FORM 10-QSB

                       SECURITIES AND EXCHANGE COMMISSION
                                WASHINGTON, D.C.

          [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                For the quarterly period ended December 31, 2000

                                       OR

          [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

         For the transition period from ............. to ..............

                        Commission File Number 000-27592


                              SCANTEK MEDICAL INC.
             ------------------------------------------------------
             (Exact name of registrant as specified in its charter)


                      DELAWARE                            84-1090126
         -------------------------------              -------------------
         (State or other jurisdiction of               (I.R.S. Employer
         incorporation or organization)               Identification No.)


                   321 PALMER ROAD, DENVILLE, NEW JERSEY 07834
                                 (973) 366-5250
             ------------------------------------------------------
             (Address and telephone number, including area code, of
                    registrant's principal executive office)


         ---------------------------------------------------------------
         (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 preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.

YES __X__       NO _____

     Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.

     At January 31, 2001 there were 19,315,690 shares of Common Stock, $.001 par
value, outstanding.

<PAGE>



                              SCANTEK MEDICAL INC.

                                      INDEX

                                                                          Page
                                                                          ----
Part I.  Financial Information                                              1

  Item 1.    Financial Statements

             Consolidated Balance Sheets as of
              December 31, 2000 (unaudited) and
              June 30, 2000                                                 2

             Consolidated Statements of Operations
              and Comprehensive (Loss) for the
              Six and three Months Ended December 31, 2000 and
              1999 (unaudited)                                            3 - 4

             Consolidated Statements of Cash Flows
              For the Three Months Ended December 31,
              2000 and 1999 (unaudited)                                   5 - 6

             Notes to Financial Statements (unaudited)                    7 - 8

  Item 2.    Management's Discussion and Analysis of
              Financial Condition and Results of Operations               9 - 15

Part II. Other Information

  Item 1.    Legal Proceedings                                             16

  Item 6.    Exhibits and Report on Form 8-K                               16

Signatures                                                                 17

<PAGE>

PART I.  FINANCIAL INFORMATION

     Item 1. Financial Statements

     Certain information and footnote disclosures required under generally
accepted accounting principles have been condensed or omitted from the following
consolidated financial statements pursuant to the rules and regulations of the
Securities and Exchange Commission. It is suggested that the following
consolidated financial statements be read in conjunction with the year-end
consolidated financial statements and notes thereto included in the Company's
Annual Report on Form 10-KSB for the year ended June 30, 2000.

     The results of operations for the six months ended December 31, 2000, are
not necessarily indicative of the results to be expected for the entire fiscal
year or for any other period.


                                      -1-


<PAGE>

                         SCANTEK MEDICAL INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS

                                            December 31,       June 30,
                                                2000             2000
                                            ------------      ------------
                                             (Unaudited)
                                     ASSETS

Current Assets:
     Cash                                    $    12,959      $     2,898
     Marketable securities                         2,806           20,735
     Accounts receivable                          24,000           24,000
     Inventories                                 594,528          721,315
     Prepaid expenses                               --              8,511
                                             -----------      -----------
         Total Current Assets                    634,293          777,459
                                             -----------      -----------
Property and equipment - net                   1,398,286        1,548,016
Other assets - net                                67,370          101,174
                                             -----------      -----------
     TOTAL ASSETS                            $ 2,099,949      $ 2,426,649
                                             ===========      ===========

                    LIABILITIES AND STOCKHOLDERS' DEFICIENCY

Current Liabilities:
     Short-term debt                         $   885,848      $   860,593
     Current portion of long-term debt           850,000          300,000
     Accounts payable                          1,222,279        1,263,095
     Accrued interest                            740,130          539,333
     Accrued salaries                          1,472,472        1,332,472
     Accrued expenses                            626,943          528,406
                                             -----------      -----------
         Total Current Liabilities             5,797,672        4,823,899
                                             -----------      -----------
Long-term debt                                 2,186,109        2,604,609
                                             -----------      -----------
         Total Liabilities                     7,983,781        7,428,508
                                             -----------      -----------
Commitments and Contingencies
Stockholders' Deficiency:
     Preferred stock, par value $.001
      per share - authorized 5,000,000
      shares; none issued                           --               --
     Common stock, par value $.001
      per share - authorized 45,000,000
      shares; outstanding 19,315,690 and
      18,810,540 shares                           19,316           18,810
     Additional paid-in-capital                3,978,537        3,726,976
     Cumulative other comprehensive loss        (299,194)        (281,265)
     Deficit                                  (9,582,491)      (8,466,380)
                                             -----------      -----------
         Total Stockholders' Deficiency       (5,883,832)      (5,001,859)
                                             -----------      -----------
     TOTAL LIABILITIES AND STOCKHOLDERS'
      DEFICIENCY                             $ 2,099,949      $ 2,426,649
                                             ===========      ===========




                 See notes to consolidated financial statements

                                      -2-


<PAGE>
<TABLE>
<CAPTION>

                                   SCANTEK MEDICAL INC. AND SUBSIDIARIES

                       CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
                                             (Unaudited)

                                         Six Months Ended December 31,       Three Months Ended December 31,
                                         -----------------------------       -------------------------------
                                            2000               1999               2000             1999
                                         ---------         -----------       ------------      -------------
<S>                                      <C>               <C>               <C>               <C>
Revenues:
    Net sales                            $     21,137      $      5,775      $     21,137      $      5,775
    License fees                                 --             597,500              --                --
                                         ------------      ------------      ------------      ------------
                                               21,137           603,275            21,137             5,775
                                         ------------      ------------      ------------      ------------
Costs and expenses:
    Cost of sales                             291,861           182,940           142,001            97,665
    General and administrative
     expenses                                 452,020           884,902           209,069           451,228
    Research and development                  140,000           140,000            70,000            70,000
                                         ------------      ------------      ------------      ------------
                                              883,881         1,207,842           421,070           618,893
                                         ------------      ------------      ------------      ------------
Income (loss) from operations                (862,744)         (604,567)         (399,933)         (613,118)
                                         ------------      ------------      ------------      ------------
Other income (expense):
    Interest and dividends                         19               150                 5                77
    Gain on sale of marketable
     securities                                  --              76,644              --                --
    Miscellaneous income                       27,000                              27,000
    Interest expense                         (280,386)         (199,360)         (127,492)          (29,470)
                                         ------------      ------------      ------------      ------------
                                             (253,367)         (122,566)         (100,487)          (29,393)
                                         ------------      ------------      ------------      ------------
Net loss                                 $ (1,116,111)     $   (727,133)     $   (500,420)     $   (642,511)
                                         ============      ============      ============      ============
Loss per common share - basic            $      (0.06)     $      (0.04)     $      (0.03)     $      (0.04)
                                         ============      ============      ============      ============
Loss per common share - diluted          $      (0.06)     $      (0.04)     $      (0.03)     $      (0.04)
                                         ============      ============      ============      ============
Weighted average number of
 common shares outstanding - basic         19,077,975        18,328,420        18,970,421        18,328,420
                                         ============      ============      ============      ============
Weighted average number of
 common shares outstanding - diluted       19,077,975        18,328,420        18,970,421        18,328,420
                                         ============      ============      ============      ============
</TABLE>











                 See notes to consolidated financial statements

                                      -3-

<PAGE>

<TABLE>
<CAPTION>

                                 SCANTEK MEDICAL INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
                                      (Unaudited) (Continued)

                                                              Six Months Ended December 31,   Three Months Ended December 31,
                                                              -----------------------------   -------------------------------
                                                                  2000              1999         2000             1999
                                                              ------------     ------------   ----------     ----------------
<S>                                                           <C>              <C>            <C>               <C>

Net loss                                                      $(1,116,111)     $(727,133)     $(500,420)        $(642,511)

Other comprehensive income (expense) net of income taxes:

      Unrealized gain (loss) on
        marketable securities                                     (17,929)           574        (11,446)          (29,588)
                                                              -----------      ---------      ---------         ---------
Comprehensive loss                                            $(1,134,040)     $(726,559)     $(511,866)        $(672,099)
                                                              ===========      =========      =========         =========
</TABLE>




                See notes to consolidated financial statements.


                                      -4-

<PAGE>

                      SCANTEK MEDICAL INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                        (Unaudited)

                                            Six Months Ended December 31,
                                           ------------------------------
                                                2000             1999
                                           ------------     -------------
Cash flows from operating activities:
    Net loss                               $(1,116,111)     $(727,133)
Adjustments to reconcile net
 loss to net cash
 used in operating activities:
    Depreciation and amortization              183,534        183,528
    Net gain on sale of marketable
     securities                                   --          (76,644)
    Non-cash officers compensation              41,867         55,943
    Other non-cash items                       188,200       (194,815)
    Changes in operating assets
     and liabilities                           533,816        233,664
                                           -----------      ---------
       Net Cash (Used in)
        Operating Activities                  (168,694)      (525,457)
                                           -----------      ---------
Cash flows from investing activities:
    Proceeds from sale of marketable
     securities                                   --          276,009
                                           -----------      ---------
Cash flows from financing activities:
    Proceeds from borrowings                    10,000        115,528
    Proceeds from officer loans                157,500        112,000
    Repayment of officer loans                    --          (28,271)
    Repayment of notes                            (745)        41,174
    Proceeds from sale of common stock          12,000         10,000
                                           -----------      ---------
       Net Cash Provided by
        Financing Activities                   178,755        250,431
                                           -----------      ---------
Net increase in Cash                            10,061            983
Cash - beginning of period                       2,898          5,516
                                           -----------      ---------
Cash - end of period                       $    12,959      $   6,499
                                           ===========      =========



                See notes to consolidated financial statements.


                                      -5-

<PAGE>

                      SCANTEK MEDICAL INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)

                                                   Six Months Ended December 31,
                                                   -----------------------------
                                                      2000           1999
                                                   ----------     -----------
Changes in operating assets and
  liabilities consist of:
    Decrease in inventory                          $ 126,787      $   6,795
    Decrease in due from licenses                       --         (305,000)
    (Increase) decrease in prepaid
     expenses                                          8,511         20,368
    (Increase) in other assets                          --           (3,300)
    Increase in accounts payable
     and accrued expenses                            398,518        514,801
    (decrease) in deferred income                       --             --
                                                   ---------      ---------
                                                   $ 533,816      $ 233,664
                                                   =========      =========
Supplementary information:
    Cash paid during the year for:
       Interest                                    $   2,235      $  32,831
                                                   =========      =========
       Income Taxes                                $     200      $     200
                                                   =========      =========
Non-cash investing activities:
    Acquisition of investment in
     connection with licensing agreement           $    --        $(247,500)
                                                   =========      =========
     Unrealized (loss) on
      marketable securities                        $ (17,929)     $    (574)
                                                   =========      =========
Non-cash financing activities:
    Conversion of accounts payable
      and accrued expenses to common
      stock                                        $    --        $  20,837
                                                   =========      =========
    Conversion of accounts payable and accrued
      expenses to stock options and warrants       $    --        $  31,848
                                                   =========      =========
    Conversion of notes payable to
      common stock                                 $  10,000      $    --
                                                   =========      =========
    Common stock issued to officers for
      loan financing                               $  41,867      $  55,943
                                                   =========      =========
    Common stock issued for loan extensions        $ 188,200      $    --
                                                   =========      =========





                See notes to consolidated financial statements.


                                      -6-


<PAGE>

                      SCANTEK MEDICAL INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.   ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     ORGANIZATION

     The consolidated balance sheet as of December 31, 2000, and the
     consolidated statements of operations and comprehensive (loss) and cash
     flows for the six months ended December 31, 2000 and 1999 have been
     prepared by the Company and are unaudited. In the opinion of management,
     all adjustments (consisting of normal recurring adjustments) necessary to
     present fairly the financial position, results of operations and
     comprehensive (loss) and cash flows for all periods presented have been
     made. Certain items in the December 31, 1999 financial statements have been
     reclassified to conform to December 31, 2000 classifications. The
     information for June 30, 2000 was derived from audited financial
     statements.

     BASIS OF PRESENTATION

     The accompanying consolidated financial statements have been prepared on a
     going concern basis, which contemplates the realization of assets and the
     satisfaction of liabilities in the normal course of business.

     The Company has experienced losses during and subsequent to its development
     stage. Losses and negative cash flows from operations have continued in the
     current fiscal year and subsequent to June 30, 2000. As of December 31,
     2000, the Company has a working capital deficit of approximately $6
     million.

     The activities of the Company are being financed through the sale of its
     common stock and debt securities. In October 2000, the Company was to sell
     36% of its Brazilian subsidiary to a Brazilian investment group for $2
     million. The Company intended to reinvest the proceeds in Scantek Medical
     do Brasil Ltda. On December 29, 2000, the agreement was unilaterally
     terminated by the Company due to the failure of the Brazilian investors to
     comply with the terms of the agreement. The Company's continued existence
     is dependent upon its ability to obtain needed working capital through
     additional equity and/or debt financing, and the commercial acceptability
     of the BreastCare(TM)/BreastAlert(TM) to create sales that will help the
     Company achieve a profitable level of operations. However, there is no
     assurance that additional capital will be obtained or the
     BreastCare(TM)/BreastAlert(TM) will be commercially successful. This raises
     substantial doubt about the ability of the Company to continue as a going
     concern.

     The financial statements do not include any adjustments relating to the
     recoverability and classification of recorded asset amounts or the amounts
     and classifications of liabilities that might be necessary should the
     Company be unable to continue as a going concern.

     EARNINGS (LOSS) PER COMMON SHARE

     Basic and diluted loss per common share are computed by dividing net loss
     by the weighted average number of common shares outstanding during the
     year. Potential common shares used in computing diluted earnings per share
     relate to stock options and warrants which, if exercised, would have a
     dilutive effect on earnings per share. During the six months ended December
     31, 2000 and 1999, potential common shares were not used in the computation
     of diluted loss per common share, as their effect would be antidilutive.

                                       -7-

<PAGE>



2.   SALE OF SUBSIDIARY

     On October 1, 2000, the Company and its Brazilian subsidiary executed an
     agreement with a Brazilian investment group. Scantek Medical Inc. was to
     sell 36% of its equity in Scantek to Brasil Ltda for $2 million
     ($2,000,000) dollars to such Brazilian investment group. The Company
     intended to reinvest the total proceeds in Scantek Medical do Brasil Ltda.

     On December 29, 2000, the agreement was unilaterally terminated by the
     Company due to the failure of the Brazilian investment group to comply with
     the terms of the agreement.

3.   SEGMENTS - GEOGRAPHIC AREAS

     The Company does not have reportable operating segments as defined in the
     Statement of Financial Accounting Standards No. 131, "Disclosure about
     Segments of an Enterprise and Related Information". The method for
     attributing revenues to individual countries is based on the destination to
     which finished goods are shipped. The Company operates facilities in the
     United States and South America. Revenues include license fees received by
     the Company in connection with various arrangements contracted throughout
     the world.

                                 Six Months Ended
                                   December 31,
                             ------------------------
                              2000           1999
                             ---------      ---------
Total Revenues:
    United States            $     400      $ 597,500
    South America               28,237           --
    Europe                        --            5,775
    Less intergeopraphic
      revenue                   (7,500)          --
                             ---------      ---------
                             $  21,137      $ 603,275
                             =========      =========
Income (loss) from
 operations:
    United States            $(691,931)     $(327,273)
    South America             (170,813)      (277,294)
                             ---------      ---------
                             $(862,744)     $(604,567)
                             =========      =========



                                       -8-

<PAGE>


3.   NEW ACCOUNTING PRONOUNCEMENTS

     In June 1998, the Financial Accounting Standards Board (FASB) issued
     Statement of Financial Accounting Standards No. 133 "Accounting for
     Derivative Instruments and Hedging Activities" (SFAS 133). This standard
     was amended by Statement of Financial Accounting Standards No. 137
     "Accounting for Derivative Instruments and Hedging Activities-Deferral of
     the Effective Date of FASB Statement No. 133" and changed the effective
     date for SFAS 133 to all fiscal quarters of fiscal years beginning after
     June 15, 2000. In June 2000, the FASB issued SFAS 138, "Accounting for
     Certain Derivative Instruments and Certain Hedging Activities, ("SFAS
     133"). SFAS 133 and 138 requires that all derivative instruments be
     recorded on the balance sheet at their respective fair values. Changes in
     the fair value of derivatives are recorded each period in current earnings
     or other comprehensive income, depending on the designation of the hedge
     transaction. For fair value hedge transactions in which the Company is
     hedging changes in the fair value of assets or liabilities, changes in the
     fair value of the derivative instrument will generally be offset by changes
     in the hedged item's fair value. For cash flow hedge transactions in which
     the Company is hedging the variability of cash flows related to a variable
     rate asset, liability or forecasted transaction, changes in the fair value
     of the derivative instrument will be reported in other comprehensive
     income. The gains and losses on the derivative instrument that are reported
     in other comprehensive income will be recognized in earnings in the periods
     in which earnings are impacted by the variability of the cash flows of the
     hedged item. The Company will adopt SFAS 133 and 138 in the first quarter
     of 2001 and does not expect such adoption to have a material effect on the
     Company's consolidated results of operations, financial position or cash
     flows.

     In December 1999, the Securities and Exchange Commission (SEC) issued Staff
     Accounting Bulletin No. 101 ("SAB 101"), "Revenue Recognition in Financial
     Statements". SAB 101 summarizes certain of the SEC's views in applying
     generally accepted accounting principles to revenue recognition in
     financial statements. The Company adopted the provisions of SAB 101 during
     the fourth quarter ending December 31, 2000 and it is not expected to have
     a material impact on the Company's consolidated results of operations,
     financial position or cash flows.



                                      -9-

<PAGE>

Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations

        The Company's quarterly and annual operating results are affected by a
        wide variety of factors that could materially and adversely affect
        revenues and profitability, including competition from other
        suppliers; changes in the regulatory and trade environment; changes in
        consumer preferences and spending habits; the inability to
        successfully manage growth; seasonality; the ability to introduce and
        the timing of the introduction of new products and the inability to
        obtain adequate supplies or materials at acceptable prices. As a
        result of these and other factors, the Company may experience material
        fluctuations in future operating results on a quarterly or annual
        basis, which could materially and adversely affect its business,
        financial condition, operating results, and stock price. Furthermore,
        this document and other documents filed by the Company with the
        Securities and Exchange Commission (the "SEC") contain certain
        forward-looking statements under the Private Securities Litigation
        Reform Act of 1995 with respect to the business of the Company. These
        forward-looking statements are subject to certain risks and
        uncertainties, including those mentioned above, and those detailed in
        the Company's Annual Report on Form 10-KSB for the year ended June 30,
        2000, which may cause actual results to differ significantly from
        these forward-looking statements. The Company undertakes no obligation
        to publicly release the results of any revisions to these
        forward-looking statements which may be necessary to reflect events or
        circumstances after the date hereof or to reflect the occurrence of
        unanticipated events. An investment in the Company involves various
        risks, including those mentioned above and those that are detailed
        from time to time in the Company's SEC filings.

Results of Operations

        The following table sets forth for the periods indicated, the
        percentage increase or (decrease) of certain items included in the
        Company's consolidated statement of operations:

                              % Increase (Decrease) from Prior Period
                             -----------------------------------------------
                              Six Months Ended            Three Months Ended
                             December 31, 2000            December 31, 2000
                             compared with 1999           compared with 1999
                             ------------------           ------------------
Sales                              266.0                        266.0
License fee revenue               (100.0)                         --
Cost of sales                       59.5                         45.4
General and administrative
   expense                         (48.9)                       (53.7)
Research and development              --                           --
Interest expense                    40.6                        332.6
Net earnings (loss)                 53.5                        (22.1)




                                      -10-


<PAGE>

   SIX MONTHS ENDED DECEMBER 31,2000 VS.
     SIX MONTHS ENDED DECEMBER 31,1999

Revenues

     Net sales increased to $21,137 during the six months ending December 31,
     2000 from $5,775 during the six months ended December 31, 1999 as the
     Company is re-focusing its South American marketing strategy in Brazil. The
     Company will ship the BreastCare(TM)/BreastAlert(TM) from the United States
     to South America until the manufacturing facility in Brazil is completed
     and operational.

     License fee revenue decreased to $-0- during the six months ended December
     31, 2000 from $597,500 for the six months ended December 31, 1999 as the
     Company recognized license fees from Nugard Healthcare Ltd. from the
     preceding year.

Cost of Sales

     Cost of sales increased to $291,861 during the six months ended December
     31, 2000 from $182,940 during the six months ended December 31, 1999
     primarily due to an inventory write off of $119,000 for expired product at
     the Uruguayan location.

General and Administrative Expenses

     General and administrative expenses decreased to $452,020 during the six
     months ending December 31, 2000 from $884,902 during the six months ended
     December 31, 1999. This decrease is primarily due to decreases in
     consulting services in the Company's South American subsidiary in Uruguay.

Interest Expense

     Interest expense was $280,386 for the six months ended December 31, 2000
     compared to $199,360 for the six months ended December 31, 1999. The 40.6%
     increase was attributable to additional inputed interest on common stock
     for loan financing and extensions.

Research and Development Expense

     Research and development expense of $140,000 stayed the same for the six
     months ended December 31, 2000 and 1999. Salaries incurred by the Company
     in the experimental area of development of its product remained constant.



                                      -11-

<PAGE>




    THREE MONTHS ENDED DECEMBER 31,2000 VS.
       THREE MONTHS ENDED DECEMBER 31,1999

Revenues

     Net sales increased to $21,137 during the three months ended December 31,
     2000 from $5,775 during the three months ended December 31, 1999 due to
     primarily the same reasons set forth in the six month analysis.

     There was no license fee revenue during the three months ended December 31,
     2000 and December 31, 1999.

Cost of Sales

     Cost of sales increased 45.4% to $142,001 during the three months ended
     December 31, 2000 from $97,665 during the three months ended December 31,
     1999 due to primarily the same reasons set forth in the six month analysis.

General and Administrative Expenses

     General and administrative expenses decreased to $209,069 during the three
     months ended December 31, 2000 from $451,228 during the three months ended
     December 31, 1999 due to primarily the same reasons set forth in the six
     month analysis.

Interest Expense

     Interest expense was $127,492 for the three months ended December 31, 2000
     compared to $29,470 for the three months ended December 31, 1999, the
     332.6% increase is due to primarily the same reasons set forth in the six
     month analysis.

Research and Development Expense

     Research and development expense of $70,000 stayed the same for the three
     months ended December 31, 2000 and 1999.



                                      -12-

<PAGE>



Liquidity and Capital Resources

     The Company's need for funds has increased from period to period, as it has
     incurred expenses for among other things, research and development;
     applications for and maintenance of domestic and international trademarks
     and international patent protection; licensing and pre-marketing
     activities; and, attempts to raise the necessary capital to expand the
     Company's production capacity. Since inception, the Company has funded
     these needs through private placements of its equity and debt securities
     and advances from the Company's President, Chief Executive Officer and
     major shareholder. The Company has entered into various license agreements
     that have raised additional funds. In addition, the Company's auditors'
     report for the year ended June 30, 2000 dated August 17, 2000, expressed an
     opinion as to the Company continuing as a going concern.

     During September 1998, the Company commenced the sale of its
     BreastCare(TM)/BreastAlert(TM) in Brazil, Uruguay and Paraguay through its
     South American licensee. During February 1999, the Brazilian economy
     declined and the Brazilian currency lost fifty (50%) percent of its value.
     Brazil increased the import and value-added tax from approximately
     twenty-one (21%) percent in December 1998 to approximately seventy-four
     (74%) percent in February 1999. Due to these factors, sales substantially
     decreased in Brazil, which represents approximately eighty (80%) percent of
     the Company's expected revenue. The Company is establishing a production
     facility in Brazil. This will eliminate the high value - added tax and
     hopefully will be able to facilitate sales. The Company terminated its
     license agreement with its former licensee in South America but key
     personnel for the former licensee have joined Scantek. The Company's
     Brazilian subsidiary plans to manufacture, market and distribute the
     BreastCare(TM)/BreastAlert(TM) in Brazil and export to other South American
     countries.

     The Company commenced its distribution operations in South America during
     the second half of calendar 2000, while shipments to Ireland commenced in
     October 1999 for test marketing and shipments to other parts of Europe will
     commence during calendar year 2001. However, until cash flow generated from
     the shipment of the BreastCare(TM) device is sufficient to support the
     Company's operations, the Company needs financing to fund its current
     overhead and various capital requirements. As of December 31, 2000, the
     Company borrowed $1,679,848 from unaffiliated third parties. These loans
     are payable by the Company on various dates through December 2001. In
     addition, as of February 1, 2001, the Company's President advanced the
     Company an additional $131,500 since July 2000. These loans have supported
     the Company through the prior fiscal year and the current fiscal year, and
     the Company expects the cash flow from sales commencing in the first
     quarter of calendar 2001 to cover the operations of the Company in calendar
     2001 and 2002, providing the Company is successful in raising additional
     capital to support the operations until cash flows generated for the sales
     of the BreastCare(TM)/BreastAlert(TM) commences.

     As previously noted, the Company terminated its license agreement with its
     South American licensee. The Company will manufacture, market and
     distribute the BreastCare(TM)/BreastAlert(TM) throughout South America
     through the Company's South American subsidiaries.

                                      -13-


<PAGE>



     Through its Brazilian subsidiary, the Company signed an agreement with the
     State of Pernambuco in December 1999. The State of Pernambuco has the
     second largest concentration of hospitals in Brazil offering quality care
     and management believes that the location is also the most desirable for
     production, shipping, financing and tax incentives. The Company is
     establishing a 2,550 square meter manufacturing facility in Recife,
     Pernambuco at the new port of Suape. The Company has broken ground, and
     anticipates construction to be completed by the first half of calendar
     2001. The Company will ship the production equipment for arrival by the
     time construction is complete.

     The State of Pernambuco has offered various incentives, including acreage,
     at a reduced price, to build the facility, a 75% reduction in taxes through
     2013, free shipping outside the state, and in connection with the federal
     programs offered in Northeast Brazil, financing programs to help fund the
     operations and capital improvements.

     The Company plans to ship the BreastCare(TM)/BreastAlert(TM) from the
     United States until the production facility in Brazil is operational.

     On October 1, 2000, the Company and its Brazilian subsidiary executed an
     agreement with a Brazilian investment group. Scantek Medical Inc. was to
     sell 36% of its equity in Scantek Medical do Brasil Ltda for two million
     ($2,000,000) dollars to the Brazilian investment group. The Company
     intended to reinvest the total proceeds in Scantek Medical do Brasil Ltda.

     On December 29, 2000, the agreement was unilaterally terminated by the
     Company due to the failure of the Brazilian investment group to comply with
     the terms of the agreement.

     On July 14, 1999, the Company granted an exclusive license to NuGard
     HealthCare Ltd. ("NuGard"), an Irish Company; to market Scantek's
     BreastCare(TM)/BreastAlert(TM) in Ireland and the United Kingdom. Pursuant
     to the licensing agreement, NuGard will pay a non-refundable licensing fee
     of $350,000 in various stages, of which $59,000 was received as of June 30,
     2000, and the Company received common shares equivalent to fifteen (15%)
     percent of NuGard's total outstanding common shares. The purchase price
     will range from $10 to $15 per unit - FOB US. The licensing agreement
     requires minimum purchases of 5,000 units a month and payments of licensing
     fees that have been postponed until the license agreement can be
     renegotiated.

     The Company's working capital and capital requirements will depend on
     numerous factors, including the level of resources that the Company devotes
     to the purchase of manufacturing equipment to support production in South
     America and to the marketing aspects of its products. The Company intends
     to construct production and/or assembly centers abroad to manufacture,
     market and sell the BreastCare(TM)/BreastAlert(TM) in the international
     market. The Company entered into an agreement with Zigmed Inc., pursuant to
     which Zigmed Inc. will manufacture the sensor production equipment needed
     for manufacturing of the BreastCare(TM)/BreastAlert(TM) device. The balance
     of $718,276 will be paid when the Company raises the additional capital.

                                      -14-


<PAGE>



     The Company's success is dependent on raising sufficient capital to
     manufacture, market and sell the BreastCare(TM)/BreastAlert(TM) for the
     global market. The Company believes the BreastCare(TM)/BreastAlert(TM) will
     be commercially accepted throughout the international market. The Company
     does not have all the financing in place at this time, nor may it ever, to
     meet these objectives.

NEW ACCOUNTING PRONOUNCEMENTS

     In June 1998, the Financial Accounting Standards Board (FASB) issued
     Statement of Financial Accounting Standards No. 133 "Accounting for
     Derivative Instruments and Hedging Activities"(SFAS 133). This standard was
     amended by Statement of Financial Accounting Standards No. 137 "Accounting
     for Derivative Instruments and Hedging Activities-Deferral of the Effective
     Date of FASB Statement No. 133" and changed the effective date for SFAS 133
     to all fiscal quarters of fiscal years beginning after June 15, 2000.In
     June 2000, the FASB issued SFAS 138, "Accounting for Certain Derivative
     Instruments and Certain Hedging Activities, ("SFAS 133"). SFAS 133 and 138
     requires that all derivative instruments be recorded on the balance sheet
     at their respective fair values. Changes in the fair value of derivatives
     are recorded each period in current earnings or other comprehensive income,
     depending on the designation of the hedge transaction. For fair value hedge
     transactions in which the Company is hedging changes in the fair value of
     assets or liabilities, changes in the fair value of the derivative
     instrument will generally be offset by changes in the hedged item's fair
     value. For cash flow hedge transactions in which the Company is hedging the
     variability of cash flows related to a variable rate asset, liability or
     forecasted transaction, changes in the fair value of the derivative
     instrument will be reported in other comprehensive income. The gains and
     losses on the derivative instrument that are reported in other
     comprehensive income will be recognized in earnings in the periods in which
     earnings are impacted by the variability of the cash flows of the hedged
     item. The Company will adopt SFAS 133 and 138 in the first quarter of 2001
     and does not expect such adoption to have a material effect on the
     Company's consolidated results of operations, financial position or cash
     flows.

     In December 1999, the Securities and Exchange Commission (SEC) issued Staff
     Accounting Bulletin No. 101 ("SAB 101"), "Revenue Recognition in Financial
     Statements". SAB 101 summarizes certain of the SEC's views in applying
     generally accepted accounting principles to revenue recognition in
     financial statements. The Company adopted the provisions of SAB 101 during
     the fourth quarter ending December 31, 2000 and it is not expected to have
     a material impact on the Company's consolidated results of operations,
     financial position or cash flows.

                                      -15-


<PAGE>



PART II.  Other Information

     Item 1. Legal Proceedings

          The Company is not presently subject to any legal proceedings which
          are material to the consolidated results of operations or financial
          condition of the Company.

     Item 6. Exhibits and Reports on Form 8-K

          (a) There were no Current Reports on Form 8-K filed by the registrant
              during the quarter ended December 31, 2000.


                                      -16-

<PAGE>

                                   SIGNATURES

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



                                          SCANTEK MEDICAL INC.

                                          By: /s/ ZSIGMOND L. SAGI
                                             -----------------------------------
                                             Zsigmond L. Sagi, President and
                                             Chief Financial Officer



Dated:  February 20, 2001


                                      -17-