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UNITED STATESSECURITIES AND EXCHANGE
COMMISSIONWashington,
D.C. 20549

FORM 10-QSB

(Mark One)


|  |                                                                
|- | ---------------------------------------------------------------
|x | QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
  SECURITIES 
|  | EXCHANGE
  ACT OF 1934                                         
|  |                                                                
|  | For the
  Quarterly Period Ended March 31, 2008                
|  |                                                                
|o | TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
  SECURITIES
|  | EXCHANGE
  ACT OF 1934                                         

For the
Transition Period from _________ to _________

Commission
file number: 0-32835

GAMMACAN
INTERNATIONAL, INC.(Exact name of
registrant as specified in its charter)

|                                                                    |                                      
|------------------------------------------------------------------- | -------------------------------------
|Delaware                                                            | 33-0956433                           
|(State
  or other jurisdiction of 
  incorporation or organization) | (IRS
  Employer Identification
  No.)

Kiryat Ono
Mall
Azorim Center A
39 Jerusalem St., 
55423 Kiryat Ono, Israel(Address of principal
executive offices)

+ 972 3
7382616(Registrants telephone
number, including area code)

(Former name, former address and former fiscal year, if changed since
last report)

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
o

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

APPLICABLE
ONLY TO CORPORATE ISSUERS:

State the number of shares
outstanding of each of the registrants classes of common equity, as of the
latest practicable date: 44,958,917 shares issued and outstanding as of May 1,
2008.

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GAMMACAN INTERNATIONAL, INC.

FORM 10-QSB

TABLE OF CONTENTS

|                               |                                                                      |     
|------------------------------ | -------------------------------------------------------------------- | ----
|                               |                                                                      | Page
|                              
|PART I  FINANCIAL INFORMATION | 1                                                                   
|                               | ITEM 1 - FINANCIAL STATEMENTS                                        | 1   
|                               | ITEM 2 - MANAGEMENTS DISCUSSION AND ANALYSIS OF PLAN OF OPERATION   | 12  
|                               | ITEM 3A(T) - CONTROLS AND PROCEDURES                                 | 20  
|PART II  OTHER INFORMATION    | 21                                                                  
|                               | ITEM 1 - LEGAL PROCEEDINGS                                           | 21  
|                               | ITEM 2 - UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS | 21  
|                               | ITEM 3 - DEFAULTS UPON SENIOR SECURITIES                             | 21  
|                               | ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS         | 21  
|                               | ITEM 5 - OTHER INFORMATION                                           | 21  
|                               | ITEM 6 - EXHIBITS                                                    | 22  

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PART I

ITEM 1 - FINANCIAL
STATEMENTS

GAMMACAN INTERNATIONAL, INC.(A Development Stage Company)INTERIM FINANCIAL STATEMENTS
AS OF MARCH 31, 2008

TABLE OF CONTENTS

|                                                                                                                                                       |  |      | 
|------------------------------------------------------------------------------------------------------------------------------------------------------ |  | ---- | 
|                                                                                                                                                       |  | Page
|                                                                                                                                                       |  |     
|CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 (unaudited):                                                                                              |  |     
|Balance Sheets - March 31, 2008 and
 September 30, 2007                                                                                                |  | 2    | 
|Statements of Operations - Three and
Six
 months ended March 31, 2008 and 2007 and the Period from Inception (October
 6, 1998) through March 31, 2008 |  | 3    | 
|Statements of Changes in
Stockholders
 Equity - Period from Inception (October 6, 1998) through March 31, 2008                                        |  | 4    | 
|Statements of Cash Flows - Six
Months ended
 March 31, 2008 and 2007 and the Period from Inception (October 6, 1998)
 through March 31, 2008           |  | 5    | 
|Notes to Financial
Statements                                                                                                                          |  | 6-11 | 

1

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GAMMACAN INTERNATIONAL, INC.(A Development Stage Company)

CONDENSED CONSOLIDATED BALANCE SHEETS

|                                                                                                                                                                                     |  |                 |             |                      |   |            |  
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | --------------- | ----------- | -------------------- | - | ---------- | -
|                                                                                                                                                                                     |  | March 31,
 2008 |             | September
 30,
 2007 |  
|                                                                                                                                                                                     |  |                 |             |                      |  
|                                                                                                                                                                                     |  | (Unaudited)     |             | (Audited)            |  
|                                                                                                                                                                                     |  |                 |             |                      |  
|Assets                                                                                                                                                                               |  |                 |             |                      |   |            |  
|CURRENT ASSETS:                                                                                                                                                                      |  |                 |             |                      |   |            |  
|Cash and cash equivalents                                                                                                                                                            |  | $               | 2,081,377   |                      | $ | 4,048,583  |  
|Prepaid expenses                                                                                                                                                                     |  |                 | 32,852      |                      |   | 9,851      |  
|Other                                                                                                                                                                                |  |                 | 70,300      |                      |   | 47,271     |  
|                                                                                                                                                                                     |  |                 |             |                      |   |            |  
|Total current
 assets                                                                                                                                                                |  |                 | 2,184,529   |                      |   | 4,105,705  |  
|                                                                                                                                                                                     |  |                 |             |                      |   |            |  
|                                                                                                                                                                                     |  |                 |             |                      |   |            |  
|FUNDS IN RESPECT OF EMPLOYEE RIGHTS UPON
 RETIREMENT                                                                                                                                 |  |                 |            |                      |   | 49,281     |  
|                                                                                                                                                                                     |  |                 |             |                      |   |            |  
|LONG TERM DEPOSITS                                                                                                                                                                   |  |                 | 18,002      |                      |   | 18,590     |  
|                                                                                                                                                                                     |  |                 |             |                      |   |            |  
|PROPERTY AND EQUIPMENT, NET                                                                                                                                                          |  |                 | 36,842      |                      |   | 26,338     |  
|                                                                                                                                                                                     |  |                 |             |                      |   |            |  
|Total assets                                                                                                                                                                         |  | $               | 2,239,373   |                      | $ | 4,199,914  |  
|                                                                                                                                                                                     |  |                 |             |                      |   |            |  
|                                                                                                                                                                                     |  |                 |             |                      |   |            |  
|Liabilities and stockholders equity                                                                                                                                                 |  |                 |             |                      |   |            |  
|CURRENT LIABILITIES:                                                                                                                                                                 |  |                 |             |                      |   |            |  
|Accounts payable                                                                                                                                                                     |  | $               | 827,561     |                      | $ | 797,515    |  
|Payroll and related accruals                                                                                                                                                         |  |                 | 131,287     |                      |   | 130,223    |  
|                                                                                                                                                                                     |  |                 |             |                      |   |            |  
|Total current
 liabilities                                                                                                                                                           |  |                 | 958,848     |                      |   | 927,738    |  
|                                                                                                                                                                                     |  |                 |             |                      |   |            |  
|                                                                                                                                                                                     |  |                 |             |                      |   |            |  
|LIABILITY FOR EMPLOYEE RIGHTS UPON
 RETIREMENT                                                                                                                                       |  |                 | 19,364      |                      |   | 71,338     |  
|                                                                                                                                                                                     |  |                 |             |                      |   |            |  
|                                                                                                                                                                                     |  |                 |             |                      |   |            |  
|STOCKHOLDERS EQUITY:                                                                                                                                                                |  |                 |             |                      |   |            |  
|Preferred stock, $0.0001 par value
 (20,000,000 shares authorized; none issued and outstanding)                                                                                      |  |                 |             |                      |   |            |  
|Common stock, $0.0001 par value
 (200,000,000 authorized shares; 44,958,917 and 44,958,917 shares issued and
 outstanding as of March 31, 2008 and September 30, 2007, respectively) |  |                 | 4,495       |                      |   | 4,495      |  
|Additional paid-in capital                                                                                                                                                           |  |                 | 9,278,533   |                      |   | 8,968,930  |  
|Warrants                                                                                                                                                                             |  |                 | 3,203,600   |                      |   | 3,203,600  |  
|Deficit accumulated during the development
 stage                                                                                                                                    |  |                 | (11,225,467 | )                    |   | (8,956,187 | )
|Services not yet rendered                                                                                                                                                            |  |                 |            |                      |   | (20,000    | )
|                                                                                                                                                                                     |  |                 |             |                      |   |            |  
|Total stockholders equity                                                                                                                                                           |  |                 | 1,261,161   |                      |   | 3,200,838  |  
|                                                                                                                                                                                     |  |                 |             |                      |   |            |  
|Total liabilities and stockholders
equity                                                                                                                                           |  | $               | 2,239,373   |                      | $ | 4,199,914  |  
|                                                                                                                                                                                     |  |                 |             |                      |   |            |  

The accompanying notes are an integral part
of the financial statements.

2

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GAMMACAN INTERNATIONAL, INC.(A Development Stage Company)

CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS
(US $, except share data)

|                                                                                                    |  |                            |            |                              |   |                                                     |   |             |            |             |   |            |   |   |             |  
|--------------------------------------------------------------------------------------------------- |  | -------------------------- | ---------- | ---------------------------- | - | --------------------------------------------------- | - | ----------- | ---------- | ----------- | - | ---------- | - | - | ----------- | -
|                                                                                                    |  | Six months ended
 March 31 |            | Three months ended
 March 31 |   | Period from
 October 6, 
 1998*
 through
 March 31, |  
|                                                                                                    |  |                           
|                                                                                                    |  |                           
|                                                                                                    |  |                           
|                                                                                                    |  |                            |            |                              |   |                                                     |  
|                                                                                                    |  | 2008                       |            | 2007                         |   | 2008                                                |   | 2007        |            | 2008        |  
|                                                                                                    |  |                            |            |                              |   |                                                     |   |             |            |             |  
|                                                                                                    |  | (Unaudited)                |            | (Unaudited)                  |   | (Unaudited)                                         |   | (Unaudited) |            | (Unaudited) |  
|                                                                                                    |  |                            |            |                              |   |                                                     |   |             |            |             |  
|                                                                                                    |  |                            |            |                              |   |                                                     |   |             |            |             |  
|RESEARCH AND DEVELOPMENT COSTS                                                                      |  | $                          | 900,677    |                              | $ | 482,870                                             |   | $           | 386,187    |             | $ | 314,898    |   | $ | 3,613,855   |  
|GENERAL AND ADMINISTRATIVE EXPENSES                                                                 |  |                            | 1,387,419  |                              |   | 1,631,800                                           |   |             | 634,593    |             |   | 998,934    |   |   | 7,766,293   |  
|                                                                                                    |  |                            |            |                              |   |                                                     |   |             |            |             |   |            |   |   |             |  
|OPERATING LOSS                                                                                      |  |                            | 2,288,096  |                              |   | 2,114,670                                           |   |             | 1,020,780  |             |   | 1,313,832  |   |   | 11,380,148  |  
|FINANCIAL INCOME                                                                                    |  |                            | (55,991    | )                            |   | (32,138                                             | ) |             | (17,852    | )           |   | (27,311    | ) |   | (272,912    | )
|FINANCIAL EXPENSES                                                                                  |  |                            | 37,175     |                              |   | 21,467                                              |   |             | 16,303     |             |   | 14,421     |   |   | 100,606     |  
|                                                                                                    |  |                            |            |                              |   |                                                     |   |             |            |             |   |            |   |   |             |  
|LOSS BEFORE TAXES ON INCOME                                                                         |  |                            | 2,269,280  |                              |   | 2,103,999                                           |   |             | 1,019,231  |             |   | 1,300,942  |   |   | 11,207,842  |  
|TAXES ON INCOME                                                                                     |  |                            |           |                              |   | 16,856                                              |   |             |           |             |   | 12,500     |   |   | 30,000      |  
|                                                                                                    |  |                            |            |                              |   |                                                     |   |             |            |             |   |            |   |   |             |  
|LOSS FROM OPERATIONS OF THE COMPANY AND ITS
 CONSOLIDATED SUBSIDIARY                                |  |                            | 2,269,280  |                              |   | 2,120,855                                           |   |             | 1,019,231  |             |   | 1,313,442  |   |   | 11,237,842  |  
|MINORITY INTERESTS IN LOSSES OF SUBSIDIARY                                                          |  |                            |           |                              |   |                                                    |   |             |           |             |   |           |   |   | (12,375     | )
|                                                                                                    |  |                            |            |                              |   |                                                     |   |             |            |             |   |            |   |   |             |  
|NET LOSS FOR THE PERIOD                                                                             |  | $                          | (2,269,280 | )                            | $ | (2,120,855                                          | ) | $           | (1,019,231 | )           | $ | (1,313,442 | ) | $ | (11,225,467 | )
|                                                                                                    |  |                            |            |                              |   |                                                     |   |             |            |             |   |            |   |   |             |  
|BASIC AND DILUTED LOSS PER COMMON SHARE                                                             |  | $                          | (0.05      | )                            | $ | (0.07                                               | ) | $           | (0.02      | )           | $ | (0.04      | ) |   |             |  
|                                                                                                    |  |                            |            |                              |   |                                                     |   |             |            |             |   |            |   |   |             |  
|WEIGHTED AVERAGE NUMBER OF COMMON SHARES
 USED IN COMPUTING BASIC AND DILUTED LOSS PER COMMON SHARE |  |                            | 44,958,917 |                              |   | 31,204,923                                          |   |             | 44,958,917 |             |   | 33,913,257 |   |   |             |  
|                                                                                                    |  |                            |            |                              |   |                                                     |   |             |            |             |   |            |   |   |             |  

* Inception date, see note 1a.

The accompanying notes are an integral part
of the financial statements.

3

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GAMMACAN INTERNATIONAL, INC.(A Development Stage Company)CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS
EQUITY
(US $, except share data)

|                                                                                                       |  |                    |             |                         |   |          |   |                                |           |                                                            |   |                               |   |       |             |   |   |         |   |   |            |  
|------------------------------------------------------------------------------------------------------ |  | ------------------ | ----------- | ----------------------- | - | -------- | - | ------------------------------ | --------- | ---------------------------------------------------------- | - | ----------------------------- | - | ----- | ----------- | - | - | ------- | - | - | ---------- | -
|                                                                                                       |  | Number of
  Shares |             | Common
  Stock
  Amount |   | Warrants |   | Additional
  paid-in
  capital |           | Deficit
  accumulated
  during
  the
  development
  stage |   | Services
  not yet
  rendered |   | Total |            
|                                                                                                       |  |                    |             |                         |   |          |   |                                |           |                                                            |   |                               |   |       |            
|Changes
  during the period from October 6, 1998 (date of inception) to September 30,
  2005 (audited) |  |                    |             |                         |   |          |   |                                |           |                                                            |   |                               |   |       |             |   |   |         |   |   |            |  
|Common stock and warrants issued for cash                                                              |  |                    | 57,506,498  |                         | $ | 5,750    |   | $                              | 139,494   |                                                            | $ | 782,141                       |   | $     |            |   | $ |        |   | $ | 927,385    |  
|Contributed capital                                                                                    |  |                    |             |                         |   |          |   |                                |           |                                                            |   | 7,025                         |   |       |             |   |   |         |   |   | 7,025      |  
|Cancellation of shares at June 8, 2004                                                                 |  |                    | (32,284,988 | )                       |   | (3,228   | ) |                                |           |                                                            |   | 3,228                         |   |       |             |   |   |         |   |   |            |  
|Gain on issuance of subsidiary Stock to third party                                                    |  |                    |             |                         |   |          |   |                                |           |                                                            |   | 86,625                        |   |       |             |   |   |         |   |   | 86,625     |  
|Common stock and warrants issued for cash on November 11, 2004, net
of
  issuance costs                |  |                    | 978,000     |                         |   | 97       |   |                                | 367,892   |                                                            |   | 766,630                       |   |       |             |   |   |         |   |   | 1,134,619  |  
|Common stock and warrants issued for cash on January 25, 2005, net of
  issuance costs                 |  |                    | 32,000      |                         |   | 3        |   |                                | 12,037    |                                                            |   | 24,760                        |   |       |             |   |   |         |   |   | 36,800     |  
|Issuance of warrants to Consultants                                                                    |  |                    |             |                         |   |          |   |                                |           |                                                            |   | 97,192                        |   |       |             |   |   |         |   |   | 97,192     |  
|Net loss                                                                                               |  |                    |             |                         |   |          |   |                                |           |                                                            |   |                               |   |       | (1,712,618  | ) |   |         |   |   | (1,712,618 | )
|                                                                                                       |  |                    |             |                         |   |          |   |                                |           |                                                            |   |                               |   |       |             |   |   |         |   |   |            |  
|Balance at September 30, 2005 (audited)                                                                |  |                    | 26,231,510  |                         |   | 2,622    |   |                                | 519,423   |                                                            |   | 1,767,601                     |   |       | (1,712,618  | ) |   |        |   |   | 577,028    |  
|Common stock and warrants issued for cash on October 31, 2005, net of
  issuance costs                 |  |                    | 666,666     |                         |   | 67       |   |                                | 72,410    |                                                            |   | 365,670                       |   |       |             |   |   |         |   |   | 438,147    |  
|Common stock and warrants issued for cash on December 20, 2005, net
of
  issuance costs                |  |                    | 1,555,556   |                         |   | 156      |   |                                | 269,641   |                                                            |   | 804,998                       |   |       |             |   |   |         |   |   | 1,074,795  |  
|Options issued to employees and directors                                                              |  |                    |             |                         |   |          |   |                                |           |                                                            |   | 163,517                       |   |       |             |   |   |         |   |   | 163,517    |  
|Options and warrants issued to non-employees                                                           |  |                    |             |                         |   |          |   |                                |           |                                                            |   | 70,498                        |   |       |             |   |   |         |   |   | 70,498     |  
|Net loss                                                                                               |  |                    |             |                         |   |          |   |                                |           |                                                            |   |                               |   |       | (2,064,795  | ) |   |         |   |   | (2,064,795 | )
|                                                                                                       |  |                    |             |                         |   |          |   |                                |           |                                                            |   |                               |   |       |             |   |   |         |   |   |            |  
|Balance at September 30, 2006 (audited)                                                                |  |                    | 28,453,732  |                         |   | 2,845    |   |                                | 861,474   |                                                            |   | 3,172,284                     |   |       | (3,777,413  | ) |   |        |   |   | 259,190    |  
|Common stock and warrants issued for cash on February 27, 2007, net
of
  issuance costs                |  |                    | 16,250,000  |                         |   | 1,625    |   |                                | 2,231,459 |                                                            |   | 3,652,640                     |   |       |             |   |   |         |   |   | 5,885,724  |  
|Common stock issued as part of the prepayment of the convertible
  promissory note                     |  |                    | 33,753      |                         |   | 3        |   |                                |           |                                                            |   | 13,498                        |   |       |             |   |   |         |   |   | 13,501     |  
|Amendment of warrants exercise price                                                                   |  |                    |             |                         |   |          |   |                                | 110,667   |                                                            |   | (110,667                      | ) |       |             |   |   |         |   |   |           |  
|Stock based compensation expenses:                                                                     |  |                    |             |                         |   |          |   |                                |           |                                                            |   |                               |   |       |             |   |   |         |   |   |            |  
|Common stock issued for services                                                                       |  |                    | 221,432     |                         |   | 22       |   |                                |           |                                                            |   | 149,978                       |   |       |             |   |   |         |   |   | 150,000    |  
|Services not yet rendered                                                                              |  |                    |             |                         |   |          |   |                                |           |                                                            |   |                               |   |       |             |   |   | (20,000 | ) |   | (20,000    | )
|Options issued to employees and directors                                                              |  |                    |             |                         |   |          |   |                                |           |                                                            |   | 1,713,169                     |   |       |             |   |   |         |   |   | 1,713,169  |  
|Options and warrants issued to non-employees                                                           |  |                    |             |                         |   |          |   |                                |           |                                                            |   | 378,028                       |   |       |             |   |   |         |   |   | 378,028    |  
|Net loss                                                                                               |  |                    |             |                         |   |          |   |                                |           |                                                            |   |                               |   |       | (5,178,774  | ) |   |         |   |   | (5,234,274 | )
|                                                                                                       |  |                    |             |                         |   |          |   |                                |           |                                                            |   |                               |   |       |             |   |   |         |   |   |            |  
|Balance at September 30, 2007 (audited)                                                                |  |                    | 44,958,917  |                         |   | 4,495    |   |                                | 3,203,600 |                                                            |   | 8,968,930                     |   |       | (8,956,187  | ) |   | (20,000 | ) |   | 3,200,838  |  
|Fully accretion in respect of services not yet rendered                                                |  |                    |             |                         |   |          |   |                                |           |                                                            |   |                               |   |       |             |   |   | 20,000  |   |   | 20,000     |  
|Options issued to employees and directors                                                              |  |                    |             |                         |   |          |   |                                |           |                                                            |   | 255,913                       |   |       |             |   |   |         |   |   | 255,913    |  
|Options and warrants issued to non-employees                                                           |  |                    |             |                         |   |          |   |                                |           |                                                            |   | 53,690                        |   |       |             |   |   |         |   |   | 53,690     |  
|Net loss                                                                                               |  |                    |             |                         |   |          |   |                                |           |                                                            |   |                               |   |       | (2,269,280  | ) |   |         |   |   | (2,269,280 | )
|                                                                                                       |  |                    |             |                         |   |          |   |                                |           |                                                            |   |                               |   |       |             |   |   |         |   |   |            |  
|Balance at March 31, 2008 (unaudited)                                                                  |  |                    | 44,958,917  |                         | $ | 4,495    |   | $                              | 3,203,600 |                                                            | $ | 9,278,533                     |   | $     | (11,225,467 | ) | $ |        |   | $ | 1,261,161  |  
|                                                                                                       |  |                    |             |                         |   |          |   |                                |           |                                                            |   |                               |   |       |             |   |   |         |   |   |            |  

The accompanying notes are an integral part
of the financial statements.

4

---



GAMMACAN INTERNATIONAL, INC.(A Development Stage Company)

CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS

|                                                                                       |  |                              |            |                                                 |   |            |   |   |             |  
|-------------------------------------------------------------------------------------- |  | ---------------------------- | ---------- | ----------------------------------------------- | - | ---------- | - | - | ----------- | -
|                                                                                       |  | Six months ended
  March 31, |            | Period from
  October 6,
  1998* to
  March 31, |  
|                                                                                       |  |                              |            |                                                 |  
|                                                                                       |  | 2008                         |            | 2007                                            |   | 2008       |  
|                                                                                       |  |                              |            |                                                 |   |            |  
|                                                                                       |  | Unaudited                    |            | Unaudited                                       |   | Unaudited  |  
|                                                                                       |  |                              |            |                                                 |   |            |  
|                                                                                       |  |                              |            |                                                 |   |            |   |   |             |  
|CASH FLOWS FROM OPERATING ACTIVITIES:                                                  |  |                              |            |                                                 |   |            |   |   |             |  
|Net loss for the period                                                                |  | $                            | (2,269,280 | )                                               | $ | (2,120,855 | ) | $ | (11,225,467 | )
|Adjustments required to reconcile net loss to net cash used in
  operating activities: |  |                              |            |                                                 |   |            |   |   |             |  
|Income and expenses not involving cash flows:                                          |  |                              |            |                                                 |   |            |   |   |             |  
|Depreciation                                                                           |  |                              | 3,150      |                                                 |   | 4,150      |   |   | 18,353      |  
|Financial expenses on convertible promissory note                                      |  |                              |           |                                                 |   | 9,431      |   |   |            |  
|Exchange differences on long term deposits                                             |  |                              | 588        |                                                 |   |           |   |   | 850         |  
|Common stock issued for services                                                       |  |                              | 20,000     |                                                 |   | 60,000     |   |   | 166,501     |  
|Minority interests in losses of a subsidiary                                           |  |                              |           |                                                 |   |           |   |   | (12,375     | )
|Write off of in process research and development                                       |  |                              |           |                                                 |   |           |   |   | 100,000     |  
|Employees and consultants stock based compensation
expenses                            |  |                              | 309,603    |                                                 |   | 912,578    |   |   | 2,694,949   |  
|Increase (Decrease) in liability for employee rights upon
retirement                   |  |                              | (2,693     | )                                               |   | 14,393     |   |   | 68,645      |  
|Changes in operating assets and liabilities:                                           |  |                              |            |                                                 |   |            |   |   |             |  
|Increase in prepaid expenses                                                           |  |                              | (23,001    | )                                               |   | (19,181    | ) |   | (32,852     | )
|Increase in other current assets                                                       |  |                              | (23,029    | )                                               |   | (39,146    | ) |   | (68,640     | )
|Increase in current liabilities                                                        |  |                              | 31,110     |                                                 |   | 183,812    |   |   | 957,848     |  
|                                                                                       |  |                              |            |                                                 |   |            |   |   |             |  
|Net cash used in operating activities                                                  |  |                              | (1,953,552 | )                                               |   | (994,818   | ) |   | (7,332,188  | )
|                                                                                       |  |                              |            |                                                 |   |            |   |   |             |  
|                                                                                       |  |                              |            |                                                 |   |            |   |   |             |  
|CASH FLOWS
      FROM INVESTING ACTIVITIES:                                            |  |                              |            |                                                 |   |            |   |   |             |  
|Increase in short term investments                                                     |  |                              |           |                                                 |   | (4,300,000 | ) |   |             |  
|Increase in long term deposits                                                         |  |                              |           |                                                 |   | (1,375     | ) |   | (20,512     | )
|Funds in respect of employee rights upon retirement                                    |  |                              |           |                                                 |   | (12,319    | ) |   | (49,281     | )
|Purchase of property and equipment                                                     |  |                              | (13,654    | )                                               |   | (2,852     | ) |   | (55,195     | )
|                                                                                       |  |                              |            |                                                 |   |            |   |   |             |  
|Net cash used in investing activities                                                  |  |                              | (13,654    | )                                               |   | (4,316,546 | ) |   | (124,988    | )
|                                                                                       |  |                              |            |                                                 |   |            |   |   |             |  
|                                                                                       |  |                              |            |                                                 |   |            |   |   |             |  
|CASH FLOWS FROM FINANCING ACTIVITIES:                                                  |  |                              |            |                                                 |   |            |   |   |             |  
|Issuance of convertible promissory note                                                |  |                              |           |                                                 |   | 350,000    |   |   |            |  
|Issuance of common stock and warrants net of issuance
costs                            |  |                              |           |                                                 |   | 5,885,724  |   |   | 9,538,553   |  
|                                                                                       |  |                              |            |                                                 |   |            |   |   |             |  
|Net cash provided by financing activities                                              |  |                              |           |                                                 |   | 6,235,724  |   |   | 9,538,553   |  
|                                                                                       |  |                              |            |                                                 |   |            |   |   |             |  
|INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                                       |  |                              | (1,967,206 | )                                               |   | 924,360    |   |   | 2,081,377   |  
|BALANCE OF CASH AND CASH EQUIVALENTS AT
  BEGINNING OF PERIOD                          |  |                              | 4,048,583  |                                                 |   | 538,738    |   |   |            |  
|                                                                                       |  |                              |            |                                                 |   |            |   |   |             |  
|BALANCE OF CASH AND CASH EQUIVALENTS AT END OF
  PERIOD                                |  | $                            | 2,081,377  |                                                 | $ | 1,463,098  |   | $ | 2,081,377   |  
|                                                                                       |  |                              |            |                                                 |   |            |   |   |             |  

* Inception date, see note 1a.The accompanying notes are an integral part
of the financial statements.

5

---



GAMMACAN INTERNATIONAL, INC.(A
Development Stage Company)

NOTES TO CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS

|                  |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|----------------- | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|NOTE 1 - GENERAL:
|                  |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                  | a. | Operation:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                  |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                  |    | GammaCan
  International, Inc. (A Development Stage Company) was incorporated on October
  6, 1998, under the laws of the State of Delaware, under the name of San Jose
  International, Inc. Unless the context indicates otherwise, references to the
  Company
  refer to GammaCan International, Inc. and its Israeli subsidiary, GammaCan
  Ltd (the Subsidiary).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                  |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                  |    | The Company
  is engaged in research and development in the biotechnology field and is
  considered a development stage company in accordance with Statement of
  Financial Accounting Standard (SFAS) No. 7 Accounting and Reporting by Development
  Stage Enterprises.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                  |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                  |    | The Companys
  lead product candidate, VitiGam, is an anti-cancer immunotherapy derived
  entirely from the plasma of donors with vitiligo, a benign skin condition
  affecting up to 2% of the general population. The Company is developing
  VitiGam to treat melanoma. The Company has demonstrated that plasma from
  individuals with vitiligo contains anti-melanoma activities, and the Company
  is seeking to develop VitiGam for the treatment of Stage III and Stage IV
  melanoma.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                  |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                  |    | The
  accompanying financial statements have been prepared assuming that the
  Company will continue as a going concern. The Company has net losses for the
  period from inception (October 6, 1998) through March 31, 2008 of
  $11,225,467, as well as negative cash flow from operating activities. Based
  upon the Companys existing spending commitments, the Company may not have
  sufficient cash resources to meet its liquidity requirements through
  September 30, 2008. Accordingly, these factors raise substantial doubt about
  the Companys ability to continue as a going concern. Management is in the process of
  evaluating various financing alternatives as the Company will need to finance
  future research and development activities and general and administrative
  expenses through fund raising in
  the public or private equity markets. Although there is no assurance that the
  Company will be successful with those initiatives, management expects to
  secure the necessary financing as a result of ongoing financing discussions
  with third party investors and existing shareholders.
|                  |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                  |    | These
  financial statements do not include any adjustments that may be necessary
  should the Company be unable to continue as a going concern. The Companys
  continuation as a going concern is dependent on its ability to obtain
  additional financing as may be required and ultimately to attain
  profitability.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              

6

---



GAMMACAN INTERNATIONAL, INC.(A
Development Stage Company)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS (continued)

|                             |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|---------------------------- | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|NOTE 1 - GENERAL(continued):
|                             |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                             | b. | Unaudited interim financial information                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                             |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                             |    | The
  accompanying unaudited financial statements of the Company and the Subsidiary
  have been prepared in accordance with accounting principles generally
  accepted in the United States for interim financial information and with the
  instructions to Form 10-QSB and Item 310 of Regulation S-B. Accordingly, they
  do not include all of the information and footnotes required by accounting
  principles generally accepted in the United States for complete financial
  statements. For further information, refer to the financial statements and
  footnotes thereto included in the consolidated annual report on Form 10-KSB
  for the year ended September 30, 2007.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                             |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                             |    | In the
  opinion of management, all adjustments (consisting of normal recurring
  accruals) considered necessary for a fair presentation have been included.
  Operating results for the six-month period ended March 31, 2008, are not
  necessarily indicative of the results that may be expected for the year ended
  September 30, 2008.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                             |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                             | c. | Income tax                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                             |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                             |    | In June
  2006, the FASB issued Interpretation No. 48, Accounting for Uncertainty in Income
  Taxes (FIN 48). FIN 48 clarifies the
  accounting for uncertainty in income taxes recognized in an enterprises
  financial statements in accordance with Statement of Financial Accounting
  Standards No. 109, Accounting for Income Taxes (FAS 109).
  This interpretation prescribes a minimum recognition threshold a tax position
  is required to meet before being recognized in the financial statements. FIN
  48 also provides guidance on derecognition of tax positions, classification
  on the balance sheet, interest and penalties, accounting in interim periods,
  disclosure, and transition. The Company adopted FIN 48 effective October 1,
  2007. FIN 48 requires significant judgment in determining what constitutes an
  individual tax position as well as assessing the outcome of each tax
  position. Changes in judgment as to recognition or measurement of tax
  positions can materially affect the estimate of the effective tax rate and
  consequently, affect the operating results of the Company. The Company had no
  unrecognized tax benefits as of October 1, 2007. The result of the
  implementation of FIN 48 did not have any impact on the Companys financial
  statements. The Company recognizes interest and penalties related to its tax
  contingencies as income tax expense. As of October 1, 2007, the Company
  recorded $30,000 of penalties related to tax contingencies.
|                             |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                             |    | As of
  October 1, 2007, the Company is subject to Israeli income tax examinations
  and to U.S. Federal income tax examinations for the tax years of 2004 through
  2007. As of March 31, 2008, the Company did not record any change to its
  unrecognized tax benefits.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   

7

---



GAMMACAN INTERNATIONAL, INC.(A
Development Stage Company)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS (continued)

|                             |    |                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|---------------------------- | -- | ----------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|NOTE 1 - GENERAL(continued):
|                             |    |                                          
|                             | d. | Recently issued accounting pronouncements
|                             |    |                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                             |    | 1.                                        | In September
  2006, the FASB issued Statement of Financial Accounting Standards
  No. 157, Fair Value Measurements (SFAS 157). SFAS 157
  defines fair value, establishes a framework and gives guidance regarding the
  methods used for measuring fair value, and expands disclosures about fair
  value measurements. SFAS 157 is effective for financial statements
  issued for fiscal years beginning after November 15, 2007, and interim
  periods within those fiscal years (October 1, 2008, for the Company). The
  Company is currently assessing the impact that SFAS 157 may have on its
  results of operations and financial position.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                             |    |                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                             |    | 2.                                        | In
  February 2007, the FASB issued Statement of Financial
  Accounting Standards No. 159, The Fair Value Option for Financial Assets and
  Financial Liabilities - Including an amendment of FASB Statement No. 115
  (SFAS 159). SFAS 159 is expected to expand the use of fair value accounting
  but does not affect existing standards which require certain assets or
  liabilities to be carried at fair value. The objective of SFAS 159 is to
  improve financial reporting by providing companies with the opportunity to mitigate
  volatility in reported earnings caused by measuring related assets and
  liabilities differently without having to apply complex hedge accounting
  provisions. Under SFAS 159, a company may choose, at its initial application
  or at other specified election dates, to measure eligible items at fair value
  and report unrealized gains and losses on items for which the fair value
  option has been elected in earnings at each subsequent reporting date.
  SFAS 159 is effective for financial statements issued for fiscal years
  beginning after November 15, 2007, and interim periods within those
  fiscal years (October 1, 2008, for the Company). If a company elects the fair
  value option for its existing assets and liabilities, the effect as of the
  adoption date, shall be reported as a cumulative-effect adjustment to the
  opening balance of retained earnings. The Company is currently assessing the
  impact that SFAS 159 may have on its financial position.
|                             |    |                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                             |    | 3.                                        | In December 2007, the FASB issued Statement
  of Financial Accounting Standards No. 141 (revised 2007), Business
  Combinations (SFAS 141(R)). SFAS 141(R) changes the
  accounting for business combinations, including the measurement of acquirer
  shares issued in consideration for a business combination, the recognition of
  contingent consideration, the accounting for contingencies, the recognition
  of capitalized in-process research and development, the accounting for
  acquisition-related restructuring cost accruals, the treatment of acquisition
  related transaction costs and the recognition of changes in the acquirers
  income tax valuation allowance and income tax uncertainties. SFAS 141(R)
  applies prospectively to business combinations for which the acquisition date
  is on or after the beginning of the first annual reporting period beginning
  on or after December 15, 2008. Early application is prohibited. The Company
  will be required to adopt SFAS 141(R) on October 1, 2009.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          

8

---



GAMMACAN INTERNATIONAL, INC.(A
Development Stage Company)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS (continued)

|                             |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|---------------------------- | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|NOTE 1 - GENERAL(continued):
|                             |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                             | 4. | In December 2007, the FASB issued SFAS No.
  160, NoncontrollingInterestsin Consolidated Financial Statements, an Amendment
  of ARB No. 51 (SFAS 160). SFAS 160 amends ARB 51 to
  establish accounting and reporting standards for the noncontrolling interest
  in a subsidiary and for the deconsolidation of a subsidiary. An
  ownership interest in subsidiaries held by parties other than the parent
  should be presented in the consolidated statement of financial position
  within equity, but separate from the parents equity. SFAS 160 requires that
  changes in a parents ownership interest while the parent retains its
  controlling financial interest in its subsidiary should be accounted for
  similarly as equity transactions. When a subsidiary is deconsolidated, any
  retained noncontrolling equity investment in the former subsidiary should be
  initially measured at fair value, with any gain or loss recognized in
  earnings. SFAS 160 requires consolidated net income to be reported at amounts
  that include the amounts attributable to both the parent and the
  noncontrolling interest. It also requires disclosure, on the face of the
  consolidated income statement, of the amounts of consolidated net income
  attributable to the parent and to the noncontrolling interests. SFAS 160 is
  effective for fiscal years (including interim periods within those fiscal
  years) beginning on or after December 15, 2008 (October 1, 2009 for the
  Company). Earlier adoption is prohibited. The statement shall be applied
  prospectively as of the beginning of the fiscal year in which it is initially
  applied, except for the presentation and disclosure requirement which shall
  be applied retrospectively for all periods presented. The Company is currently
  evaluating the impact SFAS 160 will have on its consolidated financial
  statements.
|                             |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                             | 5. | In June 2007, the Emerging Issues Task Force (EITF) issued Issue
    No. 07-03, Accounting
  for Nonrefundable Advance Payments for Goods or Services Received to Be Used
  in Future Research and Development Activities (EITF No.
  07-03). EITF No. 07-03 requires that nonrefundable advance
  payments for goods or services that will be used or rendered for future
  research and development activities be deferred and amortized over the period
  that the goods are delivered or the related services are performed, subject
  to an assessment of recoverability. The provisions of EITF 07-03 will be
  effective for financial statements issued for fiscal years beginning after
  December 15, 2007, and interim periods within those fiscal years (October 1,
  2008, for the Company). The provisions of EITF No. 07-03 are applicable for
  new contracts entered into on or after the effective date. Earlier
  application is not permitted.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         

9

---



GAMMACAN INTERNATIONAL, INC.(A
Development Stage Company)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS (continued)

|                              |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|----------------------------- | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|NOTE 1 - GENERAL (continued):
|                              |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                              | 6. | In December 2007, the FASB ratified EITF
  Issue No. 07-01, Accounting for Collaborative Arrangements
  (EITF
  07-01). EITF 07-01 defines collaborative arrangements and
  establishes reporting requirements for transactions between participants in a
  collaborative arrangement and between participants in the arrangement and
  third parties. EITF 07-01 also establishes the appropriate income statement
  presentation and classification for joint operating activities and payments
  between participants, as well as the sufficiency of the disclosures related
  to these arrangements. EITF 07-01 is effective for fiscal years beginning
  after December 15, 2008 (October 1, 2009, for the Company). EITF 07-01 shall
  be applied using modified version of retrospective transition for those
  arrangements in place at the effective date. An entity should report the
  effects of applying this Issue as a change in accounting principle through
  retrospective application to all prior periods presented for all arrangements
  existing as of the effective date, unless it is impracticable to apply the
  effects of the change retrospectively. The Company is currently assessing the
  impact that EITF 07-01 may have on its results of operations and financial
  position.
|                              |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                              | 7. | In March 2008, the FASB issued SFAS
  Statement No. 161 Disclosures about Derivative Instruments and
  Hedging Activities (SFAS No. 161). The new standard is
  intended to improve financial reporting about derivative instruments and
  hedging activities by requiring enhanced disclosures to enable investors to
  better understand their effects on an entitys financial position, financial
  performance, and cash flows. It is effective for financial statements issued
  for fiscal years and interim periods beginning after November 15, 2008, with
  early application encouraged (October 1, 2009, for the Company). The new
  standard also improves transparency about the location and amounts of
  derivative instruments in an entitys financial statements; how derivative
  instruments and related hedged items are accounted for under SFAS No. 133 Accounting
  for Derivative Instruments and Hedging Activities (SFAS No.
  133); and how derivative instruments and related hedged items
  affect its financial position, financial performance, and cash flows. The
  Company is currently evaluating the effect SFAS No. 161 will have on its
  financial statement presentations.                                                                                          

|                      |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|--------------------- | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|NOTE 2 - COMMITMENTS:
|                      |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                      | a. | On December 13, 2007, the Company entered into a Share Purchase
  Agreement effective as of November 26, 2007 with ARP Biomed,
  Ltd. (ARP). The Share Purchase Agreement provides that
  subject to fulfillment of certain closing conditions, including the receipt of an Israeli tax ruling, ARP will
  sell to the Company 12.5% of the issued and outstanding shares of the
  Subsidiary such that at closing the Company will own 100% of the issued and
  outstanding shares of the Subsidiary. In consideration for such sale, the
  Company agreed to issue to ARP, at closing, 2,697,535 shares of its common
  stock, valued at $1,348,768, calculated based upon the average of the closing
  price for the period which is two days before and after November 26, 2007, a
  warrant to acquire 1,123,973 shares of its common stock and an additional
  warrant to acquire 449,589 shares of its common stock, both valued at
  $391,152 using the Black Scholes option-pricing model.

10

---



GAMMACAN INTERNATIONAL, INC.(A
Development Stage Company)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS (continued)

|                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|---------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|NOTE 2 - COMMITMENTS (continued): 
|                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | The
  acquisition is to be accounted for by the purchase method. The purchase price
  will be allocated to in-process research and development.                                                                                                                                                                                                                                                                                                    
|                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                   | b.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | On March 27, 2008, the Subsidiary sent a notice of termination,
  effective March 31, 2008, to Tel HaShomer-Medical Research Infrastructure
  and Services LTD. (THM) terminating the Research and
  Licensing Agreement originally entered into on December 13, 2005, as amended
  during the term (the THM Agreement). The warrants to acquire
  500,000 shares of the Companys common stock
that the Company issued to THM were cancelled.
|                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|NOTE 3 - STOCK BASED COMPENSATION:
|                                  
|                                   | The
  following is a transaction that took place during the quarter ended March 31,
  2008:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                   | On March 19,
  2008, options to purchase 600,000 shares of the Companys common stock were
  granted under the Companys 2007 Global Share Option Plan to the Companys
  new Chief Financial Officer. The options are exercisable at $0.40 per share
  (equivalent to the traded market price on the date of grant) with one third
  vesting on each of the first, second and third anniversary of the date of
  grant. The fair value of these options on the date of grant was $160,292,
  using the Black Scholes option-pricing model and was based on the following
  assumptions: dividend yield of 0% for all years; expected volatility of 83%;
  risk-free interest rates of 2.36%; and expected lives of 5.02 years.
|                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|NOTE 4 - LOSS PER SHARE:          
|                                  
|                                   | The total
  number of common stock options and warrants excluded from the calculations of
  diluted net loss was 24,972,558 for the six months ended March 31, 2008
  (24,782,558 for the six months ended March 31, 2007).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|NOTE 5  SUBSEQUENT EVENTS:       
|                                  
|                                   | On April 10,
  2008, options to purchase 50,000 of the Companys common stock were granted
  under the Companys 2007 Global Share Option Plan to an employee. The options
  are exercisable at $0.37 per share (equivalent to the traded market price on
  the date of grant) with one third vesting on each of the first, second and
  third anniversary of the date of grant. The fair value of these options on
  the date of grant was $12,332, using the Black Scholes option-pricing model
  and was based on the following assumptions: dividend yield of 0% for all
  years; expected volatility of 82%; risk-free interest rates of 2.66%; and
  expected lives of 5.02 years.                                       

11

---



ITEM 2 - MANAGEMENTS DISCUSSION AND ANALYSIS
OF PLAN OF OPERATION

The following information should be read in
conjunction with the financial statements and notes thereto appearing elsewhere
in this Quarterly Report.

We have included in this Quarterly Report certain
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995 concerning our business, operations and financial
condition. Forward-looking statements consist of all non-historical information,
and the analysis of historical information, including the references in this
Quarterly Report to future revenues, collaborative agreements, future expense
growth, future credit exposure, earnings before interest, taxes, depreciation
and amortization, future profitability, anticipated cash resources, anticipated
capital expenditures, capital requirements, and our plans for future periods.
In addition, the words could, expects, anticipates, objective, plan,
may affect, may depend, believes, estimates, projects and similar
words and phrases are also intended to identify such forward-looking
statements.

Actual results could differ materially from those
projected in our forward-looking statements due to numerous known and unknown
risks and uncertainties, including, among other things, unanticipated
technological difficulties, the length, scope and outcome of our clinical
trial, costs related to intellectual property, cost of manufacturing and higher
consulting costs, product demand, changes in domestic and foreign economic,
market and regulatory conditions, the inherent uncertainty of financial
estimates and projections, the uncertainties involved in certain legal
proceedings, instabilities arising from terrorist actions and responses
thereto, and other considerations described as Risk Factors in our other
filings with the SEC. Such factors may also cause substantial volatility in the
market price of our common stock. All such forward-looking statements are
current only as of the date on which such statements were made. We do not
undertake any obligation to publicly update any forward-looking statement to
reflect events or circumstances after the date on which any such statement is
made or to reflect the occurrence of unanticipated events.

As
used in this Quarterly Report, the terms we, us, our, Company and
GammaCan mean GammaCan International, Inc. and our subsidiary, GammaCan,
Ltd., unless otherwise indicated.

All
dollar amounts refer to US dollars unless otherwise indicated.

Overview

We
are a development stage company and currently have no revenue from operations.
Other than existing cash reserves and our intellectual property we have no
significant assets, tangible or intangible. Presently, we do not have
sufficient cash resources to meet our liquidity requirements
through September 30, 2008 and
we expect to seek to raise additional funds during that time period. There can
be no assurance that we will raise additional funds on a timely basis, on terms
acceptable to us or at all and there can be no assurance that we will generate
revenues in the future, or that we will be able to operate profitably in the
future, if at all. We have incurred net losses in each fiscal year since
inception of our operations.

12

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Plan
of Operation

Short Term Business Strategy

We
are a life science company focused on the development of immunotherapy and
related approaches to treat cancer. Until recently, we have focused on the use
of intravenous immunoglobulins, or IgGs, derived from human plasma to treat
melanoma, prostate, and colon cancers. We believe that IgG therapy may be the
basis of a more effective and efficient cancer treatment both as mono and as
combination therapy as well as an adjuvant for cancer treatments (IgGs used in
concert with other proprietary pharmaceuticals). Our business objective is to
become a recognized leader in the development of immunotherapy including
IgG-based therapies and related approaches to treat cancer.

IgG-based
immunotherapy will require regulatory approval before being commercially
marketed for human therapeutic use. Clinical trials generally include three
phases that, together, may take several years to complete. Phase I clinical
studies are conducted primarily to establish safety and determine the maximum
tolerated dose, or MTD. Phase II studies are designed to determine preliminary
efficacy and establish dosing. Phase III studies are conducted to demonstrate
therapeutic efficacy in a statistically significant number of patients, at an
optimal dose level, method or route of delivery into the body, and a schedule
of administration. Once clinical trials are successfully completed, products
may receive regulatory approval.

We
are pursuing the development of IgG-based technology to develop therapies for
the treatment of melanoma, as well as therapies directed
toward disrupting the blood supply to cancers, referred to as
anti-angiogenesis.

Melanoma: Our lead product
candidate, VitiGam, is a first-in-class anti-cancer immunotherapy derived
entirely from the plasma of donors with vitiligo, a benign autoimmune skin
condition affecting up to two percent of the general population. We have
demonstrated that
plasma from individuals with vitiligo contains anti-melanoma activities. Based
on this, we are developing VitiGam to initially address Stage III and Stage IV
melanoma and possibly earlier stages of melanoma at a future time.

In
June 2007, we completed a non-FDA Phase II clinical trial designed to test the
safety and efficacy of standard IgG (collected and manufactured from general
population donors, which may have included donors with vitiligo) in patients
with prostate cancer, colon cancer and melanoma. In this trial, no serious
untoward effects of IgGs were noted. In one patient with melanoma, the cancer
remained stable or improved over eight cycles of therapy (approximately ten
months).

In
addition to the pre-clinical evidence we have accumulated using
vitiligo-derived plasma, the above observations provide further validation for
our plan to develop VitiGam.

We
plan to file an Investigational New Drug Application, or IND, for VitiGam in
the near future. We believe that the FDA is well acquainted with IgG-based
therapies and their safety profiles resulting from a long history of regulatory
approvals of IgG-based products.

In
addition to VitiGam, we are also developing the following:

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  Next generation (recombinant) VitiGam -
 VitiGam is currently manufactured as a mixture that largely consists of IgG
 molecules (antibodies of the IgG type). We
 anticipate that within this mixture, only a subset of IgG molecules will be
 responsible for the biological activity of VitiGam. Next generation
 VitiGam will be composed of only the IgGs
 required to exert the anti-melanoma effect, thereby creating a
 more effective compound. Identifying the relevant IgGs may also permit cost
 reductions; and

13

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| |                                                                                                                                                                                                                                                                                                                                                                                               
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                                                                                                               
| |  Cancer vaccines based on VitiGam - An
 off-the-shelf cancer vaccine is considered a silver bullet in cancer
 therapy. We anticipate that based on our evolving understanding of the
 specific IgG molecules responsible for the biological activity of VitiGam,
 we may be in a position to identify the corresponding antigens that may be
 used to develop melanoma cancer vaccines.

Anti-angiogenesis: We
are developing additional novel IgG-based therapies for cancer and other
diseases. These therapies are based on the disruption of the blood supply to
cells. Our scientists have shown that several mechanisms may be involved in
mediating the anti-cancer effects of IgG-based immunotherapies. Angiogenesis is
one of a number of well known pathways to deprive cells from their blood supply.

In
June 2007, we announced the discovery of proprietary IgG sub-fractions in human
plasma, which contain potent anti-angiogenic properties. These
sub-fractions may be used for treatment of disorders resulting from neovascularization
(the formation of new
blood vessels or angiogenesis).

We
have established a pre-clinical development program to define and characterize
these anti-angiogenic anti-cancer fractions and to test their biological activity in
animal models. We believe that successfully developed therapies derived
from our novel IgG sub-fractions have the potential to address multi-billion
dollar markets. For example, Avastin®, also known as bevacizumab, counteracts
VEGF, a growth factor which stimulates neovascularization, and is approved to
treat colon and other cancers. Sales for Avastin® in 2007 were in excess of $2
billion.

We are also contemplating conducting additional clinical trials to test new formulations and/or combinations of IgG-based
immunotherapy candidates and to test these formulations and/or methods for different cancers at different stages of disease
progression with varying dosages and routes of administration. To achieve this, we may elect to partner with a pharmaceutical company
to conduct these further clinical trials, although there can be no
assurance that we will locate a pharmaceutical company able, or willing, to
partner with us on terms commercially acceptable to us, in order to attain
broad-based regulatory approval.

Although
there can be no assurance that the FDA will approve VitiGam, or any other IgG
immunotherapy candidate, we expect that, at a minimum, it will take a number of
years to receive final approval and registration for commercial use as an
anti-cancer agent. Our strategy is to collaborate with a suitable partner,
although there can be no assurance that we will locate a suitable partner, to
support late stage (Phase III) clinical development, registration and/or sales
for our IgG-based cancer products.

Long Term Business Strategy

If
our IgG-based cancer immunotherapy candidates show significant promise in
clinical trials, and at this preliminary stage there can be no assurance that
any such immunotherapy candidates will show significant promise, we plan to
ultimately seek a strategic commercial

14

---



partner, or partners, with extensive experience in the
development, commercialization, and marketing of cancer drugs and/or other
infused therapeutic proteins, although there can be no assurance that we will
locate a strategic commercial partner or partners on terms commercially
acceptable to us. We anticipate such partner or partners would be responsible for, or substantially support,
late stage clinical trials (Phase III) to ensure regulatory approvals and
registrations in the appropriate territories in a timely manner. We further
anticipate that the partner, or partners, would be responsible for sales and
marketing of our IgG-based immunotherapies in certain agreed upon territories.
Such planned strategic partnership, or partnerships, may provide a marketing
and sales infrastructure for our products as well as financial and operational
support for global clinical trials, post marketing studies, label expansions
and other regulatory requirements concerning future clinical development in the
United States and elsewhere. Any future strategic partner, or partners, may
also provide capital and expertise that would enable the partnership to develop
new formulations of IgG cancer immunotherapy suitable for patients at different
stages of disease progression as well as IgG derivatives. Under certain
circumstances, we may determine to develop one or more of our IgG based cancer
immunotherapies on our own, either world-wide or in select territories.

Other Planned Research and Development Activities

In
addition to conducting early-stage clinical trials, we plan to conduct
pre-clinical research to accomplish the following:

| |                                                                                                         | 
| | ------------------------------------------------------------------------------------------------------- | 
| |  Further
 deepen and broaden our understanding of the biology of our IgG products in
 cancer;         
| |                                                                                                         | 
| |  Develop
 alternative delivery systems and determine the optimal dosage for different
 patient groups;
| |                                                                                                         | 
| |  Investigate
 alternative sources of immunoglobulin other than human plasma;                          
| |                                                                                                         | 
| |  Develop
 novel IgG-based therapies; and                                                              
| |                                                                                                         | 
| |  Develop
 successor products.                                                                         

Our
plan is to patent any successful inventions resulting from our future research
activities and to exploit any other means that may exist to protect our future
IgG anti-cancer therapies in the commercial markets; although at this early
stage there can be no assurance that there will be any successful inventions
resulting from such research activities.

Other Planned Strategic Activities

In
addition to developing our own IgG-based anti-cancer therapies drug portfolio,
we are, on an on-going basis, considering in-licensing and other means of
obtaining additional lead molecules of technologies to complement and/or expand
our current product portfolio. Our goal is to create a well-balanced product
portfolio that includes lead molecules in different stages of development and
addresses different medical needs.

15

---



Critical accounting policies and estimates

Managements
discussion and analysis of the financial condition and results of operations is
based upon the consolidated financial statements, which have been prepared in
accordance with accounting principles generally accepted in the United States
of America. The preparation of these financial statements requires us to make estimates
and judgments that affect the reported amounts of assets and liabilities,
expenses and related disclosure of contingent assets and liabilities. On an
on-going basis, we evaluate our estimates and judgments. We base our estimates
on various factors, including historical experience that we believe to be
reasonable under the circumstances, the results of which form the basis for
making judgments about the carrying values of assets and liabilities that are
not readily apparent from other resources. Actual results may differ from these
estimates under different assumptions or conditions.

We
believe the following critical accounting policies affect our more significant
judgments and estimates used in the preparation of our consolidated financial statements.

Going concern assumption

The
accompanying financial statements have been prepared assuming that we will
continue as a going concern. We have net losses for the period from inception
(October 6, 1998) through March 31, 2008 of $11,225,467, as well as
negative cash flow from operating activities. Based upon our existing spending
commitments, we may not have sufficient cash resources to meet our liquidity
requirements through September 30, 2008. Accordingly, these factors raise substantial
doubt about our ability to continue as a going concern. Management is in the process of evaluating various
financing alternatives as we will need to finance future research and
development activities and general and administrative expenses through fund
raising in the public or private equity markets. Although there is no assurance
that we will be successful with those initiatives, management expects to secure
the necessary financing as a result of ongoing financing discussions with third
party investors and existing shareholders.

The
financial statements do not include any adjustments that may be necessary
should we be unable to continue as a going concern. Our continuation as a going concern is dependent on our
ability to obtain additional financing as may be required and ultimately to
attain profitability.

Valuation of options and warrants

We
granted options to purchase shares of our common stock to employees and
consultants and issued warrants in connection with fund raising.

On
October 1, 2006 we adopted the revised Statement of Financial Accounting
Standards (FAS) No. 123,
Share-Based Payment (FAS 123R), which addresses
the accounting for share-based payment transactions in which we obtain employee
services in exchange for (a) equity instruments of the Company or (b)
liabilities that are based on the fair value of our equity instruments or that
may be settled by the issuance of such equity instruments. FAS 123R eliminates
the ability to account for employee share-based payment transactions using APB
25, and requires instead that such transactions be accounted for using the
grant-date fair value based method.

16

---



The
fair value of each stock option grant was estimated at the date of grant using
a Black-Scholes option pricing model. The volatility is based on a historical
volatility, by statistical analysis of the weekly share price for past periods.
The expected term is the length of time until the expected dates of exercising
the options, based on estimated data regarding employees exercise behavior.

FAS
123R applies to all awards granted or modified after the Statements effective
date. In addition, compensation cost for the unvested portion of previously granted awards that remain
outstanding on the Statements effective date shall be recognized on or after
the effective date, as the related services are rendered, based on the awards
grant-date fair value as previously calculated for the pro-forma disclosure
under FAS 123.

We
applied the modified prospective application
transition method, as permitted by the Statement. Under such transition method,
upon the adoption of FAS 123R, our financial statements for periods prior to
the effective date of the Statement are not restated.

We
account for equity instruments issued to third party service providers
(non-employees) in accordance with the fair value based on an option-pricing
model, pursuant to the guidance in EITF 96-18 Accounting
for Equity Instruments That Are Issued to Other Than Employees for Acquiring,
or in Conjunction with Selling Goods or Services. The fair value of
the options granted is revalued over the related service periods and recognized
using the accelerated method.

Deferred income taxes

Deferred
taxes are determined utilizing the assets and liabilities method based on the
estimated future tax effects of differences between the financial accounting and tax bases of assets
and liabilities under the applicable tax laws. Deferred tax balances are
computed using the tax rates expected to be in effect when those differences
reverse. A valuation allowance in respect of deferred tax assets is provided
if, based upon the weight of available evidence, it is more likely than not that
some or all of the deferred tax assets will not be realized. We have provided a
full valuation allowance with respect to our deferred tax assets.

Regarding
our Israeli subsidiary, Gammacan Ltd, paragraph 9(f) of FAS 109, Accounting for Income Taxes, prohibits the
recognition of deferred tax
liabilities or assets that arise from differences between the financial
reporting and tax bases of assets and liabilities that are measured from the
local currency into dollars using historical exchange rates, and that result
from changes in exchange rates or indexing for tax purposes. Consequently, the
above mentioned differences are not reflected in the computation of deferred
tax assets and liabilities.

Income Taxes

The
Company adopted FIN 48 effective October 1, 2007. FIN 48 requires significant
judgment in determining what constitutes an individual tax position as well as
assessing the outcome of each tax position. Changes in judgment as to
recognition or measurement of tax positions can materially affect the estimate
of the effective tax rate and consequently, affect the operating results of the
Company. The Company had no unrecognized tax benefits as of October 1, 2007.
The result of the implementation of FIN 48 did not have any impact on the
Companys financial statements.

17

---



Results of Operations

The
following table summarizes certain statements
of operations data for the Company for the six months period ended March 31,
2008 and 2007 (in US$):

|                                           |  |                   |            |                 |   |            |  
|------------------------------------------ |  | ----------------- | ---------- | --------------- | - | ---------- | -
|                                           |  | Six months
 ended |           
|                                           |  |                   |            |                 |   |            |  
|Operating Data:                            |  | March 31,
 2008   |            | March 31,
 2007 |  
|                                           |  |                   |            |                 |  
|                                           |  |                   |            |                 |   |            |  
|Research and development costs             |  | $                 | 900,677    |                 | $ | 482,870    |  
|General and administrative expenses        |  |                   | 1,387,419  |                 |   | 1,631,800  |  
|Financial income, net                      |  |                   | (18,816    | )               |   | (10,671    | )
|                                           |  |                   |            |                 |   |            |  
|Loss before tax on income                  |  |                   | 2,269,280  |                 |   | 2,103,999  |  
|Taxes on Income                            |  |                   |           |                 |   | 16,856     |  
|                                           |  |                   |            |                 |   |            |  
|Net loss for the period                    |  | $                 | (2,269,280 | )               | $ | (2,120,855 | )
|                                           |  |                   |            |                 |   |            |  
|                                           |  |                   |            |                 |   |            |  
|Loss per common share  basic and diluted  |  | $                 | (0.05      | )               | $ | (0.07      | )
|                                           |  |                   |            |                 |   |            |  
|Weighted average common shares outstanding |  |                   | 44,958,917 |                 |   | 31,204,923 |  
|                                           |  |                   |            |                 |   |            |  

Research and development costs

Research
and development expenses are the costs incurred in the process of our
pre-clinical research and our clinical trials. Clinical trial and pre-clinical
expenses include regulatory consultant compensation and fees, research
expenses, purchase of plasma,
the cost of manufacturing IgG and payments to clinical research organizations
and to medical centers for patient recruitment and treatment.

During
the six months ended March 31, 2008 and 2007, research and development expenses
included, among others, the cost
of IgG used in the clinical trials and research work, payments to medical
centers and research labs for clinical trial and pre-clinical trial work,
regulatory and scientific consultants compensation, costs related to the
maintenance of our registered patents, costs related to the filings of patent applications as well as
salaries and related expenses of research and development staff.

During
the six months ended March 31, 2008, research and development expenses totaled
$900,677, compared to $482,870 for
the six months ended March 31, 2007. The increase is attributable to assay
development as well as pre-clinical work related to the filing of the IND for
VitiGam.

General and administrative expenses

General
and administrative expense includes the salaries and related expenses of our management,
consulting costs, legal and professional fees, traveling, business development
costs, insurance expenses and other general costs.

For
the six months ended March 31, 2008, general and administrative expenses
totaled $1,387,419 compared to $1,631,800 for the six months ended March 31,
2007. Costs incurred related to general and administrative activities in the
six months ended March 31, 2008 reflect a

18

---



decrease of $362,000 in salary and
related expenses due to lower stock based compensation expense and a reduction
of headcount and a decrease of $155,000 in stock based compensation expenses
for consultants, offset by an increase of $75,000 in professional, $94,000 in
legal and $83,000 in consulting expenses and an increase in general expenses
such as office and maintenance expenses.

Financial income/expense, net

During
the six months ended March 31, 2008 and 2007, we generated interest income on
available cash and cash equivalents balance as well as bank charges.

Liquidity and Capital Resources

Through
March 31, 2008, we incurred losses in an aggregate amount of $11,225,467. We have financed our
operations from the private placements of equity and debt financing. Through
March 31, 2008, we raised a total of $9,538,553, net of transaction costs, through private placements of
equity. We anticipate that additional financing will be through similar
sources. As of March 31, 2008, we had $2,081,377 of available cash, most
of which is deposited in short term, interest bearing, bank deposits. To implement
our business plan, as currently contemplated, we anticipate we will need
approximately $4 million for the remainder of our fiscal year, and
approximately $11 million for the twelve months following April 1, 2008.

Although
we do not have material financing commitments, management is in the process of
evaluating various financing alternatives as we will need to finance future
research and development activities and general and administrative expenses
through fund raising in the public or private equity markets. Although there is
no assurance that we will be successful with those initiatives, management is
confident that it will be able to secure the necessary financing as a result of
ongoing financing discussions with third party investors and existing
shareholders.

Off-Balance Sheet Arrangements

We
have no off-balance sheet arrangements.

Planned Expenditures

The
estimated expenses referenced herein are in accordance with our business plan.
As our technology is still in the development stage, it can be expected that
there will be changes in some budgetary items. Our planned expenditures for the
twelve months following April 1, 2008 are as follows:

|                                  |  |        |            |  
|--------------------------------- |  | ------ | ---------- | -
|Category                          |  | Amount |           
|                                  |  |        |            |  
|Research & Development            |  | $      | 8,079,000  |  
|General & Administrative Expenses |  |        | 3,219,000  |  
|Finance Income, net               |  |        | (116,000   | )
|                                  |  |        |            |  
|Total                             |  | $      | 11,182,000 |  

As
previously indicated, we are planning to file an IND with the FDA for VitiGamTM.
Our ability to proceed with this IND application as well as the commencement of
the relatedclinical trial is dependent on several major
factors including the ability to attract sufficient financing on terms acceptable
to us.

19

---



ITEM 3A(T) - CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

As of March 31, 2008, our management carried
out an evaluation, under the supervision of our Chief Executive Officer and the
Chief Financial Officer, of the effectiveness of the design and operation of
our system of disclosure controls and procedures (as defined by Rule 13a-15(e)
and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the
Exchange Act)). Based upon that evaluation, the Chief Executive Officer and
Chief Financial Officer concluded that our disclosure controls and procedures
were effective, as of the date of their evaluation, for the purposes of
recording, processing, summarizing and timely reporting material information
required to be disclosed in reports filed by us under the Exchange Act.

Changes in internal controls

There
were no changes in our internal controls over financial reporting, that
occurred during the quarter ended March 31, 2008 that have materially affected,
or are reasonably likely to materially effect, our internal control over
financial reporting.

20

---



PART II

ITEM 1 - LEGAL PROCEEDINGS

From
time to time we may become subject to litigation incidental to our business.
    We are not currently a party to any legal proceedings.

ITEM 2 - UNREGISTERED SALES OF EQUITY SECURITIES AND
USE OF PROCEEDS

On
April 10, 2008, we granted options to purchase 50,000 shares of our common
stock under our 2007 Global Share Option Plan to an employee. The options are
exercisable at $0.37 per share which was the fair market value at the close of
business on April 10, 2008 with one third vesting on each of the first, second
and third anniversary of the date of grant. The issuance of these options was
exempt from registration requirements pursuant to Section 4(2) of the
Securities Act of 1933, as amended, as a transaction by an issuer not involving
a public offering.

ITEM 3 - DEFAULTS UPON SENIOR SECURITIES

None.

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

None.

ITEM 5 - OTHER INFORMATION

None.

21

---



ITEM 6 - EXHIBITS

|       |                                                                                                                                                                 
|------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------------
|Number | Exhibit                                                                                                                                                         
|31.1   | Certification
 of Principal Executive Officer pursuant to Rule 13a-14 and Rule 15d-14(a),
 promulgated under the Securities and Exchange Act of 1934, as amended
|      
|31.2   | Certification
 of Principal Financial Officer pursuant to Rule 13a-14 and Rule 15d 14(a),
 promulgated under the Securities and Exchange Act of 1934, as amended
|      
|32.1   | Certification
 pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
 Sarbanes-Oxley Act of 2002 (Chief Executive Officer)              
|      
|32.2   | Certification
 pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
 Sarbanes-Oxley Act of 2002 (Chief Financial Officer)              

22

---



SIGNATURES

In
accordance with the requirements of the Securities Exchange Act of 1934, the
registrant caused this report to be signed on its behalf by the undersigned,
hereunto duly authorized.

|                    |                              |                        
|------------------- | ---------------------------- | -----------------------
|                    | GAMMACAN INTERNATIONAL, INC.
|                    |                              |                        
|                    |                              | Registrant             
|                    |                              |                        
|Date: May
 14, 2008 | By:                          | /s/ Limor Zur-Stoller  
|                    |                              |                        
|                    |                              | Limor Zur-Stoller      
|                    |                              | Chief Financial Officer

23

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