---

UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

FORM 10-Q

(Mark One)

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 
For the quarterly period ended: June 30, 2010

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: 000-49833

ACRONGENOMICS INC.(Exact name of registrant as specified in its charter)

|Nevada                          | 52-2219285         
|------------------------------- | -------------------
|(State or other jurisdiction of | (IRS Employer      
|incorporation or organization)  | Identification No.)

Fairfax House, 15 Fulwood Place, London UK WC1V
6AY(Address of principal executive offices) (Zip Code)

30 697 724 3620(Registrants telephone
number, including area code)

Not Applicable(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 by check mark whether the registrant has submitted
electronically and posted on its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation
S-T (§229.405 of this chapter) during the preceding 12 months (or for such
shorter period that the registrant was required to submit and post such files)
Yes [   ]    No [   ]  (Not
currently applicable to the registrant)

Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller
reporting company. See the definitions of large accelerated filer,
accelerated filer, and smaller reporting company in Rule 12b-2 of the
Exchange Act.

|Large accelerated filer [   ] |                                                     | Accelerated
      filer                 
      [   ]
|----------------------------- | --------------------------------------------------- | ----------------------------------------------------
|Non-accelerated filer   [   ] | (Do not check if a smaller
      reporting company) | Smaller reporting company
[X]                       

---

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

APPLICABLE ONLY TO CORPORATE ISSUERS

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

26,965,481 shares of common stock outstanding as of August
20, 2010.

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TABLE OF CONTENTS

|PART
      I - FINANCIAL INFORMATION                                                                       | 1 
|---------------------------------------------------------------------------------------------------------- | --
|Item
      1. Financial Statements                                                                         | 1 
|Item
      2. Managements Discussion and Analysis of Financial Condition and Results
      of Operations. | 3 
|Item
      3. Quantitative and Qualitative Disclosures About Market Risks.                                 | 9 
|Item
      4. Controls and Procedures                                                                      | 9 
|PART
      II - OTHER INFORMATION                                                                          | 11
|Item
      1. Legal Proceedings.                                                                           | 11
|Item
      1A. Risk Factors                                                                                | 11
|Item
      2. Unregistered Sales of Equity Securities and Use of Proceeds                                  | 16
|Item
      3. Defaults Upon Senior Securities.                                                             | 16
|Item
      4. (Removed and Reserved).                                                                      | 16
|Item
      5. Other Information                                                                            | 16
|Item
      6. Exhibits.                                                                                    | 16
|SIGNATURES                                                                                                 | 18

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PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.

It is the opinion of management that the interim financial
statements for the six months ended June 30, 2010 include all adjustments that
are necessary in order to make the interim financial statements not misleading.

Our interim financial statements are stated in United States
dollars and are prepared in accordance with United States generally accepted
accounting principles.

1

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ACRONGENOMICS, INC.

(A Development Stage Company)

INTERIM FINANCIAL STATEMENTS

June 30, 2010

(Stated in US Dollars)

(unaudited)







2

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ACRONGENOMICS, INC.
  (A Development Stage Company) 
  INTERIM BALANCE SHEETS 
  June 30, 2010 and December 31, 2009 
  (Stated in US Dollars) 
  (Unaudited)

|                                                                                                       |   | June 30,    |   |   | December 31, |  
|------------------------------------------------------------------------------------------------------ | - | ----------- | - | - | ------------ | -
|                                                                                                       |   | 2010        |   |   | 2009         |  
|ASSETS                                                                                                 |  
|Current                                                                                                |   |             |   |   |              |  
|Cash                                                                                                   | $ | 495         |   | $ | 4,303        |  
|Prepaid expenses and deposit                                                                           |   | 15,000      |   |   | 15,000       |  
|                                                                                                       |   | 15,495      |   |   | 19,303       |  
|                                                                                                       |   |             |   |   |              |  
|Deposit                                                                                                |   | 14,142      |   |   | 14,142       |  
|Investment in Molecular Vision Ltd.  Note 3                                                           |   | 827,401     |   |   | 827,401      |  
|                                                                                                       |   |             |   |   |              |  
|                                                                                                       | $ | 857,038     |   | $ | 860,846      |  
|                                                                                                       |   |             |   |   |              |  
|LIABILITIES                                                                                            |  
|                                                                                                       |   |             |   |   |              |  
|Current                                                                                                |   |             |   |   |              |  
|Accounts payable and accrued
      liabilities  Note 7                                                | $ | 925,783     |   | $ | 721,149      |  
|Convertible promissory notes payable 
      Note 5                                                    |   | 651,462     |   |   | 658,522      |  
|Loans payable Note
      6                                                                            |   | 58,353      |   |   | 1,000        |  
|                                                                                                       |   |             |   |   |              |  
|                                                                                                       |   | 1,635,598   |   |   | 1,380,671    |  
|                                                                                                       |   |             |   |   |              |  
|CAPITAL DEFICIT                                                                                        |  
|                                                                                                       |   |             |   |   |              |  
|Common stock  Note 8                                                                                  |   |             |   |   |              |  
|Par value $0.001                                                                                       |   |             |   |   |              |  
|100,000,000 shares
      authorized 
               
      25,780,481 shares issued (2009: 25,580,481) |   | 25,780      |   |   | 25,580       |  
|Additional paid-in capital                                                                             |   | 27,070,464  |   |   | 27,024,990   |  
|Deficit accumulated during the development
      stage                                                 |   | (27,874,804 | ) |   | (27,570,395  | )
|                                                                                                       |   |             |   |   |              |  
|                                                                                                       |   | (778,560    | ) |   | (519,825     | )
|                                                                                                       |   |             |   |   |              |  
|                                                                                                       | $ | 857,038     |   | $ | 860,846      |  

SEE ACCOMPANYING NOTES

---

ACRONGENOMICS, INC.
  (A Development Stage Company) 
  INTERIM STATEMENTS OF OPERATIONS
  for the Three and Six months ended June
  30, 2010 and 2009 and 
  for the period August 17, 1999 (Date of Inception) to
  June 30, 2010 
  (Stated in US Dollars) 
  (Unaudited)

|                                                                                |   |                            |   |   |                          |   |   |            |   |   |            |   |   | August 17, 1999 |  
|------------------------------------------------------------------------------- | - | -------------------------- | - | - | ------------------------ | - | - | ---------- | - | - | ---------- | - | - | --------------- | -
|                                                                                |   |                            |   |   |                          |   |   |            |   |   |            |   |   | ( Date of       |  
|                                                                                |   |                            |   |   |                          |   |   |            |   |   |            |   |   | Inception ) to  |  
|                                                                                |   | For the three months ended |   |   | For the six months ended |   |   | June 30,   |  
|                                                                                |   | June 30,                   |   |   | June 30,                 |   |   | 2010       |  
|                                                                                |   | 2010                       |   |   | 2009                     |   |   | 2010       |   |   | 2009       |   |   | cumulative      |  
|Expenses                                                                        |   |                            |   |   |                          |   |   |            |   |   |            |   |   |                 |  
|Accounting and audit fees
       Note 7                                        | $ | 67,409                     |   | $ | 59,403                   |   | $ | 116,374    |   | $ | 94,182     |   | $ | 843,456         |  
|Amortization of patents                                                         |   | -                          |   |   | -                        |   |   | -          |   |   | -          |   |   | 741,430         |  
|Appraisals                                                                      |   | -                          |   |   | -                        |   |   | -          |   |   | -          |   |   | 14,500          |  
|Bank charges                                                                    |   | 461                        |   |   | 481                      |   |   | 763        |   |   | 934        |   |   | 19,478          |  
|Consulting fees 
      Note 7                                                  |   | 64,500                     |   |   | 72,911                   |   |   | 129,674    |   |   | 184,654    |   |   | 3,038,179       |  
|Legal fees - Note 7                                                             |   | 2,803                      |   |   | 31,872                   |   |   | 2,803      |   |   | 42,438     |   |   | 431,373         |  
|Management fees 
      Note 7                                                  |   | -                          |   |   | -                        |   |   | -          |   |   | 11,647     |   |   | 3,326,506       |  
|Office and miscellaneous                                                        |   | 486                        |   |   | 738                      |   |   | 1,151      |   |   | 2,211      |   |   | 140,963         |  
|Public relations and donation                                                   |   | -                          |   |   | -                        |   |   | -          |   |   | 7,600      |   |   | 587,096         |  
|Rent - Note 7                                                                   |   | 15,455                     |   |   | 15,278                   |   |   | 30,743     |   |   | 30,557     |   |   | 200,173         |  
|Research and development
       Note 7                                         |   | -                          |   |   | -                        |   |   | -          |   |   | -          |   |   | 9,202,266       |  
|Transfer agent and filing fees                                                  |   | 2,580                      |   |   | 2,399                    |   |   | 2,580      |   |   | 4,291      |   |   | 42,323          |  
|Travel                                                                          |   | -                          |   |   | 2,624                    |   |   | -          |   |   | 4,496      |   |   | 456,587         |  
|Write-down of patents                                                           |   | -                          |   |   | -                        |   |   | -          |   |   | -          |   |   | 8,004,447       |  
|                                                                                |   |                            |   |   |                          |   |   |            |   |   |            |   |   |                 |  
|Operating loss                                                                  |   | (153,694                   | ) |   | (185,706                 | ) |   | (284,088   | ) |   | (383,010   | ) |   | (27,048,777     | )
|                                                                                |   |                            |   |   |                          |   |   |            |   |   |            |   |   |                 |  
|Interest income                                                                 |   | -                          |   |   | 1                        |   |   | -          |   |   | 9          |   |   | 23,150          |  
|Interest and
      accretion on notes 
           payable 
      Notes 5 and 7 |   | (15,058                    | ) |   | (9,934                   | ) |   | (29,746    | ) |   | (15,723    | ) |   | (657,375        | )
|Write-down of investment in 
           Molecular Vision  Note 3               |   | -                          |   |   | -                        |   |   | -          |   |   | -          |   |   | (239,330        | )
|Change in fair value of
      derivative liability                              |   | 85,163                     |   |   | (34,211                  | ) |   | -          |   |   | (42,251    | ) |   | 169,452         |  
|Foreign exchange gain (loss)                                                    |   | 29,160                     |   |   | (2,487                   | ) |   | 9,425      |   |   | (2,644     | ) |   | (79,926         | )
|                                                                                |   |                            |   |   |                          |   |   |            |   |   |            |   |   |                 |  
|Loss from continuing operations                                                 |   | (54,429                    | ) |   | (232,337                 | ) |   | (304,409   | ) |   | (443,619   | ) |   | (27,832,806     | )
|Loss from discontinued operations                                               |   | -                          |   |   | -                        |   |   | -          |   |   | -          |   |   | (41,998         | )
|                                                                                |   |                            |   |   |                          |   |   |            |   |   |            |   |   |                 |  
|Net loss for the period                                                         | $ | (54,429                    | ) | $ | (232,337                 | ) | $ | (304,409   | ) | $ | (443,619   | ) | $ | (27,874,804     | )
|                                                                                |   |                            |   |   |                          |   |   |            |   |   |            |   |   |                 |  
|Basic and diluted loss per share                                                | $ | (0.00                      | ) | $ | (0.01                    | ) | $ | (0.01      | ) | $ | (0.02      | ) |   |                 |  
|                                                                                |   |                            |   |   |                          |   |   |            |   |   |            |   |   |                 |  
|Weighted average shares outstanding                                             |   | 25,690,203                 |   |   | 24,863,366               |   |   | 25,635,343 |   |   | 24,728,324 |   |   |                 |  

SEE ACCOMPANYING NOTES

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ACRONGENOMICS, INC.
  (A Development Stage Company) 
  INTERIM STATEMENTS OF CASH FLOWS 
  for the six months ended June 30, 2010
  and 2009 and 
  for the period August 17, 1999 (Date of Inception) to June 30,
  2010 
  (Stated in US Dollars) 
  (Unaudited)

|                                                                                                          |   |                          |   |   |               |   |   | August 17,   |  
|--------------------------------------------------------------------------------------------------------- | - | ------------------------ | - | - | ------------- | - | - | ------------ | -
|                                                                                                          |   |                          |   |   |               |   |   | 1999(Date of |  
|                                                                                                          |   | For the Six months Ended |   |   | Inception) to |  
|                                                                                                          |   | June 30,                 |   |   | June 30,      |  
|                                                                                                          |   | 2010                     |   |   | 2009          |   |   | 2010         |  
|Cash Flows used in Operating Activities                                                                   |   |                          |   |   |               |   |   |              |  
|Net loss for the period                                                                                   | $ | (304,409                 | ) | $ | (443,619      | ) | $ | (27,874,804  | )
|Adjustments to reconcile
      net income to net cash provided
            by operating
      activities: |   |                          |   |   |               |   |   |              |  
|Amortization of patents                                                                                   |   | -                        |   |   | -             |   |   | 741,430      |  
|Financing
      fee on convertible promissory note                                                        |   | -                        |   |   | -             |   |   | 7,500        |  
|Write-down of investment
      in Molecular Vision                                                        |   | -                        |   |   |               |   |   | 239,330      |  
|Change
      in fair value of derivative liability                                                        |   | -                        |   |   | 42,251        |   |   | (169,452     | )
|Accretion of debt
      discount                                                                          |   | -                        |   |   | -             |   |   | 538,262      |  
|Unrealized
      foreign exchange (gain) loss                                                             |   | (9,425                   | ) |   | -             |   |   | 88,716       |  
|Shares issued for
      consulting and management fees                                                    |   | -                        |   |   | -             |   |   | 1,312,500    |  
|Loan
      origination fee  Note 5                                                                       |   | -                        |   |   | -             |   |   | 16,245       |  
|Stock-based compensation                                                                                  |   | 674                      |   |   | 28,086        |   |   | 1,904,389    |  
|Write-down
      of patents                                                                               |   | -                        |   |   | -             |   |   | 8,004,447    |  
|Changes in non-cash working capital items:                                                                |   |                          |   |   |               |   |   |              |  
|Prepaid
      expenses and deposit                                                                        |   | -                        |   |   | 2,432         |   |   | (15,000      | )
|Accounts payable and
      accrued liabilities                                                            |   | 204,634                  |   |   | (28,229       | ) |   | 2,759,398    |  
|                                                                                                          |   |                          |   |   |               |   |   |              |  
|Net cash used in operating activities                                                                     |   | (108,526                 | ) |   | (399,079      | ) |   | (12,447,039  | )
|                                                                                                          |   |                          |   |   |               |   |   |              |  
|Cash Flows used in Investing Activity                                                                     |   |                          |   |   |               |   |   |              |  
|Investment in Molecular
      Vision                                                                      |   | -                        |   |   | -             |   |   | (1,373,140   | )
|Refund on termination of development agreement
      with                                                 |   |                          |   |   |               |   |   |              |  
|Molecular Vision                                                                                          |   | -                        |   |   | -             |   |   | 149,794      |  
|Deposit                                                                                                   |   | -                        |   |   | (14,142       | ) |   | (14,142      | )
|Patents                                                                                                   |   | -                        |   |   | -             |   |   | (121,877     | )
|                                                                                                          |   |                          |   |   |               |   |   |              |  
|Net cash used in investing activities                                                                     |   | -                        |   |   | (14,142       | ) |   | (1,359,365   | )
|                                                                                                          |   |                          |   |   |               |   |   |              |  
|Cash Flows provided by Financing Activities                                                               |   |                          |   |   |               |   |   |              |  
|Common stock issued for cash                                                                              |   | 45,000                   |   |   | 419,000       |   |   | 12,809,438   |  
|Stock purchase warrants                                                                                   |   | -                        |   |   | -             |   |   | 370,307      |  
|Common stock subscriptions                                                                                |   | -                        |   |   | -             |   |   | 29,800       |  
|Issuance of convertible
      notes                                                                       |   | -                        |   |   | -             |   |   | 836,636      |  
|Repayment of convertible note                                                                             |   | -                        |   |   | -             |   |   | (300,000     | )
|Loans payable                                                                                             |   | 59,718                   |   |   | -             |   |   | 60,718       |  
|                                                                                                          |   |                          |   |   |               |   |   |              |  
|Net cash provided by financing activities                                                                 |   | 104,718                  |   |   | 419,000       |   |   | 13,806,899   |  
|                                                                                                          |   |                          |   |   |               |   |   |              |  
|Increase (decrease) in cash during the period                                                             |   | (3,808                   | ) |   | 5,779         |   |   | 495          |  
|                                                                                                          |   |                          |   |   |               |   |   |              |  
|Cash, beginning of period                                                                                 |   | 4,303                    |   |   | 22,044        |   |   | -            |  
|                                                                                                          |   |                          |   |   |               |   |   |              |  
|Cash, end of period                                                                                       | $ | 495                      |   | $ | 27,823        |   | $ | 495          |  
|                                                                                                          |   |                          |   |   |               |   |   |              |  
|Supplemental cash flow information:                                                                       |   |                          |   |   |               |   |   |              |  
|Cash paid for interest                                                                                    | $ | -                        |   | $ | -             |   |   |              |  
|Cash
      paid for taxes                                                                                 | $ | -                        |   | $ | -             |   |   |              |  

SEE ACCOMPANYING NOTES

---

ACRONGENOMICS,INC.
  (A Development Stage
  Company) 
  INTERIM STATEMENT OF CHANGES IN CAPITAL DEFICIT 
  for the period
  August 17, 1999 (Date of Inception) to June 30, 2010 
  (Stated in US Dollars ) 
  (Unaudited)

|                                           |           |        |                    |  |    |           |  |         |             |   |   |               |  |   | Deficit     |   |         |            |  
|------------------------------------------ | --------- | ------ | ------------------ |  | -- | --------- |  | ------- | ----------- | - | - | ------------- |  | - | ----------- | - | ------- | ---------- | -
|                                           |           |        | Common
      Stock |  |    |           |  |         | Accumulated |   |   |               | 
|                                           |           |        |                    |  |    |           |  |         | Additional  |   |   | Share         |  |   | During the  |   |         |            |  
|                                           |           |        |                    |  |    |           |  |         | Paid-in     |   |   | Subscriptions |  |   | Development |   |         |            |  
|                                           |           |        | Shares             |  |    | Par Value |  |         | Capital     |   |   | (Receivable)  |  |   | Stage       |   |         | Total      |  
|                                           |           |        |                    |  |    |           |  |         |             |   |   |               |  |   |             |   |         |            |  
|Capital stock issued for cash              | at $0.001 |        | 5,000,000          |  | $  | 5,000     |  | $       | -           |   | $ | -             |  | $ | -           |   | $       | 5,000      |  
|                                           | at $0.01  |        | 5,000,000          |  |    | 5,000     |  |         | 45,000      |   |   | -             |  |   |             |   |         | 50,000     |  
|Net loss for the period                    |           |        | -                  |  |    | -         |  |         | -           |   |   | -             |  |   | (2,116      | ) |         | (2,116     | )
|Balance, December 31, 1999                 |           |        | 10,000,000         |  |    | 10,000    |  |         | 45,000      |   |   | -             |  |   | (2,116      | ) |         | 52,884     |  
|Capital stock issued for cash              | at $0.20  |        | 100,000            |  |    | 100       |  |         | 19,900      |   |   | -             |  |   | -           |   |         | 20,000     |  
|Net loss for the year                      |           |        | -                  |  |    | -         |  |         | -           |   |   | -             |  |   | (8,176      | ) |         | (8,176     | )
|Balance, December 31, 2000                 |           |        | 10,100,000         |  |    | 10,100    |  |         | 64,900      |   |   | -             |  |   | (10,292     | ) |         | 64,708     |  
|Net loss for the year                      |           |        | -                  |  |    | -         |  |         | -           |   |   | -             |  |   | (205        | ) |         | (205       | )
|                                           |           |        |                    |  |    |           |  |         |             |   |   |               |  |   |             |   |         |            |  
|Balance, December 31, 2001                 |           |        | 10,100,000         |  |    | 10,100    |  |         | 64,900      |   |   | -             |  |   | (10,497     | ) |         | 64,503     |  
|Capital stock issued for cash              | at $0.20  |        | 15,000             |  |    | 15        |  |         | 2,985       |   |   | -             |  |   | -           |   |         | 3,000      |  
|Net loss for the year                      |           |        | -                  |  |    | -         |  |         | -           |   |   | -             |  |   | (24,818     | ) |         | (24,818    | )
|Balance, December 31, 2002                 |           |        | 10,115,000         |  |    | 10,115    |  |         | 67,885      |   |   | -             |  |   | (35,315     | ) |         | 42,685     |  
|Net loss for the year                      |           |        | -                  |  |    | -         |  |         | -           |   |   | -             |  |   | (21,576     | ) |         | (21,576    | )
|Balance, December 31, 2003                 |           |        | 10,115,000         |  |    | 10,115    |  |         | 67,885      |   |   | -             |  |   | (56,891     | ) |         | 21,109     |  
|Pursuant to the acquisition of patent      | at $1.96  |        | 4,000,000          |  |    | 4,000     |  |         | 7,836,000   |   |   | -             |  |   | -           |   |         | 7,840,000  |  
|Capital stock issued for patent commission | at $1.96  |        | 400,000            |  |    | 400       |  |         | 783,600     |   |   | -             |  |   | -           |   |         | 784,000    |  
|Capital stock issued for cash              | at $1.00  |        | 420,000            |  |    | 420       |  |         | 419,580     |   |   | -             |  |   | -           |   |         | 420,000    |  
|Capital stock issued for commission        | at $1.00  |        | 42,000             |  |    | 42        |  |         | 41,958      |   |   | -             |  |   | -           |   |         | 42,000     |  
|Less: commission                           |           |        | -                  |  |    | -         |  |         | (77,000     | ) |   | -             |  |   | -           |   |         | (77,000    | )
|Capital stock issued for cash              | at $2.30  |        | 537,956            |  |    | 538       |  |         | 1,236,761   |   |   | -             |  |   | -           |   |         | 1,237,299  |  
|Capital stock issued for commission        |           | 50,594 |                    |  | 50 |           |  | 116,316 |             |   | - |               |  | - |             |   | 116,366 |           
|Less: commission                           |           |        | -                  |  |    | -         |  |         | (116,366    | ) |   | -             |  |   | -           |   |         | (116,366   | )
|Capital contribution                       |           |        | -                  |  |    | -         |  |         | 6,000       |   |   | -             |  |   | -           |   |         | 6,000      |  
|Stock subscriptions                        |           |        | -                  |  |    | -         |  |         | -           |   |   | 426,329       |  |   | -           |   |         | 426,329    |  
|Net loss for the year                      |           |        | -                  |  |    | -         |  |         | -           |   |   | -             |  |   | (1,863,376  | ) |         | (1,863,376 | )
|Balance, December 31, 2004                 |           |        | 15,565,550         |  | $  | 15,565    |  | $       | 10,314,734  |   | $ | 426,329       |  | $ | (1,920,267  | ) | $       | 8,836,361  |  

SEE ACCOMPANYING NOTES

---

ACRONGENOMICS,INC.
  (A Development Stage
  Company) 
  INTERIM STATEMENT OF CHANGES IN CAPITAL DEFICIT 
  for the period
  August 17, 1999 (Date of Inception) to June 30, 2010 
  (Stated in US Dollars ) 
  (Unaudited)

|                                                               |          |         |                    |   |     |           |   |        |             |   |   |               |   |             | Deficit     |   |             |            |  
|-------------------------------------------------------------- | -------- | ------- | ------------------ | - | --- | --------- | - | ------ | ----------- | - | - | ------------- | - | ----------- | ----------- | - | ----------- | ---------- | -
|                                                               |          |         | Common
      Stock |   |     |           |   |        | Accumulated |   |   |               |  
|                                                               |          |         |                    |   |     |           |   |        | Additional  |   |   | Share         |   |             | During the  |   |             |            |  
|                                                               |          |         |                    |   |     |           |   |        | Paid-in     |   |   | Subscriptions |   |             | Development |   |             |            |  
|                                                               |          |         | Shares             |   |     | Par Value |   |        | Capital     |   |   | (Receivable)  |   |             | Stage       |   |             | Total      |  
|                                                               |          |         |                    |   |     |           |   |        |             |   |   |               |   |             |             |   |             |            |  
|Balance, December 31, 2004                                     |          |         | 15,565,550         |   | $   | 15,565    |   | $      | 10,314,734  |   | $ | 426,329       |   | $           | (1,920,267  | ) | $           | 8,836,361  |  
|                                                               |          |         |                    |   |     |           |   |        |             |   |   |               |   |             |             |   |             |            |  
|Capital stock issued for cash                                  | at $2.30 |         | 72,500             |   |     | 73        |   |        | 166,677     |   |   | -             |   |             | -           |   |             | 166,750    |  
|                                                               | at $2.40 |         | 108,168            |   |     | 108       |   |        | 259,495     |   |   | -             |   |             | -           |   |             | 259,603    |  
|                                                               | at $3.50 |         | 551,443            |   |     | 551       |   |        | 1,929,499   |   |   | -             |   |             | -           |   |             | 1,930,050  |  
|                                                               | at $4.00 |         | 915,125            |   |     | 915       |   |        | 3,659,585   |   |   | (386,329      | ) |             | -           |   |             | 3,274,171  |  
|Capital stock issued for commission                            | at $4.00 |         | 81,337             |   |     | 82        |   |        | 325,266     |   |   | -             |   |             | -           |   |             | 325,348    |  
|Less: commission                                               |          |         | -                  |   |     | -         |   |        | (325,348    | ) |   | -             |   |             | -           |   |             | (325,348   | )
|commission                                                     |          |         | -                  |   |     | -         |   |        | (24,900     | ) |   | -             |   |             | -           |   |             | (24,900    | )
|Capital stock issued for cash pursuant to exercise of warrants | at $1.00 |         | 420,000            |   |     | 420       |   |        | 419,580     |   |   | -             |   |             | -           |   |             | 420,000    |  
|Stock-based compensation                                       |          |         | -                  |   |     | -         |   |        | 364,000     |   |   | -             |   |             | -           |   |             | 364,000    |  
|Capital stock issued for consulting services                   | at $4.68 |         | 100,000            |   |     | 100       |   |        | 467,900     |   |   | -             |   |             | -           |   |             | 468,000    |  
|Net loss from continuing operations                            |          | -       |                    |   | -   |           |   | -      |             |   | - |               |   | (14,152,210 | )           |   | (14,152,210 | )         
|Net loss from discontinued operations                          |          |         |                    |   |     |           |   |        |             |   |   |               |   | (1,935      | )           |   | (1,935      | )         
|Capital contribution from subsidiary
      on disposition      |          | -       |                    |   | -   |           |   | (6,000 | )           |   | - |               |   | -           |             |   | (6,000      | )         
|Balance, December 31, 2005                                     |          |         | 17,814,123         |   |     | 17,814    |   |        | 17,550,488  |   |   | 40,000        |   |             | (16,074,412 | ) |             | 1,533,890  |  
|Cancellation of shares                                         |          |         | (4,000,000         | ) |     | (4,000    | ) |        | 4,000       |   |   | -             |   |             | -           |   |             | -          |  
|Stock-based compensation                                       |          |         | -                  |   |     | -         |   |        | 529,673     |   |   | -             |   |             | -           |   |             | 529,673    |  
|Capital stock issued for cash                                  | at $0.75 |         | 317,334            |   |     | 317       |   |        | 237,683     |   |   | -             |   |             | -           |   |             | 238,000    |  
|Less: share issue costs                                        |          |         | -                  |   |     | -         |   |        | (6,300      | ) |   | -             |   |             | -           |   |             | (6,300     | )
|Net loss for the year                                          |          |         | -                  |   |     | -         |   |        | -           |   |   | -             |   |             | (2,480,288  | ) |             | (2,480,288 | )
|Balance, December 31, 2006                                     |          |         | 14,131,457         |   |     | 14,131    |   |        | 18,315,544  |   |   | 40,000        |   |             | (18,554,700 | ) |             | (185,025   | )
|Capital stock issued for cash:                                 | at $0.50 |         | 220,000            |   |     | 220       |   |        | 109,780     |   |   | (40,000       | ) |             | -           |   |             | 70,000     |  
|                                                               | at $0.80 |         | 250,000            |   |     | 250       |   |        | 199,750     |   |   | -             |   |             | -           |   |             | 200,000    |  
|                                                               | at $1.10 |         | 2,230,924          |   |     | 2,231     |   |        | 2,451,785   |   |   | (3,300        | ) |             | -           |   |             | 2,450,716  |  
|Capital stock issued for commission                            |          | 126,090 |                    |   | 126 |           |   | (126   | )           |   | - |               |   | -           |             |   | -           |           
|Less: commission - cash                                        |          |         | -                  |   |     | -         |   |        | (64,021     | ) |   | -             |   |             | -           |   |             | (64,021    | )
|Stock as bonus                                                 | at $0.86 |         | 750,000            |   |     | 750       |   |        | 644,250     |   |   | -             |   |             | -           |   |             | 645,000    |  
|Stock issued to settle accounts payable                        | at $1.00 |         | 158,000            |   |     | 158       |   |        | 157,842     |   |   | -             |   |             | -           |   |             | 158,000    |  
|Stock-based compensation                                       |          |         | -                  |   |     | -         |   |        | 533,252     |   |   | -             |   |             | -           |   |             | 533,252    |  
|Net loss for the year                                          |          |         | -                  |   |     | -         |   |        | -           |   |   | -             |   |             | (5,056,117  | ) |             | (5,056,117 | )
|Balance, December 31, 2007                                     |          |         | 17,866,471         |   | $   | 17,866    |   | $      | 22,348,056  |   | $ | (3,300        | ) | $           | (23,610,817 | ) | $           | (1,248,195 | )

SEE ACCOMPANYING NOTES

---

ACRONGENOMICS,INC.
  (A Development Stage
  Company) 
  INTERIM STATEMENT OF CHANGES IN CAPITAL DEFICIT 
  for the period
  August 17, 1999 (Date of Inception) to June 30, 2010 
  (Stated in US Dollars ) 
  (Unaudited)

|                                                   |            |  |                    |   |   |           |         |   |             |   |   |               |   |   | Deficit     |         |   |            |  
|-------------------------------------------------- | ---------- |  | ------------------ | - | - | --------- | ------- | - | ----------- | - | - | ------------- | - | - | ----------- | ------- | - | ---------- | -
|                                                   |            |  | Common
      Stock |   |   |           |         |   | Accumulated |   |   |               |  
|                                                   |            |  |                    |   |   |           |         |   | Additional  |   |   | Share         |   |   | During the  |         |   |            |  
|                                                   |            |  |                    |   |   |           |         |   | Paid-in     |   |   | Subscriptions |   |   | Development |         |   |            |  
|                                                   |            |  | Shares             |   |   | Par Value |         |   | Capital     |   |   | (Receivable)  |   |   | Stage       |         |   | Total      |  
|                                                   |            |  |                    |   |   |           |         |   |             |   |   |               |   |   |             |         |   |            |  
|Balance, December 31, 2007                         |            |  | 17,866,471         |   | $ | 17,866    |         | $ | 22,348,056  |   | $ | (3,300        | ) | $ | (23,610,817 | )       | $ | (1,248,195 | )
|Stock Subscriptions                                |            |  | -                  |   |   | -         |         |   | -           |   |   | 29,800        |   |   | -           |         |   | 29,800     |  
|Capital stock issued for cash:                     | - at $0.80 |  | 1,250,010          |   |   | 1,250     |         |   | 998,758     |   |   | -             |   |   | -           |         |   | 1,000,008  |  
|                                                   | - at $1.10 |  | 90,000             |   |   | 90        |         |   | 98,910      |   |   | -             |   |   | -           |         |   | 99,000     |  
|                                                   | - at $0.40 |  | 1,450,250          |   |   | 1,450     |         |   | 578,650     |   |   | -             |   |   | -           |         |   | 580,100    |  
|Capital stock issued for consulting                |            |  |                    |   |   |           |         |   |             |   |   |               |   |   |             |         |   |           
|and management fees                                | - at $0.95 |  | 150,000            |   |   | 150       |         |   | 142,350     |   |   | -             |   |   | -           |         |   | 142,500    |  
|                                                   | - at $0.53 |  | 150,000            |   |   | 150       |         |   | 79,350      |   |   | -             |   |   | -           |         |   | 79,500     |  
|                                                   | - at $0.27 |  | 1,650,000          |   |   | 1,650     |         |   | 443,850     |   |   | -             |   |   | -           |         |   | 445,500    |  
|Less: commission - cash                            |            |  | -                  |   |   | -         |         |   | (169,460    | ) |   | -             |   |   | -           |         |   | (169,460   | )
|Capital stock issued to settle
      accounts      |            |  |                    |   |   |           |         |   |             |   |   |               |   |   |             |         |   |           
|payable:                                           | - at $0.95 |  | 150,000            |   |   | 150       |         |   | 142,350     |   |   | -             |   |   | -           |         |   | 142,500    |  
|                                                   | - at $0.79 |  | 1,150,000          |   |   | 1,150     |         |   | 907,350     |   |   | -             |   |   | -           |         |   | 908,500    |  
|Beneficial conversion feature on convertible notes | -          |  |                    | - |   |           | 482,124 |   |             | - |   |               | - |   |             | 482,124 |  
|Stock-based compensation                           |            |  | -                  |   |   | -         |         |   | 454,919     |   |   | -             |   |   | -           |         |   | 454,919    |  
|Net loss for the year                              |            |  | -                  |   |   | -         |         |   | -           |   |   | -             |   |   | (3,022,005  | )       |   | (3,022,005 | )
|                                                   |            |  |                    |   |   |           |         |   |             |   |   |               |   |   |             |         |   |            |  
|Balance, December 31, 2008                         |            |  | 23,906,731         |   |   | 23,906    |         |   | 26,507,207  |   |   | 26,500        |   |   | (26,632,822 | )       |   | (75,209    | )
|Capital stock issued for cash                      | - at $0.40 |  | 1,673,750          |   |   | 1,674     |         |   | 667,826     |   |   | (26,500       | ) |   | -           |         |   | 643,000    |  
|Less: commission                                   |            |  | -                  |   |   | -         |         |   | (58,600     | ) |   | -             |   |   | -           |         |   | (58,600    | )
|Reclassification of derivative
      liability     |            |  |                    |   |   | (113,314  | )       |   |             |   |   |               |   |   | (113,314    | )      
|Stock-based compensation                           |            |  | -                  |   |   | -         |         |   | 21,871      |   |   | -             |   |   | -           |         |   | 21,871     |  
|Net loss for the year                              |            |  | -                  |   |   | -         |         |   | -           |   |   | -             |   |   | (937,573    | )       |   | (937,573   | )
|Balance, December 31,2009                          |            |  | 25,580,481         |   |   | 25,580    |         |   | 27,024,990  |   |   | -             |   |   | (27,570,395 | )       |   | (519,825   | )
|Capital stock issued for cash:                     | - at $0.40 |  | 25,000             |   |   | 25        |         |   | 9,975       |   |   | -             |   |   | -           |         |   | 10,000     |  
|                                                   | - at $0.20 |  | 175,000            |   |   | 175       |         |   | 34,825      |   |   | -             |   |   | -           |         |   | 35,000     |  
|Stock-based compensation                           |            |  | -                  |   |   | -         |         |   | 674         |   |   | -             |   |   | -           |         |   | 674        |  
|Net loss for the period                            |            |  | -                  |   |   | -         |         |   | -           |   |   | -             |   |   | (304,409    | )       |   | (304,409   | )
|Balance, June 30, 2010                             |            |  | 25,780,481         |   | $ | 25,780    |         | $ | 27,070,464  |   | $ | -             |   | $ | (27,874,804 | )       | $ | (778,560   | )

SEE ACCOMPANYING NOTES

---

ACRONGENOMICS, INC.
  (A Development Stage Company) 
  NOTES TO THE FINANCIAL STATEMENTS 
  June 30, 2010 and 2009 
  (Stated
    in US Dollars) 
  (Unaudited)

|Note 1 | Nature of Operations and Ability to Continue
      as a Going Concern                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|------ | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|       | The Company is in the development stage and has not yet realized
      any revenues from its planned operations. The Companys business is
      research and development in the field of life science including BioLED technology.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|       | These financial statements have been prepared
      in accordance with generally accepted accounting principles in the United
      States of America on a going concern basis, which assumes that the Company
      will continue to realize its assets and discharge its obligations and commitments
      in the normal course of operations. Realization values may be substantially
      different from carrying values as shown and these financial statements do
      not give effect to adjustments that would be necessary to the carrying values
      and classification of assets and liabilities should the Company be unable
      to continue as a going concern. At June 30, 2010, the Company had not yet
      achieved profitable operations, had an accumulated deficit of $27,874,804
      (2009 - $27,570,395) since its inception and incurred a net loss of $304,409
      for the six months then ended and expects to incur further losses in the
      development of its business, all of which casts substantial doubt about
      the Companys ability to continue as a going concern. The Companys
      ability to continue as a going concern is dependent upon its ability to
      generate future profitable operations and/or to obtain the necessary financing
      to meet its obligations and repay its liabilities arising from normal business
      operations when they come due. Management has no formal plan in place to
      address this concern but is considering obtaining additional funds by debt
      financing to the extent there is a shortfall from operations. While the
      Company is expending its best efforts to achieve the above plans, there
      is no assurance that any such activity will generate funds for operations.
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|       | The Company was incorporated in the State of Nevada,
      USA on August 17, 1999 as Cellway Ventures Inc. Effective February 25, 2004,
      the Company changed its name to Acrongenomics, Inc.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|       | These unaudited interim financial statements reflect
      all adjustments, consisting of normal recurring adjustments, which in the
      opinion of management are necessary for fair presentation of the information
      contained therein. It is suggested that these interim financial statements
      be read in conjunction with the audited financial statements of the Company
      for the year ended December 31, 2009. The interim results are not necessarily
      indicative of the operating results expected for the fiscal year ending
      on December 31, 2010. Certain information and footnote disclosures normally
      included in financial statements prepared in accordance with generally accepted
      accounting principles have been condensed or omitted pursuant to such rules
      and regulations, although the Company believes that the disclosures herein
      are adequate to make the information presented not misleading.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Note 2 | Summary of Significant Accounting Policies                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|       | Recent Accounting Pronouncements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|       | In October 2009, the FASB issued ASU No. 2009-13, Multiple-Deliverable
      Revenue Arrangements, or ASU 2009-13, which amends existing revenue
      recognition accounting pronouncements that are currently within the scope
      of ASC 605. This guidance eliminates the requirement to establish the fair
      value of undelivered products and services and instead provides for separate
      revenue recognition based upon managements estimate of the selling
      price for an undelivered item when there is no other means to determine
      the fair value of that undelivered item. ASU 2009-13 is effective prospectively
      for revenue arrangements entered into or materially modified in fiscal years
      beginning on or after June 15, 2010. The Company is currently evaluating
      the impact, if any, that the adoption of this amendment will have on its
      consolidated financial statements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             

---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  June 30, 2010 and 2009 (Unaudited - Stated in US Dollars) - Page 2

|Note 2 | Summary of Significant
      Accounting Policies  (contd)
|------ | -----------------------------------------------------------

|       | Recent Accounting
      Pronouncements  (contd)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|------ | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|       | In January 2010, the FASB issued Accounting Standards
      Update No. 2010-06, Improving Disclosures about Fair Value
        Measurements (Topic 820)Fair Value Measurements and Disclosures(ASU 2010-06), to add additional disclosures about the different
      classes of assets and liabilities measured at fair value, the valuation
      techniques and inputs used, the activity in Level 3 fair value
      measurements, and the transfers between Levels 1, 2, and 3. The Company is
      currently evaluating the impact of the pending adoption of this standards
      update on its consolidated financial statements. The new disclosures and
      clarifications of existing disclosure are effective for fiscal years
      beginning after December 15, 2009, except for the disclosure requirements
      related to the purchases, sales, issuances and settlements in the
      roll-forward activity of Level 3 fair value measurements. Those disclosure
      requirements are effective for fiscal years ending after December 31,
      2010. The adoption of ASU 2010-06 had no material impact on the Companys
      financial statements.
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|       | In February 2010, the FASB issued ASU 2010-09, Subsequent Events. ASU 2010-09 was issued to amend ASC 855 to
      remove the requirement for SEC filers to disclose the date through which
      an entity has evaluated subsequent events. This change is intended to
      alleviate potential conflicts with current SEC guidance. The provisions of
      ASU 2010-09 are effective upon issuance. The adoption of ASC 855 and ASU
      2010-09 did not have a material impact on the Company's consolidated
      financial statements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|       | In April 2010, the FASB issued Accounting Standards
      Update No. 2010-17, Revenue Recognition Milestone Method (Topic
        605) Revenue Recognition(ASU 2010-17). ASU 2010-17 provides
      guidance on defining the milestone and determining when the use of the
      milestone method of revenue recognition for research or development
      transactions is appropriate. It provides criteria for evaluating if the
      milestone is substantive and clarifies that a vendor can recognize
      consideration that is contingent upon achievement of a milestone as
      revenue in the period in which the milestone is achieved, if the milestone
      meets all the criteria to be considered substantive. ASU 2010-17 is
      effective for the Company in fiscal 2011 and should be applied
      prospectively. Early adoption is permitted. The Company is currently
      evaluating the impact of the pending adoption of ASU 2010-17 on its
      consolidated financial statements.                                                                                                                                                         
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|Note 3 | Investment in Molecular Vision Ltd.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|       | The Companys investment in Molecular Vision Ltd.
      (Molecular) is summarized as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

| |                                                        |  | Number of Molecular |  |   |          |  
| | ------------------------------------------------------ |  | ------------------- |  | - | -------- | -
| |                                                        |  | shares owned        |  |   | Amount   |  
| |                                                        |  |                     |  |   |          |  
| | Balance - December 31, 2008                            |  | 33,734              |  | $ | 791,230  |  
| | Acquisition of Molecular shares for GBP
      £166,042 |  | 19,426              |  |   | 275,501  |  
| | Less: Write-down                                       |  | -                   |  |   | (239,330 | )
| |                                                        |  |                     |  |   |          |  
| | Balance as at June 30, 2010
      and                  |  |                     |  |   |          |  
| | December 31, 2009                                      |  | 53,160              |  | $ | 827,401  |  

The 53,160 shares owned in Molecular
  above represent 17.2% of the total issued shares of Molecular as at June 30,
  2010 and December 31, 2009.

---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  June 30, 2010 and 2009 (Unaudited - Stated in US Dollars) - Page 3

|Note 4 | Fair Value Measurements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|------ | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|       | ASC 820 defines fair value, establishes a framework for
      measuring fair value under generally accepted accounting principles and
      enhances disclosures about fair value measurements. Fair value is defined
      under ASC 820 as the exchange price that would be received for an asset or
      paid to transfer a liability (an exit price) in the principal or most
      advantageous market for the asset or liability in an orderly transaction
      between market participants on the measurement date. Valuation techniques
      used to measure fair value under ASC 820 must maximize the use of
      observable inputs and minimize the use of unobservable inputs. The
      standard describes a fair value hierarchy based on three levels of inputs,
      of which the first two are considered observable and the last
      unobservable, that may be used to measure fair value which are the
      following:

| | Level 1 - | quoted prices (unadjusted) in active markets for
      identical assets or liabilities;                                                                                                                                                                                                                                                   
| | --------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |           |                                                                                                                                                                                                                                                                                                                                           
| | Level 2 - | observable inputs other than Level I, quoted prices for
      similar assets or liabilities in active markets, quoted prices for
      identical or similar assets and liabilities in markets that are not
      active, and model-derived prices whose inputs are observable or whose
      significant value drivers are observable; and
| |           |                                                                                                                                                                                                                                                                                                                                           
| | Level 3 - | assets and liabilities whose significant value drivers
      are unobservable by little or no market activity and that are significant
      to the fair value of the assets or liabilities.                                                                                                                                              

As at June 30, 2010, the Company has
  determined that it does not hold any Level 1 assets and its shareholdings in
  Molecular Vision, which are measured on a non-recurring basis, represent Level 2
  assets.

The fair value changes of the
  Companys Level 2 assets are summarized as follows:

| |                                        |   | Beginning Value |  |   |          |  |   |            |  |   | Ending Fair      | 
| | -------------------------------------- | - | --------------- |  | - | -------- |  | - | ---------- |  | - | ---------------- | 
| |                                        |   | of              |  |   | Shares   |  |   | Impairment |  |   | Value of Level 2 | 
| |                                        |   | Level 2 Assets  |  |   | Acquired |  |   | Charge     |  |   | Assets           | 
| |                                        |   |                 |  |   |          |  |   |            |  |   |                  | 
| | For the six months ended June 30, 2010 | $ | 827,401         |  | $ | -        |  | $ | -          |  | $ | 827,401          | 

During the year ended December 31,
  2009, in accordance with ASC 815-40-15, the Company determined that the
  conversion features associated with its convertible promissory notes required
  bifurcation as derivative liabilities  (Note 5). The resulting derivatives are
  required to be measured at their fair value each reporting period and they
  constitute Level 3 liabilities given that they have no active market and are
  measured based on information that is unobservable. A summary of the Companys
  Level 3 for the six months ended June 30, 2010 and year ended December 31, 2009
  is as follows:

| |                                           |   |                     |  |   | Derivative Liabilities |  |   |                     |   |   |                   | 
| | ----------------------------------------- | - | ------------------- |  | - | ---------------------- |  | - | ------------------- | - | - | ----------------- | 
| |                                           |   | Beginning Value     |  |   | bifurcated from        |  |   | Change in fair      |   |   | Ending Fair Value | 
| |                                           |   | of                  |  |   | convertible            |  |   | value of derivative |   |   | of Level 3        | 
| |                                           |   | Level 3 Liabilities |  |   | promissory notes       |  |   | liabilities         |   |   | Liabilities       | 
| |                                           |   |                     |  |   |                        |  |   |                     |   |   |                   | 
| | For the six months ended June 30, 2010    | $ | -                   |  | $ | -                      |  | $ | -                   |   | $ | -                 | 
| |                                           |   |                     |  |   |                        |  |   |                     |   |   |                   | 
| | For the 12 months ended December 31, 2009 | $ | -                   |  | $ | 169,452                |  | $ | (169,452            | ) | $ | -                 | 

---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  June 30, 2010 and 2009 (Unaudited - Stated in US Dollars) - Page 4

|Note 4 | Fair Value Measurements 
      (contd)                                                                                                                                                                                                        
|------ | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|       |                                                                                                                                                                                                                                                 
|       | The Company determined for the fair value of the
      component of derivative liability represented by the warrants issuable on
      conversion of the promissory notes by using the Black Scholes model with
      the following assumptions:

Expected life
      2 yearsExpected Volatility
      211.19%Risk free interest rate
      1.02% - 1.63%Dividend Yield
      0%


|Note 5 | Convertible Promissory Notes Payable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|       | $394,136 Convertible Promissory Note                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|       | During the year ended December 31, 2008, the Company was
      loaned $394,136 by a director of the Company by the issuance of a
      convertible promissory note, payable on demand, with interest accruing on
      the balance of principal outstanding at 8% per annum, compounded monthly
      and payable monthly. The note is convertible into units of the Company at
      a price of $0.40 per unit. Each unit will consist of one common share and
      one share purchase warrant exercisable at $0.75 per share for a period of
      two years from the date of issuance. Upon the issuance of the note, the
      Company recorded a beneficial conversion feature totalling $292,124 which
      was accreted to income in its entirety and included in interest, fees and
      accretion on notes payable in the financial statements for the year ended
      December 31, 2008.                                                                                                                    
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|       | Effective March 1, 2009, the Company and the lender
      agreed to modify the terms of the note by increasing the interest rate to
      10% per annum and by changing the terms of repayment such that the Company
      is to repay the note in Canadian dollars at a foreign exchange rate of not
      less than $1US = $1.27 Canadian. As a result of the Company having to
      repay the note in a currency other than its functional currency, in
      accordance with ASC 830-35-1 Transaction Gains and Losses,changes in the exchange rate between the US and Canadian dollar will
      affect the expected amount of the payment upon the settlement of the note
      requiring the Company to record the change in rate as a transaction gain
      or loss in the Statement of Operations. For the six months ended June 30,
      2010, the Company recorded a foreign exchange gain of $5,037 (2009: $Nil)
      on the note resulting in a balance payable as at June 30, 2010 of $471,
      956.
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|       | Additionally, the conversion feature of this note failed
      the two-step evaluation criteria contained in ASC 815-40 and, as a result,
      it was determined that it was required to be bifurcated from the host
      contract and recorded as a derivative liability. In accordance with ASC
      815, the Company is required to re-measure the fair value of the
      derivative at each reporting period with the change in fair value recorded
      as a gain or loss in the Statement of Operations. At June 30, 2010, the
      Company re-measured the fair value of the derivative liability and
      determined it had a fair value of $nil.                                                                                                                                                                                                                                                                                                                                                          
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|       | During the six months ended June 30, 2010, the Company
      accrued interest of $21,792 (2009: $5,789) on this note.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     

---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  June 30, 2010 and 2009 (Unaudited - Stated in US Dollars) - Page 5

|Note 5 | Convertible Promissory Notes Payable  (contd)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|------ | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|       | $150,000 Promissory Note                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|       | On July 15, 2009, the Company was loaned an additional
      $150,000 by the same director of the Company by issuance of a convertible
      promissory note, payable on demand, with interest accruing on the balance
      of the principal outstanding at 10% per annum compounded monthly and
      payable monthly. The note contained a similar repayment feature wherein
      the Company agreed to repay the note in Canadian dollars at a foreign
      exchange rate of not less than $1US = $1.27 Canadian. The note is
      convertible into units of the Company at a price of $0.40 per unit. Each
      unit will consist of one common share and one share purchase warrant
      exercisable at $0.75 per share for a period of two years from the date of
      issuance.
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|       | For the six months ended June 30, 2010, the Company
      recorded a foreign exchange gain of $2,026 on the note resulting in a
      balance payable as at June 30, 2010 of $179,506.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|       | Additionally, the conversion feature of this note failed
      the two-step evaluation criteria contained in ASC 815-40 and, as a result,
      it was determined that it was required to be bifurcated from the host
      contract and recorded as a derivative liability. In accordance with ASC
      815, the Company is required to re-measure the fair value of the
      derivative at each reporting period with the change in fair value recorded
      as a gain or loss in the Statement of Operations. At June 30, 2010, the
      Company re-measured the fair value of the derivative liability and
      determined it had a fair value of $nil.                                                                                                                             
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|       | During the six months ended June 30, 2010, the Company
      accrued interest of $7,953 (12 months ended December 31, 2009: $5,785) on
      this note.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|       | The notes are collaterized by an interest in all property
      of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|Note 6 | Loans Payable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|       | On April 1, 2010,
      the Company was loaned €25,000 (US $33,090) by issuance of a promissory
      note, payable on demand, with interest accruing on the balance of the
      principle outstanding at 8 percent per annum compounding monthly and
      payable quarterly, maturing on October 1, 2010. For the six months ended
      June 30, 2010, the Company recorded a foreign exchange gain of $2,365 on
    the note resulting in a balance payable as at June 30, 2010 of $30,725.                                                                                                                                                                                                                                                                                             
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|       | As at June 30, 2010, the Company has received additional
      unsecured advances totalling $27,628. These advances are non-interest
      bearing and have no specific terms for repayment.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|Note 7 | Related Party Transactions                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|       | The Company incurred the following charges with directors
      and officers, companies with a common director and former director, an
      officer and director of a company of which a former officer and director
      is the spouse of the Companys president; the research and development
      expenditures were paid to a company in which a former officer and director
      of the Company is the spouse of the Companys former president.                                                                                                                                                                                                                                                                                                                                    

---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  June 30, 2010 and 2009 (Unaudited - Stated in US Dollars) - Page 6

|Note 7 | Related Party Transactions 
      (contd)
|------ | -------------------------------------------

|                                                                               |   |                            |  |   |                          |  |   |          |  |   |         |  |   | August 17, 1999     | 
|------------------------------------------------------------------------------ | - | -------------------------- |  | - | ------------------------ |  | - | -------- |  | - | ------- |  | - | ------------------- | 
|                                                                               |   |                            |  |   |                          |  |   |          |  |   |         |  |   | (Date of Inception) | 
|                                                                               |   | For the Three Months Ended |  |   | For the Six Months Ended |  |   | to       | 
|                                                                               |   | June 30,                   |  |   | June 30,                 |  |   | June 30, | 
|                                                                               |   | 2010                       |  |   | 2009                     |  |   | 2010     |  |   | 2009    |  |   | 2010                | 
|                                                                               |   |                            |  |   |                          |  |   |          |  |   |         |  |   |                     | 
|Accounting fees                                                                | $ | 17,769                     |  | $ | 26,926                   |  | $ | 36,734   |  | $ | 51,705  |  | $ | 393,092             | 
|Consulting fees                                                                |   | 34,500                     |  |   | 34,500                   |  |   | 69,000   |  |   | 89,000  |  |   | 793,901             | 
|Legal fees                                                                     |   | -                          |  |   | -                        |  |   | -        |  |   | -       |  |   | 60,656              | 
|Management fees                                                                |   | -                          |  |   | -                        |  |   | -        |  |   | -       |  |   | 2,747,128           | 
|Rent                                                                           |   | -                          |  |   | -                        |  |   | -        |  |   | -       |  |   | 36,000              | 
|Research and development                                                       |   | -                          |  |   | -                        |  |   | -        |  |   | -       |  |   | 5,604,189           | 
|Interest and accretion and fees on convertible
      Promissory notes - Note 5 |   | 15,058                     |  |   | 9,934                    |  |   | 29,746   |  |   | 15,723  |  |   | 460,385             | 
|                                                                               | $ | 67,327                     |  | $ | 71,360                   |  | $ | 135,480  |  | $ | 156,428 |  | $ | 10,095,351          | 

|       | Research and development expenditures charged by a
      related company were comprised of testing costs of the molecular
      diagnostic test products.                                                                                                                                                                                                       
|------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|       |                                                                                                                                                                                                                                                                                                                                                                 
|       | Accounts payable and accrued liabilities at June 30, 2010
      includes $298,771 (December 31, 2009: $195,037) owing to companies with a
      common director, a former director and a company of which a former officer
      and director is the spouse of the Companys former president for
      accounting, management and consulting services received.
|       |                                                                                                                                                                                                                                                                                                                                                                 
|       | Loans payable at June 30, 2010 includes $18,628 (December
      31, 2009: $nil) owing to a former officer and director and the spouse of a
      former officer and director of the company.                                                                                                                                                                    
|       |                                                                                                                                                                                                                                                                                                                                                                 
|Note 8 | Common Stock                                                                                                                                                                                                                                                                                                                                                    
|       |                                                                                                                                                                                                                                                                                                                                                                 
|       | On February 6, 2009, the Company issued 625,000 units
      pursuant to a private placement at $0.40 per share for total proceeds of
      $250,000. Each unit consisted of one share and one common share purchase
      warrant exercisable at $0.75 for a period of two (2) years. The Company
      paid a commission of $25,000 on this placement.         
|       |                                                                                                                                                                                                                                                                                                                                                                 
|       | On February 6, 2009, the Company issued 66,250 units
      pursuant to a subscription received of $26,500 as at December 31, 2008.
      Each unit consisted of one share and one common share purchase warrant
      exercisable at $0.75 for a period of two (2) years.                                                                                       
|       |                                                                                                                                                                                                                                                                                                                                                                 
|       | On May 15, 2009, the Company issued 525,000 units
      pursuant to a private placement at $0.40 per share for total proceeds of
      $210,000. Each unit consisted of one share and one common share purchase
      warrant exercisable at $0.75 for a period of two (2) years. The Company
      paid a commission of $16,000 on this placement.             
|       |                                                                                                                                                                                                                                                                                                                                                                 
|       | On July 22, 2009, the Company issued 105,000 units @
      $0.40 per unit for total proceeds of $42,000 received on February 1, 2010.
      Each unit consists of one share and one common share purchase warrant
      exercisable at $0.75 for a period of two (2) years. The Company paid a
      commission of $4,200 on this placement.                    
|       |                                                                                                                                                                                                                                                                                                                                                                 
|       | On September 16, 2009, the Company issued 165,000 units
      pursuant to a private placement at $0.40 per share for total proceeds of
      $66,000. Each unit consisted of one share and one common share purchase
      warrant exercisable at $0.75 for a period of two (2) years. The Company
      paid a commission of $5,900 on this placement.         

---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes to the Financial Statements 
  June 30, 2010 and 2009 (Unaudited - Stated in US Dollars) - Page 7

|Note 8 | Common Stock  (contd)                                                                                                                                                                                                                                                                                              
|------ | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|       |                                                                                                                                                                                                                                                                                                                      
|       | On September 30, 2009, the Company issued 137,500 units
      at $0.40 per unit for total proceeds of $55,000. Each unit consists of one
      share and one common share purchase warrant exercisable at $0.75 for a
      period of two (2) years. The Company paid a commission of $5,500 on this
      placement.
|       |                                                                                                                                                                                                                                                                                                                      
|       | On October 29, 2009, the Company issued 50,000 units at
      $0.40 per unit for total proceeds of $20,000. Each unit consists of one
      share and one common share purchase warrant exercisable at $0.75 for a
      period of two (2) years. The Company paid a commission of $2,000 on this
      placement.   
|       |                                                                                                                                                                                                                                                                                                                      
|       | On April 15, 2010, the Company issued 25,000 units at
      $0.40 per unit for total proceeds of $10,000. Each unit consists of one
      share and one common share purchase warrant exercisable at $0.75 for a
      period of two (2) years. No commission is payable on this placement.                          
|       |                                                                                                                                                                                                                                                                                                                      
|       | On May 14, 2010, the Company issued 175,000 units at
      $0.20 per unit for total proceeds of $35,000. Each unit consists of one
      share of common stock and one common share purchase warrant exercisable at
      $0.50 for a period of two (2) years.                                                       
|       |                                                                                                                                                                                                                                                                                                                      
|       | Commitments                                                                                                                                                                                                                                                                                                          
|       |                                                                                                                                                                                                                                                                                                                      
|       | Share Purchase Warrants                                                                                                                                                                                                                                                                                              
|       |                                                                                                                                                                                                                                                                                                                      
|       | A summary of changes in the Companys share purchase
      warrants for the six months ended June 30, 2010 and December 31, 2009
      outstanding is presented below:                                                                                                                                               

| |                                  | June
      30, 2010 |  | December
      31, 2009 | 
| | -------------------------------- | ------------------- |  | ----------------------- | 
| |                                  |                     |  | Weighted                | 
| |                                  |                     |  | Average                 | 
| |                                  | Number of           |  | Exercise                | 
| |                                  | Warrants            |  | Price                   | 
| |                                  |                     |  |                         | 
| | Outstanding, beginning of period | 3,124,000           |  | $0.75                   | 
| | Issued                           | 200,000             |  | $0.53                   | 
| | Expired                          | -                   |  | -                       | 
| |                                  |                     |  |                         | 
| | Outstanding, end of period       | 3,324,000           |  | $0.74                   | 

The following table summarizes the
  warrants outstanding as at June 30, 2010:

Number Outstanding
      
      Exerciseand Exercisable
      
      Price
      
      Expiry Date290,000
      
      $0.75
      
      July
        31,2010(1 )317,750
      
      $0.75
      
      August 31, 2010120,000
      
      $0.75
      
      September
        30,2010375,000
      
      $0.75
      
      October 31, 2010347,500
      
      $0.75
      
      December 31,
        201020,000
      
      $0.75
      
      January 31,2011671,250
      
      $0.75
      
      February 28,
        2011525,000
      
      $0.75
      
      May 31, 2011165,000
      
      $0.75
      
      September 30,
        2011187,500
      
      $0.75
      
      October 31, 2011105,000
      
      $0.75
      
      February 28,
        201225,000
      
      $0.75
      
      April 15, 2012175,000
      
      $0.50
      
      June 15, 20123,324,000


(1) Subsequent to June 30,
  2010, these warrants expired unexercised.

---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  June 30, 2010 and 2009 (Unaudited - Stated in US Dollars) - Page 8

|Note 8 | Commitments  (contd)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|------ | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|       | Stock-Based Compensation Plan                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|       | In May, 2005, the Company adopted a stock
      option plan which provides for the granting of stock options to selected
      directors, officers, employees or consultants in an aggregate amount of up
      to 2,600,000 common shares of the Company and, in any case, the number of
      shares to be issued to any one individual pursuant to the exercise of
      options shall not exceed 10% of the issued and outstanding share capital.
      The grant of stock options, exercise prices and terms are determined by
      the Company's Board of Directors.
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|       | A summary of changes in the Companys stock
      options for the six months ended June 30, 2010 and the year ended December
      31, 2009 is presented below:                                                                                                                                                                                                                                                                                                                                                                                                            

June
        30, 2010
      
      
      December
        31, 2009Weighted
      
      
      
      
      
      WeightedAverage
      
      
      
      
      
      AverageNumber of
      
      
      Exercise
      
      
      Number of
      
      
      ExerciseOptions
      
      
      Price
      
      
      Options
      
      
      PriceOutstanding, beginning of period
      
      2,100,000
      
      
      $0.76
      
      
      3,500,000
      
      
      $0.70Granted
      
      -
      
      
      -
      
      
      700,000
      
      
      $0.57Cancelled
      
      -
      
      
      -
      
      
      (2,100,000
      )
      
      $0.50Outstanding, end of period
      
      2,100,000
      
      
      $0.76
      
      
      2,100,000
      
      
      $0.76Exercisable, end of period
      
      2,100,000
      
      
      $0.76
      
      
      2,050,000
      
      
      $0.76


At June 30, 2010 the following stock
  options were outstanding:

Number of sharesAggregateTotal
      
      
      Number
      
      
      Exercise
      
      
      Expiry
      
      
      IntrinsicNumber
      
      
      Vested
      
      
      Price
      
      
      Date
      
      
      Value600,000
      (1)
      
      600,000
      
      
      $1.00
      
      
      March 22, 2012
      
      $
      -100,000
      (2)
      
      100,000
      
      
      $2.50
      
      
      May 3, 2016
      
      $
      -600,000
      (3)
      
      600,000
      
      
      $0.50
      
      
      February 12, 2017
      
      $
      -500,000
      (4)
      
      500,000
      
      
      $0.60
      
      
      March 31, 2018
      
      $
      -100,000
      (5)
      
      100,000
      
      
      $0.50
      
      
      April 1, 2018
      
      $
      -200,000
      (6)
      
      200,000
      
      
      $0.50
      
      
      April 1, 2018
      
      $
      -2,100,000
      
      
      2,100,000


---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  June 30, 2010 and 2009 (Unaudited - Stated in US Dollars) - Page 9

|Note 8 | Common Stock  (contd)                       
|------ | ----------------------------------------------
|       |                                               
|       | Commitments  (contd)                        
|       |                                               
|       | Stock-Based Compensation Plan
       (contd)

| | (1) | As at June 30, 2010, these options had fully vested and
      no stock-based compensation was recognized in the financial statements for
      the period then ended.                                                                                         
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                               
| | (2) | As at June 30, 2010, these options had fully vested and
      no stock-based compensation was recognized in the financial statements for
      the period then ended.                                                                                         
| |     |                                                                                                                                                                                                                                                               
| | (3) | As at June 30, 2010, these options had fully vested and
      no stock-based compensation was recognized in the financial statements for
      the period ended March 31, 2010 (2009: $11,647).                                                               
| |     |                                                                                                                                                                                                                                                               
| | (4) | As at June 30, 2010, these options had fully vested and
      no stock-based compensation was recognized in the financial statements for
      the period then ended.                                                                                         
| |     |                                                                                                                                                                                                                                                               
| | (5) | As at June 30, 2010, these options had fully vested and
      no stock-based compensation was recognized in the financial statements for
      the period then ended.                                                                                         
| |     |                                                                                                                                                                                                                                                               
| | (6) | As at June 30, 2010, 200,000 of these options were fully
      vested. During the six months ended June 30, 2010, the Company recognized
      stock-based compensation of $674 (2009: $16,439) included in consulting
      fees in the financial statements.

A summary of changes in the Companys
  unvested stock options for the six month period ended June 30, 2010 and the year
  ended December 31, 2009 is presented below:

|                                 |  | June
      30, 2010 |   |  | December
      31, 2009 | 
|-------------------------------- |  | ------------------- | - |  | ----------------------- | 
|                                 |  |                     |   |  | Weighted                | 
|                                 |  |                     |   |  | Average                 | 
|                                 |  | Number of           |   |  | Exercise                | 
|                                 |  | Options             |   |  | Price                   | 
|                                 |  |                     |   |  |                         | 
|Outstanding, beginning of period |  | 50,000              |   |  | $0.50                   | 
|Granted                          |  | -                   |   |  | -                       | 
|Cancelled                        |  | -                   |   |  | -                       | 
|Vested                           |  | (50,000             | ) |  | $0.50                   | 
|                                 |  |                     |   |  |                         | 
|Outstanding, end of period       |  | -                   |   |  | -                       | 

Stock-based compensation amounts,
  including those related to shares issued for non-cash consideration during the
  period, are classified in the Companys Statement of Operations as follows:

2010
      
      
      2009Consulting fees
      $
      674
      
      $
      16,439Management fees
      
      -
      
      
      11,647$
      674
      
      $
      28,086


---

Acrongenomics, Inc. 
  (A Development Stage Company) 
  Notes
  to the Financial Statements 
  June 30, 2010 and 2009 (Unaudited - Stated in US Dollars) - Page 10

|Note 9  | Subsequent Events                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|        | Subsequent to June 30, 2010, the Board of Directors
      approved the issuance of 985,000 shares and the grant of 1,200,000 options
      to directors and consultants of the company for services rendered. The
      options vest on a graded vesting schedule where by 25% of the options will
      vest 3 months after the grant date and every 3 months thereafter until
      fully vested. They have an exercise price of $0.50 per share and are
      exercisable for a period of 8 years from the date of issue.
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|Note 10 | Comparative Figures                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|        | Certain of the comparative figures have been reclassified
      to conform with the presentation for the current period.                                                                                                                                                                                                                                                                                                                                                                                                    

---

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

Forward-Looking Statements

This quarterly report contains forward-looking statements.
These statements relate to future events or our future financial performance. In
some cases, you can identify forward-looking statements by terminology such as
may, should, expect, plan, anticipate, believe, estimate,
predict, potential or continue or the negative of these terms or other
comparable terminology. These statements are only predictions and involve known
and unknown risks, uncertainties and other factors, including the risks in the
section entitled Risk Factors, which may cause our or our industrys actual
results, levels of activity, performance or achievements to be materially
different from any future results, levels of activity, performance or
achievements expressed or implied by these forward-looking statements. Examples
of forward-looking statements in this quarterly report include statements
regarding, by way of example and not in limitation:

- the plans of Molecular Vision;
- our intention to acquire additional shares in Molecular Vision;
- our intention to close the share exchange transaction with Vardisto;
- our belief that certain products will be classified in certain categories
  for regulator purposes; and
- our cash requirements for the next 12 months.

Although we believe that the expectations reflected in the
forward-looking statements are reasonable, we cannot guarantee future results,
levels of activity, performance or achievements. Except as required by
applicable law, including the securities laws of the United States, we do not
intend to update any of the forward-looking statements to conform these
statements to actual results.

In this report, unless otherwise specified, all references to
common shares refer to the common shares of our capital stock.

As used in this quarterly report, the terms we, us, our,
and Acrongenomics refer to Acrongenomics Inc., unless otherwise indicated. All
references to $ means United States dollars.

Plan of Operation

Corporate Overview

Until August 19, 2008, we had been operating pursuant to a
development agreement with Molecular Vision Limited (Molecular Vision),
whereby we funded the development of the point-of-care device of Molecular
Vision in return for a license to commercialize and sell the device. On August
19, 2008, we changed our relationship with Molecular Vision by entering into an
interim agreement, and a subsequent agreement on November 13, 2008, whereby, we
terminated our previous development agreement in exchange for a royalty on
product sales or license fees received by Molecular Vision for products or
licenses based on Molecular Visions suite of patents, and we received 17,168
additional common shares of Molecular Vision.

On January 31, 2009, we entered into a share exchange agreement
with Vardisto Investments Limited (Vardisto), whereby we agreed to acquire 600
shares of common stock of Vardisto, representing 60% of their total outstanding
share capital in exchange for the issuance of 9,000,000 shares of our common
stock. The share exchange agreement is conditional upon certain events occurring
and there is no assurance that the share exchange agreement will close. As at
August 20, 2010, we have not issued the 9,000,000 share in connection with the
acquisition of Vardisto and the transaction has not closed.

3

---

Over the next 12 months, we will work on closing the share
exchange agreement with Vardisto. Further, we intend to work with Molecular
Vision to develop and commercialize the BioLED Technology.

Cash Requirements

We have not generated any revenues and our operating activities
have resulted in a loss of $153,694 for the three month period ended June 30,
2010 and a loss of $185,706 for the three month period ended June 30, 2009. This
negative cash flow is attributable to our operating expenses, including but not
limited to, general and administration and the payment of our consulting fees, audit fees and
legal fees. We anticipate that our expenses will increase as we intend to focus
on the development of our new project with Vardisto. We estimate our expenses in
the next 12 months will be approximately $1,800,000, generally falling in four
major categories: research and development, general and administrative expenses,
investor relations and professional fees.

We estimate our operating expenses and working capital
requirements for the next 12 months to be as follows:

Expense
    
    AmountResearch & Development
    $
    500,000General & Administrative
    $
    600,000Investor Relations
    $
    400,000Professional fees
    $
    300,000$
    1,800,000


Research & Development expenses are expected to include our
contributions to the research and development of the potential
cholesterol-lowering agent that is currently in development by the subsidiary of
Vardisto. If we do not acquire Vardisto, then we intend to seek out and acquire
another, as yet unknown, technology and to spend approximately this amount on
our research and development.

General & Administrative expenses will include consulting fees, office rent,
utilities, communication, office equipment and supplies, banking fees,
insurance, corporate materials, accounting and temporary office assistance.

Investor relations expenses will include the costs of paying
for investor relations representatives, press releases, advertising, and travel
expenses related to promoting our company.

Professional fees will include all payments to our outsourced
attorney and independent auditor.

As of June 30, 2010, we had approximately $495 in cash. We do
not have enough funds to pay for our estimated operating expenses for the next
12 months and require additional financing to continue our business. We
anticipate that we will have to address the cash shortfall through additional
equity financings in the future. We can offer no assurance, however, that such
financings will be available on terms acceptable to our company. The weakening
of economic conditions in the U.S. and around the world could have harmful
effects on our ability to raise money to fund our planned operations.

We believe that decreases in value of the common shares of many
companies worldwide will make selling shares of our common stock increasingly
difficult. If we are not able to sell enough of our shares to meet our financial
needs, we will have to consider borrowing the money we need. Because of the
credit crisis, it is possible that we would not be able to borrow adequate
amounts to fund our operations on terms and at rates of interest we find
acceptable and in our best interests. If we are unable to obtain the amount of
money that we need to fund our operations, then we will likely go out of
business and investors will lose their entire investment in our company.

We do not expect that the difficult economic conditions are
likely to improve significantly in the near future. Further deterioration of the
economy, and even consumer fear that the economy will deteriorate further could
intensify the adverse effects of these difficult market conditions.

4

---

Purchase of Significant Equipment

We do not intend to purchase any significant equipment.

Personnel Plan

We currently have two executive officers and one consultant,
which are engaged pursuant to consulting agreements.

General Administration

We anticipate spending approximately $600,000 on general and
administration costs in the next 12 months. These costs are expected to consist
primarily of travel, office, rent and consulting fees.

Results of Operations

Our operating results for the three and six month period ended
June 30, 2010 and June 30, 2009 are summarized as follows:

| |                   |   | Three    |   |   | Three    |   |   |            |   |   |            |  
| | ----------------- | - | -------- | - | - | -------- | - | - | ---------- | - | - | ---------- | -
| |                   |   | Months   |   |   | Months   |   |   | Six Months |   |   | Six Months |  
| |                   |   | Ended    |   |   | Ended    |   |   | Ended      |   |   | Ended      |  
| |                   |   | June 30, |   |   | June 30, |   |   | June 30,   |   |   | June 30,   |  
| |                   |   | 2010     |   |   | 2009     |   |   | 2010       |   |   | 2009       |  
| |                   |   |          |   |   |          |   |   |            |   |   |            |  
| | Revenue           | $ | -        |   | $ | -        |   | $ | -          |   | $ | -          |  
| | Expenses          |   | 153,694  |   |   | 185,706  |   |   | 284,088    |   |   | 383,010    |  
| | Net income (loss) | $ | (54,429  | ) |   | (232,337 | ) |   | (304,409   | ) |   | (443,619   | )

Revenue

We have not earned any revenues since our inception and we do
not anticipate earning revenues until such time as we have begun commercial
production or receive royalties from our investment with Molecular Vision.

Expenses

Our expenses for the three and six month period ended June 30,
2010 and 2009 are summarized as follows:

Three Months Ended
      
      
      Six Months EndedJune 30
      
      
      June 302010
      
      
      2009
      
      
      2010
      
      
      2009ExpensesAccounting and audit
        fees
      $
      67,409
      
      $
      59,403
      
      $
      116,374
      
      $
      94,182Amortization of patents
      
      -
      
      
      -
      
      
      -
      
      
      -Appraisals
      
      -
      
      
      -
      
      
      -
      
      
      -Bank charges
      
      461
      
      
      481
      
      
      763
      
      
      934Consulting fees
      
      64,500
      
      
      72,911
      
      
      129,674
      
      
      184,654Legal fees
      
      2,803
      
      
      31,872
      
      
      2,803
      
      
      42,438Management fees
      
      -
      
      
      -
      
      
      -
      
      
      11,647Office and miscellaneous
      
      486
      
      
      738
      
      
      1,151
      
      
      2,211Public relations and
        donation
      
      -
      
      
      -
      
      
      -
      
      
      7,600Rent
      
      15,455
      
      
      15,278
      
      
      30,743
      
      
      30,557Research and development
      
      -
      
      
      -
      
      
      -
      
      
      -Transfer agent and filing fees
      
      2,580
      
      
      2,399
      
      
      2,580
      
      
      4,291Travel
      
      -
      
      
      2,624
      
      
      -
      
      
      4,496Write-down of patents
      
      -
      
      
      -
      
      
      -
      
      
      -Total Expenses
      $
      153,694
      
      $
      185,706
      
      $
      284,088
      
      $
      383,010


5

---

Three Months Ended June 30, 2010 and 2009

Expenses for the three months ended June 30, 2010 decreased by
$32,012 over the same period in 2009.

Accounting and audit fees

Accounting and audit fees for the three months ended June 30,
2010 increased by $8,006 compared to the same period in 2009. This was primarily
the result of an increase in our audit fees for the year ended December 31,
2009, which were invoiced during the three month ended June 30, 2010.

Consulting fees

The consulting fees for the three months ended June 30, 2009
decreased by $8,411 compared to the same period in 2009. This was primarily the
result of reduction in termination of a temporary consultant.

Legal fees

Legal fees for the three months June 30, 2010 were reduced by
$29,069compared to the same period in 2009. This was primarily due to agreements
required in 2009 for the Vardisto Investments and for legal review of agreements
with Molecular Vision, which were not required in 2010.

Travel expenses

Travel expenses for the three months ended June 30, 2010
decreased by $2,624 compared to the same period ended June 30, 2009. This was
primarily the result of a reduction in travel during the three months ended June
30, 2010.

Six months ended June 30, 2010 and 2009

Expenses for the six months ended June 30, 2010 decreased by
$98,922 over the same period in 2009.

Accounting and audit fees

Accounting and audit fees for the six months ended June 30,
2010 increased by $22,192 compared to the same period in 2009. This was due to
increase in auditing fees invoiced during the six months after December 31,
2009.

Consulting fees

Consulting fees for the six months ended June 30, 2010
decreased by $54,980 compared to the same period in 2009. This was primarily the
result of recording in 2009 signing bonuses as consulting fees and paying
$20,000 to a temporary consultant.

Legal fees

Legal fees for the six months ended June 30, 2010 were reduced
by $39,635 due to additional work for agreements required in 2009 on Vardisto
Project and Molecular Vision, which was not required in 2010.

Management Fees

Management fees payable for the six months ended June 30, 2010
decreased by $11,647 compared to the same period in 2009. This is primarily due
to our not incurring any management fees for the six months ended June 30, 2010.

6

---

Public Relations and Donations

Public relations fees payable for the six months ended June 30,
2010 decreased by $7,600 compared to the same period in 2009. This is primarily
due to not paying any fees for public relations during the six months ended June
30, 2010.

Travel expense

Travel expense for the six months ended June 30, 2010 decreased
by $4,496 compared to the same period in 2009. This is primarily due to
reduction in travel operations.

Liquidity and Capital Resources

Working Capital

Our working capital as at June 30, 2010 and December 31, 2009
is summarized as follows:

|                          |   | At June 30, |   |   | At December 31, |  
|------------------------- | - | ----------- | - | - | --------------- | -
|                          |   | 2010        |   |   | 2009            |  
|Cash                      | $ | 495         |   | $ | 4,303           |  
|Current Assets            |   | 15,000      |   |   | 15,000          |  
|Current Liabilities       |   | (1,635,598  | ) |   | (1,380,671      | )
|Working Capital (Deficit) | $ | (1,620,103  | ) | $ | (1,361,368      | )

The increase in our working capital deficit of $258,735 was
primarily due to an increase in our accounts payable and accrued liabilities.

During February 2010, we sold 105,000 units to one offshore
investor at $0.40 per unit for gross proceeds of $42,000. Each unit consists of
one share of common stock and one warrant to purchase one share of our common
share at a price of $0.75 for a period of two years from the date of issuance.
We paid $4,200 commissions for the sale of these units.

During April 2010, we sold 25,000 units to one U.S. investor at
$0.40 per unit for gross proceeds of $10,000. Each unit consists of one share of
common stock and one warrant to purchase one share of our common share at a
price of $0.75 for a period of two years from the date of issuance. We paid
$1,000 as commissions for the sale of these units.

During May 2010, we sold 175,000 units to two offshore
investors at $0.20 per unit for gross proceeds of $35,000. Each unit consists of
one share of common stock and one warrant to purchase one share of our common
share at a price of $0.75 for a period of two years from the date of issuance.
No commissions were paid on the sale of these units.

We issued a convertible promissory note dated April 1, 2010
with a maturity date of October 1, 2010 for proceeds received in the amount of
€25,000 (US$33,090). The note bears interest at 8% per annum and is convertible
into units of our company at $0.20 per unit. Each unit will consist of one share
and one share purchase warrant exercisable at US $0.50 for a period of 2
years.

On April 8, 2010 we received $5,000 loan advance from one of
our stockholders. On April 14, 2010, we received $3,000 loan advance from one of
our stockholders. These loans are non-interest bearing and payable one month
from date of demand.

On March 5, 2010, we received unsecured advances of $7,320 from
Platon Tzouvalis, our president and one of our directors, and on May 14, 2010,
we repaid Mr. Tzouvalis in full. This advance was non-interest bearing and had
no specific terms for repayment.

7

---

On March 11, 2010 and May 14, 2010, we received unsecured
advances of $13,506.46 and $5,121.23, respectively, from Ron Lizée, our chief
financial officer and one of our directors, and his spouse. These advances are
non-interest bearing and have no specific terms for repayment.

Cash Flows

Our cash flow for the six month periods ended June 30, 2010 and
2009 is summarized as follows:

Six Months
    
    
    Six MonthsEnded
    
    
    EndedJune 30,
    
    
    June 30,2010
    
    
    2009Net cash used in operating
      activities
    
    (108,526
    )
    
    (399,079
    )Net cash used in investing activities
    
    -
    
    
    (14,142
    )Net cash provided by
      financing activities
    
    104,718
    
    
    419,000Increase (decrease) in cash during the period
    
    (3,808
    )
    
    5,779


Cash Used In Operating Activities

During the six months ended June 30, 2010, we used net cash in
operating activities in the amount of $108,526 primarily towards payments for
our expense of office, consulting and professional fees, as well as increasing
our accounts payables.

Cash Used In Investing Activities

During the six months ended June 30, 2010, we did not use any
cash in investing activities.

Cash from Financing Activities

We received net cash of $104,718 from financing activities
during the six months ended June 30, 2010. Net cash generated by financing
activities is attributable to cash received from the sale of 200,000 shares of
our common stock for a total of $45,000 and loan advances of $59,718.

Going Concern

We have historically incurred losses and have incurred a net
loss of $54,429 for the three months ended June 30, 2010 and $304,409 for the
six months ended June 30, 2010. Because of these historical losses, we will
require additional working capital to develop our business operations. We intend
to raise additional working capital through equity financing, bank financing
and/or advances from related parties or stockholder loans.

The continuation of our business is dependent upon obtaining
further financing and achieving a break even or profitable level of operations.
The issuance of additional equity securities by us could result in a significant
dilution in the equity interests of our current or future stockholders.
Obtaining commercial loans, assuming those loans would be available, will
increase our liabilities and future cash commitments.

There are no assurances that we will be able to either (i)
achieve a level of revenues adequate to generate sufficient cash flow from
operations; or (ii) obtain additional financing through either equity financing
and/or bank financing necessary to support our working capital requirements. To
the extent that funds generated from operations and any equity financing and/or
bank financing are insufficient, we will have to raise additional working
capital. No assurance can be given that additional financing will be available,
or if available, will be on terms acceptable to us. If adequate working capital
is not available we may scale down or even cease our operations.

8

---

Our auditors have included an explanatory paragraph in the
audit report of the year-ended December 31, 2009 financial statements that we
are in the development stage, we have not yet achieved profitable operations and
we are dependent on our ability to raise capital from shareholders or other
sources to meet our obligations and repay our liabilities arising from normal
business operations when they come due.

These conditions raise substantial doubt about our ability to
continue as a going concern. The financial statements do not include any
adjustments relating to the recoverability and classification of asset carrying
amounts or the amount and classification of liabilities that might be necessary
should we be unable to continue as a going concern.

Future Financing

We will require additional financing to fund our planned
operations, including researching and developing our patents, the related
compounds and any further intellectual property that we may acquire and entering
some of our current compounds into clinical trials. We currently do not have
committed sources of additional financing and may not be able to obtain
additional financing, particularly, if the volatile conditions in the stock and
financial markets, and more particularly the market for early development stage
biotechnology research and development company stocks persist.

There can be no assurance that additional financing will be
available to us when needed or, if available, that it can be obtained on
commercially reasonable terms. If we are not able to obtain the additional
financing on a timely basis, if and when it is needed, we will be forced to
delay or scale down some or all of our research and development activities or
perhaps even cease the operation of our business.

Since inception we have funded our operations primarily through
equity and debt financings and we expect that we will continue to fund our
operations through equity and debt financing. If we raise additional financing
by issuing equity securities, our existing stockholders ownership will be
diluted. Obtaining commercial loans, assuming those loans would be available,
will increase our liabilities and future cash commitments.

There is no assurance that we will be able to maintain
operations at a level sufficient for an investor to obtain a return on his, her,
or its investment in our common stock. Further, we may continue to be
unprofitable.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements that have or are
reasonably likely to have a current or future effect on our financial condition,
changes in financial condition, revenues or expenses, results of operations,
liquidity, capital expenditures or capital resources that is material to our
stockholders.

Item 3. Quantitative and Qualitative Disclosures About
Market Risks.

Not Applicable.

Item 4T. Controls and Procedures.

Disclosure Controls and Procedures

As required by Rule 13a-15 under the Securities Exchange Act of
1934, our management, with the participation of our principal executive officer
and our principal financial officer, evaluated our disclosure controls and
procedures (as defined in Rules 13a-15(e) of the Securities Exchange Act of
1934) as of the end of the period covered by this quarterly report on Form 10-Q.
Disclosure controls and procedures are controls and other procedures that are
designed to ensure that information required to be disclosed in our reports
filed or submitted under the Securities Exchange Act of 1934 is recorded,
processed, summarized and reported, within the time periods specified in the
Securities and Exchange Commissions rules and forms. Disclosure controls and
procedures include controls and procedures designed to ensure that information
required to be disclosed in our reports filed under the Securities Exchange Act
of 1934 is accumulated and communicated to our principal executive officer and
our principal financial officer to allow timely decisions regarding required
disclosure.

9

---

Based on that evaluation, our management, with the
participation of our principal executive officer and our principal financial
officer, concluded that as of the end of the period covered by this quarterly
report on Form 10-Q, our disclosure controls and procedures were not effective.
The ineffectiveness of our disclosure controls and procedures was due to the
material weaknesses disclosed below.

We intend to take appropriate and reasonable steps to make the
necessary improvements to remediate these deficiencies at some time in the
future. This will depend on our financial position and the managements
determination of which changes should be made and when. We intend to consider
the results of our remediation efforts and related testing as part of our
year-end assessment of the effectiveness of our internal control over financial
reporting.

We continue to have material weaknesses in our internal control
over financial reporting as disclosed in our annual report on Form 10-K filed on
April 15, 2010. We have not implemented remediation measures for the material
weaknesses described in our annual report due to lack of funds. These material
weaknesses are in our internal control processes over procurement and
disbursements, primarily related to lack of segregations of duties.

More specifically, management has identified the following
weaknesses:

- Our company does not have a code of conduct or ethics;
- Our company does not have Human Resources policies and Procedures and
  Function Activities are not clearly defined;
- Our company does not have a specific Mission Statement or Key Performance
  indicators;
- Our company's accounting staff does not have sufficient technical
  accounting knowledge relating to accounting for income taxes and complex US
  GAAP matters. Management corrected any errors prior to the release of our
  company's June 30, 2010 financial statements.

We intend to implement remediation measures for these material
weaknesses. Such remediation activities include the following:

| | (1) | We intend to appoint independent members to our audit
      committee in the 2010 fiscal year;                                                                                                              
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                             
| | (2) | We intend to update the documentation of our internal
      control processes, including formal risk assessment of our financial
      reporting processes as well as codify a code of conduct and
  ethics;
| |     |                                                                                                                                                                                                             
| | (3) | We intend to update our business plan to include a
      Mission Statement and document our key performance indicators;
  and                                                                               
| |     |                                                                                                                                                                                                             
| | (4) | We intend to engage the services of an independent
      consultant with sufficient expertise in complex US GAAP matters to assist
      us in the preparation of our financial statements.                 

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial
  reporting during the fiscal quarter ended June 30, 2010 that have materially
  affected, or are reasonably likely to materially affect our internal control
  over financial reporting.

10

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PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

We know of no material, existing or pending legal proceedings
to which we are a party or of which any of our properties is the subject. In
addition, we do not know of any such proceedings contemplated by any
governmental authorities. We know of no proceedings in which any of our
directors, officers or affiliates, or any registered or beneficial stockholder
is a party adverse to our company or has a material interest adverse to our
company.

Item 1A. Risk Factors.

Much of the information included in this report includes or is
based upon estimates, projections or other forward-looking statements. Such
forward-looking statements include any projections and estimates made by us and
our management in connection with our business operations. While these
forward-looking statements, and any assumptions upon which they are based, are
made in good faith and reflect our current judgment regarding the direction of
our business, actual results will almost always vary, sometimes materially, from
any estimates, predictions, projections, assumptions or other future performance
suggested herein. Such estimates, projections or other forward-looking
statements involve various risks and uncertainties as outlined below. We
caution the reader that important factors in some cases have affected and, in
the future, could materially affect actual results and cause actual results to
differ materially from the results expressed in any such estimates, projections
or other forward-looking statements.

Shares of our common stock are speculative, especially since we
are in the development stage of our new business. We operate in a volatile
sector of business that involves numerous risks and uncertainties. The risks and
uncertainties described below are not the only ones we face. Other risks and
uncertainties, including those that we do not currently consider material, may
impair our business. If any of the risks discussed below actually occur, our
business, financial condition, operating results or cash flows could be
materially adversely affected. This could cause the trading price of our
securities to decline, and you may lose all or part of your investment.
Prospective investors should consider carefully the risk factors set out below.

Risks Related to our Financial Condition

We have not earned any revenues since our incorporation and
only have a limited operating history in our current business, which raise doubt
about our ability to continue as a going concern.

Our company has a limited operating history in our current
business and is in the development stage. We have not generated any revenues
since our inception and we will, in all likelihood, continue to incur operating
expenses without significant revenues until Molecular Vision successfully
develops its BioLED Technology and commercializes its future point-of-care
testing devices. Our primary source of funds has been the sale of our common
stock. We cannot assure that we will be able to generate any significant
revenues or income. These circumstances make us dependent on additional
financial support until profitability is achieved.

Our independent auditors have expressed substantial doubt
about our ability to continue as a going concern, which may hinder our ability
to obtain future financing.

Since our inception, we have accumulated a deficit of
$27,982,184 as at June 30, 2010 and incurred a net loss of $411,789 during the
six month period ended June 30, 2010. These circumstances raise substantial
doubt about our ability to continue as a going concern, as described in the
explanatory paragraph to our independent auditors report on our consolidated
financial statements for the year ended December 31, 2009, which are included in
our annual report on Form 10-K filed with the SEC on April 15, 2010. Although
our consolidated financial statements raise substantial doubt about our ability
to continue as a going concern, they do not include any adjustments relating to
recoverability and classification of recorded assets, or the amounts or
classifications of liabilities that might be necessary in the event our company
cannot continue in existence.

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Risks Related to our Business

The global financial crisis has had, and may continue to
have, an impact on our business and financial condition.

The ongoing global financial crisis may also limit our ability
to access the capital markets at a time when we would like, or need, to raise
capital, which could have an impact on our ability to react to changing economic
and business conditions. Accordingly, if the global financial crisis and current
economic downturn continue or worsen, our business, results of operations and
financial condition could be materially and adversely affected.

The share exchange agreement with Vardisto may not complete
and we may not obtain an interest in the development of the potential
cholesterol-lowering agent.

The share exchange agreement may not complete and we may not
obtain an interest in the development of the potential cholesterol-lowering
agent. Even if we do obtain an interest in the potential cholesterol-lowering
agent, there is no assurance that it will ever become commercially viable. The
development of life science technology is extremely risky and expensive. It is
likely that we will never develop and sell a product that will make us
profitable. If we never become profitable, we will go out of business and
investors will lose all of the money they have invested in our company.

We need to raise additional financing to support the
research and development of future business but we cannot be sure that we will
be able to obtain additional financing on terms favorable to us when needed. If
we are unable to obtain additional financing to meet our needs, our operations
may be adversely affected or terminated.

Our ability to develop our business is dependent upon our
ability to raise significant additional financing when needed. Our future
capital requirements will depend upon many factors, including:

- the closing of the share exchange agreement with Vardisto;
- investments in other technologies or technology companies; and
- any additional investments in Molecular Vision, including investments
  required to maintain our ownership position.

We have limited financial resources and to date, no cash flow
from operations and we are dependent for funds on our ability to sell our common
stock, primarily on a private placement basis. There can be no assurance that we
will be able to obtain financing on that basis in light of factors such as the
market demand for our securities, the state of financial markets generally and
other relevant factors. Any sale of our common stock in the future will result
in dilution to existing stockholders. Furthermore, there is no assurance that we
will not incur debt in the future, that we will have sufficient funds to repay
our future indebtedness or that we will not default on our future debts,
jeopardizing our business viability. Finally, we may not be able to borrow or
raise additional capital in the future to meet our needs or to otherwise provide
the capital necessary to conduct the development of our technology, which might
result in the loss of some or all of your investment in our common stock.

Molecular Vision may be subject to intellectual property
litigation such as patent infringement claims, which could adversely affect our
business.

Other patents could exist or could be filed which would
prohibit or limit Molecular Visions ability to develop the BioLED Technology.
In the event of an intellectual property dispute, we may be forced to litigate.
Intellectual property litigation would divert attention away from developing the
BioLED Technology and marketing our potential products and be very expensive. An
adverse outcome could take our ability to develop or commercialize a potential
product and could prevent us from becoming profitable.

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Because some of our officers and directors are located in
non-U.S. jurisdictions, you may have no effective recourse against the
management for misconduct and may not be able to enforce judgment and civil
liabilities against our officers, directors, experts and agents.

Most of our directors and officers are nationals and/or
residents of countries other than the United States, and all or a substantial
portion of their assets are located outside the United States. As a result, it
may be difficult for you to enforce within the United States any judgments
obtained against our officers or directors, including judgments predicated upon
the civil liability provisions of the securities laws of the United States or
any U.S. state.

If we are deemed to be an investment company under the
Investment Company Act, we may be required to institute burdensome compliance
requirements and our activities may be restricted.

The Investment Company Act of 1940(the Investment
Company Act) contains substantive legal requirements that regulate the manner
in which investment companies are permitted to conduct their business
activities. If we are deemed to be an investment company under the Investment
Company Act, we may be required to institute burdensome compliance requirements
and our activities may be restricted, which would materially adversely affect
our business, financial condition and results of operations. In addition, our
contracts would be voidable and a court could appoint a receiver to take control
of and liquidate our business.

In order not to be regulated as an investment company under the
Investment Company Act, unless we can qualify for an exemption, we must ensure
that we are engaged primarily in a business other than investing, reinvesting,
owning, holding or trading in securities (as defined in the Investment Company
Act) and that we do not own or acquire investment securities having a value
exceeding 40% of the value of our total assets (exclusive of U.S. government
securities and cash items) on an unconsolidated basis. The SEC has adopted Rule
3a-1 that provides an exemption from registration as an investment company if a
company meets both an asset and an income test and is not otherwise primarily
engaged in an investment company business by, among other things, holding itself
out to the public as such or by taking controlling interests in companies with a
view to realizing profits through subsequent sales of these interests. A company
satisfies the asset test of Rule 3a-1 if it has no more than 45% of the value of
its total assets (adjusted to exclude U.S. Government securities and cash) in
the form of securities other than interests in majority-owned subsidiaries and
companies which it primarily and actively controls. A company satisfies the
income test of Rule 3a-1 if it has derived no more than 45% of its net income
for its last four fiscal quarters combined from securities other than interests
in majority owned subsidiaries and primarily controlled companies.

Our ability to hire and retain qualified personnel will be
an important factor in the success of our business and a failure to hire and
retain key personnel may result in our inability to manage and implement our
business plan.

Our ability to hire and retain qualified personnel will be an
important factor in the success of our business. In addition, in order to manage
growth effectively, we must implement management systems and continue to recruit
and train new employees. We may not be able to attract and retain the necessary
qualified personnel. If we are unable to retain or to hire qualified personnel
as required, we may not be able to adequately manage and implement our business
plan.

Our disclosure controls and procedures and internal control
over financial reporting were proven not effective, which may cause our
financial reporting to be unreliable and lead to misinformation being
disseminated to the public.

Our management evaluated our disclosure controls and procedures
as of June 30, 2010 and concluded that as of that date, our disclosure controls
and procedures were not effective. The ineffectiveness of our disclosure
controls and procedures was mainly due to a lack of knowledge regarding U.S.
generally accepted accounting principles and the rules of the Securities and
Exchange Commission by responsible people within our company.

In addition, our management evaluated our internal control over
financial reporting as of December 31, 2009 and concluded that that there were
material weaknesses in our internal control over financial reporting as of that
date and that our internal control over financial reporting was not effective as
of that date. A material weakness is a deficiency or a combination of control
deficiencies in internal control over financial reporting such that there is a

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reasonable possibility that a material misstatement of our
annual or interim financial statements will not be prevented or detected on a
timely basis. We intend to remedy these material weaknesses in the 2010 fiscal
year.

We have not yet remediated these material weaknesses and we
believe that our disclosure controls and procedures and internal control over
financial reporting continue to be ineffective. Until these issues are
corrected, our ability to report quarterly and annual financial results or other
information required to be disclosed on a timely and accurate basis may be
adversely affected and our financial reporting may continue to be unreliable,
which could result in additional misinformation being disseminated to the
public. Investors relying upon this misinformation may make an uninformed
investment decision.

Risks Related to our Common Stock

The weakening of economic conditions around the world could
have harmful effects on our company. If these harmful effects cause us to cease
our development of medical technologies, then our stockholders will likely lose
their entire investment in our company.

The weakening of economic conditions in the U.S. and around the
world could have harmful effects on our ability to raise money to fund our
planned operations. If this happens, we would likely go out of business and our
investors will lose their entire investment in our company.

We believe that decreases in value of the shares of many
companies worldwide will make selling shares of our common stock increasingly
difficult. If we are not able to sell enough of our shares to meet our financial
needs, we will have to consider borrowing the money we need. A tightening of
credit conditions has also been experienced in the economy recently. Because of
the recent credit crisis, it is possible that we would not be able to borrow
adequate amounts to fund our operations on terms and at rates of interest we
find acceptable and in the best interests of our company. If we are unable to
obtain the amount of money that we need to fund our operations, then we will
likely go out of business and investors will lose their entire investment in our
company.

Because we do not intend to pay any dividends on our common
stock, investors seeking dividend income or liquidity should not purchase shares
of our common stock.

We have not declared or paid any dividends on our common stock
since our inception, and we do not anticipate paying any such dividends for the
foreseeable future. Investors seeking dividend income or liquidity should not
invest in our common stock.

A decline in the price of our common stock could affect our
ability to raise further working capital and adversely impact our ability to
continue operations.

A prolonged decline in the price of our common stock could
result in a reduction in the liquidity of our common stock and a reduction in
our ability to raise capital. Because a portion of our continued operations will
be financed through the sale of equity securities, a decline in the price of our
common stock could be especially detrimental to our liquidity and our
operations. Such reductions may force us to reallocate funds from other planned
uses and may have a significant negative effect on our business plan and
operations, including our ability to develop new products and continue our
current operations. If our stock price declines, we can offer no assurance that
we will be able to raise additional capital or generate funds from operations
sufficient to meet our obligations. If we are unable to raise sufficient capital
in the future, we may not be able to have the resources to continue our normal
operations.

If we issue additional shares in the future, it will result
in the dilution of our existing stockholders.

Our articles of incorporation authorize the issuance of up to
100,000,000 shares of common stock with a par value of $0.001. Our board of
directors may choose to issue some or all of such shares to acquire one or more
businesses or to provide additional financing in the future. The issuance of any
such shares will result in a reduction of the book value and market price of the
outstanding shares of our common stock. If we issue any such additional shares,
such issuance will cause a reduction in the proportionate ownership and voting
power of all current stockholders. Further, such issuance may result in a change
of control of our company.

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Trading of our stock may be restricted by the Securities
Exchange Commissions penny stock regulations, which may limit a stockholders
ability to buy and sell our stock.

The Securities and Exchange Commission has adopted regulations
which generally define penny stock to be any equity security that has a market
price (as defined) less than $5.00 per share or an exercise price of less than
$5.00 per share, subject to certain exceptions. Our securities are covered by
the penny stock rules, which impose additional sales practice requirements on
broker-dealers who sell to persons other than established customers and
accredited investors. The term accredited investor refers generally to
institutions with assets in excess of $5,000,000 or individuals with a net worth
in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly
with their spouse. The penny stock rules require a broker-dealer, prior to a
transaction in a penny stock not otherwise exempt from the rules, to deliver a
standardized risk disclosure document in a form prepared by the Securities and
Exchange Commission, which provides information about penny stocks and the
nature and level of risks in the penny stock market. The broker-dealer also must
provide the customer with current bid and offer quotations for the penny stock,
the compensation of the broker-dealer and its salesperson in the transaction and
monthly account statements showing the market value of each penny stock held in
the customers account. The bid and offer quotations, and the broker-dealer and
salesperson compensation information, must be given to the customer orally or in
writing prior to effecting the transaction and must be given to the customer in
writing before or with the customers confirmation. In addition, the penny stock
rules require that prior to a transaction in a penny stock not otherwise exempt
from these rules, the broker-dealer must make a special written determination
that the penny stock is a suitable investment for the purchaser and receive the
purchasers written agreement to the transaction. These disclosure requirements
may have the effect of reducing the level of trading activity in the secondary
market for the stock that is subject to these penny stock rules. Consequently,
these penny stock rules may affect the ability of broker-dealers to trade our
securities. We believe that the penny stock rules discourage investor interest
in and limit the marketability of our common stock.

The Financial Industry Regulatory Authority, or FINRA, has
adopted sales practice requirements which may also limit a stockholders ability
to buy and sell our stock.

In addition to the penny stock rules described above, FINRA
has adopted rules that require that in recommending an investment to a customer,
a broker-dealer must have reasonable grounds for believing that the investment
is suitable for that customer. Prior to recommending speculative low priced
securities to their non-institutional customers, broker-dealers must make
reasonable efforts to obtain information about the customers financial status,
tax status, investment objectives and other information. Under interpretations
of these rules, FINRA believes that there is a high probability that speculative
low priced securities will not be suitable for at least some customers. FINRA
requirements make it more difficult for broker-dealers to recommend that their
customers buy our common stock, which may limit your ability to buy and sell our
stock and have an adverse effect on the market for our shares.

Our common stock is illiquid and the price of our common
stock may be negatively impacted by factors which are unrelated to our
operations.

Our common stock currently trades on a limited basis on the OTC
Bulletin Board. Trading of our stock through the OTC Bulletin Board is
frequently thin and highly volatile. There is no assurance that a sufficient
market will develop in our stock, in which case it could be difficult for
stockholders to sell their stock. The market price of our common stock could
fluctuate substantially due to a variety of factors, including market perception
of our ability to achieve our planned growth, quarterly operating results of our
competitors, trading volume in our common stock, changes in general conditions
in the economy and the financial markets or other developments affecting our
competitors or us. In addition, the stock market is subject to extreme price and
volume fluctuations. This volatility has had a significant effect on the market
price of securities issued by many companies for reasons unrelated to their
operating performance and could have the same effect on our common stock.

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Item 2. Unregistered Sales of Equity Securities and Use of
Proceeds.

Please see Item 5. Other Information of Part II of this
quarterly report on Form 10-Q.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. (Removed and Reserved).

Item 5. Other Information.

On March 5, 2010, we received unsecured advances of $7,320 from
Platon Tzouvalis, our president and one of our directors, and on May 14, 2010,
we repaid Mr. Tzouvalis in full. This advance was non-interest bearing and had
no specific terms for repayment.

On March 11, 2010 and May 14, 2010, we received unsecured
advances of $13,506.46 and $5,121.23, respectively, from Ron Lizée, our chief
financial officer and one of our directors, and his spouse. These advances are
non-interest bearing and have no specific terms for repayment.

On August 9, 2010, we issued an aggregate of 985,000 shares of
our common stock to nine consultants of our company for services rendered during
2009. Eight of these consultants were not U.S. persons (as that term is defined
in Regulation S of the Securities Act of 1933) and they received these shares in
transactions that occurred outside of the United States. In issuing these shares
to these eight consultants, we relied on the exemption from the registration
requirements of the Securities Act of 1933 provided for in Regulation S and/or
Section 4(2) of the Securities Act of 1933. The other consultant was a U.S.
person (as that term is defined in Regulation S of the Securities Act of 1933)
and in issuing these shares to this consultant, we relied on the exemption from
the registration requirements of the Securities Act of 1933 provided for in
Section 4(2) of the Securities Act of 1933.

On June 1, 2010, we granted 1,200,000 options to a director of
our company for the services rendered during 2009. The options vest on a graded
vesting schedule where by 25% of the options will vest 3 months after the grant
date and every 3 months thereafter until fully vested. They have an exercise
price of $0.50 per share and are exercisable for a period of 8 years from the
date of grant. In granting these options to the director, we relied on the
exemption from the registration requirements of the Securities Act of 1933
provided for in Section 4(2) of the Securities Act of 1933.

Item 6. Exhibits.

Exhibit No.
    Document Name(3)
    Articles of Incorporation and
      Bylaws3.1
    Articles of Incorporation
      (incorporated by reference to an exhibit to our registration statement on
      Form 10-SB filed on May 24, 2002, as amended)3.2
    Bylaws, as amended (incorporated
      by reference to an exhibit to our registration statement on Form 10- SB
      filed on May 24, 2002, as amended)(10)
    Material Contracts10.1
    Agreement for the Sale of Stock
      between our company and Dr. Leftheris Georgakopoulos dated February 13,
      2006 (incorporated by reference to an exhibit to our current report on
      Form 8-K filed February 16, 2006)10.2
    Development Agreement between our
      company and Molecular Vision Limited (incorporated by reference to an
      exhibit to our current report on Form 8-K filed on February 20, 2007)10.3
    Employment Agreement dated
      September 3, 2007 between our company and Dr. Dimitris Goundis
      (incorporated by reference to an exhibit to our current report on Form 8-K
      filed on September 28, 2007)


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Exhibit No.
      Document Name10.4
      Letter Agreement dated February
          1, 2008 with Molecular Vision Limited (incorporated by reference to
          an exhibit to our current report on Form 8-K filed on February 19, 2008)10.5
      Royalty Agreement dated November
          13, 2008 with Molecular Vision Limited (incorporated by reference to
          an exhibit to our current report on Form 8-K filed on November 20, 2008)10.6
      Supplemental Agreement to
          the Subscription and Shareholders Agreement relating to Molecular
          Vision Limited dated November 13, 2008 (incorporated by reference to
          an exhibit to our current report on Form 8-K filed on November 20, 2008)10.7
      Option Agreement dated November
          13, 2008 with Molecular Vision Limited to acquire additional 20,000
          shares of Molecular Vision Limited (incorporated by reference to an
          exhibit to our current report on Form 8-K filed on November 20, 2008)10.8
      Deed of Termination and Release
          dated November 13, 2008 with Molecular Vision Limited (incorporated
          by reference to an exhibit to our current report on Form 8-K filed on
          November 20, 2008)10.9
      Share Exchange Agreement dated
          January 31, 2009 between our company, Vardisto Investments Limited and
          a certain shareholder of Vardisto Investments Limited (incorporated
          by reference to an exhibit to our current report on Form 8-K filed on
          March 12, 2009)10.10
      Asset Purchase Agreement dated
          January 30, 2009 between Maragrita Hadzopoulou-Cladaras and Halldale
          Ventures Limited (incorporated by reference to an exhibit to our current
          report on Form 8-K filed on March 12, 2009)10.11
      Promissory note dated June
          12, 2008 issued to Ron and Johanne Lizée by our company (incorporated
          by reference to our quarterly report on Form 10-Q filed on May 15, 2009)10.12
      Promissory note dated July
          15, 2009 issued to Ron and Johanne Lizée by our company (incorporated
          by reference to our quarterly report on Form 10-Q filed on August 14,
          2009)10.13
      Employment Agreement dated
          April 1, 2007 between our company and Platon Tzouvalis (incorporated
          by reference to an exhibit to our annual report on Form 10-K filed on
          April 15, 2010)10.14
      Employment Agreement dated
          April 1, 2007 between our company and Manos Topoglidis (incorporated
          by reference to an exhibit to our annual report on Form 10-K filed on
          April 15, 2010)10.15
      Management and Operational
          Services Agreement dated October 1, 2008 between our company and Vardisto
          Investments Limited (incorporated by reference to an exhibit to our
          annual report on Form 10- K filed on April 15, 2010)(31)
      Section 302 Certifications31.1*
      Section
          302 Certification of Platon Tzouvalis31.2*
      Section
          302 Certification of Ron Lizée(32)
      Section 906 Certifications32.1*
      Section
          906 Certification of Platon Tzouvalis32.2*
      Section
          906 Certification of Ron Lizée


* Filed herewith.

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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.

ACRONGENOMICS INC.

By:  /s/ Platon
Tzouvalis       Platon
Tzouvalis       President and
Director       (Principal Executive
Officer)
       Date: August 20, 2010



By:  /s/ Ron
Lizée       Ron
Lizée       Chief Financial Officer and
Director       (Principal Financial Officer
and Principal        Accounting
Officer)
       Date: August 20, 2010

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