Purchase Plan
(the 1998 Purchase  Plan). A total of 250,000 shares of Company common stock has
been reserved for issuance under the 1998 Purchase Plan,  plus annual  increases
equal to the lesser of 0.5 percent of the  outstanding  capital  stock,  200,000
shares,  or a lesser  amount set by the Board.  As of December 31, 2000,  28,431
shares have been issued under the 1998 Purchase Plan.

10.   SUPPLEMENTAL CASH FLOW INFORMATION:

The  following  non-cash  transactions  took place in the periods  presented (in
thousands):

<TABLE>

                                                                                                                Period from March
                                                                                                                    21, 1997
                                                                    Year Ended December 31,                     (Inception) to
                                                     ------------------------------------------------------        December 31,
                                                          1998             1999                2000                   2000
                                                     ------------------------------------------------------    --------------------
<S>                                                    <C>               <C>                <C>                     <C>
Common stock issued upon conversion of
  convertible notes plus interest                      $     -           $ 25,615           $    -                  $25,615
Common stock issued in exchange for notes                    -                 -                 -                   20,500
Common stock and common stock warrants
  issued in exchange for brokerage services                588                 -                 -                    1,518
Bridge loan converted to common stock                        -                 -                 -                      880
Common stock surrendered by stockholders
  for payment of principal and interest                      -                 -                170                     170
Compensation in the form of common stock
  and common stock options                                   -                 -                  -                      18
</TABLE>


11.   CARSON STREET CLOSURE

During the first quarter of 2000, the Company decided to close its Carson Street
clinical  manufacturing  facility. In connection with this decision, the Company
recorded a charge of  approximately  $4.4  million.  The  facility was no longer
required for the  production of  Aldurazyme,  the initial  purpose of the plant,
after a decision by the  BioMarin/Genzyme LLC joint venture to use the Company's
Galli Drive facility for the  manufacture of bulk  Aldurazyme both for the Phase
III trial and for the commercial  launch of Aldurazyme.  This decision was based
in part  on U.S.  Food  and  Drug  Administration  guidance  to use an  improved
production  process,  which was installed in the Galli Drive  facility,  for the
clinical trial, the biologics license application  submission and for commercial
production.  The majority of the Company's  technical staff at the Carson Street
facility in  Torrance,  California  transferred  to the Galli Drive  facility in
Novato, California in May. The charge primarily consisted of impairment reserves
for leasehold improvements and equipment located in the Carson Street facility.












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<PAGE>
12.   SUBSEQUENT EVENT

In January 2001,  the Company signed an agreement  with Acqua  Wellington  North
American  Equities Fund Ltd. (Acqua  Wellington)  whereby Acqua  Wellington will
make an equity  investment  in the  Company  of up to $50  million.  Subject  to
certain  conditions,  including the market price of BioMarin stock,  these funds
will be drawn  down,  at the  Company's  option,  over the course of the next 20
months from sales of registered  common stock to be sold at a small  discount to
the market price.

In the initial  transaction  under this  agreement  on  February 2, 2001,  Acqua
Wellington  purchased  $1 million  of the  Company's  common  stock at $9.85 per
share.

13.  QUARTERLY CONSOLIDATED FINANCIAL DATA (unaudited)

The Company's  quarterly  operating  results have fluctuated in the past and may
continue to do so in the future as a result of a number of  factors,  including,
but not limited to, the  completion of  development  projects and  variations in
levels of production.

The Company's common stock has been traded on the NASDAQ Stock Market since July
22, 1999.  There were 64 common  stockholders of record at December 31, 2000. No
dividends were paid for the years ended December 31, 2000 and 1999.

<TABLE>

                                                                  Quarter Ended
                                        -------------------------------------------------------------------
                                           March 31,        June 30,      September 30,    December 31,
2000                                                  (In thousands, except per share data)

<S>                                       <C>            <C>               <C>              <C>
Total revenue                             $  3,298       $  3,083          $  2,807         $  3,138
Loss from operations                       (11,965)        (7,188)           (8,247)         (10,024)
Net loss                                   (11,736)        (7,086)           (8,148)         (10,394)
Net loss per share, basic and diluted        (0.34)         (0.20)            (0.23)           (0.28)
Common stock price per share:
  High                                    $ 38.750       $ 27.750          $ 21.750         $  17.62
  Low                                       12.750         16.750            16.375            7.156


                                                                  Quarter Ended
                                        -------------------------------------------------------------------
                                           March 31,        June 30,      September 30,    December 31,
1999                                                  (In thousands, except per share data)

Total revenue                              $  1,104      $  1,557          $  1,999         $  2,315
Loss from operations                        (4,583)        (6,145)           (7,732)          (9,040)
Net loss                                    (4,609)        (6,782)           (7,643)          (9,038)
Net loss per share, basic and diluted       (0.18)          (0.26)            (0.24)           (0.26)
Common stock price per share:
   High                                        N/A           N/A           $ 18.750         $ 17.000
   Low                                         N/A           N/A             11.625           11.625


</TABLE>




























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