FORM 10-Q SB

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act of
1934

For Quarter Ended November 30, 2004              Commission File Number  0-7405

                          MEDISCIENCE TECHNOLOGY CORP.
--------------------------------------------------------------------------------
(Exact Name of Registrant as Specified in its Certificate of Incorporation)

                                   New Jersey
--------------------------------------------------------------------------------
(State or other jurisdiction on incorporation or organization)

                                   22-1937826
--------------------------------------------------------------------------------
(I.R.S. Employer Identification Number)

               1235 Folkestone Way, Cherry Hill, New Jersey 08034
--------------------------------------------------------------------------------
(Address of principal executive offices)

(Registrant's telephone number, including area code) 856-428-7952
                                                     ------------

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes |X|  No |_|

Registrant has not been involved in bankruptcy  proceedings during the preceding
five years.

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock, as of November 30, 2004.

      Title of Class                               Number of Shares Outstanding
      --------------                               ----------------------------

Common Stock, par value
$.01 per share                                               53,346,647

<PAGE>

                          MEDISCIENCE TECHNOLOGY CORP.
                          ----------------------------
                                NOVEMBER 30, 2004
                                -----------------

                                      INDEX
                                      -----

                                                                            PAGE
                                                                            ----

PART I.  Financial Information

Item 1.  Financial Statements

         Consolidated Balance Sheet as of November 30, 2004
         (Unaudited) and February 29, 2004 (Audited)                         1

         Consolidated Statement of Operations for the Nine and Three
         Months Ended November 30, 2004 (Unaudited) and November 30,
         2003 (Unaudited)                                                    2

         Consolidated Statement of Changes in Stockholders' Deficit
         for the Nine Months Ended November 30, 2004 (Unaudited)             3

         Consolidated Statement of Cash Flows for the Nine Months
         Ended November 30, 2004 (Unaudited) and November 30, 2003
         (Unaudited)                                                         4

         Exhibit to Consolidated Statement of Operations                     5

         Notes to Financial Statements                                      6-14

Item 2.  Management's Discussion and Analysis or Plan of
         Operation                                                         15-16

Item 3.  Controls and Procedures                                           17-18

PART II. Other Information                                                   19

Item 1.  Legal Proceedings

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

Item 3.  Defaults Upon Senior Securities

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

Item 5.  Other Information

Item 6.  Exhibits and Reports on Form 8-K

         Signatures                                                          20

         Exhibit Index                                                       21

<PAGE>

                          MEDISCIENCE TECHNOLOGY CORP.
                          ----------------------------
                           CONSOLIDATED BALANCE SHEET
                           --------------------------

<TABLE>
<CAPTION>
                                     ASSETS
                                     ------
                                                                          November 30,      February 29,
                                                                               2004             2004
                                                                           (Unaudited)       (Audited)
                                                                          ------------      ------------
<S>                                                                       <C>               <C>
CURRENT ASSETS
--------------
      Cash and Cash Equivalents                                           $    342,878      $  1,406,371
      Prepaid Expenses                                                             938             3,388
                                                                          ------------      ------------
           Total Current Assets                                                343,816         1,409,759

PROPERTY, PLANT AND EQUIPMENT
-----------------------------
      Net of accumulated depreciation $204,552 -
        November 30, 2004; $204,361 - February 29, 2004                            701               892

OTHER ASSETS - Security Deposit                                                  1,800             1,800
------------
             - Deferred Costs                                                1,653,955                --
                                                                          ------------      ------------
TOTAL ASSETS                                                              $  2,000,272      $  1,412,451
------------                                                              ============      ============
                         LIABILITIES AND STOCKHOLDERS' DEFICIT
                         -------------------------------------

CURRENT LIABILITIES
-------------------
      Current Portion of Officer and Other Loans                          $     31,542      $    181,587
      Accounts Payable                                                          82,443            19,505
      Accrued Liabilities                                                    2,812,647         3,132,686
                                                                          ------------      ------------
           Total Current Liabilities                                         2,926,632         3,333,778
                                                                          ------------      ------------
LONG-TERM LIABILITIES
---------------------
      Long-Term Portion of Other Loans                                         280,000                --
                                                                          ------------      ------------
           Total Liabilities                                                 3,206,632         3,333,778
                                                                          ------------      ------------
STOCKHOLDERS' DEFICIT
---------------------
      Convertible Preferred Stock, $.01 Par Value, 50,000 Shares
         Authorized; Issued and Outstanding -0- Shares - November 30,
         2004; 60 Shares - February 29, 2004                                        --                 1
      Common Stock $.01 Par Value, Authorized 199,950,000
         Shares; Issued and Outstanding 53,346,647 Shares -
         November 30, 2004; 39,372,753 Shares - February 29, 2004              533,467           393,727
      Additional Paid-in Capital                                            22,395,478        20,076,019
      Accumulated Deficit                                                  (24,135,305)      (22,391,074)
                                                                          ------------      ------------
           Total Stockholders' Deficit                                      (1,206,360)       (1,921,327)
                                                                          ------------      ------------
TOTAL LIABILITIES & STOCKHOLDERS' DEFICIT                                 $  2,000,272      $  1,412,451
-----------------------------------------                                 ============      ============
</TABLE>

                 See Notes to Consolidated Financial Statements.


                                     - 1 -
<PAGE>

                          MEDISCIENCE TECHNOLOGY CORP.
                          ----------------------------
                      CONSOLIDATED STATEMENT OF OPERATIONS
                      ------------------------------------
         FOR THE NINE AND THREE MONTHS ENDED NOVEMBER 30, 2004 AND 2003
         --------------------------------------------------------------
                                   (UNAUDITED)
                                   -----------

<TABLE>
<CAPTION>
                                                NINE MONTHS                        THREE MONTHS
                                                -----------                        ------------
                                           2004              2003              2004              2003
                                           ----              ----              ----              ----
<S>                                    <C>               <C>               <C>               <C>
Net Sales                              $         --      $         --      $         --      $         --

Cost of Sales                                    --                --                --                --
                                       ------------      ------------      ------------      ------------

       Gross Profit                              --                --                --                --

General and Administrative Expense        1,310,111           490,296           497,803           162,469
Product Development Expense                 306,122            17,725            90,537             3,593
Debt Conversion Inducement Expense           58,555                --                --                --
Advertising, Travel and Marketing            72,245            55,384            35,023             6,239
                                       ------------      ------------      ------------      ------------
       Total Expenses                     1,747,033           563,405           623,363           172,301
                                       ------------      ------------      ------------      ------------

Other Income                                  2,802               427               302                61
                                       ------------      ------------      ------------      ------------

Net Loss                               $ (1,744,231)     $   (562,978)     $   (623,061)     $   (172,240)
                                       ============      ============      ============      ============

Basic and Diluted Loss Per Common
   Share                               $     (0.034)     $     (0.015)     $      (0.01)     $     (0.005)
                                       ============      ============      ============      ============

Weighted Average Common Shares
   Outstanding                           51,677,488        38,433,523        52,539,980        39,372,753
                                       ============      ============      ============      ============
</TABLE>

                 See Notes to Consolidated Financial Statements.


                                     - 2 -
<PAGE>

                  MEDISCIENCE TECHNOLOGY CORP. AND SUBSIDIARIES
                  ---------------------------------------------
           CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' DEFICIT
           ----------------------------------------------------------
                   FOR THE NINE MONTHS ENDED NOVEMBER 30, 2004
                   -------------------------------------------
                                   (UNAUDITED)
                                   -----------

<TABLE>
<CAPTION>
                                                                                                        Additional
                                                                                                        ----------
                                                         Preferred Stock             Common Stock         Paid-In       Accumulated
                                                         ---------------             ------------         -------       -----------
                                                      Shares        Amount      Shares        Amount      Capital         Deficit
                                                      ------        ------      ------        ------      -------         -------
<S>                                                         <C>    <C>        <C>          <C>           <C>             <C>
BALANCE, FEBRUARY 29, 2004                                  60     $     1    39,372,753   $  393,727  $ 20,076,019    $(22,391,074)

    Conversion of Preferred Stock                          (60)         (1)    6,000,000       60,000       (59,999)

    Issuance of Stock - Exercise of Warrants                                     150,000        1,500        (1,500)

    Issuance of Stock for Future Consulting Services                           1,925,000       19,250     1,232,000

    Issuance of Stock - Anti-dilution Rights                                   3,083,338       30,834       (30,834)

    Issuance of Stock - Debt Conversion                                        1,460,000       14,600       229,470

    Issuance of Stock - Debt Conversion and Future
      Consulting Services                                                        200,000        2,000       116,000

    Issuance of Stock for Secretarial and
       Consulting Services                                                       155,556        1,556        90,222

    Issuance of Stock-Collaborative Research
       Agreement                                                               1,000,000       10,000       744,100

    Net Loss                                                                                                             (1,744,231)
                                                      --------     -------   -----------   ----------  ------------    ------------

BALANCE, NOVEMBER 30, 2004                                  --     $    --    53,346,647   $  533,467  $ 22,395,478    $(24,135,305)
                                                      ========     =======   ===========   ==========  ============    ============
</TABLE>

                 See Notes to Consolidated Financial Statements.


                                     - 3 -
<PAGE>

                          MEDISCIENCE TECHNOLOGY CORP.
                          ----------------------------
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                      ------------------------------------
              FOR THE NINE MONTHS ENDED NOVEMBER 30, 2004 AND 2003
              ----------------------------------------------------
                                   (UNAUDITED)
                                   -----------

<TABLE>
<CAPTION>
                                                                     2004             2003
                                                                     ----             ----
<S>                                                              <C>              <C>
CASH FLOWS FROM OPERATING ACTIVITIES
------------------------------------
       Net Loss                                                  $(1,744,231)     $  (562,978)
       Adjustments to Reconcile Net Loss to Net Cash Used in
          Operating Activities:
             Depreciation                                                191              192
             Amortization of Deferred Costs                          471,079               --
             Debt Conversion Inducement Expense                       58,555               --
             Issuance of Common Stock for Services                    32,778               --
                                                                 -----------      -----------
             Subtotal                                             (1,181,628)        (562,786)

       Changes in Assets and Liabilities:
             Decrease in Prepaid Expenses                              2,450           13,992
             (Decrease) Increase in Accounts Payable                  62,938          (22,527)
             (Decrease) Increase in Accrued Liabilities             (227,253)         415,694
                                                                 -----------      -----------
                   Net Cash Used in Operating Activities          (1,343,493)        (155,627)
                                                                 -----------      -----------
CASH FLOWS  FROM INVESTING ACTIVITIES
-------------------------------------                                     --               --
                                                                 -----------      -----------
CASH FLOWS FROM FINANCING ACTIVITIES
------------------------------------
       Proceeds From Issuance of Debt                                280,000               --
       Increase in Officer Loans                                          --           37,502
       Proceeds From Exercise of Common Stock Warrants                    --           19,000
                                                                 -----------      -----------
                   Net Cash Provided by Financing Activities         280,000           56,502
                                                                 -----------      -----------
DECREASE IN CASH AND CASH EQUIVALENTS                             (1,063,493)         (99,125)
-------------------------------------

CASH AND CASH EQUIVALENTS
-------------------------

       Beginning Balance                                           1,406,371          119,681
                                                                 -----------      -----------

       Ending Balance                                            $   342,878      $    20,556
                                                                 ===========      ===========
</TABLE>

                 See Notes to Consolidated Financial Statements.


                                     - 4 -
<PAGE>

                 EXHIBIT TO CONSOLIDATED STATEMENT OF OPERATIONS
                  WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING
                                   (UNAUDITED)
                                   -----------

<TABLE>
<CAPTION>
                                                                       Nine Months Ended November 30, 2004
                                                        -----------------------------------------------------------------
                                                                                      Weighted
                                                             Net                   Average Shares              Per Share
                                                            Loss                     Outstanding                 Amount
                                                            ----                     -----------                 ------
<S>                                                     <C>                          <C>                       <C>
Basic/diluted loss per common share:

Net Loss                                                $(1,744,231)                 51,677,488                $  (0.034)

       Effect of dilutive securities                             --                          --                       --

                                                        -----------                 -----------                ---------
       Total                                            $(1,744,231)                 51,677,488                $  (0.034)
                                                        ===========                 ===========                =========

<CAPTION>
                                                                        Nine Months Ended November 30, 2003
                                                        -----------------------------------------------------------------
                                                                                      Weighted
                                                             Net                   Average Shares              Per Share
                                                            Loss                     Outstanding                 Amount
                                                            ----                     -----------                 ------
<S>                                                     <C>                          <C>                       <C>
Basic/diluted loss per common share:

Net Loss                                                $  (562,978)                 38,433,523                $  (0.015)

       Effect of dilutive securities                             --                          --                       --
                                                        -----------                 -----------                ---------
       Total                                            $  (562,978)                 38,433,523                $  (0.015)
                                                        ===========                 ===========                =========

<CAPTION>
                                                                       Three Months Ended November 30, 2004
                                                        -----------------------------------------------------------------
<S>                                                     <C>                          <C>                       <C>
Basic/diluted loss per common share:

Net Loss                                                $  (623,061)                 52,539,980                $   (0.01)

       Effect of dilutive securities                             --                          --                       --
                                                        -----------                 -----------                ---------
       Total                                            $  (623,061)                 52,539,980                $   (0.01)
                                                        ===========                 ===========                =========

<CAPTION>
                                                                       Three Months Ended November 30, 2003
                                                        -----------------------------------------------------------------
<S>                                                     <C>                          <C>                       <C>
Basic/diluted loss per common share:

Net Loss                                                $  (172,240)                 39,372,753                $  (0.005)

       Effect of dilutive securities                             --                          --                       --
                                                        -----------                 -----------                ---------
       Total                                            $  (172,240)                 39,372,753                $  (0.005)
                                                        ===========                 ===========                =========
</TABLE>

                 See Notes to Consolidated Financial Statements.


                                     - 5 -
<PAGE>

                   Notes to Consolidated Financial Statements
                                   (Unaudited)
                                   -----------

1.    Management Plans and Going Concern Matters

Mediscience  Technology Corp. and Subsidiaries  (the "Company") has no revenues,
incurred  significant losses from operations,  has an accumulated  deficit and a
highly  leveraged  position  that raises  substantial  doubt about the Company's
ability to continue as a going concern. The consolidated financial statements do
not include any adjustments  relating to  recoverability  and  classification of
recorded  asset amounts or the amount and  classification  of  liabilities  that
might be necessary  should the Company be unable to continue as a going concern.
The Company expects to incur substantial expenditures to further the development
and  commercialization  of its products.  The Company intends to seek additional
financing through private  placements or other financing  alternatives,  and may
also seek to sell the Company or its technology.  There can be no assurance that
continued financings will be available to the Company or that, if available, the
amounts will be sufficient or that the terms will be acceptable to the Company.

2.    Nature of Operations and Basis of Presentation

The Company operates in one business  segment and is principally  engaged in the
design and development of medical  diagnostic  instruments that detect cancer in
vivo in humans by using light to excite the  molecules  contained  in tissue and
measuring  the  differences  in  the  resulting  natural   fluorescence  between
cancerous and normal tissue.

The  consolidated  financial  statements  include the  accounts  of  Mediscience
Technology  Corp.  ("Mediscience")  and  its  wholly-owned  subsidiaries,  Laser
Diagnostics  Instruments,  Inc. ("LASER"),  Photonics for Women's Oncology,  LLC
("PHOTONICS"),  Proscreen, LLC ("PROSCREEN") and Medi-Photonics Development, LLC
("MEDI").  MEDI is the only active  subsidiary of the Company.  All  significant
intercompany balances and transactions have been eliminated in consolidation.

The  consolidated  financial  statements  as of and for the nine and three month
periods  ended  November  30,  2004  and 2003 are  unaudited  and are  presented
pursuant to the rules and regulations of the Securities and Exchange Commission.
Accordingly,   these  consolidated   financial  statements  should  be  read  in
conjunction  with  the  consolidated  financial  statements  and  notes  thereto
contained in the Company's 2004 Annual Report on Form 10-KSB.  In the opinion of
management,  the  accompanying  consolidated  financial  statements  reflect all
adjustments  (which  are of a  normal  recurring  nature)  necessary  for a fair
statement  of the  results  for the  interim  periods,  but are not  necessarily
indicative of the results of operations for a full fiscal year.

3.    Significant Accounting Policies

      Use of Estimates

The preparation of financial statements in conformity with accounting principles
generally  accepted in the United States of America requires  management to make
estimates  and  assumptions  that  affect  the  reported  amounts  of assets and
liabilities  and disclosure of contingent  assets and liabilities at the date of
the  financial  statements  and the  reported  amounts of revenues  and expenses
during the reporting period. Actual results could differ from those estimates.


                                     - 6 -
<PAGE>

      Loss per Common Share

Statement of Financial  Accounting  Standards  ("SFAS") No. 128,  "Earnings  Per
Share" requires the  presentation of basic earnings (loss) per share and diluted
earnings  (loss) per share.  Basic loss per share is based on the average number
of shares outstanding  during the period.  Diluted loss per share is the same as
basic loss per share,  as the  inclusion  of common stock  equivalents,  such as
options, would be antidilutive.

      Accounting for Stock-Based Compensation

The Company follows the disclosure  provisions of SFAS No. 148,  "Accounting for
Stock-Based  Compensation - Transition and  Disclosure."  Since the Company does
not plan to adopt the fair  value  method of  accounting  of SFAS No.  123,  the
Company  does not expect any impact on  consolidated  results of  operations  or
financial  condition  in fiscal 2005.  At November 30, 2004,  the Company had an
incentive  stock option plan for officers and employees and a consultants  stock
option  plan.  The Company  accounts for these plans under the  intrinsic  value
recognition  and measurement  principles of APB Opinion No. 25,  "Accounting for
Stock Issued to Employees," and related interpretations.

The following table illustrates the effect on net loss and loss per share if the
Company  applied the fair value  recognition  provisions  of SFAS No. 123 to all
awards.

<TABLE>
<CAPTION>
                                                           Nine Months Ended                      Three Months Ended
                                                              November 30,                            November 30,
                                                   ----------------------------------      ----------------------------------
                                                        2004                 2003               2004                 2003
                                                        ----                 ----               ----                 ----
<S>                                                <C>                 <C>                 <C>                 <C>
Net loss, as reported                              $   (1,744,231)     $     (562,978)     $     (623,061)     $     (172,240)
Deduct: Total stock-based employee
    compensation expense determined
    under fair value based method for
    all awards, net of related tax effects         $           --      $           --      $           --      $           --
                                                   --------------      --------------      --------------      --------------
Pro forma net loss                                 $   (1,744,231)     $     (562,978)     $     (623,061)     $     (172,240)
                                                   ==============      ==============      ==============      ==============

Basic and Diluted Loss per share:

    As reported                                    $       (0.034)     $       (0.015)     $        (0.01)     $       (0.005)
                                                   ==============      ==============      ==============      ==============
    Pro forma                                      $       (0.034)     $       (0.015)     $        (0.01)     $       (0.005)
                                                   ==============      ==============      ==============      ==============
</TABLE>

       Recent Accounting Pronouncements

In December 2004, the Financial Accounting Standards Board ("FASB") issued SFAS
No. 123(R), "Share- Based Payment," which requires companies to measure and
recognize compensation expense for all stock- based payments at fair value. SFAS
123(R) is effective for all interim periods beginning after June 15, 2005 and,
thus, will be effective for the Company beginning with the third quarter of
fiscal 2006. Early adoption is encouraged and retroactive application of the
provisions of SFAS 123(R) to the beginning of the fiscal year that includes the
effective date is permitted, but not required. The Company is currently
evaluating the impact of adopting SFAS 123(R) but does not expect to have a
material impact on its results of operations or its financial condition.


                                     - 7 -
<PAGE>

4.    Deferred Costs

During the nine months ended November 30, 2004, the Company issued 3,225,000
fully vested restricted shares of its common stock to six consulting groups in
exchange for services to be rendered, over a period of 12 - 60 months, for
matters such as corporate management, marketing opportunities, product
development and research, corporate funding, internal accounting and FDA
clinical trials (Note 9). These costs have been capitalized and will be
recognized ratably over the terms of the agreements. Expected future
amortization of these costs is as follows:

       Three Months Ending              February 28, 2005     $   199,267
           Year Ending                  February 28, 2006         434,389
           Year Ending                  February 28, 2007         390,612
           Year Ending                  February 29, 2008         378,320
           Year Ending                  February 28, 2009         150,820
           Year Ending                  February 28, 2010         100,547

5. Other Loans

In fiscal 2000, the Company entered into two interest-bearing convertible notes
with the Olive Cox Sleeper Trust (the "Trust") totaling $30,000. Both notes bear
interest at the rate of 8.25% per annum and are convertible into common stock on
the basis of $.25 per share. The conversion option is unlimited in duration.
Both notes are demand instruments and the holder can demand and receive payment
in full including interest. The principal balance of the notes was $ -0- at
November 30, 2004 and $30,000 at February 29, 2004. Accrued interest at November
30, 2004 and February 29, 2004 totaled $ -0- and $10,626, respectively.

On June 20, 2002, the Company entered into an additional $120,045 promissory
note with the Trust with interest at 12% per annum. The note was amended on June
13, 2003 to extend the maturity date to March 31, 2004 from February 20, 2003.
The principal amount of the note plus accrued interest is due and payable on the
maturity date. There is a conversion feature that allows the Trust to convert
the principal and accrued interest on the note on March 31, 2004 to common stock
of the Company at the rate of one share for each $.12 of principal and accrued
interest at date of conversion. Accrued interest at November 30, 2004 and
February 29, 2004 was $ -0- and $24,844, respectively.

The Company made an inducement offer to the Trust to convert all of its then
outstanding notes. On March 8, 2004 the Trust accepted the offer to convert the
principal amount of $150,045 plus related interest of $35,470 to 1,460,000
common shares (Note 9). In connection with the inducement offer and related
conversion, the Company recognized an expense of $58,555 during the nine-month
period ended November 30, 2004.

In November 2004, the Company entered into a $200,000 promissory note agreement
with the Trust. The agreement provides for interest at 11% and a maturity date
of November 18, 2006. Accrued interest is due and payable on January 15, 2005,
January 15, 2006 and the maturity date. After the maturity date, unpaid
principal and accrued interest on the promissory note bear interest at 15%.


                                     - 8 -
<PAGE>

In November 2004, the Company entered into a $50,000 promissory note agreement
with an individual. The agreement provides for interest at 5% and a maturity
date of November 18, 2006. Accrued interest is due and payable on January 15,
2005, January 15, 2006 and the maturity date. After the maturity date, unpaid
principal and accrued interest on the promissory note bear interest at 7%.

6.    Related Party Transactions

From time to time, Mr. Katevatis, Chairman/CEO, advances funds to the Company to
provide funding to pay operational expenses as they become due. These advances
do not accrue interest. At November 30, 2004 and February 29, 2004, officer
loans payable to Mr. Katevatis were, $31,542 and $31,542 respectively.

Legal services rendered by Mr. Katevatis amounted to $37,500 for the nine months
ended November 30, 2004 and November 30, 2003. These amounts are recorded in
general and administrative expense.

As part of Mr. Katevatis' employment agreement, the Company pays property taxes
and certain operating expenses on the home of Mr. Katevatis in lieu of rent,
since the Company's operations are located in Mr. Katevatis' home. Expenses
recognized were $12,909 and $13,093 for the nine months ended November 30, 2004
and 2003, respectively.

The Company entered into an agreement with THM Group, LLC ("THM") to be the
exclusive advisor to explore options for the Company to commercialize its
technology. Mr. Engelhart was the President and Chief Executive Officer of THM
from 2000 to 2003. The agreement was terminated on April 12, 2004. On April 23,
2003, Mr. Engelhart was elected President and Chief Operating Officer of the
Company and shortly thereafter entered into an employment agreement with the
Company (Note 8). Expense reimbursements of $23,090 and $6,000 were accrued or
paid to Mr. Engelhart for the nine months ended November 30, 2004 and 2003,
respectively, with respect to his role as President and Chief Operating Officer
of the Company.

On August 1, 2004, the Company entered into a thirteen month consulting
agreement with John Matheu, a Director and member of the audit committee,
pursuant to which Mr. Matheu will provide management services to the Company
(Note 8). Mr. Matheu will be paid a monthly consulting fee of $4,166 during the
term of the agreement and received an option to purchase 300,000 shares of
common stock at $1.50 per share.

7.    Accrued Liabilities

Accrued liabilities consist of the following:

                                                November 30,     February 29,
                                                ------------     ------------
                                                    2004             2004
                                                    ----             ----

            Legal and professional fees          $  134,888       $  365,354
            Consulting and university fees        1,186,415        1,164,915
            Salaries and wages                    1,408,833        1,508,833
            Other                                    82,511           93,584
                                                 ----------       ----------
                         Total                   $2,812,647       $3,132,686
                                                 ==========       ==========


                                     - 9 -
<PAGE>

Included in legal and professional fees as of November 30, 2004 and February 29,
2004 is $45,000 and $287,500, respectively, for legal services rendered by Mr.
Katevatis (Note 6).

Included in Consulting and University Fees as of November 30, 2004 and February
29, 2004 is $1,142,818 and $1,121,318, respectively, owed to Dr. Alfano (Note 8)
with respect to his consulting agreement.

Included in salaries and wages as of November 30, 2004 and February 29, 2004 is
$1,406,333 and $1,406,333, respectively, owed to Mr. Katevatis with respect to
his employment agreement (Note 8).

Included in salaries and wages as of November 30, 2004 and February 29, 2004 is
$2,500 and $102,500, respectively, owed to Mr. Engelhart with respect to his
employment agreement (Note 8).

8.    Commitments and Contingencies

      Dr. Robert R. Alfano

In April 1992, the Company entered into a five-year consulting agreement with
Dr. Robert R. Alfano, a principal stockholder of the Company and Chairman of its
Scientific Advisory Board which term was subsequently extended in 1995 to March
2002 and in 1999 to March 2007. Pursuant to the terms of the agreement, Dr.
Alfano is paid a consulting fee of not less than $150,000 per annum in exchange
for services to be rendered for approximately fifty days per year in connection
with the Company's medical photonics business and bonus and fringe benefits in
accordance with policies and formulas applicable to key executives of the
Company.

In connection with the acquisition of patent rights to its cancer detection
technology, the Company assumed an obligation to pay to Dr. Alfano's daughter a
royalty of 1% of the gross sales derived from any equipment made, leased or sold
which utilizes the concepts described in the Company's cancer detection patent.
Since there has been no activity, no amounts have been paid during the nine
month periods ended November 30, 2004 and 2003.

      Other Royalties

The Company entered into an agreement for worldwide licensing rights for patents
from Yale University and has agreed to pay royalties based on net sales of all
products generated from the patents and 50% of any income received from
sublicensing of the patents. The Company has not recorded any revenues since the
inception of this agreement and therefore has not recorded or paid any royalties
during the nine month periods ended November 30, 2004 and 2003.

      Research Foundation of the City University of New York

The Company and the Research Foundation of the City University of New York
("RFCUNY") entered into a Research Agreement in June 1992, which has been
amended from time to time. The Research Agreement called for the Company to
commercialize certain technology owned by "RFCUNY" and granted an exclusive,
worldwide license to the technology. In respect to the licensing, the Company is
liable to pay royalties based on net sales of products and any income received
from sublicensing. The Company has not recorded or paid any royalties during the
nine months period ended November 30, 2004 and 2003.


                                     - 10 -
<PAGE>

In May 2004, MEDI, a wholly-owned subsidiary of the Company, and RFCUNY, entered
into a one-year project agreement for research and development by RFCUNY and
MEDI, primarily, but not exclusively, in the area of optical biopsy for the
assembly of a commercially viable CD-Ratiometer and adjunctive technology. Under
the terms of this agreement, the Company is granted an exclusive world-wide
license, with the right to grant sublicenses, to make, use or sell patented
imaging product technology for the molecular detection of cancer and
physiological change.

      Employment Agreements

Mr. Peter Katevatis, Chief Executive Officer and Chairman of the Company, has an
employment agreement with the Company. The agreement states that Mr. Katevatis
is to be paid $200,000 per year. The agreement also provides for a bonus and
fringe benefits in accordance with policies and formulas mutually agreed upon by
Mr. Katevatis and the Board of Directors. The contract expires March 5, 2007
(Note 7).

On July 9, 2001, the Company entered into a three-year employment agreement with
Sidney Braginsky, a Director. Pursuant to the terms of the agreement, Mr.
Braginsky became the President and Chief Operating Officer of the Company and
was to be paid $100,000 per annum. On April 26, 2003, Mr. Braginsky voluntarily
terminated employment as President and Chief Operating Officer of the Company
and waived all rights to any accrued compensation owed to him in respect to this
agreement, which was recorded as of February 28, 2003.

On December 9, 2004, the Company entered into an Amended and Restated Employment
Agreement with Mr. Engelhart, which restated and amended the terms of his
employment agreement to clarify the original intent of the parties with respect
to the nature of the stock options granted to Mr. Engelhart. Mr. Engelhart was
granted an option to purchase 200,000 shares of the Company's common stock at an
option price of $0.25 per share, in which he was immediately vested. This grant
resulted in a non-cash compensation charge of $70,000 during the year ended
February 29, 2004 (Note 10). Mr. Engelhart was also granted an option to
purchase an aggregate of 1,800,000 shares of the Company's common stock at an
option price of $1.00 per share. The 1,800,000 options vest upon attainment of
either Critical Milestones or Financial Milestones, as both terms are defined in
the employment and incentive stock option agreements.

      Consulting Agreement

In August 2004, the Company entered into a thirteen month consulting agreement
with John Matheu, a Director and member of the audit committee (Note 6).
Pursuant to the terms of the agreement, Mr. Matheu is to assist in the final
development of the CD-Ratiometer for which he will receive $4,166 per month. Mr.
Matheu was also granted an option to purchase 300,000 shares of the Company's
common stock for $1.50 per share.

On May 15, 2004, MEDI entered into a six month consulting agreement with Dr.
Stan Wiener, M.D. pursuant to which Dr. Wiener will provide consulting services
for the final development and FDA submission of the CD Ratiometer, including
identification of sites for clinical trials, software development, development
of calibration standards and operational manuals and training of medical
personnel. Dr. Weiner will be paid $7,000 per month over the term of the
agreement.


                                     - 11 -
<PAGE>

9.    Stockholders' Deficit

      Anti-Dilution Rights

The Company granted certain anti-dilution rights to Mr. Peter Katevatis and Dr.
Robert Alfano.

Mr. Katevatis was granted anti-dilution rights on certain shares ("Katevatis
Shares"), which at the time represented 17% ("Katevatis Anti-Dilution
Percentage") of the then issued and outstanding shares of common stock of the
Company. The anti-dilution rights require the Company from time to time to issue
additional shares of common stock of the Company to Mr. Katevatis so that the
Katevatis Shares represent 17% of the issued and outstanding shares of common
stock of the Company. If Mr. Katevatis were to sell a portion or all of the
Katevatis Shares, the Katevatis Anti-Dilution Percentage would be adjusted
proportionately. During the nine-months ended November 30, 2004, the Company
issued 2,496,036 of common stock of the Company to Mr. Katevatis in connection
with the anti-dilution rights and as of November 30, 2004, the Company is
obligated to issue an additional 9,444 shares to Mr. Katevatis in connection
with the anti-dilution rights. In connection with the issuance of these shares,
the Company capitalized only the stock's par value from additional
paid-in-capital because of the Company's accumulated deficit.

Dr. Alfano was granted anti-dilution rights on certain shares ("Alfano Shares"),
which at the time represented 4% ("Alfano Anti-Dilution Percentage") of the then
issued and outstanding shares of common stock of the Company. The anti-dilution
rights require the Company from time to time to issue additional shares of
common stock of the Company to Dr. Alfano so that the Alfano Shares represent 4%
of the issued and outstanding shares of common stock of the Company. If Dr.
Alfano were to sell a portion or all of the Alfano Shares, the Alfano
Anti-Dilution Percentage would be adjusted proportionately. During the
nine-months ended November 30, 2004, the Company issued 587,302 of common stock
of the Company to Dr. Alfano in connection with the anti-dilution rights and as
of November 30, 2004, the Company is obligated to issue an additional 2,222
shares to Dr. Alfano in connection with the anti-dilution rights. In connection
with the issuance of these shares, the Company capitalized only the stock's par
value from additional paid-in-capital because of the Company's accumulated
deficit.

      Debt Conversion

On March 8, 2004, the Trust converted $185,515 of promissory notes and related
interest into 1,460,000 shares of the Company's common stock (Note 5).

      Preferred Stock Conversion

On March 8, 2004, the Company converted 60 shares of its preferred stock into
6,000,000 shares of its common stock, under the terms of a preferred stock
private placement offering dated February 1, 2004. Under the terms of the
offering, the Company agreed to file a registration statement covering resale of
the converted common shares, which it did on December 20, 2004.

      Common Stock Issued for Future Services

During March and April 2004, the Company issued 1,925,000 restricted shares of
its common stock to three consulting groups in exchange for consulting services
to be rendered over a 12-48 month period (Note 4).


                                     - 12 -
<PAGE>

During August 2004, the Company issued 300,000 restricted shares of its common
stock to two consulting groups in exchange for past services and services to be
rendered over approximately a two year period (Note 4).

      Common Stock Issued for Services

During August 2004, the Company issued 55,556 shares of its common stock at a
value of $32,878 for secretarial services provided to the Company. The
transaction was recognized based on the fair value of shares issued. This was
recorded as general and administrative expense in the consolidated statement of
operations.

      Common Stock Issued for Collaborative Research and Development Agreement

On November 9, 2004, the Company, through its subsidiary MEDI, entered into a
collaborative research and development agreement with Infotonics Technology
Center Inc., a Not-for-Profit Corporation, a consortium of founding participants
Corning Inc., Eastman Kodak Company and Xerox Corporation. Infotonics and the
Company will collaborate with one another in the conduct of a research program
involving the development of commercially viable miniature devices for the
Company that will make use of ultraviolet light to diagnose the health of living
tissue remotely monitoring the health/status of various medical environments,
e.g., the detection of various types of cancer and the monitoring of body
functions. Other markets from the research program would include commercially
viable miniature devices for sensing of biological and chemical species like
bacteria and pollutants. The period of research under this agreement will
terminate upon completion of the research, currently estimated to be five years.
The Agreement has certain rights including but not limited to ownership, future
development services, first right and right of first refusal for manufacturing
and indemnification.

As consideration for Infotonics to carry out the research, the Company issued to
Infotonics 1,000,000 shares of its common stock, having a fair market value of
$754,100. In addition, the Company granted a warrant exercisable at $3.00 per
share for 1,000,000 shares of common stock, and will pay fees for specific
research services to be determined by Infotonics based upon detailed Statements
of Work, to be agreed upon as the research progresses.

10.   Stock Options and Warrants

The Company maintains two stock options plans - the 1999 Incentive Stock Option
Plan (The "1999 Plan") and the 2003 Consultants Plan (the "2003 Plan"), which
were approved by the Company's stockholders on February 17, 2004.

The maximum number of shares issuable under the 1999 Plan and the 2003 Plan are
3,000,000 and 7,000,000, respectively.

In connection with his employment agreement, Mr. Braginsky was granted options
to purchase up to 2,000,000 shares of the Company's common stock at an option
price of $.25 per share for the first 150,000 shares and at an option price of
$1.00 per share for the remaining 1,850,000 shares. Mr. Braginsky's ability to
exercise these options is subject to a series of milestones described in his
employment agreement. On April 26, 2003, Mr. Braginsky resigned from the Company
and forfeited these stock options.

Mr. Engelhart was granted options to purchase 200,000 shares of the Company's
common stock at an option price of $.25 per share, in which he was immediately
vested. This grant resulted in a non-cash compensation charge of $70,000 during
the year ended February 29, 2004 (Note 8).


                                     - 13 -
<PAGE>

Mr. Engelhart was also granted options to purchase up to 1,800,000 shares of the
Company's common stock at an option price of $1.00 per share. Vesting and
exercisability of these shares are contingent upon the attainment of certain
milestones described in Mr. Engelhart's employment agreement.

In connection with the Company's agreement with the RFCUNY (Note 8), the Company
granted a warrant to RFCUNY to purchase 600,000 shares of the Company's common
stock at a price of $1.00 per share. The warrant can be exercised within a five
year period ending June 2007.

In 2002, the Company issued 400,000 shares of common stock at a value of $76,000
and issued warrants to purchase 200,000 shares of the Company's common stock at
an exercise price of $.25 per share for financial advisory services. The
warrants expire in 2006.

Peter J. Katevatis, son of the Chairman and Chief Executive Officer, exercised a
warrant acquired through a prior company private placement on May 20, 2000 to
purchase 100,000 shares of the Company's common stock for $19,000. The original
exercise price of these warrant shares was $.25 per share which was modified to
$.19 per share on March 5, 2003. The market value of Mediscience shares on March
5, 2003 was $0.13 per share.

During March 2004, the Company issued 50,000 shares of its restricted common
stock to Laurence Elgart to satisfy his exercise of the warrant in February 2004
for $12,500.

During March 2004, the Company issued 100,000 shares of its restricted common
stock to William Baker to satisfy his exercise of the warrant in February 2004
for $25,000.

During August 2004, Allan Moses was issued a warrant to purchase up to 100,000
shares of the Company's restricted common stock at a price of $2 per share. The
warrant shall be exercisable from August 8, 2004 to August 8, 2006.

During August 2004, John Matheu, a Director of the Company, was granted options
to purchase up to 300,000 shares of the Company's restricted common stock at an
option price of $1.50 per share (Note 8). Mr. Matheu's ability to exercise these
options is subject to a series of milestones described in his consulting
agreement.

During November 2004, Infotonics Technology Center, Inc. was issued a warrant to
purchase up to 1,000,000 shares of the Company's restricted common stock at a
price of $3 per share. The warrant shall be exercisable from November 9, 2004 to
November 9, 2010.

11.   Subsequent Events

On December 9, 2004, the Company entered into a $50,000 promissary note
agreement with an individual. The agreement provides for interest at 5% and a
maturity date of November 18, 2006. Accrued interest is due and payable on
January 15, 2005, January 15, 2006 and the maturity date. The Company received
$30,000 prior to November 30, 2004.

The Company filed Pre-Effective Amendment No. 2 to Form S-3 on Form SB-2/A on
December 23, 2004, which was declared effective by the Securities and Exchange
Commission on January 12, 2005.


                                     - 14 -
<PAGE>

                         MANAGEMENT'S PLAN OF OPERATION

The Company is principally engaged in the design, development, marketing, and
licensing of medical diagnostic instruments that detect cancer in humans through
the utilization of ultra violet light. The Company uses UV light to excite
molecules contained in human tissue. Once excited, the Company's device measures
the differences in the resulting natural fluorescence between cancerous and
normal tissue. The Company has successfully conducted certain preclinical and
clinical evaluations, which support the belief that its proprietary technology,
when fully developed, will have substantial commercial appeal due to its
non-invasive character, point of care - real time results, and diagnostic
sensitivity and specificity.

The Company's strategy is to commercialize early cancer detection devices in the
area of cervical, esophagus, oral and colon cancers and is based upon our
developed technology, prototypes and expertise in the area of fluorescent
imaging. The Company formed Mediphotonics Development Company, LLC, a New York
limited liability company (Medi), to engage in the development of equipment for
optical biopsy. Through its relationship with Infotonics, the Company will
have proven engineering expertise and successful experience in the technical and
business processes needed to develop and augment existing scientific approaches
and technology into commercially viable medical applications. On November 9,
2004, Medi, entered into an agreement to jointly develop the "Compact Photonic
Explorer" (CPE) or "pill camera", for medical and non- medical applications with
Infotonics Technology Center, Inc. (Infotonics), (a consortium of Corning, Inc.,
Eastman Kodak Company and Xerox Corporation). The parties' initial focus of the
project is developing a Compact Photonic Explorer (CPE) or "smart pill". The CPE
has a photonic sensor that uses ultraviolet (UV) light to remotely monitor the
health of human tissue in various environments. The product is being designed to
potentially take a biopsy of various areas through spectroscopy. The initial
target of the CPE is to develop a "smart pill" that targets the diagnosis of
various forms of cancer throughout the GI tract.

Medi and Research Foundation of City College of New York (RF-CUNY) have
undertaken a joint program of development to be conducted by RF-CUNY and Medi,
primarily, but not exclusively, in the area of optical biopsy for the assembly
of a commercially viable CD-Ratiometer and adjunctive technology. The joint
development agreement calls for:

Build prototype CD GYN Ratiometer for clinical testing

      o     Assemble units in-housing and make all necessary wiring and
            connections.

      o     Test operation of prototype unit.

      o     Test operation of Software code.

      o     Test CD-Ratiometer on ex vivo tissue specimens.

      o     Debug unit and final check.

      o     Deliver CD-Ratiometer to Mediphotonics Development LLC.


                                     - 15 -
<PAGE>

On December 9, 2005, Medi completed development of the CD-Ratiometer and
submitted Pre-IDE briefing materials to the FDA with respect to the use of the
CD-Ratiometer in the area of cervical cancer detection.

A principal issue facing the Company is a lack of the financial resources and
liquidity required to maintain business momentum and to properly leverage
intellectual property assets; the resolution of this issue is the highest
priority of management. In the absence of the availability of such financing on
a timely basis, the Company may be forced to materially curtail or cease its
operations.

Critical Accounting Policies

The preparation of financial statements requires management to make estimates
and assumptions that affect amounts reported therein. The most significant of
these involve the use of estimates. In each situation, management is required to
make estimates about the effects of matters or future events that are inherently
uncertain.

The financial statements are prepared in conformity with accounting principles
generally accepted in the United States of America, and, as such, include
amounts based on informed estimates and judgements of management, such as:

      o     Determining accruals and contingencies;

      o     Valuing options and other equity instruments;

      o     Reviewing the realization/recoverability of deferred costs resulting
            from the issuance of common stock to acquire certain consulting
            services to be rendered in future periods.

      o     Deferred tax valuation allowance.

The Company used what it believes are reasonable assumptions where applicable,
established valuation techniques in making its estimates. Actual results could
differ from those estimates.


                                     - 16 -
<PAGE>

Item 3.     Controls and Procedures
            -----------------------

            Evaluation of disclosure controls and procedures

            Our chief executive officer and our chief financial officer, after
            evaluating the effectiveness of the Company's "disclosure controls
            and procedures" (as defined in Exchange Act Rules 13a-15(e) and
            15d-15(e)) as of the end of the period covered by this report (the
            "Evaluation Date"), have concluded that as of the Evaluation Date,
            our disclosure controls and procedures were adequate and effective
            and designed to ensure that material information relating to us and
            our consolidated subsidiaries would be made known to them by others
            within those entities.

            Internal controls over financial reporting

            In connection with their review of the Company's November 30, 2004
            interim financial statements, the Company's independent registered
            public accounting firm identified certain material weaknesses and
            other deficiencies in our internal control. The Public Company
            Accounting Oversight Board, Standard No. 2 states a material
            weakness is "a significant deficiency, or a combination of
            significant deficiencies, that results in more than a remote
            likelihood that a material misstatement of the annual or interim
            financial statements will not be prevented of detected."

            The Company's independent registered public accounting firm
            identified the following material weaknesses in the Company's
            internal controls:

                  1.    The Company does not have sufficient resources and
                        therefore:

                                a.    is heavily dependent on external legal
                                      counsel and an accounting consultant for
                                      financial accounting and reporting
                                      functions and,

                                b.    lacks proper segregation of duties over
                                      the authorization and approval of
                                      transactions.

                  2.    Insufficient analysis, documentation and review of the
                        selection and application of generally accepted
                        accounting principles of significant non-routine
                        transactions, including the preparation of financial
                        statement disclosures relating thereto.

                  3.    The Company does not have sufficient internal control
                        policies and procedures over reviewing formal vendor and
                        other agreements.

                  4.    The Company does not have a formal budgeting process and
                        does not prepare written BOD and committee meeting
                        minutes on a timely basis.

                  5.    The Company has informal policies and procedures.

            In connection with the material control weaknesses discussed above,
            we have or expect to take the following actions:

                  1.    The Company has and will continue to consult with
                        external legal counsel prior to execution of material
                        contracts and filings with the Securities and Exchange
                        Commission.


                                     - 17 -
<PAGE>

                  2.    The Company has and will continue to consult with an
                        accounting consultant and improve its analysis,
                        documentation and review of the selection and
                        application of generally accepted accounting principles
                        to significant non-routine transactions, including the
                        preparation of financial statement disclosures relating
                        thereto.

                  3.    Once adequate funding is obtained, the Company intends
                        to hire a full time chief financial officer with
                        requisite skills. At that point the Company will further
                        remediate all of the above material control weaknesses.

            There were no significant changes in our internal controls or in
            other factors that could significantly affect the Company's
            disclosure controls and procedures, nor any significant deficiencies
            or material weaknesses in such disclosure controls and procedures
            requiring corrective actions other than the material control
            weaknesses discussed above.

            A control system, no matter how well-designed and operated, cannot
            provide absolute assurance that the objectives of the control
            systems are met, and no evaluation of internal controls can provide
            absolute assurance that all control issues and instances of fraud,
            if any, within a company have been detected.


                                     - 18 -
<PAGE>

                           PART II - OTHER INFORMATION

Item 1.     Legal Proceedings
            -----------------

            None

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

            On November 9, 2004, the Company, through its subsidiary MEDI,
            entered into a collaborative research and development agreement with
            Infotonics Technology Center Inc., a Not-for-Profit Corporation, a
            consortium of founding participants Corning Inc., Eastman Kodak
            Company and Xerox Corporation.

            As consideration for Infotonics to carry out the research, the
            Company issued to Infotonics 1,000,000 shares of its common stock.
            The estimated fair market value has been determined to be $754,100.
            In addition, the Company granted a warrant exercisable at $3.00 per
            share for 1,000,000 shares. (See Note 9).

Item 3.     Defaults Upon Senior Securities
            -------------------------------

            None

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

            None

Item 5.     Other Information
            -----------------

            None

Item 6.     Exhibits and Reports on Form 8-K
            --------------------------------

            (A)   Exhibits

            10.1  Agreement, dated as of November 11, 2004 between the Company
                  and Infotonics Technology Center, Inc. (Incorporated by
                  reference to Exhibit 99.1 to the Company's current report on
                  Form 8-K dated November 11, 2004)

            31.1  Certifications pursuant to Section 302 of the Sarbanes-Oxley
                  Act of 2002

            31.2  Certifications pursuant to Section 302 of the Sarbanes-Oxley
                  Act of 2002

            32    Certifications pursuant to 18 U.S.C. Section 1350 as adopted
                  pursuant to Section 906 of the Sarbanes-Oxley Act of 202


                                     - 19 -
<PAGE>

                                   SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report on Form 10-QSB to be signed on its behalf
by the undersigned thereunto duly authorized.

                                           MEDISCIENCE TECHNOLOGY CORP.
                                           (Registrant)


                                           /s/ Peter Katevatis
                                           --------------------------------
                                           Peter Katevatis
                                           Chairman of the Board and
                                           Chief Executive Officer

January 19, 2005


                                     - 20 -
<PAGE>

                                  EXHIBIT INDEX

EXHIBIT NO.             DESCRIPTION
-----------             -----------

    10.1                Agreement, dated as of November 11, 2004 between the
                        Company and Infotonics Technology Center, Inc.
                        (Incorporated by reference to Exhibit 99.1 to the
                        Company's current report on Form 8-K dated November 11,
                        2004)

    31.1                Certification of the Chief Executive Officer pursuant to
                        Section 302 of the Sarbanes- Oxley Act of 2002.

    31.2                Certification of the Chief Financial Officer pursuant to
                        Section 302 of the Sarbanes- Oxley Act of 2002.

    32                  Certification of the Chief Executive Officer and the
                        Chief Financial Officer pursuant to 18 U.S.C. Section
                        1350, as adopted pursuant to Section 906 of the
                        Sarbanes-Oxley Act of 2002.


                                     - 21 -