UNITED
STATES SECURITIES AND


EXCHANGE
COMMISSION


Washington,
D.C. 20549





FORM
10-Q





QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF


THE
SECURITIES EXCHANGE ACT OF 1934





For the
quarterly period ended March 31, 2009


Commission File No:0-27848





BIOFIELD
CORP.


(Name of
registrant in its charter)




Delaware
            13-3703450(State of other jurisdiction of Incorporation or
      Organization)
            (Employer
      Identification Number)1615
      Walnut Street, 3rd
      Floor, Philadelphia, PA
            19102(Address
      of principal executive offices)
            (Zip
      Code)





(215)
972-1717


(Registrant’s
telephone number, including area code)





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 30 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 (§232.405 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  [X]





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
definition of accelerated filer and large accelerated filer in Rule 12b-12 of
the Exchange Act (Check one):





Large Accelerated Filer
            
            [ 
      ]
            
            Accelerated Filer
            [
       ]Non-Accelerated
      Filer
            
            [ 
      ]
            
            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]








AS
OF MAY 8, 2009, THERE WERE 28,486,833 SHARES OF COMMON STOCK OUTSTANDING AND
12,300,000 SHARES OF VOTING PREFERRED STOCK OUTSTANDING.





PART I—FINANCIAL
INFORMATION





ITEM
1.     FINANCIAL STATEMENTS





BIOFIELD
      CORP.(A
      Development Stage Company)CONSOLIDATED
      BALANCE SHEETSMarch
      31,
                      
                      
                      December
      31,ASSETS
                      
                      2009
                      
                      
                      2008(Unaudited)
                      
                      
                      (Audited)CURRENT
      ASSETS:Cash
      and cash equivalents
                      
                      $
                      -
                      
                      
                      $
                      -Total
      current assets
                      
                      
                      -
                      
                      
                      
                      -PROPERTY
      AND EQUIPMENT - Net
                      
                      
                      4,864
                      
                      
                      
                      5,211TOTAL
      ASSETS
                      
                      $
                      4,864
                      
                      
                      $
                      5,211LIABILITIES
      AND STOCKHOLDERS’ DEFICITCURRENT
      LIABILITIES:Bank
      overdraft
                      
                      $
                      9,141
                      
                      
                      $
                      9,912Accounts
      payable
                      
                      
                      1,402,514
                      
                      
                      
                      1,402,514Accrued
      interest
                      
                      
                      1,062,056
                      
                      
                      
                      991,849Accrued
      expenses
                      
                      
                      2,076,822
                      
                      
                      
                      2,058,823Due
      to affiliate
                      
                      
                      329,687
                      
                      
                      
                      329,686Advances
      from stockholder
                      
                      
                      2,438,448
                      
                      
                      
                      2,378,973Notes
      payable
                      
                      
                      2,431,161
                      
                      
                      
                      2,410,951Line
      of credit
                      
                      
                      418,920
                      
                      
                      
                      418,920Total
      current liabilities
                      
                      
                      10,168,749
                      
                      
                      
                      10,001,628Commitments
      and contigenciesSTOCKHOLDERS’
      DEFICIT:Preferred
      stock, $.001 par value, 12,300,000 shares authorized,12,300,000
      shares issued and outstanding at March 31, 2009December
      31, 2008, respectively
                      
                      
                      12,300
                      
                      
                      
                      12,300Common
      stock, $.01 par value, 60,000,000 shares authorized,28,486,833
      and 24,793,500 shares issued at March 31, 2009 andDecember
      31, 2008, respectively
                      
                      
                      284,868
                      
                      
                      
                      247,935Treasury
      stock - 2,306,131 shares
                      
                      
                      (3,100
                      )
                      
                      
                      (3,100
                      )Stock
      subscriptions
                      
                      
                      3,849
                      
                      
                      
                      3,849Additional
      paid-in capital
                      
                      
                      75,008,620
                      
                      
                      
                      74,935,552Accumulated
      deficit during development stage
                      
                      
                      (85,470,422
                      )
                      
                      
                      (85,192,953
                      )Total
      stockholders’ deficit
                      
                      
                      (10,163,885
                      )
                      
                      
                      (9,996,417
                      )TOTAL
      LIABILITIES AND STOCKHOLDERS' DEFICIT
                      
                      $
                      4,864
                      
                      
                      $
                      5,211









2


BIOFIELD
      CORP.(A
      Development Stage Company)CONSOLIDATED
      STATEMENTS OF OPERATIONS - UNAUDITEDPeriod
      October 16,Three
      Months Ended
                          
                          
                          Three Months Ended
                          
                          
                          1987
      (Date ofMarch
      31,
                          
                          
                          March
      31,
                          
                          
                          Inception)
      Through2009
                          
                          
                          2008
                          
                          
                          March
      31, 2009REVENUE
                          
                          $
                          -
                          
                          
                          $
                          -
                          
                          
                          $
                          244,522COST
      OF SALESCost
      of goods sold
                          
                          
                          -
                          
                          
                          
                          -
                          
                          
                          
                          95,111Loss
      on write down of inventory
                          
                          
                          -
                          
                          
                          
                          -
                          
                          
                          
                          693,500GROSS
      PROFIT
                          
                          
                          -
                          
                          
                          
                          -
                          
                          
                          
                          (544,089
                          )OPERATING
      EXPENSES:Research
      and development
                          
                          
                          -
                          
                          
                          
                          -
                          
                          
                          
                          40,481,889Selling,
      general, and administrative
                          
                          
                          127,578
                          
                          
                          
                          88,377
                          
                          
                          
                          42,769,563Impairment
      of intangible assets
                          
                          
                          -
                          
                          
                          
                          -
                          
                          
                          
                          194,268Gain
      on disposition of fixed assets
                          
                          
                          -
                          
                          
                          
                          -
                          
                          
                          
                          (8,084
                          )Total
      operating expenses
                          
                          
                          127,578
                          
                          
                          
                          88,377
                          
                          
                          
                          83,437,636OTHER
      INCOME (EXPENSE):Interest
      income
                          
                          
                          -
                          
                          
                          
                          -
                          
                          
                          
                          2,476,722Interest
      expense
                          
                          
                          (149,891
                          )
                          
                          
                          (142,891
                          )
                          
                          
                          (3,755,014
                          )Amortization
      of shares issued to lendersand
      other finance costs
                          
                          
                          -
                          
                          
                          
                          -
                          
                          
                          
                          (405,523
                          )Royalty
      income and other
                          
                          
                          -
                          
                          
                          
                          -
                          
                          
                          
                          214,867Other
      expense
                          
                          
                          (149,891
                          )
                          
                          
                          (142,891
                          )
                          
                          
                          (1,468,948
                          )LOSS
      BEFORE INCOME TAXES
                          
                          
                          (277,469
                          )
                          
                          
                          (231,268
                          )
                          
                          
                          (85,450,673
                          )PROVISION
      FOR INCOME TAXES
                          
                          
                          -
                          
                          
                          
                          -
                          
                          
                          
                          (19,749
                          )NET
      LOSS
                          
                          $
                          (277,469
                          )
                          
                          $
                          (231,268
                          )
                          
                          $
                          (85,470,422
                          )NET
      LOSS PER SHARE:Basic
      and Diluted
                          
                          $
                          (0.01
                          )
                          
                          $
                          (0.02
                          )WEIGHTED-AVERAGE
      SHARESBasic
      and Diluted
                          
                          
                          25,860,411
                          
                          
                          
                          12,296,724












3






BIOFIELD
      CORP. ( A DEVELOPMENT STAGE COMPANY)CONSOLIDATED
      STATEMENTS OF CASH FLOWS - UNAUDITEDPeriod October 16,1987
      (Date ofThree
      Months Ended
                                          
                                          
                                          Three Months Ended
                                          
                                          
                                          Inception)
      ThroughMarch
      31,
                                          
                                          
                                          March 31,
                                          
                                          
                                          March
      31,2009
                                          
                                          
                                          2008
                                          
                                          
                                          2009CASH
      FLOWS FROM OPERATING ACTIVITIES:Net
      loss
                                          
                                          $
                                          (277,469
                                          )
                                          
                                          $
                                          (231,268
                                          )
                                          
                                          $
                                          (85,470,422
                                          )Adjustments
      to reconcile net loss to net cash used in operating
      activities:Depreciation
      and amortization
                                          
                                          
                                          347
                                          
                                          
                                          
                                          348
                                          
                                          
                                          
                                          2,762,943Amortization
      of premiums on short-term investments
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          156,692Amortization
      of deferred financing costs
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          2,296,978Loss
      on disposal of property and equipment
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          194,102Loss
      on license and settlement agreements
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          49,026Loss
      on abandonment of patent applications
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          303,234Loss
      on inventory write-down
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          602,308Impairment
      of intangible assets
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          194,268Vendor
      settlements
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          (77,257
                                          )Noncash
      compensation
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          3,533,451Gain
      from disposition of fixed assets
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          (159,473
                                          )Interest
      paid in common stock
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          575,260Accrued
      interest
                                          
                                          
                                          149,891
                                          
                                          
                                          
                                          142,891
                                          
                                          
                                          
                                          2,898,011Commisions
      and discounts on sale of common stock
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          96,919Loan
      repayment default payable in shares of common stock
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          350,000Consultancy
      fees paid in options
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          242,762Issuances
      of common stock for outstanding stock obligations
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          8,667,010Changes
      in assets and liabilities:Inventories
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          (602,308
                                          )Due
      to affiliate
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          329,687Accounts
      payable and accrued liabilities
                                          
                                          
                                          18,002
                                          
                                          
                                          
                                          (25,299
                                          )
                                          
                                          
                                          3,479,336Net
      cash used in operating activities
                                          
                                          
                                          (109,229
                                          )
                                          
                                          
                                          (113,328
                                          )
                                          
                                          
                                          (59,577,473
                                          )CASH
      FLOWS FROM INVESTING ACTIVITIES:Acquisitions
      of property and equipment
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          (2,610,691
                                          )Costs
      incurred for patents and patent applications
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          (782,527
                                          )Proceeds
      from sale of property and equipment
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          294,748Purchases
      of short-term investments
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          (26,476,638
                                          )Proceeds
      from sale and maturity of short-term investments
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          26,476,638Net
      cash used in investing activities
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          (3,098,470
                                          )CASH
      FLOWS FROM FINANCING ACTIVITIES:Bank
      overdraft
                                          
                                          
                                          (771
                                          )
                                          
                                          
                                          -
                                          
                                          
                                          
                                          9,141Repayments
      of capitalized lease obligations
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          (82,234
                                          )Proceeds
      from issuance of preferred stock
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          22,341,892Proceeds
      from issuance of common stock and common stock warrants
                                          
                                          
                                          110,000
                                          
                                          
                                          
                                          100,000
                                          
                                          
                                          
                                          35,313,258Proceeds
      from exercise of common stock
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          298,546Proceeds
      from issuance of notes payable
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          2,052,569Proceeds
      from borrowings on line of credit
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          418,920Advances
      from stockholder and related party
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          4,313,176Repayments
      of advances from stockholder
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          (1,874,728
                                          )Repurchases
      of common stock held in treasury
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          (3,100
                                          )Net
      cash provided by financing activities
                                          
                                          
                                          109,229
                                          
                                          
                                          
                                          100,000
                                          
                                          
                                          
                                          62,787,440NET
      INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
                                          
                                          
                                          -
                                          
                                          
                                          
                                          (13,328
                                          )
                                          
                                          
                                          111,497EFFECT
      OF EXCHANGE RATE CHANGES
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -
                                          
                                          
                                          
                                          (111,497
                                          )BEGINNING
      OF PERIOD
                                          
                                          
                                          -
                                          
                                          
                                          
                                          13,328
                                          
                                          
                                          
                                          -END
      OF PERIOD
                                          
                                          $
                                          -
                                          
                                          
                                          $
                                          -
                                          
                                          
                                          $
                                          -See
      notes to consolidated financial statements






4


BIOFIELD
      CORP.(A
      Development Stage Company)CONSOLIDATED
      STATEMENTS OF CASH FLOWS - UNAUDITED (continued)Period October 16,Three Months Ended
                                            
                                            
                                            Three Months Ended
                                            
                                            
                                            1987
      (Date of Inception) ThroughMarch
      31,
                                            
                                            
                                            March
      31,
                                            
                                            
                                            March
      31,2009
                                            
                                            
                                            2008
                                            
                                            
                                            2009SUPPLEMENTAL
      DISCLOSURES OF CASHFLOW
      INFORMATION:Cash
      paid for interest
                                            
                                            $
                                            -
                                            
                                            
                                            $
                                            -
                                            
                                            
                                            $
                                            857,003Cash
      paid for taxes
                                            
                                            $
                                            -
                                            
                                            
                                            $
                                            -
                                            
                                            
                                            $
                                            -SUPPLEMENTAL
      SCHEDULE FOR NONCASHINVESTING
      AND FINANCING ACTIVITIES:During
      the fiscal year ended December 31, 2005, 897,500 shares of Common
      Stockdue
      as penalty for non-payment of notes payable on maturity
      issued:
                                            
                                            $
                                            -
                                            
                                            
                                            $
                                            -
                                            
                                            
                                            $
                                            17,949During
      the fiscal year ended December 31, 2005, a principal shareholder and his
      associates repaidthe
      Company's line of credit and the debt is reflected in the financial
      statements asadvances
      from stockholder:
                                            
                                            $
                                            -
                                            
                                            
                                            $
                                            -
                                            
                                            
                                            $
                                            1,200,000During
      the fiscal year ended December 31, 2007, 1,000,000 shares of Common
      Stockissued
      to former employee, in lieu of accrued liabilities
                                            
                                            $
                                            -
                                            
                                            
                                            $
                                            -
                                            
                                            
                                            $
                                            100,000





















5





BIOFIELD CORP.


A
DEVELOPMENT STAGE COMPANY


NOTES TO UNAUDITED FINANCIAL
STATEMENTS




NOTE
1 – ORGANIZATION




Biofield
Corp. is a development-stage medical technology company, which has developed an
advanced medical device and associated diagnostic system (the Biofield
Diagnostic System or “BDS”) to assist in detecting breast cancer. The financial
statements are presented on the basis that the Company is a going concern, which
contemplates the realization of assets and the satisfaction of liabilities in
the normal course of business over a reasonable length of time. The financial
statements do not include any adjustments that might result from the outcome of
these uncertainties. The Company has incurred operating losses since its
inception. This condition raises substantial doubt as to the Company’s ability
to continue as a going concern as such continuance is dependent upon the
Company’s ability to raise sufficient capital.






The
accompanying interim unaudited financial information has been prepared pursuant
to the rules and regulations of the Securities and Exchange Commission
(SEC).  Certain information and footnote disclosures normally included
in financial statements prepared in accordance with accounting principles
generally accepted in the United States of America have been condensed or
omitted pursuant to such rules and regulations.  In the opinion of
management, all adjustments, consisting only of normal recurring adjustments,
necessary to present fairly the financial position of the Company as of March
31, 2009 and the related operating results and cash flows for the interim period
presented have been made. The results of operations of such interim periods are
not necessarily indicative of the results of the full year. This financial
information should be read in conjunction with the Consolidated Financial
Statements and Notes thereto included in the Company’s Annual Report on Form
10-K for the year ended December 31, 2008. There have been no changes in
significant accounting policies since December 31, 2008.




NOTE
2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES




Principals
of Consolidation





The
consolidated financial statements include the accounts of the Company and any
wholly owned subsidiaries. All material inter-company transactions and balances
have been eliminated in consolidation.





Use
of Estimates





The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities at
the date of the financial statement and the reported amounts of revenues and
expenses during the reporting period. Estimates that are critical to the
accompanying financial statements arise from the determination of the fair value
of the Company’s investment. Because such determination involves subjective
judgment, it is at least reasonably possible that the Company’s estimates could
change in the near term with respect to this matter.





Revenue
Recognition





The
Company has adopted and follows the guidance provided in the SEC’s Staff
Accounting Bulletin (“SAB”) No. 104, which provides guidance on the recognition,
presentation and disclosure of revenue in the financial statements.





Reclassification





Certain
amounts in the prior year consolidated financial statements have been
reclassified for comparative purposes to conform to the presentation in the
current year consolidated financial statements.






6







NOTE
3 – RECENT ACCOUNTING PRONOUNCEMENTS





In April 2009,Financial
Accounting Standard Board (“FASB”)issued three Final Staff Positionson Financial Accounting Standards (“FAS”) to provide additional guidance and
disclosures regarding fair value measurements and impairments of
securities. These three FSPs are effective for interim and annual periods
ending after June 15, 2009.





FSP FAS
157-4, “Determining Fair Value When the Volume and Level of Activity for the
Asset or Liability Have Significantly Decreased and Identifying Transactions
That Are Not Orderly”, provides guidance for estimating fair
value  when the volume and level of activity for an asset or liability
have significantly decreased. The Company does not expect that FSP FAS 157-4
will have a material impact on the Company’s consolidated financial
statements.





FSP FAS
115-2 and FAS 124-2, “Recognition and Presentation of Other-Than-Temporary
Impairments”, amends the other-than-temporary impairment guidance for debt
securities to make the guidance more operational and to improve the presentation
and disclosure of other-than-temporary impairments on debt and equity securities
in financial statements. The Company does not expect that FSP FAS 115-2 and FAS
124-2 will have a material impact on the Company’s consolidated financial
statements.





FSP FAS
107-1 and APB 28-1, “Interim Disclosures about Fair Value of Financial
Instruments”, requires disclosure about fair value of financial instruments for
interim reporting periods of publicly traded companies as well as in annual
financial statements. The Company will review the requirements of FSP FAS 107-1
and comply with its requirements.





On
January 12, 2009, the FASB issued 99-20-1, “Amendments to the Impairment
Guidance of EITF Issue No. 99-20”. FASB FSP 99-20-1 amends the impairment
guidance in EITF Issue No. 99-20, “Recognition of Interest Income and Impairment
on Purchased Beneficial Interests and Beneficial Interests that Continue to be
held by a Transferor in Securitized Financial Assets”. The intent of the FSP is
to reduce complexity and achieve more consistent determinations as to whether
other-than-temporary impairments of available for sale or held to maturity debt
securities have occurred. The FSP is effective for interim and annual reporting
periods ending after December 15, 2008. The adoption of this FSP did not have an
impact on the Company’s consolidated financial statements.





Employers’
Disclosures about Postretirement Benefit Plan Assets





In
December 2008, FASB issued FSP FAS No. 132(R)-1, “Employers’ Disclosures about
Postretirement Benefit Plan Assets.”  This FSP amends FASB Statement
No. 132(R) (“SFAS No. 132(R)”), “Employers’ Disclosures about Pensions and Other
Postretirement Benefits,” to provide guidance on an employer’s disclosures about
plan assets of a defined benefit pension or other postretirement
plan.  FSP FAS No. 132(R)-1 also includes a technical amendment to
SFAS No. 132(R) that requires a nonpublic entity to disclose net periodic
benefit cost for each annual period for which a statement of income is
presented.  The required disclosures about plan assets are effective
for fiscal years ending after December 15, 2009.  The technical
amendment was effective upon issuance of FSP FAS No. 132(R)-1.  The
adoption of the technical amendment of FSP FAS No. 132(R)-1 had no impact on the
Company’s consolidated financial position and results of
operations.





Effective
Date of FASB Interpretation No. 48 for Certain Nonpublic
Enterprises





In
December 2008, the FASB issued FSP No. 48-3, “Effective Date of FASB
Interpretation No. 48 for Certain Nonpublic Enterprises.”  FSP FIN No.
48-3 defers the effective date of FIN No. 48, “Accounting for Uncertainty in
Income Taxes,” for certain nonpublic enterprises as defined in SFAS No. 109,
“Accounting for Income Taxes.”  However, nonpublic consolidated
entities of public enterprises that apply U.S. generally accepted accounting
principles (GAAP) are not eligible for the deferral.  FSP FIN No. 48-3
was effective upon issuance.  The impact of adoption was not material
to the Company’s consolidated financial condition or results of
operations.






7







Disclosures
by Public Entities (Enterprises) about Transfers of Financial Assets and
Interests in Variable Interest Entities





In
December 2008, the FASB issued FSP FAS No. 140-4, “Disclosures by Public
Entities (Enterprises) about Transfers of Financial Assets and Interests in
Variable Interest Entities.”  This FSP amends SFAS No. 140,
“Accounting for Transfers and Servicing of Financial Assets and Extinguishments
of Liabilities,” to require public entities to provide additional disclosures
about transfers of financials assets.  FSP FAS No. 140-4 also amends
FIN No. 46(R)-8, “Consolidation of Variable Interest Entities,” to require
public enterprises, including sponsors that have a variable interest entity, to
provide additional disclosures about their involvement with a variable interest
entity.  FSP FAS No. 140-4 also requires certain additional
disclosures, in regards to variable interest entities, to provide greater
transparency to financial statement users.  FSP FAS No. 140-4 is
effective for the first reporting period (interim or annual) ending after
December 15, 2008, with early application encouraged.  The adoption
FSP FAS No. 140-4 had no impact on the Company’s consolidated financial position
and results of operations.





Determination
of the Useful Life of Intangible Assets





In April
2008, the FASB issued FSP FAS 142-3, “Determination of the Useful Life of
Intangible Assets,” which amends the factors that should be considered in
developing renewal or extension assumptions used to determine the useful life of
intangible assets under FASB 142 “Goodwill and Other Intangible Assets”. 
The intent of this FSP is to improve the consistency between the useful life of
a recognized intangible asset under SFAS No. 142 and the period of the expected
cash flows used to measure the fair value of the asset under SFAS No. 141
(revised 2007) “Business Combinations” and other U.S. generally accepted
accounting principles.    FSP FAS No. 143-3 is effective for the
first reporting period (interim or annual) ending after December 15, 2008, with
early application encouraged.  The adoption of FSP FAS No. 143-3 had
no impact on the Company’s consolidated financial statements.





Disclosure
about Derivative Instruments and Hedging Activities





In March
2008, the FASB issued SFAS No. 161, “Disclosure about Derivative Instruments and
Hedging Activities,” an amendment of FASB Statement No. 133, (SFAS No. 161).
This statement requires that objectives for using derivative instruments be
disclosed in terms of underlying risk and accounting designation. The Company
was required to adopt SFAS No. 161 on January 1, 2009. The adoption of SFAS No.
161 had no impact on the Company’s consolidated financial
statements.













8




NOTE
4 - EQUITY





During
the first quarter of 2009 the Company issued for cash 3,693,333 shares of common
stock for $110,000.








NOTE
5 - SUBSEQUENT EVENTS





None





ITEM
2.      MANAGEMENT’S DISCUSSION AND ANALYSIS OR
PLAN OF OPERATION





The
following discussion and analysis should be read in conjunction with our
Financial Statements and Notes thereto appearing elsewhere in this
document.





Certain
statements contained in this "Management's Discussion and Analysis of Financial
Condition and Results of Operations" and elsewhere in this report are
forward-looking statements that involve risks and
uncertainties.  These statements relate to future events or our future
financial performance.  In some cases, forward-looking statements can
be identified by terminology such as "may," "will",
"should",  "expect", "anticipate", "intend", "plan", "believe",
"estimate", "potential", or "continue", the negative of these terms or other
comparable terminology.   These statements involve a number of
risks and uncertainties.   Actual events or results may differ
materially from any forward-looking statement as a result of various factors,
including those described above and in the Company’s last Form 10-K for 2008
under "Risk Factors".  We have no obligation to release publicly the
result of any revisions to any of our "forward-looking statements" to reflect
events or circumstances that occur after the date of this Report or to reflect
the occurrence of other unanticipated events.





LIQUIDITY
AND CAPITAL RESOURCES





We have
financed our operations since inception almost entirely by the issuance of our
securities, interest income on the then unutilized proceeds from these issuances
and with loans made directly, or guaranteed and collateralized, by Dr. David
Long and certain of his affiliates (until the MKG Acquisition) and by MKG (after
the MKG Acquisition).





At March
31, 2009, we had a working capital deficiency of $10,163,885.





Our total
assets were $4,864 at March 31, 2009. There were no cash and cash equivalents at
March 31, 2009.  For the three months ended March 31, 2009, there was
no change in cash and cash equivalents from December 31, 2008.





Operating
Activities





During
the three months ended March 31, 2009, we had a net loss of $277,469, compared
to $231,268 for the three months ended March 31, 2008, an increase of $46,201 or
20.0%. During the three months ended March 31, 2009, our net cash used in
operating activities was $109,229, compared to $113,328 for the three months
ended March 31, 2008, a decrease of $4,099 or 3.6%. The decrease was primarily
due to an increase in accounts payable and accrued liabilities of $18,002 in
2009 compared to a decrease of $25,299 offset by the increase to net loss year
over year.





During
the three months ended March 31, 2009, we had depreciation and amortization in
connection with operating activities of $347 compared to $348 for the three
months ended March 31, 2008.





Investing
Activities





There
were no investing activities ended March 31, 2009 and March 31,
2008.








9







Financing
Activities





During
the three months ended March 31, 2009, we had net cash provided by financing
activities of $109,229, compared to $100,000 for the three months ended March
31, 2008, an increase of $9,229 or 9.2%. During the three months ended March 31,
2009, we had proceeds from issuance of common stock of $110,000 compared to
$100,000 for the three months ended March 31, 2008, an increase of $10,000 or
10.0%





While we
have raised capital to meet our working capital and financing needs in the past,
additional financing is required in order to meet our current and projected cash
flow deficits from operations and development. We are seeking financing in the
form of equity in order to provide the necessary working capital.  We
currently have no commitments for financing.  There is no guarantee
that we will be successful in raising the funds required.





By
adjusting its operations and development to the level of capitalization,
management believes it has sufficient capital resources to meet projected cash
flow deficits through the next twelve months. However, if we are not successful
in generating sufficient liquidity from operations or in raising sufficient
capital resources, on terms acceptable to us, this could have a material adverse
effect on our business, results of operations, liquidity and financial
condition.





The
independent auditors report on our December 31, 2008 financial statements states
that our recurring losses raise substantial doubts about our ability to continue
as a going concern.





RESULTS
OF OPERATIONS





Comparison
of the three month period ended March 31, 2009 with the three month period
ended


March
31, 2008.





In the
fiscal quarter ended March 31, 2009 and 2008, there were no sales and we did not
incur any cost of sales.





The total
operating expenses for the three months ended March 31, 2009 and March 31, 2008
were $127,578 and $88,377 respectively, thus representing an increase of $39,201
or 44.4%. This increase is due primarily to expenses related to new management
in 2009.





We did
not incur any research and development expenses or impairment to intangible
assets in the fiscal quarters ending March 31, 2009 and 2008.





Interest
expense for the three months ended March 31, 2009 and March 31, 2008, were
$149,891 and $142,891, representing an increase of $7,000 or 4.9%. The increase
is a direct result of increased debt in the first quarter of 2009.





As a
result of the foregoing, we incurred a net loss of $277,469 for the three months
ended March 31, 2009, compared to $231,268 for the three months ended March 31,
2008, an increase of $46,201, or 20.0%.





OFF-BALANCE
SHEET ARRANGEMENTS





None.





ITEM
3.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK





Not
Applicable.








10







ITEM
4T.   CONTROLS AND PROCEDURES





Our chief
executive officer and chief financial officer (the “Certifying Officers”) are
responsible for establishing and maintaining disclosure controls and procedures
for our company and our subsidiary. Such officers have concluded (based upon his
evaluation of these controls and procedures as of the end of the period covered
by this report) that our disclosure controls and procedures are effective to
ensure that information required to be disclosed by us in this report is
accumulated and communicated to management, including our principal executive
officers as appropriate, to allow timely decisions regarding required
disclosure.





The
Certifying Officers have also indicated that there were no significant changes
in our internal controls or other factors that could significantly affect such
controls subsequent to the date of his evaluation, and there were no corrective
actions with regard to significant deficiencies and material
weaknesses.




Our
management, including the Certifying Officers, does not expect that our
disclosure controls or our internal controls will prevent all error and all
fraud. A control system, no matter how well conceived and operated, can provide
only reasonable, not absolute, assurance that the objectives of the control
system are met. In addition, the design of a control system must reflect the
fact that there are resource constraints, and the benefits of controls must be
considered relative to their costs. Because of the inherent limitations in all
control systems, no evaluation of controls can provide absolute assurance that
all control issues and instances of fraud, if any, within a company have been
detected. These inherent limitations include the realities that judgments in
decision-making can be faulty, and that breakdowns can occur because of simple
error or mistake. Additionally, controls can be circumvented by the individual
acts of some persons, by collusion of two or more people or by management
override of the control. The design of any systems of controls also is based in
part upon certain assumptions about the likelihood of future events, and there
can be no assurance that any design will succeed in achieving its stated goals
under all potential future conditions. Because of these inherent limitations in
a cost-effective control system, misstatements due to error or fraud may occur
and not be detected.





CHANGES
IN INTERNAL CONTROL OVER FINANCIAL REPORTING





As
required by Rule 13a-15(d), the Company's Chief Executive Officer and Chief
Accounting Officer, also conducted an evaluation of Biofield's internal controls
over financial reporting to determine whether any changes occurred during the
fourth fiscal quarter that have materially affected, or are reasonably likely to
materially affect, the Company's internal control over financial reporting.
During the preparation of the Company's financial statements as of and for the
year ended December 31, 2008, the Company concluded that the then current system
of disclosure controls and procedures needed improvement, partly due to the
transition to new management, facilities, and auditors. As a result of this
conclusion, the Company initiated changes in internal control. It should be
noted that any system of controls, however well designed and operated, can
provide only reasonable, and not absolute, assurance that the objectives of the
system will be met. In addition, the design of any control system is based in
part upon certain assumptions about the likelihood of future
events.





Lack
of Adequate Accounting Staff





Due to
limitations in financial and management resources, the Company does not have
adequate accounting staff.  As a result, the Company took steps to
address its understaffed Finance and Accounting team to correct this material
weakness.  The Company engaged an independent contractor with
extensive CFO-level management and SEC reporting experience in public
companies.  The Company feels this addition to the Company's Finance
and Accounting team will improve the quality of future period financial
reporting.






11







PART
II.                      OTHER
INFORMATION





Item
1.                          Legal
Proceedings





As result
of the Company’s arrangement with third party to help manage the Company’s
operations and development of the BDS, the Company has forwarded much of what
was in its King of Prussia office to the third party’s certified manufacturing
and regulatory facilities near Atlanta, Georgia, and seeks to vacate the King of
Prussia office.  The landlord of the Company’s King of Prussia office
has subsequently filed for and obtained a judgment in
confession.  Counsel, for both sides, is in discussions to work out a
settlement terminating the lease.  The monthly rent is approximately
$3,500 and it is a 3 year lease. As of April 10, 2009, the Company
had  worked out all remaining issues with the Landlord and final
payment on the lease has been made..





The
Company was also advised that a judgment in the amount of $16,228 has been
entered against it and its former officer, Michael Yom.  The Company’s
counsel was advised of this matter only after judgment was entered and is
considering appropriate relief.  The Complaint only states that this
company sued for the price of goods sold and/or services provided on a book
account, although the Company’s present management is unaware of what goods
and/or services were allegedly provided to this company.





The
Company filed an action seeking a declaratory judgment and injunctive relief
against William R. Dunavant in the Eastern District of
Pennsylvania.  The Company is seeking a determination that Company has
no obligation to pay the remuneration contemplated by the consulting agreement
with Mr. Dunavant and injunctive relief to prevent Mr. Dunavant from continuing
to violate the confidentiality and restrictive covenants in the consulting
agreement.





We are
not a party to any other pending legal proceeding which is not routine
litigation incidental to our business or which involves a claim for damages
exceeding 10% of our current assets, nor are we aware of any current proceeding
concerning us that a governmental authority may be contemplating.





Item
1A.   RISK FACTORS





We Expect to Continue to
Incur Significant Operating Losses Which Endangers our Viability as a
Going-Concern





The
Company has never established adequate sources of operating revenue and had
incurred net operating losses since our inception.  At March 31, 2009,
we had an accumulated deficit of approximately $85.4 million.  These
losses have resulted principally from costs incurred in research and development
and clinical trials and from general and administrative costs associated with
our operations. We expect operating losses to continue, mainly due to the
anticipated expenses associated with the pre-market approval process and
proposed commercialization of our device, research and development and marketing
activities and administration costs.  Our continuing losses have
caused our independent accountants to qualify their audit report regarding our
use of "going concern" basis of accounting in preparation of our 2008
consolidated financial statements.  Although the Company, under MKG, is
now focused on distributing the BDS and complementary products overseas relying
on MKG’s foreign government, industry, and distribution relationships, there can
be no reasonable assurances, however, that such efforts will be to establish
predictable and scalable sources of revenue.





Our Cash Flow Problems Have
Caused Us to be Delinquent in Payments to Vendors and Other
Creditors





Since
1998, our lack of financial resources has caused us to delay payment of our
obligations as they became due in the ordinary course of our
business.  Such delays have damaged some of our vendor and
professional relationships, and have caused us to incur additional expenses in
the payment of late charges and penalties.  As of March 31, 2009, we
had a working capital deficiency of approximately $10.1 million and accounts
payable, primarily to service providers and vendors, aggregating approximately
$1.4 million, substantially all of which are past due. At March 31, 2009, we
have accrued expenses, primarily to Officers and Consultants for service
providers, aggregating approximately $2.1 million, substantially all of which
are past due.









12







We Will Require Significant
Additional Capital to Continue Operations Which May Not be
Available





Our
continued losses and operational plan require us to secure substantial equity
financing to continue in business.  As a result of our weak financial
position, lack of operating history, and inherent risk, the cost of obtaining
new finance will continue to be very high, and if arrangements involve issuance
of shares, the future dilution could be significant.  There can be no
reasonable assurances that equity financing, if available, can be obtained when
needed or on terms favorable to the Company or the existing holders of our
equity securities.





We Have a Limited Operating
History





We have
had a limited history of operations. Since inception in October 1987, we have
engaged principally in the development of our device, which has not been
approved for sale in the United States, and recently in securing distribution
rights for complimentary products. Consequently, we have little experience in
manufacturing, marketing and selling our products and no meaningful history upon
which you can evaluate the likelihood of our ultimate success.  There
can be no reasonable assurances, the Company will be successful.





We May Not Be Able to Obtain
Government Regulatory Approval to Market and Sell Our
Products





Regulation
by governmental authorities in the United States will be a significant factor in
the manufacture and marketing of our products, as well as our research and
development activities.  All of our proposed products will require
regulatory approval by governmental agencies before commercialization and our
products must undergo rigorous pre-clinical and clinical testing and other
pre-market approval procedures prescribed by the FDA. Various federal and, in
some cases, state statutes and regulations also govern or influence the
manufacturing, safety, labeling, storage, record keeping and marketing of
medical devices. The lengthy process of seeking these approvals, and the
subsequent compliance with applicable statutes and regulations, will require us
to expend substantial resources.  If we fail to obtain or are
otherwise substantially delayed in obtaining regulatory approvals, our business
and operations could be significantly and adversely affected. The regulation of
medical devices, particularly in Europe, continues to develop and we cannot
assure that, as new laws and regulations are adopted, these actions will not
have an adverse effect on us.





We May Never be Able to
Bring Our Device to Market or Sustain Its Sales After Regulatory
Approval





Our
device faces a high degree of uncertainty, including the following:





·
            We
      may not be able to obtain United States regulatory approval. Obtaining
      regulatory approval may take significantly more time and cost
      significantly more money than anticipated. Lack of United States
      regulatory approval has significantly affected our ability to sell our
      device outside of the United
States.


·
            We
      may not be able to produce our device in commercial quantities at
      reasonable cost.


·
            We
      may not be able to successfully market our device or find an appropriate
      corporate partner, if necessary, to assist us in the marketing of our
      device. Our device may not gain satisfactory market acceptance. Our device
      may be superseded by another product commercialized for the same use or
      may infringe patents issued to others, which would prevent us from
      marketing and selling our device.


·
            After
      approval, our device may be recalled or withdrawn at any time as a result
      of regulatory issues, including those concerning safety and
      efficacy.





If we are
unable to successfully market our device or sustain its sales, our business,
financial condition and results of operations will be significantly and
adversely affected.








13





We are Currently Dependent
on a Single Product Which Has Not Yet Been Commercialized




We intend
to develop additional applications for our device, based on its core technology,
none of these applications is expected to result in a commercial product for at
least several years, if at all. Consequently, until such time, if at all, as our
device is approved for commercial distribution in the United States, limited
distribution of our device overseas will account for substantially all of our
revenues, if any. The Company, under MKG, is proceeding to distribute the BDS
overseas and is working with foreign government, medical, and other experts to
develop the BDS for additional applications such as screening and diagnosis of
other cancers. Moreover, the Company, under MKG, is working to acquire the
rights to other medical technologies. There can be no reasonable assurances that
such efforts will be successful.




Our Contract Manufacturers
May be Unable to Produce Commercial Quantities of Our
Products




Our
current contract manufacturer for our device has not yet completed the redesign
of a new version of our device due to our delay in payment for its redesign
services and has not yet manufactured our device. We cannot assure you that it
will complete its redesign services or be able to manufacture in volume, when,
or if, the need may arise. If this situation occurs, our business could be
significantly and adversely affected. Given the interest generated overseas, the
Company, under MKG, is considering many options with regard to manufacture, both
in the U.S. and overseas, including China, India, and Mexico.  There
can be no reasonable assurances that such efforts will be
successful.




If Our Single Source
Suppliers are Unable to Deliver, Our Business Would Suffer




For
certain services and components, we currently rely on single suppliers. If we
encounter delays or difficulties with our third-party suppliers in producing,
packaging or distributing our device and its components, market introduction and
subsequent sales would be significantly adversely affected. If we are required
to rely on alternative sources of supply, we cannot assure you that we will be
able to enter into alternative supply arrangements at commercially acceptable
rates, if at all. If we are unable to obtain or retain qualified suppliers and
contract manufacturers on commercially acceptable terms, we will not be able to
commercialize our device as planned.  Our dependence upon third
parties for the manufacture and supply of our device and components may
significantly and adversely affect our ability to attain profitability and our
ability to manufacture and deliver our device on a timely and competitive
basis.




We May Not be Able to Apply
Our Technology to Other Uses and Products




We cannot
assure you that our technology will be approved and accepted for breast cancer
screening or for the detection of other cancers.  Furthermore, we also
cannot assure you, even if we can develop any new products or uses for our
current device that such products or uses would be approved by the FDA or by any
comparable foreign regulatory bodies, or would be commercially
viable.




Our Device Will Be Subject
to Continuing Review by the FDA Which Could Impact On Our Ability to Sell It in
the Future





Any
changes to our device or the manner in which it is used after it is approved
will require additional approval by the FDA. Our failure to receive approval of
such a change on a timely basis, or at all, would have a significant adverse
effect on our business.





A Failure of Our Contract
Manufacturers to Comply with FDA Regulations Would Impact on Our Ability to Sell
Our Device





We cannot
assure that our manufacturers will be in compliance with the FDA's quality
system regulations and good manufacturing practices, when the FDA inspects them,
or that they will continue to maintain this compliance. A failure to maintain
compliance could significantly delay approval of our pre-market application to
the FDA for our device or prevent us from marketing it if we obtain this
approval, and would have a significant adverse effect on our
business.








14





If Foreign Regulatory
Approvals are Withdrawn, Our Business Will Suffer





We cannot
assure you that the foreign regulatory approvals that we have received, which
allow us to sell the prior version of our device in certain foreign countries,
will not be withdrawn or that our redesigned device, when completed, will
receive regulatory approval. Our failure to continue to maintain these approvals
or to obtain any additional foreign approvals could have a significant adverse
effect on our business.





Changes to Health Care
Reimbursement Regulations and Practices Could Adversely Affect
Us





Our
ability to successfully commercialize our products will depend, in part, on the
extent to which reimbursement for the cost of our products and related treatment
will be available from government health administration authorities, private
health insurers and other organizations.  These third-party payers are
increasingly challenging the price of medical products and
services.





Several
proposals have been made that may lead to a government-directed national health
care system.  Adoption of this type of system could further limit
reimbursement for medical products, and we cannot assure you that adequate
third-party coverage will be available to enable us to establish, and then
maintain, price levels sufficient to generate reasonable profit. In addition, we
also cannot assure you that the U.S. government or foreign governments will not
implement a system of price controls.  Any change in the existing
system might significantly affect our ability to market our products
profitably.





Health Care Insurers May Not
Reimburse for the Use of Our Products





Governmental
health authorities, private health insurers and other organizations may not
approve the cost for the use of our device as an authorized medical expenditure
under their programs, which would severely restrict the marketability of our
device.





Certain Foreign Governments
May Not Give Reimbursement Code for Our Device





Government
health authorities, especially in the countries where most of the reimbursements
flow through government agencies, may not provide us with a reimbursement code,
which is required for claiming the cost for the use of our device from
government agencies.  If we are unable to obtain such reimbursement
codes in major markets, marketability of our device may be severely
restricted.





We Expect to Encounter
Difficulty in Hiring Required Personnel and the Loss of any Key Personnel Could
Adversely Affect our Operations





As a
small medical technology company, we are heavily dependent upon the talents of
key personnel.  Due to lack of funding, we are unable to pay current
salaries, and thus retention of employees is a difficult.  We use
services of some of the ex-employees as consultants when we have the cash and if
they are available to perform the required services.  Competition for
qualified personnel in the medical device and biotechnology industries is
intense and we do not know if we will be successful in our recruitment
efforts.  If we are unable to attract, and then retain, qualified
personnel, our operations will be significantly adversely affected.





Our Results of Operations
May Suffer if Foreign Trade is Restricted or Foreign Regulations are
Modified





Until we
receive approval from the FDA to market our device in the United States, our
revenues, if any, will be derived from international sales. A significant
portion of our revenues, therefore, may be subject to the risks associated with
international sales, including foreign regulatory requirements, economic or
political instability, shipping delays, fluctuations in foreign currency
exchange rates and various trade restrictions, all of which could have a
significant impact on our ability to deliver products on a competitive and
timely basis and our ability to achieve profitable operations.  Future
impositions of, or significant increases in the level of, customs duties, export
quotas or other trade restrictions could have a significant adverse effect on
our business.








15





We Face Substantial
Competition in the Medical Technology Field and May Not be Able to Successfully
Compete





The
medical technology industry is highly competitive, particularly in the area of
cancer screening and diagnostic products. We are likely to encounter significant
competition with respect to our device, as well as any other products that we
may develop.  A number of companies are engaged in the same field as
us, and many of these companies have significantly greater financial, technical
and marketing resources than us. In addition, many of these companies may have
more established positions in the industry and may be better equipped than us to
develop, refine and market their products.  Our inability to
successfully compete in the industry would have a significant adverse effect on
our business.





Our Device May be Rendered
Obsolete by Rapid Technological Changes





Methods
for the detection of cancer are subject to rapid technological innovation and we
cannot assure you that technological changes will not render our device
obsolete.  Likewise, we cannot assure you that the development of new
types of diagnostic medical equipment or technology will not have a significant
adverse effect on the marketability of our device.  Commercial
availability of any new product could render our device obsolete, which would
have a significant adverse effect on our business.





Product Liability Claims in
Excess of the Amount of Our Insurance Could Significantly Affect Our Financial
Condition





Our
business exposes us to potential product liability risks, which are inherent in
the testing, manufacturing and marketing of cancer detection products.
Significant litigation, none of which has involved us, has occurred in the past
based on allegations of false negative diagnoses of cancer.  While our
device does not purport to diagnose any patient, we cannot assure you that we
will not be subjected to future claims and potential liability. We cannot assure
you that claims against us arising with respect to our device will be
successfully defended or that any insurance which we then carry will be
sufficient to cover liabilities arising from these claims. A successful claim
against us in excess of any insurance coverage, which we may have, would, in
most instances, deplete our assets and have a significant adverse effect on our
business. Furthermore, we cannot assure that we will be able to obtain or
maintain liability insurance on acceptable terms.





Our Contract Manufacturers
Use Potentially Hazardous Materials, the Replacement of Which Could Affect Our
Costs





Although
we do not manufacture any of our products, we understand that various cleaning
solvents, used in connection with the contract manufacture of our products, may
contain potentially hazardous materials. As a result, our contract
manufacturers, in the future, could become subject to stringent federal, state
and local laws, rules, regulations and policies governing the use, generation,
manufacture, storage, air emission, effluent discharge, handling and disposal of
these materials. We cannot assure you that we will not incur significant future
price increases imposed by our contract manufacturers to comply with
environmental laws, rules, regulations and policies, or that our business will
not be significantly and adversely affected by current or future environmental
laws, rules, regulations and policies or by any releases or discharges of
hazardous materials.





If We are Unable to Protect
Our Intellectual Property Rights, We Could
Lose Our Competitive Advantage





Our
commercial success will be dependent upon proprietary rights that we own or
license.  We cannot assure you that any of our patents will not be
invalidated or that our patents will provide us protection that has commercial
significance. Litigation may be necessary to protect our patent positions, which
could be costly and time consuming. If any of our key patents that we own or
license is invalidated, our business may be significantly adversely affected. In
addition, other companies may have trade secrets or may independently develop
know-how or obtain access to our trade secrets, know-how or proprietary
technology, which could significantly and adversely affect our
business.






16






We Do Not Have
theFinancial
Resources to Enforce and Defend All of Our Intellectual Property
Rights





The
actions, which we may take to protect our intellectual property, may not be
adequate to deter misappropriation of this property. We currently do not have
adequate financial resources required to enforce, through litigation, our
intellectual property rights. In addition, litigation could result in a
substantial diversion of managerial time and resources, which could adversely
affect our business.





Our Device May InfringeThird Party
Intellectual Property Rights





Other
companies may have obtained other proprietary rights to technology that may be
potentially useful to us. It is possible that a third party could successfully
claim that our device or its components infringe on its intellectual property
rights. If this were to occur, we may be subject to substantial damages, and we
may not be able to obtain appropriate licenses at a cost that we could afford
and we may not have the ability to timely redesign our device. If we are
required to pay material damages or are unable to obtain these rights or are
unable to successfully redesign our device at a reasonable cost, our business
could be significantly and adversely affected.





Our Stock Price has Been
Volatile





The price
of our common stock has fluctuated substantially since our initial public
offering in 1996. The market price for our common stock, like that of the common
stock of many other medical device companies, is likely to continue to be highly
volatile.





Our PrincipalStockholder Can Control Most
Matters Requiring Approval by Our Stockholders





MKG owns
a majority of the outstanding voting securities and can determine the election
of our directors, and as a result, our policies and the outcome of all important
matters that are subject to the vote of our stockholders. This concentration of
ownership, among other things, also may increase our difficulty in raising
necessary financing.





We Lack Independent
Directors





We cannot
assure you that our Board of Directors will have any independent
directors.  In the absence of a majority of independent directors, our
Board of Directors could establish policies and enter into transactions without
independent review.  This presents the potential for a conflict of
interest between MKG, management, and our stockholders, and may increase our
difficulty in raising necessary financing. In addition, we cannot establish an
audit committee or compensation committee without independent directors, which
could prohibit us from listing our shares of common stock for trading on a
recognized national securities exchange or on any electronic exchange regulated
by NASDAQ.  MKG, intends to restructure the Company’s board of
directors in the future to bring recruit independent directors to preserve or
prepare for future potential listing opportunities. There can be no reasonable
assurances that such efforts will be successful.





WeHave Issued 12,300,000
shares ofPreferred Stock





The
Company issued 12,300,000 shares of voting preferred stock of the Company to Mr.
MacKay to consummate the conversion of the Converted Debt.  Each share
of voting preferred stock entitles the holder thereto to two (2) votes. For a
description of the Series A Preferred Stock, see the Company’s Form 8-K filed
January 23, 2008.








17





Our Stockholders Could be
Adversely Affected by the Anti-Takeover Effects of Delaware
Law





We are
subject to the provisions of Section 203 of the General Corporation Law of the
State of Delaware.  In general, Section 203 prohibits a publicly held
Delaware corporation from engaging in a "business combination" with an
"interested stockholder" for a period of three years after the date of the
transaction in which the person becomes an interested stockholder, unless the
business combination is approved in a prescribed manner or unless the interested
stockholder acquires at least 85% of the corporation's voting stock (excluding
shares held by certain designated stockholders) in the transaction in which it
becomes an interested stockholder. A "business combination" includes mergers,
asset sales and other transactions resulting in a financial benefit to the
interested stockholder. Subject to certain exceptions, an "interested
stockholder" is a person who, together with affiliates and associates, owns, or
within the previous three years did own, 15% or more of the corporation's voting
stock. This provision of the Delaware law could delay and make more difficult a
business combination, even if the business combination would be beneficial to
the interests of our stockholders, and also could limit the price certain
investors might be willing to pay for shares of our common stock.





We Do Not Expect that We
Will Pay Dividends





We have
never declared or paid any cash dividends on our capital stock and do not intend
to pay any cash dividends in the foreseeable future.





If We Fail to Remain Current
on Our Reporting Requirements, We Could be Removed from the OTC Bulletin Board,
We Could be Investigated by the SEC or We Could Incur Liability to Our
Shareholders.





Companies
trading on the OTC Bulletin Board, such as us, must be reporting issuers under
Section 12 of the Securities Exchange Act of 1934, as amended, and must be
current in their reports under Section 13, in order to maintain price quotation
privileges on the OTC Bulletin Board. If we fail to remain current on our
reporting requirements, we could be removed from the OTC Bulletin Board. As a
result, the market liquidity for our securities could be severely adversely
affected by limiting the ability of broker-dealers to sell our securities and
the ability of stockholders to sell their securities in the secondary market.
Failure to remain current in our reporting obligations might also subject us to
SEC investigation or private rights of action by our shareholders.





Our Common Stock is Subject to the
"Penny Stock" Rules of the SEC and the Trading Market in Our Securities is
Limited, Which Makes Transactions in Our Stock Cumbersome and May Reduce the
Value of an Investment in Our Stock.





The
Securities and Exchange Commission has adopted Rule 15g-9 which establishes the
definition of a "penny stock," for the purposes relevant to us, as any equity
security that has a market price of less than $5.00 per share or with an
exercise price of less than $5.00 per share, subject to certain exceptions. For
any transaction involving a penny stock, unless exempt, the rules
require:





·
            that
      a broker or dealer approve a person's account for transactions in penny
      stocks;


·
            and
      the broker or dealer receive from the investor a written agreement to the
      transaction, setting forth the identity and quantity of the penny stock to
      be purchased.





In order
to approve a person's account for transactions in penny stocks, the broker or
dealer must:





·
            obtain
      financial  information and investment  experience
      objectives of the person; and


·
            make
      a reasonable determination that the transactions in penny stocks are
      suitable for that person and the person has
      sufficient  knowledge and experience in
      financial  matters to be capable of evaluating the risks of
      transactions in penny stocks.








18





The
broker or dealer must also deliver, prior to any transaction in a penny stock, a
disclosure schedule prescribed by the Commission relating to the penny stock
market, which, in highlight form:





·
            sets  forth  the  basis  on  which  the  broker  or  dealer  made  the
      suitability determination; and


·
            that
      the broker or dealer received a signed, written agreement from the
      investor prior to the transaction.





Generally,
brokers may be less willing to execute transactions in securities subject to the
"penny stock" rules. This may make it more difficult for investors to dispose of
our common stock and cause a decline in the market value of our
stock.





Disclosure
also has to be made about the risks of investing in penny stocks in both public
offerings and in secondary trading and about the commissions payable to both the
broker-dealer and the registered representative, current quotations for the
securities and the rights and remedies available to an investor in cases of
fraud in penny stock transactions. Finally, monthly statements have to be sent
disclosing recent price information for the penny stock held in the account and
information on the limited market in penny stocks.





Stock Issued by the Company
is Subject to Rule 144 of the Securities Act of
1933





Stock
issued by the Company is subject to Rule 144 of the Securities Act of 1933 and
the restrictions therein.





In
addition to the above risk factors, see the risk factors set forth in the
Company’s Form 10-K for fiscal year ending December 31, 2008 filed April 13,
2009.  These include risks associated with the political and economic
environment, foreign currency exchange and the legal system in foreign
countries. The economy of China and other foreign countries differs
significantly from the economies of the western industrialized nations in such
respects as structure, level of development, growth rate,
capital   reinvestment, repatriation, resource allocation,
self-sufficiency, rate of inflation and balance of payment positions, among
others. While certain foreign governments such as China have enacted laws
encouraging foreign investment, it remains to be seen how uniformly they will be
enforced and interpreted.





As to
China, a major focus of the Company, under MKG, the Chinese economy has
experienced significant growth in the past several years, but such growth has
been uneven among various sectors of the economy and geographic
regions.  Such development and growth may present risks to entities
operating in China.  Because of the challenges created by such growth,
the Chinese government has indicated and taken certain steps to control such
growth and address such challenges. Actions by Chinese government to control
inflation, for example, have restrained economic expansion in the recent past
across several industrial sectors. Similar and continued actions by the Chinese
government in the future could have a significant adverse effect on domestic
economic condition in China. There can be no reasonable assurances that there
will not be any changes respecting Chinese government, economy, laws, and
regulation which may adversely affect the Company.





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





None.





Item
3.                         
Defaults Upon Senior Securities





None.








19







Item
4.                          Submission
of Matters to a Vote of Security Holders





No matter
was submitted to a vote of our securities holders during the fiscal quarter
ended March 31, 2009.





Item
5.                          Other
information





Not
applicable.





Item
6.                          Exhibits
and Reports on Form 8-K





Exhibits





31.           Rule
13a-14(a)/15d-14(a) Certifications





*31.1
Certification of Shepard G. Bentley Chief Executive Officer





*31.2
Certification of Steven M. Waszak Chief Financial Officer





32.           Section
1350 Certifications





*32.1
Certification of Shepard G. Bentley Chief Executive Officer





*32.2
Certification of Steven M. Waszak Chief Financial Officer


20








SIGNATURES





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





BIOFIELD
      CORP.Date:  May
      15, 2009
            By:
            /s/  Shepard
      G.BentleyShepard
      G. BentleyChief
      Executive OfficerBy:
            /s/  Steven M.
    WaszakSteven
      M. WaszakChief
      Financial Officer











21