**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


**WASHINGTON,
      D** . **C** . **20549**






**FORM
      10-KSB/A**


**ANNUAL
      REPORT PURSUANT TO SECTION 13 OR 15(d)**


**OF
      THE SECURITIES EXCHANGE ACT OF 1934**


**FOR
      THE FISCAL YEAR ENDED DECEMBER 31, 2006**


**COMMISSION
      FILE NUMBER 000-51038**







**MEDASORB
      TECHNOLOGIES CORPORATION**


(Name
      of
      Small Business Issuer in Its Charter)




**Nevada**
              (State
                or Other Jurisdiction of Incorporation or Organization)
            **98-0373793**
              (I.R.S.
                Employer identification number)




**7
      Deer Park Drive, Suite K**


**Monmouth
      Junction, New Jersey 08852**


**(732)
      329-8885**


(Address,
      including zip code, and telephone number,


including
      area code, of registrant’s principal executive offices)







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





**Securities
      registered pursuant to Section 12(g) of the Act: Common Stock
      $0** . **001
      par value**





Check
      whether the issuer is not required to file reports pursuant to Section 13 or
      15
      (d) of the Exchange Act.     ̈







Check
      whether the issuer: (1) filed all reports required to be filed by Section 13
      or
      15(d) of the Exchange Act during the past 12 months (or for such shorter period
      that the registrant was required to file such reports), and (2) has been subject
      to such filing requirements for the past 90 days.


þ Yes  ̈ No




Check
      if
      there is no disclosure of delinquent filers in response to Item 405 of
      Regulation S-B contained herein, and no disclosure will be contained, to the
      best of registrant’s knowledge, in definitive proxy or information statements
      incorporated by reference in Part III of this Form 10-KSB. þ




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




The
      issuer had no **** revenues
      for its fiscal year ended December 31, 2006.





The
      aggregate market value of the voting and non-voting common equity held by
      non-affiliates of the registrant as of March 26, 2007 was approximately
      $14,115,315. The number of shares outstanding of the registrant’s Common Stock
      as of March 26, 2007 was 24,628,274.




Transitional
      Small Business Disclosure Format:  ̈ Yes  þ No





**PART
      III**




**Item
      9.**  **Directors,
      Executive Officers, Promoters and Control Persons; Compliance with Section
      16(a)
      of the Exchange Act** **.**




**Directors
      and Executive Officers**





The
      following table sets forth our directors and executive officers, their ages
      and
      the positions they hold:


**Name**
              **Age**
              **Position**Al
                  Kraus
              62
              President
                  and Chief Executive Officer, DirectorWilliam
                  R. Miller
              78
              Chairman
                  of the BoardJames
                  Winchester, MD
              62
              Chief
                  Medical OfficerVincent
                  Capponi
              48
              Chief
                  Operating OfficerDavid
                  Lamadrid
              36
              Chief
                  Financial OfficerEdward
                  R. Jones, MD, MBA
              58
              DirectorJoseph
                  Rubin, Esq.
              68
              DirectorKurt
                  Katz
              74
              Director




***Al
      Kraus.*** Mr.
      Kraus
      has more than twenty-five years’ experience managing companies in the dialysis,
      medical device products, personal computer and custom software industries.
      He
      has been the President and Chief Executive Officer of MedaSorb since 2003.
      Prior
      to joining us, from 2001 to 2003, Mr. Kraus was President and CEO of
      NovoVascular Inc., an early stage company developing coated stent technology.
      From 1996 to 1998, Mr. Kraus was President and CEO of Althin Healthcare and
      from
      1998 to 2000, of Althin Medical Inc., a manufacturer of products for the
      treatment of end stage renal disease. While CEO of Althin, he provided strategic
      direction and management for operations throughout the Americas. From 1979
      to
      1985, Mr. Kraus was U.S. Subsidiary Manager and Chief Operating Officer of
      Gambro Inc., a leading medical technology and healthcare company. Mr.
      Kraus
      was the Chief Operating Officer of Gambro when it went public in the United
      States in an offering led by Morgan Stanley.




***William
      R. Miller*** .
      Mr.
      Miller has been the Chairman of the Board since January 1, 2007. Mr. Miller
      served as Vice Chairman of the Board of Directors of the Bristol-Myers Squibb
      Company from 1985 until 1991, at which time he retired. Mr. Miller has served
      as
      a director of ImClone Systems Incorporated since June 1996 and also serves
      as
      the Chairman of the Board of Vion Pharmaceuticals, Inc. Mr. Miller previously
      served as Chairman of Cold Spring Harbor Laboratory, a non-profit institution,
      and the Pharmaceutical Manufacturers Association. Mr. Miller is also a Trustee
      of the Manhattan School of Music, a director of the Opera Orchestra of New
      York
      and a Managing Director of the Metropolitan Opera Association. Mr. Miller earned
      his M.A. in Philosophy, Politics and Economics from St. Edmund Hall, Oxford
      University, Oxford, England.




***James
      Winchester, M.D.*** Prior to
      joining MedaSorb in 2000, Dr. Winchester was Professor of Medicine and Director
      of Dialysis Programs at Georgetown University School of Medicine for more than
      25 years. Dr. Winchester is also currently the Chief of the Nephrology Division
      at Beth Israel Medical Center, a position he has held since July 2004. He has
      published more than 200 articles in scientific and medical journals, and has
      co-authored eight books in the fields of renal replacement therapy and clinical
      poisoning management. Dr. Winchester is editor-in chief of *Replacement
      of Renal Function* ,
      the
      most widely used textbook for nephrology fellows. Dr. Winchester has published
      more articles on hemoperfusion than any other nephrologist in the world. He
      is
      widely recognized as one of the world’s leading experts in hemoperfusion and
      toxicology, and is a former member of the Scientific Advisory Board for Total
      Renal Care (Davita). Dr. Winchester received his medical degree from the
      University of Glasgow and is a Fellow of the Royal College of Physicians and
      Surgeons of Glasgow ,
      and a
      Fellow of the American College of Physicians.


2




***Vincent
      Capponi*** .
      Mr.
      Capponi joined MedaSorb as Vice President of Operations in 2002 and became
      its
      Chief Operating Officer in July 2005. He has more than 20 years of management
      experience in medical device, pharmaceutical and imaging equipment at companies
      including Upjohn, Sims Deltec and Sabratek. Prior to joining MedaSorb in 2002,
      Mr. Capponi held several senior management positions at Sabratek and its
      diagnostics division GDS, and was interim president of GDS diagnostics in 2001.
      From 1998 to 2000, Mr. Capponi was Senior Vice President and Chief Operating
      Officer for Sabratek and Vice President Operations from 1996 to 1998. He
      received his MS in Chemistry and his BS in Chemistry and Microbiology from
      Bowling Green State University.




***David
      Lamadrid*** .  Mr.
      Lamadrid has been with MedaSorb since 2000 and has served as its Chief Financial
      Officer since October 2002. He
      has 15
      years of business experience in finance and operations. Prior to joining MedaSorb in
      2000,
      Mr. Lamadrid was a financial analyst at Chase Manhattan Bank working in the
      Middle Market Banking Group. Mr. Lamadrid received his MBA from New York
      University, a BS in Finance from St. John’s University, and an AAS in Accounting
      from S.U.N.Y. Rockland.




***Edward
      R. Jones, MD, MBA*** . **** Dr.
      Jones
      has been a director of ours since April 2007. Dr. Jones is an attending
      physician at the Albert Einstein Medical Center and Chestnut Hill Hospital
      as
      well as Clinical Professor of Medicine at Temple University Hospital. Dr. Jones
      has published or contributed to the publishing of 30 chapters, articles, and
      abstracts on the subject of treating kidney-related illnesses. He is a
      sixteen-year member of the Renal Physicians Association, the Philadelphia County
      Medical Society and a past board member of the National Kidney Foundation of
      the
      Delaware Valley. Dr. Jones has been elected to serve as the next President
      of
      the Renal Physicians Association starting in 2009. ******




***Joseph
      Rubin, Esq.*** **** Mr.
      Rubin
      became a director of MedaSorb in 1997. Mr. Rubin is a founder and Senior Partner
      of Rubin, Bailin, and Ortoli, LLP an international and domestic corporate and
      commercial law firm in New York City, where he has practiced law since 1986.
      Mr.
      Rubin also teaches at the Columbia University School of International and Public
      Affairs, where he is also Executive Director of the International Technical
      Assistance Program for Public Affairs (ITAP). Mr. Rubin was Adjunct Professor
      at
      the Columbia University Graduate School of Business from 1973 to 1994, and
      taught at Columbia Law School in 1996. Mr. Rubin received his law degree from
      Harvard Law School, and his B.A., MIA, and M.Phil degrees in political science
      and international relations from Columbia University.




***Kurt
      Katz, M.Ch.E.*** Mr.
      Katz
      became a director of MedaSorb in 1997. Since retiring from Peabody International
      Corporation in 1986, Mr. Katz has pursued various business interests. He is
      currently the Chairman of Polymeric Resources Corporation, a polymer company
      engaged in the manufacture of nylon and compounding. Mr. Katz served as
      President and Chief Operating Officer of Peabody, which specializes in energy
      and environmental products. Mr. Katz served as Executive Vice President and
      Chief Operating Officer of Peabody from 1981 to 1983, and was a Director from
      1977 to 1985. Prior to joining Peabody in 1973, Mr. Katz held a variety of
      management positions with Westinghouse Electric Corporation, where he served
      for
      18 years and was directly involved in the launching of new products, divisions
      and subsidiaries. . Mr.
      Katz
      has a B.S. and M.S. in chemical engineering, and an MBA.




**Section
      16(a) Beneficial Ownership Reporting Compliance**




The
      members of our Board of Directors, our executive officers and persons who hold
      more than 10% of our outstanding Common Stock are subject to the reporting
      requirements of Section 16(a) of the Exchange Act, which requires them to file
      reports with respect to their ownership of our Common Stock and their
      transactions in such Common Stock. Based solely upon a review of Forms 3 and
      4
      and amendments filed with the SEC by persons subject to the reporting
      requirements of Section 16(a) of the Exchange Act, we believe that, with the
      exception of the late filing of one Form 4 by each of Kurt Katz and Joseph
      Rubin, directors, and the late filing of a Form 3 by Guillermina Montiel, a
      holder of more than 10% of our Common Stock, all reporting requirements under
      Section 16(a) for the 2006 fiscal year were met in a timely manner by our
      directors, executive officers and beneficial owners of more than 10% of our
      Common Stock.


3


**Code
      of Conduct**




We
      maintain a Code of Business Conduct and Ethics that is applicable to all of
      our
      employees, including our Chief Executive Officer and Chief Financial Officer,
      and our directors. The Code of Conduct, which satisfies the requirements of
      a
“code of ethics” under applicable SEC rules, contains written standards that are
      designed to deter wrongdoing and to promote honest and ethical conduct,
      including the ethical handling of actual or apparent conflicts of interest;
      full, fair, accurate, timely and understandable public disclosures and
      communications, including financial reporting; compliance with applicable laws,
      rules and regulations; prompt internal reporting of violations of the code;
      and
      accountability for adherence to the code.




**Audit
      Committee Financial Expert**




The
      Board
      of Directors does not have an Audit Committee, and therefor does not have an
      “audit committee financial expert,” as such term is defined in Item 401(e) of
      Regulation S-B.




**Item
      10.**  **Executive
      Compensation.** ****




*Summary
      Compensation Table*




The
      following table shows for the fiscal year ended December 31, 2006, compensation
      awarded to or paid to, or earned by, our Chief Executive Officer, our Chief
      Operating Officer, our Chief Financial Officer, and our Chief Medical Officer
      (the “Named Executive Officers”).


Name
                and Principal Position
            
            Year
            
            Salary
              ($)
            
            Bonus
              ($)
            
            Option
                Awards (1)
              ($)
            
            Total
                ($)Al
                Kraus
              *Chief
                Executive Officer*
            
            
            2006
            
            
            201,257
            
            
            -0-
            
            
            69,555
                (2
            )
            
            270,812Vincent
                Capponi,
              *Chief
                Operating Officer*
            
            
            2006
            
            
            178,441
            
            
            200
            
            
            40,297(3
            )
            
            218,939David
                Lamadrid,
              *Chief
                Financial Officer*
            
            
            2006
            
            
            135,629
            
            
            200
            
            
            -0-
            
            
            135,829Dr.
                James Winchester*Chief
                Medical Officer*
            
            
            2006
            
            
            120,000
            
            
            -0-
            
            
            40,297(4
            )
            
            160,297




(1)
            The
                value of option awards granted to the Named Executive Officers has
                been
                estimated pursuant to SFAS No. 123(R) for the options described in
                the
                footnotes below, except that for purposes of this table, we have
                assumed
                that none of the options will be forfeited. The Named Executive Officers
                will not realize the estimated value of these awards in cash until
                these
                awards are vested and exercised or sold. For information regarding
                our
                valuation of option awards, see “Stock-Based Compensation” in Note 2 of
                our financial statements for the period ended December 31, 2006.




(2)
            Reflects
                options to purchase 413,920shares
                of Common Stock, all of which are currently exercisable at an exercise
                price of $6.64 per share. Options to purchase 332,094 of these shares
                were
                granted on September 30, 2006 and expire on September 30, 2016, and
                options to purchase 81,826 of these shares were granted on December
                31,
                2006 and expire on December 31,
                2016.




(3)
            Reflects
                options to purchase 50,000 shares of Common Stock at an exercise
                price of
                $1.65 per share, which options were granted on December 31, 2006
                and
                expire on December 31, 2016. This option vested and became exercisable
                as
                to 16,667 shares on the date of grant, and will vest and become
                exercisable as to 16,667 shares on December 31, 2007; and as to 16,666
                shares on December 31, 2008.


4




(4)
            Reflects
                options to purchase 50,000 shares of Common Stock at an exercise
                price of
                $1.65 per share, which were granted on December 31, 2006 and expire
                on
                December 31, 2016. This option vested and became exercisable as to
                16,667
                shares on the date of grant, and will vest and become exercisable
                as to
                16,667 shares on December 31, 2007; and as to 16,666 shares on December
                31, 2008.




*Outstanding
      Equity Awards at Fiscal Year End*




The
      following table shows for the fiscal year ended December 31, 2006, certain
      information regarding outstanding equity awards at fiscal year end for the
      Named
      Executive Officers .




**Outstanding
      Equity Awards At December 31, 2006**




Option
                AwardsName
            
            Number
                of
              Securities
                Underlying Unexercised Options
              (#)
              Exercisable
            
            Number
                of Securities Underlying Unexercised Options
              (#)
              Unexercisable
            
            Option
                Exercise Price
              ($)
            
            Option
                Expiration DateAl
                Kraus
            
            
            332,094
              81,826
            
            
            --
              --
            
            
            6.64
                (1
              6.64
                (1
            )
              )
            
            9/30/16
              12/31/16Vincent
                Capponi
            
            
            16,667
            
            
            33,333
            
            
            1.65
                (2
            )
            
            12/31/16David
                Lamadrid
            
            
            --
            
            
            --
            
            
            --
            
            
            --Dr.
                James Winchester
            
            
            16,667
            
            
            33,333
            
            
            1.65
                (3
            )
            
            12/31/16


(1)
            Fully
                vested




(2)
            Vests
                and becomes exercisable as to (i) 16,667 shares on December 31, 2006;
                (ii)
                16,667 shares on December 31, 2007; and (iii) 16,666 shares on December
                31, 2008.




(3)
            Vests
                and becomes exercisable as to (i) 16,667 shares on December 31, 2006;
                (ii)
                16,667 shares on December 31, 2007; and (iii) 16,666 shares on December
                31, 2008.




***Director
      Compensation***




The
      following table shows for the fiscal year ended December 31, 2006 certain
      information with respect to the compensation of all non-employee directors
      of
      the Company.




**Director
      Compensation for Fiscal 2006**




Name
            
            Fees
                Earned or
              Paid
                in
              Cash
              ($)
            
            Option
              Awards
              ($)
                (1)
            
            Total
              ($)Joseph
                Rubin (2)
            
            
            -0-
            
            
            9,732
                (2
            )
            
            9,732Kurt
                Katz (3)
            
            
            -0-
            
            
            9,732
                (2
            )
            
            9,732




5




(1)
            The
                value of option awards granted to directors has been estimated pursuant
                to
                SFAS No. 123(R) for the options described in the footnotes below,
                except
                that for purposes of this table, we have assumed that none of the
                options
                will be forfeited. The directors will not realize the estimated value
                of
                these awards in cash until these awards are vested and exercised
                or sold.
                For information regarding our valuation of option awards, see “Stock-Based
                Compensation” in Note 2 of our financial statements for the period ended
                December 31, 2006.




(2)
            At
                December 31, 2006, Mr. Rubin held options to purchase 61,715 shares
                of our
                Common Stock.




(3)
            At
                December 31, 2006, we had issued on behalf of Mr. Katz options to
                purchase
                56,817 shares of our Common Stock in connection with his service
                as a
                director. All of these options have been issued to a trust established
                by
                Mr. Katz for the benefit of his
                children.




Our
      directors did not receive any cash compensation for their service on the Board
      of Directors during 2006. On June 15, 2006, in anticipation of our June 30,
      2006
      merger and private placement, each non-employee director of MedaSorb Delaware
      was granted an option to purchase that number of shares of MedaSorb Delaware
      common stock equal to the number of shares of common stock then subject to
      director options held by such person that had exercise prices ranging from
      $6.64
      to $21.57. The options issued on June 15, 2006 have an exercise price of $1.25
      per share, which is the conversion price of the Series A Preferred Stock issued
      in the June 30, 2006 private placement. The non-employee directors of MedaSorb
      Delaware at the time of that grant included our current non-employee directors
      Joseph Rubin and Kurt Katz, who were each issued options to purchase
      15,069 **** shares
      of
      common stock; Brian Murray and Jean Futrell, who were each issued options to
      purchase 15,069 **** shares
      of
      common stock, and Bruce Davis, who was issued an option to purchase 2,260 shares
      of common stock. All of these options became options to purchase the same number
      of shares of our Common Stock at the same exercise price following the merger.
      In addition, on August 1, 2006, we granted options to purchase 5,000 shares
      of
      Common Stock at an exercise price of $1.25 per share to each of our
      non-employee **** directors,
      Joseph Rubin and Kurt Katz, following the determination of our Board that such
      grant fairly reflected the services provided by our non-employee **** directors
      during 2006.




In
      2007,
      we approved arrangements under which each non-employee director receives a
      fee
      of $2,000 for each Board meeting attended in person and a fee of $1,000 for
      each
      Board meeting participated in by telephone. In addition, our Board approved
      a
      policy under which each non-employee director will be eligible to be issued
      options to purchase up to 10,000 shares of our Common Stock on December 31,
      2007
      based on attendance at Board meetings held during 2007, so that, for example,
      a
      non-employee director attending all of our meetings would be entitled to receive
      an option to purchase 10,000 shares of our Common Stock, and a non-employee
      director attending 80% of our meetings would be entitled to receive an option
      to
      purchase 8,000 shares of our Common Stock. Such options will be exercisable
      at
      the closing price of our Common Stock on the date of grant. Our directors are
      also reimbursed for actual out-of-pocket expenses incurred by them in connection
      with their attendance at meetings of the Board of Directors.




In
      connection with his appointment as Chairman of the Board, we agreed to
      compensate Mr. Miller at the rate of $20,000 per annum, and on January 1, 2007
      issued Mr. Miller a ten year option to purchase 200,000 shares of our Common
      Stock at a price of $1.65 per share (the last reported sales price on the OTC
      Bulletin Board on December 29, 2006). We have also agreed to issue to Mr. Miller
      in 2008, to the extent he continues to serve as our Chairman, an additional
      option to purchase 100,000 shares of Common Stock. Such options would be
      exercisable at the closing price of our Common Stock on the date of
      grant.




**Employment
      Agreements with Named Executive Officers**




Agreement
      with Chief Executive Officer




MedaSorb
      Delaware entered into an Employment Agreement, dated as of July 18, 2003, with
      Al Kraus, our Chief Executive Officer. The Employment Agreement provides for
      an
      initial five-year term of employment as our Chief Executive Officer. Under
      the
      terms of the Employment Agreement, Mr. Kraus received an annual base salary
      of
      $200,000 through December 31, 2006. Effective January 1, 2007, Mr. Kraus’s
      annual base salary was increased to $216,351. Under the Employment Agreement,
      Mr. Kraus was also granted an option to purchase 5% of the outstanding equity
      interests of MedaSorb Delaware (which was then a limited liability company)
      on a
      fully-diluted basis, and will be issued additional options so that the combined
      total of Common Stock owned by Mr. Kraus, including upon exercise of options,
      equals 5% of our outstanding Common Stock on a fully diluted basis. Mr. Kraus
      has such right until such time as an aggregate of $20 million of financing
      has
      been received by MedaSorb Delaware (including us following the merger) following
      the commencement of his employment. These options are exercisable at a price
      of
      $6.64 per share of Common Stock, and based on the number of currently
      outstanding shares of Common Stock, Series A Preferred Stock, warrants and
      options, entitle Mr. Kraus to purchase 413,920 shares of Common Stock. In 2005,
      MedaSorb Delaware’s board approved the issuance to Mr. Kraus of “Management
      Units” of the limited liability company in lieu of the options he was then
      entitled to under the Employment Agreement. As a result of the conversion of
      MedaSorb Delaware to a corporation and the merger, the Management Units issued
      under the Employment Agreement were exchanged for 1,393,631 shares of Common
      Stock.


6


In
      the
      event that Mr. Kraus’s employment is terminated as a result of his death, his
      heirs will be entitled to 120-days of salary. In the event Mr. Kraus is
      terminated for “justifiable cause” we will pay him his accrued and unpaid base
      salary through the date of termination. If Mr. Kraus’s employment is terminated
      without cause or in the event of a Change of Control, he will be entitled to
      one-year’s base salary payable monthly over a period of one year.




Mr.
      Kraus
      is prohibited under the Employment Agreement from disclosing any of our
      confidential information (as defined in the agreement) during the term of his
      employment and any time thereafter and, following the termination of the
      agreement with us, from competing with us and directly or indirectly soliciting
      any of our customers or suppliers for a period of one year, and from soliciting
      our employees for a period of three years.




On
      February 8, 2007, Mr. Kraus, was granted an immediately exercisable option
      to
      purchase 400,000 shares of our Common Stock at an exercise price of $1.26 (the
      closing price of our Common Stock on the date of grant).




Agreement
      with Chief Operating Officer




MedaSorb
      Delaware entered into an Employment Agreement, dated as of July 1, 2005, with
      Vincent Capponi, our Chief Operating Officer. The Employment Agreement provides
      for an initial term of one-year, with automatic annual renewal unless either
      party provides notice to the other within 120 days prior to the end of the
      year
      of its intention not to renew. Under the terms of the Employment Agreement,
      Mr.
      Capponi received an annual base salary of $181,886 through December 31, 2006.
      Effective January 1, 2007, Mr. Capponi’s annual base salary was increased to
      $195,527. Under the Employment Agreement, Mr. Capponi was also granted
      Management Units equal to 1.5% of the outstanding equity interests of MedaSorb
      Delaware (which was then a limited liability company) on a fully-diluted basis,
      and was entitled to receive additional Management Units so that Mr. Capponi
      continued to hold Management Units equal to 1.5% of the outstanding equity
      of
      MedaSorb Delaware on a fully diluted basis until December 31, 2005. This right
      has expired. As a result of the conversion of MedaSorb Delaware to a corporation
      and the merger, these Management Units were exchanged for 418,086 shares of
      our
      Common Stock.




In
      the
      event that Mr. Capponi’s employment is terminated as a result of his death, his
      heirs will be entitled to 120-days of salary. In the event Mr. Capponi is
      terminated for “justifiable cause” we will pay him his accrued and unpaid base
      salary through the date of termination. If Mr. Capponi’s employment is
      terminated without cause or in the event of Change of Control, he will be
      entitled to one-year’s base salary payable monthly for a period of one year.




Mr.
      Capponi is prohibited under the Employment Agreement from disclosing any of
      our
      confidential information (as defined in the agreement) during the term of his
      employment and any time thereafter, and following the termination of the
      agreement with us, from competing with us and directly or indirectly soliciting
      any of our customers or suppliers for a period of one year, and from soliciting
      our employees for a period of three years.


7


Agreement
      with Chief Financial Officer




MedaSorb
      Delaware entered into an Employment Agreement, dated as of July 1, 2005, with
      David Lamadrid, our Chief Financial Officer. The Employment Agreement provides
      for an initial term of one-year, with automatic annual renewal unless either
      party provides notice to the other within 120 days prior to the end of the
      year
      of its intention not to renew. Under the terms of the Employment Agreement,
      Mr.
      Lamadrid received an annual base salary of $135,629 through December 31, 2006.
      Effective January 1, 2007, Mr. Lamadrid’s annual base salary was increased to
      $145,801. Under the Employment Agreement, Mr. Lamadrid was also granted
      Management Units equal to 1.8% of the outstanding equity interests of MedaSorb
      Delaware (which was then a limited liability company) on a fully-diluted basis,
      and was entitled to receive additional Management Units so that Mr. Lamadrid
      continued to hold Management Units equal to 1.8% of the outstanding equity
      of
      MedaSorb Delaware on a fully diluted basis until December 31, 2005. This right
      has expired. As a result of the conversion of MedaSorb Delaware to a corporation
      and the merger, these Management Units were exchanged for 501,704 shares of
      our
      Common Stock.




In
      the
      event that Mr. Lamadrid’s employment is terminated as a result of his death, his
      heirs will be entitled to 120-days of salary. In the event Mr. Lamadrid is
      terminated for “justifiable cause” we will pay him his accrued and unpaid base
      salary through the date of termination. If Mr. Lamadrid’s employment is
      terminated without cause or in the event of Change of Control, he will be
      entitled to one-year’s base salary payable monthly for a period of one year.




Mr.
      Lamadrid is prohibited under the Employment Agreement from disclosing any of
      our
      confidential information (as defined in the agreement) during the term of his
      employment and any time thereafter, and following the termination of the
      agreement with us, from competing with us and directly or indirectly soliciting
      any of our customers or suppliers for a period of one year, and from soliciting
      our employees for a period of three years.




On
      January 16, 2007, we granted Mr. Lamadrid an option to purchase 150,000 shares
      of our Common Stock at an exercise price of $1.90 (the closing price of our
      Common Stock on the date of grant). The option is currently exercisable as
      to
      50,000 shares, and becomes exercisable as to an additional 50,000 shares on
      January 16, 2008 and the remaining 50,000 shares on January 16,
      2009.




Agreement
      with Chief Medical Officer




MedaSorb
      Delaware entered into an Employment Agreement, dated as of July 1, 2004, with
      Dr. James Winchester, our Chief Medical Officer. The Employment Agreement
      provides for an initial term of one-year, with automatic annual renewal unless
      either party provides notice to the other within 90 days prior to the end of
      the
      year of its intention not to renew. Under the terms of the Employment Agreement,
      Dr. Winchester receives an annual base salary of $120,000. Dr. Winchester’s
      primary employment is with Beth Israel Medical Center, as the Chief of its
      Nephrology division. Although the time Mr. Winchester provides to us varies
      from
      time to time, it is generally in the range of one-half day to one full day
      per
      week.




Dr.
      Winchester is prohibited under his Employment Agreement from disclosing any
      of
      our confidential information (as defined in the agreement) during the term
      of
      his employment and any time thereafter, and following the termination of this
      agreement with us, from competing with us and directly or indirectly soliciting
      any of our customers, suppliers or employees for a period of one year.




**Item
      11.**  **Security
      Ownership of Certain Beneficial Owners and Management and Related Stockholder
      Matters.**




The
      following table sets forth information known to us with respect to the
      beneficial ownership of Common Stock held of record as of April 23, 2007, by
      (1)
      all persons who are owners of 5% or more of our Common Stock, (2) each of our
      named executive officers (see “Summary Compensation Table”), (3) each director,
      and (4) all of our executive officers and directors as a group . Each
      of
      the stockholders can be reached at our principal executive offices located
      at 7
      Deer Park Drive, Suite K, Monmouth Junction, New Jersey 08852.


8





**SHARES
                BENEFICIALLY OWNED****1****Number**
            
            **Percent
                (%)***Beneficial
                Owners of more than 5% of Common Stock (other than directors and
                executive
                officers)*Margie
                Chassman(2)
            
            6,638,334
            (2)
            25.1
            %Guillermina
                Montiel(3)
            
            
            5,052,456
            
            
            20.5
            %Margery
                Germain(4)
            
            
            2,000,000
            
            
            8.1
            %Robert
                Shipley(5)
            
            
            1,495,710
            
            
            5.8
            %*Directors
                and Executive Officers*Al
                Kraus(6)
            
            
            2,207,551
            
            
            8.7
            %William
                R. Miller(7)
            
            
            200,000
            
            
            *David
                Lamadrid(8)
            
            
            558,734
            
            
            2.3
            %Vince
                Capponi(9)
            
            
            434,753
            
            
            1.8
            %Joseph
                Rubin(10)
            
            
            388,284
            
            
            1.6
            %James
                Winchester(11)
            
            
            69,186
            
            
            *Kurt
                Katz(12)
            
            
            59,077
            
            
            *Edward
                Jones
            
            
            0
            
            
            **All
                directors and executive officers as a group (eight
                persons)*(12)
            
            
            3,917,585
            
            
            15.0
            %


*  Less
      than
      1%.




1
            Gives
                effect to the shares of Common Stock issuable upon the exercise of
                all
                options exercisable within 60 days of April 23, 2007 and other rights
                beneficially owned by the indicated stockholders on that date. Beneficial
                ownership is determined in accordance with the rules of the Securities
                and
                Exchange Commission and includes voting and investment power with
                respect
                to shares. Unless otherwise indicated, the persons named in the table
                have
                sole voting and sole investment control with respect to all shares
                beneficially owned. Percentage ownership is calculated based on 24,485,696
                shares of Common Stock outstanding as of April 23, 2007.




2
            Based
                on information reflected in a Schedule 13G filed by Ms. Chassman
                with the
                SEC on November 20, 2006, and includes 630,000 shares of Common Stock
                ultimately issuable upon exercise and conversion of the Series A
                Preferred
                Stock and warrants underlying the warrant we issued Ms. Chassman
                upon the
                closing of our Series A Preferred Stock private placement, 800,000
                shares
                of Common Stock issuable upon conversion of Series A Preferred Stock
                and
                400,000 shares of Common Stock issuable upon exercise of warrants.
                Ms.
                Chassman has waived her registration rights with respect to the Series
                A
                Preferred Stock and warrants. Margie Chassman is married to David
                Blech.
                Mr. Blech disclaims beneficial ownership of these shares. Since 1980
                Mr.
                Blech has been a founder of companies and venture capital investor
                in the
                biotechnology sector. His initial venture investment, Genetic Systems
                Corporation, which he helped found and served as treasurer and a
                member of
                the board of directors, was sold to Bristol Myers in 1986 for $294
                million
                of Bristol Myers stock. Other companies he helped found include DNA
                Plant
                Technology, Celgene Corporation, Neurogen Corporation, Icos Corporation,
                Incyte Pharmaceuticals, Alexion Pharmaceuticals and Neurocrine
                Biosciences. He was also instrumental in the turnaround of Liposome
                Technology, Inc. and Biotech General Corporation. In 1990 Mr. Blech
                founded D. Blech & Company, which, until it ceased doing business in
                September 1994, was a registered broker-dealer involved in underwriting
                biotechnology issues. In May 1998, David Blech pled guilty to two
                counts
                of criminal securities fraud, and, in September 1999, he was sentenced
                by
                the U.S. District Court for the Southern District of New York to
                five
                years’ probation, which was completed in September 2004. Mr. Blech also
                settled administrative charges by the Commission in December 2000
                arising
                out of the collapse in 1994 of D. Blech & Co., of which Mr. Blech was
                President and sole stockholder. The settlement prohibits Mr. Blech
                from
                engaging in future violations of the federal securities laws and
                from
                association with any broker-dealer. In addition, the District Business
                Conduct Committee for District No.10 of NASD Regulation, Inc. reached
                a
                decision, dated December 3, 1996, in a matter styled District Business
                Conduct Committee for District No. 10 v. David Blech, regarding the
                alleged failure of Mr. Blech to respond to requests by the staff
                of the
                National Association of Securities Dealers, Inc. (“NASD”) for documents
                and information in connection with seven customer complaints against
                various registered representatives of D. Blech & Co. The decision
                found that Mr. Blech failed to respond to such requests in violation
                of
                NASD rules and that Mr. Blech should, therefore, be censured, fined
                $20,000 and barred from associating with any member firm in any capacity.
                Furthermore, Mr. Blech was discharged in bankruptcy in the United
                States
                Bankruptcy Court for the Southern District of New York in March 2000.




9


3
            Includes
                58,472 shares issuable upon exercise of stock options.





4
            Includes
                1,700,000 shares of Common Stock held directly by Ms. Germain and
                300,000
                shares of Common Stock held by her minor
                children.





5
            Includes
                328,402 shares of Common Stock issuable upon conversion of Series
                A
                Preferred Stock and 661,293 shares of Common Stock issuable upon
                exercise
                of warrants and options.





6
            Includes
                413,920 shares of Common Stock issuable upon exercise of stock options
                pursuant to Mr. Kraus’s Employment Agreement described above, and an
                additional 400,000 shares of Common Stock. issuable upon other currently
                exercisable stock options.





7
            These
                shares are issuable upon exercise of stock
                options





8
            Includes
                50,000 shares of Common Stock issuable upon exercise of stock options.





9
            Includes
                16,667 shares of Common Stock issuable upon exercise of stock options.





10
            Includes
                2,050 shares of Common Stock issuable upon conversion of Series A
                Preferred Stock and 303,970 shares of Common Stock issuable upon
                exercise
                of warrants and stock options. Does not include shares of Common
                Stock
                beneficially owned by Mr. Rubin’s spouse, as to which he disclaims
                beneficial ownership.





11
            Includes
                16,667 shares of Common Stock issuable upon exercise of stock options.





12
            Includes
                56,817 shares of Common Stock issuable upon exercise of stock options,
                all
                of which are held by a trust established for the benefit of Mr. Katz’s
                children. Mr. Katz does not exercise voting control over these shares
                and
                disclaims beneficial ownership of the
                shares.





13
            Includes
                an aggregate of 1,460,091 shares of Common Stock issuable upon exercise
                of
                stock options and warrants and conversion of Series A Preferred
                Stock.





**Item
      12.**  **Certain
      Relationships and Related Transactions, and Director
      Independence.**




In
      October 2005, MedaSorb Delaware entered into an Investment Agreement with Margie
      Chassman pursuant to which she advanced us $1,000,000. At the time of the
      advance, Ms. Chassman was not a stockholder of, or otherwise affiliated with,
      MedaSorb Delaware. The advance bore interest at the rate of 6% per annum.
      Pursuant to the terms of the Investment Agreement, on October 28, 2006, the
      $1,000,000 advance was converted into 1,000,000 shares of Series A Preferred
      Stock (convertible into 800,000 shares of Common Stock) and warrants to purchase
      400,000 shares of Common Stock at a price of $2.00 per share. On the date of
      conversion, the last reported sales price of our Common Stock was $1.44, so
      that
      the aggregate market value of the 800,000 shares of Common Stock underlying
      the
      Series A Preferred Stock issued on October 28, 2006 was $1,152,000, and the
      aggregate market value of the 400,000 shares of Common Stock underlying the
      Warrants issued on October 28, 2006, which had an aggregate exercise price
      of
      $800,000, was $576,000.


10


The
      Investment Agreement provided that Ms. Chassman would be issued 10 million
      shares of common stock in consideration for funding the loan, and further
      provided that she would assist in arranging a “Qualified Merger” and that she
      would “invest or arrange for others to invest” between $3 to $11.5 million. This
      assistance consisted primarily of consultations between MedaSorb Delaware and
      Ms. Chassman’s husband, David Blech. Mr. Blech introduced MedaSorb Delaware to
      potential placement agents, investors and merger partners including the company
      (Gilder Enterprises, Inc.) that MedaSorb Delaware ultimately merged with. Mr.
      Blech also introduced us to the four institutional investors that purchased
      $5.25 million of our securities on June 30, 2006. Mr. Blech also assisted us
      in
      structuring these transactions. Of the four investors, two had co-invested
      with
      Ms. Chassman in other transactions, and the other two were introduced by the
      investors that had previously invested with Ms. Chassman. A description of
      Mr.
      Blech and his background can be found in footnote 2 to the Principal
      Stockholders table. We have been informed that Ms. Chassman has operated a
      small
      graphic design business for at least fifteen years and, for at least the last
      seven years, has invested in numerous early stage biotechnology and information
      technology companies. Ms. Chassman has also informed us that her portfolio
      of
      investments, exclusive of her investment in MedaSorb, is currently worth in
      excess $25,000,000.




In
      consideration for funding the $1 million advance, in addition to the securities
      into which such loan was converted on October 28, 2006 as described above,
      Ms.
      Chassman and her designees were **** issued
      an
      aggregate of 10 million shares of Common Stock prior to the merger; such shares
      are included in the 20,340,929 shares of common stock of MedaSorb Delaware
      outstanding immediately prior to the June 30, 2006 merger. Upon issuance, the
      shares were valued at $12,500,000 based on the conversion price of the 5,250,000
      shares of Series A Preferred Stock sold on that date. These shares of Common
      Stock are subject to a 12-month lock-up agreement expiring June 30, 2007 and
      a
      voting agreement entitling us to voting rights with respect to such shares
      until
      the earlier to occur of a transfer of those shares to an unrelated third party
      or June 30, 2008.




Following
      transfers effected by Ms. Chassman, the 10,000,000 shares of Common Stock are
      currently held as follows:




Stockholder
            
            Shares
                of Common StockMargie
                Chassman
            
            
            4,795,000Margery
                Germain
            
            
            2,000,000Central
                Yeshiva Beth Joseph
            
            
            1,000,000Wood
                River Trust
            
            
            1,050,000Spring
                Charitable Remainder Trust
            
            
            1,150,000Miriam
                Fisher
            
            
            5,000




The
      share
      held by Ms. Germain include 300,000 shares held directly by her minor children.
      Wood River Trust is a trust formed for the benefit of Evan Blech, the son of
      Ms.
      Chassman and Mr. Blech. The trustees of Wood River Trust are Harvey Kesner
      and
      Michael C. Doyle. Ms. Chassman and Mr. Blech are the income beneficiaries of
      Spring Charitable Remainder Trust, and its remainder beneficiary is a charitable
      organization yet to be designated. Andrew Levinson is the trustee of the Spring
      Charitable Remainder Trust.




In
      connection with our June 30, 2006 sale of Series A Preferred Stock and warrants
      to four institutional investors which generated gross proceeds of $5.25 million,
      to induce those investors to make the investment, Margie Chassman pledged to
      those investors securities of other publicly traded companies. The pledged
      securities consist of a $400,000 promissory note of Xechem International, Inc.
      convertible into Xechem common stock at $.005 per share, and 250,000 shares
      of
      the common stock of Novelos Therapeutics, Inc. Based on the market value of
      the
      Xechem common stock ($.07 per share) and the Novelos common stock ($1.03) per
      share, on June 30, 2006, the aggregate fair market value of the pledged
      securities at the date of pledge was approximately $5,857,500.


11


In
      the
      event those investors have suffered a loss on their investment in our securities
      as of June 30, 2007 (as determined by actual sales by those investors or the
      market price of our Common Stock on such date), the investors may sell all
      or a
      portion of the pledged securities so that the investors receive proceeds from
      such sale in an amount equal to their loss on their investment in our
      securities. No assurance can be given that the sale of the pledged securities
      will provide these investors with sufficient proceeds to cover the full extent
      of their loss, if any, on their investment. In consideration of her pledge
      to
      these investors, we paid Ms. Chassman (i) $525,000 in cash (representing 10%
      of
      the cash amount raised from the institutional investors), and (ii) five-year
      warrants to purchase




·
            525,000
                shares of Series A Preferred Stock (representing 10% of the Series
                A
                Preferred Stock purchased by those investors), and




·
            warrants
                to purchase 210,000 shares of Common Stock at an exercise price of
                $2.00
                per share (representing 10% of the Series A Preferred Stock purchased
                by
                those investors),




for
      an
      aggregate exercise price of $525,000.




In
      August
      2003, in order to induce Guillermina Vega Montiel, a principal stockholder
      of
      ours, to make a $4 million investment in MedaSorb Delaware, we granted Ms.
      Montiel a perpetual royalty equal to three percent of all gross revenues
      received by us from sales of CytoSorb TM in
      the
      applications of sepsis, cardiopulmonary bypass surgery, organ donor,
      chemotherapy and inflammation control. In addition, for her investment, Ms.
      Montiel received 1,230,770 membership units of MedaSorb Delaware, which at
      the
      time was a limited liability company. Those membership units ultimately became
      185,477 shares of our Common Stock following our June 30, 2006
      merger.




Separate
      from the $1 million advance provided by Ms. Chassman, from time to time
      beginning in 2003 through June 30, 2006, MedaSorb Delaware issued convertible
      notes to various investors in the aggregate principal amount of $6,549,900.
      The
      notes bore interest at a rate of 12 percent per annum and were convertible
      into
      common stock at prices ranging from $3.32 per share to $6.64 per share (as
      adjusted for the merger and conversion of MedaSorb Delaware from a limited
      liability company to a corporation). Some of the convertible notes were issued
      together with warrants. On June 30, 2006, these convertible notes, in the
      aggregate principal amount of $6,549,900, together with $1,480,249 in accrued
      interest, were converted into 5,170,880 shares of Common Stock and five-year
      warrants to purchase a total of 816,691 shares of Common Stock at a price of
      $4.98 per share. The 5,170,880 shares of Common Stock issued upon conversion
      includes 3,058,141 shares issued to the note holders as an inducement for them
      to convert the convertible notes. The inducement shares were valued at
      $3,351,961, and such amount is included as a charge to interest expense in
      our
      Consolidated Statements of Operations for the nine months ended September 30,
      2006. Guillermina Vega Montiel, a principal stockholder of ours, held
      approximately $4,120,000 in principal amount of the convertible notes, which
      together with $679,800 of accrued interest, converted into 4,354,189 of the
      shares of Common Stock issued as a result of the conversion.




Joseph
      Rubin is a director of ours and performs legal services from time to time.
      At
      December 31, 2006, MedaSorb Delaware owed Mr. Rubin’s firm approximately $5,000
      in respect of legal services provided by his firm to MedaSorb
      Delaware.




***Director
      Independence*** **




All
      members of our Board of Directors, other than Joseph Rubin, who performs legal
      services for us as disclosed above; and AL Kraus, our Chief Executive Officer,
      are independent under the standards set forth in Nasdaq Marketplace Rule
      4200(a)(15).




**Item
      13.**  **Exhibits.**




14
            Code
                of Business Conduct and Ethics of MedaSorb Technologies
                Corporation


12


31.1
            Certification
                of Al Kraus, Chief Executive Officer of the Registrant, pursuant
                to Rules
                13a-14(a) and 15(d)-14(a) of the Securities Exchange Act of
                1934





31.2
            Certification
                of David Lamadrid, Chief Financial Officer, pursuant to Rules 13a-14(a)
                and 15(d)-14(a) of the Securities Exchange Act of
                1934





**Item
      14.**  **Principal
      Accountant Fees and Services.**




The
      following table presents fees for professional audit services rendered by
      WithumSmith+Brown, A Professional Corporation, for the audit of our annual
      financial statements for the years ended December 31, 2006 and 2005, and fees
      billed for other services rendered by WithumSmith+Brown during those years.




**2006**
            
            **2005**Audit
                fees(1)
            
            $
            127,772
            
            $
            41,200Audit
                related fees
            
            
            --
            
            
            --Tax
                fees
            
            
            --
            
            
            --All
                other fees
            
            $
            --
            
            $
            --Total
                fees
            
            $
            127,772
            
            $
            41,200


_____________________________





(1)
            Includes
                fees paid for professional services rendered in connection with the
                audit
                of annual financial statements and the review of quarterly financial
                statements, and the review of such financial statements in the Company’s
                Annual Report on Form 10-KSB, Quarterly Reports on Form 10-QSB,
                Registration Statement on Form SB-2 and Current Reports on Form
                8-K.




**Pre-Approval
      Policies And Procedures**




We
      do not
      have an audit committee or a formal pre-approval process for the performance
      for
      us by our independent auditor of non-audit services, and no such services were
      provided to us during the year ended December 31, 2006. We anticipate that
      any
      non-audit services to be performed for us by our independent auditor, subject
      to
      the de minimis exceptions for non-audit services described in Section
      10A(i)(1)(B) of the Securities Exchange Act of 1934, as amended, will be
      approved prior to our auditor’s engagement for such services by our Board of
      Directors, acting in the capacity of an audit committee.


13




**SIGNATURES**




In
      accordance with Section 13 or 15(d) of the Exchange Act, MedaSorb Technologies
      Corporation has caused this report to be signed on its behalf by the
      undersigned, thereunto duly authorized, on this 30th day of April,
      2007.




MEDASORB
              TECHNOLOGIES CORPORATIONBy:
            /s/ Al
              KrausAl
              KrausChief
              Executive Officer





Pursuant
      to the requirements of the Securities Exchange Act of 1934, this report has
      been
      signed below by the following persons on behalf of the registrant and in the
      capacities and on the dates indicated.





**Signature**
            
            **Title**
            
            ******Date**/s/
                Al Kraus
            
            Chief
                Executive Officer (Principal Executive Officer) and
                Director
            
            April
                30, 2007Al
                Kraus/s/
                David LamadridDavid
                Lamadrid
            
            Chief
                Financial Officer (Principal Accounting and Financial
                Officer)
            
            April
                30, 2007/s/
                William R. MillerWilliam
                R. Miller
            
            Chairman
                of the Board
            
            April
                30, 2007/s/
                Joseph RubinJoseph
                Rubin, Esq.
            
            Director
            
            April
                30, 2007/s/
                Kurt KatzKurt
                Katz
            
            Director
            
            April
                30, 2007/s/
Edward
                JonesEdward
                Jones, MD
            
            Director
            
            April
                30, 2007


14