UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB
  [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
                                  ACT OF 1934
                   FOR THE FISCAL YEAR ENDED DECEMBER 31, 2007

                          Commission File No. 000-51739

                            R&R ACQUISITION III, INC.
                                ----------------
                 (Name of Small Business Issuer in its Charter)

               Delaware                                      43-2069362
     ------------------------------             --------------------------------
     State or other jurisdiction of             I.R.S. Employer Identification
     incorporation or organization                         Number


             47 School Avenue
           Chatham, New Jersey                               07928
    -------------------------------------                 ------------
    Address of principal executive office                   Zip Code

                    Issuer's telephone number: (973) 635-4047

                                       N/A
              (Former name, former address and former fiscal year,
                          if changed since last report)

       SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE EXCHANGE ACT

                                      NONE

       SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE EXCHANGE ACT

                         COMMON STOCK, $0.0001 PAR VALUE
                         ------------------------------
                                (Title of Class)

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

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

         Check if there is no disclosure of delinquent filers pursuant to Item
405 of Regulation S-B contained in this form, and no disclosure will be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. |X|

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

         For the year ended December 31, 2007, the issuer had no revenues.

         As of March 27, 2008, 2,500,000 shares of the issuer's common stock,
par value $0.0001 per share, were outstanding of which none were held by
non-affiliates.

                       DOCUMENTS INCORPORATED BY REFERENCE
                                      NONE

         Transitional Small Business Disclosure Format (Check One):
                                                                Yes [ ] No |X|


<PAGE>

                   R&R ACQUISITION III, INC. AND SUBSIDIARIES

                                   FORM 10-KSB

<TABLE>
<S>                                                                                                               <C>
PART I
   Item 1.     Description of Business..............................................................................2
   Item 2.     Description of Property..............................................................................8
   Item 3.     Legal Proceedings....................................................................................8
   Item 4.     Submission of Matters to a Vote of Security Holders..................................................8

PART II
   Item 5.     Market for Common Equity, Related Stockholder Matters
               and Small Business Issuer Purchases of Equity Securities.............................................8
   Item 6.     Management's Discussion and Analysis or Plan of Operation............................................9
   Item 7.     Financial Statements................................................................................11
   Item 8.     Change in and Disagreements with Accountants on Accounting
               and Financial Disclosure............................................................................20
   Item 8A(T)  Controls And Procedures.............................................................................20
   Item 8B.    Other Information...................................................................................20

PART III
   Item 9.     Directors, Executive Officers, Promoters, Control Persons and Corporate Governance;
               Compliance With Section 16(a) of the Exchange Act...................................................21
   Item 10.    Executive Compensation..............................................................................22
   Item 11.    Security Ownership of Certain Beneficial Owners and Management and
               Related Stockholder Matters.........................................................................23
   Item 12.    Certain Relationships and Related Transactions, and Director Independence...........................23
   Item 13.    Exhibits............................................................................................24
   Item 14.    Principal Accountant Fees and Services..............................................................24
</TABLE>

                      FORWARD LOOKING STATEMENT INFORMATION

CERTAIN   STATEMENTS   MADE  IN  THIS   ANNUAL   REPORT  ON  FORM   10-KSB   ARE
"FORWARD-LOOKING  STATEMENTS"  REGARDING THE PLANS AND  OBJECTIVES OF MANAGEMENT
FOR  FUTURE  OPERATIONS.  SUCH  STATEMENTS  INVOLVE  KNOWN  AND  UNKNOWN  RISKS,
UNCERTAINTIES  AND OTHER FACTORS THAT MAY CAUSE OUR ACTUAL RESULTS,  PERFORMANCE
OR ACHIEVEMENTS TO BE MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS,  PERFORMANCE
OR ACHIEVEMENTS  EXPRESSED OR IMPLIED BY SUCH  FORWARD-LOOKING  STATEMENTS.  THE
FORWARD-LOOKING  STATEMENTS  INCLUDED  HEREIN ARE BASED ON CURRENT  EXPECTATIONS
THAT INVOLVE  NUMEROUS  RISKS AND  UNCERTAINTIES.  OUR PLANS AND  OBJECTIVES ARE
BASED, IN PART, ON ASSUMPTIONS  INVOLVING JUDGMENTS WITH RESPECT TO, AMONG OTHER
THINGS,  FUTURE ECONOMIC,  COMPETITIVE AND MARKET CONDITIONS AND FUTURE BUSINESS
DECISIONS,  ALL OF WHICH ARE DIFFICULT OR IMPOSSIBLE TO PREDICT  ACCURATELY  AND
MANY OF WHICH ARE BEYOND OUR CONTROL.  ALTHOUGH WE BELIEVE THAT OUR  ASSUMPTIONS
UNDERLYING THE FORWARD-LOOKING STATEMENTS ARE REASONABLE, ANY OF THE ASSUMPTIONS
COULD  PROVE  INACCURATE  AND,  THEREFORE,  THERE CAN BE NO  ASSURANCE  THAT THE
FORWARD-LOOKING STATEMENTS INCLUDED IN THIS REPORT WILL PROVE TO BE ACCURATE. IN
LIGHT  OF  THE  SIGNIFICANT   UNCERTAINTIES   INHERENT  IN  THE  FORWARD-LOOKING
STATEMENTS  INCLUDED  HEREIN  PARTICULARLY  IN VIEW OF THE CURRENT  STATE OF OUR
OPERATIONS,  THE  INCLUSION  OF SUCH  INFORMATION  SHOULD NOT BE  REGARDED  AS A
STATEMENT  BY US OR ANY OTHER  PERSON  THAT OUR  OBJECTIVES  AND  PLANS  WILL BE
ACHIEVED.  FACTORS THAT COULD CAUSE  ACTUAL  RESULTS TO DIFFER  MATERIALLY  FROM
THOSE EXPRESSED OR IMPLIED BY SUCH  FORWARD-LOOKING  STATEMENTS INCLUDE, BUT ARE
NOT  LIMITED TO, THE FACTORS SET FORTH  HEREIN  UNDER THE  HEADINGS  "BUSINESS,"
"PLAN OF OPERATION" AND "RISK FACTORS".  WE UNDERTAKE NO OBLIGATION TO REVISE OR
UPDATE PUBLICLY ANY FORWARD-LOOKING STATEMENTS FOR ANY REASON.


                                       1
<PAGE>

                                     PART I

ITEM 1. DESCRIPTION OF BUSINESS


INTRODUCTION

         R&R Acquisition III, Inc., a Delaware  corporation ("we",  "our", "us",
the "Company" or the  "Registrant"),  includes,  on a  consolidated  basis,  its
wholly-owned subsidiaries,  R&R Sub III, Inc. and PRP Merger Sub, Inc. (both are
more fully described  below).  The Company maintains its principal offices at 47
School  Avenue,  Chatham,  New Jersey  07928 and was  organized  as a vehicle to
investigate  and, if such  investigation  warrants,  acquire a target company or
business seeking the perceived  advantages of being a publicly held corporation.
The  Company's  principal  business  objective for the next 12 months and beyond
such time will be to achieve  long-term growth  potential  through a combination
with an operating business.

         The Company, based on proposed business activities,  is a "blank check"
company.  The  Securities  and Exchange  Commission  (the "SEC")  defines  those
companies  as "any  development  stage  company  that is issuing a penny  stock,
within the meaning of Section 3 (a)(51) of the Securities  Exchange Act of 1934,
as amended  (the  "Exchange  Act"),  and that has no specific  business  plan or
purpose,  or  has  indicated  that  its  business  plan  is  to  merge  with  an
unidentified company or companies.  Many states have enacted statutes, rules and
regulations  limiting the sale of securities of "blank check" companies in their
respective  jurisdictions.  The  Company,  as defined  in Rule  12b-2  under the
Exchange Act, also is a "shell company," defined as a company with no or nominal
assets  (other  than cash) and no or  nominal  operations.  Management  does not
intend to undertake any efforts to cause a market to develop in our  securities,
either  debt  or  equity,  until  we  have  successfully  concluded  a  business
combination.   The  Company  intends  to  comply  with  the  periodic  reporting
requirements  of the  Exchange  Act  for  so  long  as it is  subject  to  those
requirements.

ARISTON MERGER

         On December 12, 2006,  we entered into an Agreement  and Plan of Merger
(the  "Ariston  Merger   Agreement")   with  Ariston   Acquisition   Corp.  (our
wholly-owned  subsidiary  incorporated  on November  30,  2006,  in the State of
Delaware)  (the "Ariston  Merger  Sub"),  and Ariston  Pharmaceuticals,  Inc., a
Delaware corporation  ("Ariston") pursuant to which the Ariston Merger Sub would
merge with and into Ariston and Ariston would become a  wholly-owned  subsidiary
and continue implementing its business plan and operations following the closing
(the "Ariston Merger").

         The closing of the Ariston  Merger was  subject to the  fulfillment  by
Ariston of specified  conditions prior to January 31, 2007. On January 31, 2007,
the  conditions to closing the Ariston  Merger were not satisfied by Ariston and
the Ariston Merger  Agreement was terminated  thereafter with no further effect.
Subsequently, on February 9, 2007, the name of the Ariston Acquisition Corp. was
changed to "R&R Sub III, Inc."


PR PHARMACEUTICALS MERGER

         On June 19, 2007,  we entered into an Agreement and Plan of Merger (the
"PRP Merger Agreement") with PRP Merger Sub, Inc. (a wholly-owned  subsidiary of
ours  incorporated  in the


                                       2
<PAGE>

State of  Delaware)  (the "PRP Merger  Sub"),  and PR  Pharmaceuticals,  Inc., a
Delaware  corporation  ("PRP"),  pursuant to which the PRP Merger Sub,  upon the
consummation  of the Merger (as hereinafter  defined),  will merge with and into
PRP and PRP will become our wholly  owned  subsidiary  (the "PRP  Merger").  The
closing  of  the  PRP  Merger  was  subject  to  the  fulfillment  of  specified
conditions.

         Subsequently,  PRP  Merger  Agreement  was  terminated  with no further
effect as of October 31, 2007.

         As a  result  of the  termination  of the  PRP  Merger  Agreement,  our
principal business objective for the next 12 months and beyond such time will be
to achieve  long-term  growth  potential  through a combination  with a business
rather than immediate,  short-term earnings.  We will not restrict our potential
candidate  target companies to any specific  business,  industry or geographical
location  and,  thus,  may acquire  any type of  business.  The  analysis of new
business  opportunities  will be undertaken by or under the  supervision  of our
officers and directors.


COMPETITION

         Our primary  goal is the  acquisition  of a target  company or business
seeking the  perceived  advantages  of being a publicly  held  corporation.  The
Company  faces  vast  competition  from  other  shell  companies  with  the same
objectives.  The Company is in a highly competitive market for a small number of
business  opportunities  which could reduce the  likelihood  of  consummating  a
successful business combination. A large number of established and well-financed
entities, including small public companies and venture capital firms, are active
in mergers and acquisitions of companies that may be desirable target candidates
for  us.  Nearly  all  these  entities  have  significantly   greater  financial
resources,   technical  expertise  and  managerial   capabilities  than  we  do;
consequently,  we will be at a competitive  disadvantage in identifying possible
business opportunities and successfully completing a business combination. These
competitive   factors  may  reduce  the  likelihood  of  our   identifying   and
consummating a successful business combination.

EMPLOYEES

         We have no employees.


RISK FACTORS

THERE MAY BE CONFLICTS OF INTEREST BETWEEN OUR MANAGEMENT AND OUR NON-MANAGEMENT
STOCKHOLDERS.

         Conflicts  of  interest  create  the risk that  management  may have an
incentive to act  adversely to the interests of other  investors.  A conflict of
interest may arise between our management's  personal pecuniary interest and its
fiduciary duty to our  stockholders.  Further,  our  management's  own pecuniary
interest may at some point compromise its fiduciary duty to our stockholders. In
addition,  Mr. Kling and Mr. Warshaw, our sole officers,  are currently involved
with other  blank  check  offerings  and  conflicts  in the  pursuit of business
combinations  with  such  other  blank  check  companies  with  which  they  and
affiliates  of  our  majority  stockholders  are,  and  may in  the  future,  be
affiliated  with, may arise.  If we and the other blank check companies that our
officers and directors are affiliated  with desire to take advantage of the same
opportunity,


                                       3
<PAGE>

then those officers and directors that are affiliated  with both companies would
abstain  from  voting  upon the  opportunity.  Further,  Rodman &  Renshaw,  LLC
("Rodman & Renshaw"),  a registered  broker-dealer and affiliate of our majority
stockholder,  may act as our  investment  banker,  placement  agent or financial
advisor to the  Company in  connection  with a  potential  business  combination
transaction and may receive a fee and/or securities for such services. We cannot
assure you that conflicts of interest among us, our management, Rodman & Renshaw
and our stockholders will not develop.

OUR BUSINESS IS DIFFICULT TO EVALUATE BECAUSE WE HAVE NO OPERATING HISTORY.

         As the Company  has no  operating  history or revenue and only  minimal
assets,  there is a risk that we will be unable to continue  as a going  concern
and consummate a business  combination.  The Company has had no recent operating
history nor any revenues or earnings from operations since inception. We have no
significant assets or financial resources.  We will, in all likelihood,  sustain
operating  expenses  without   corresponding   revenues,   at  least  until  the
consummation of a business  combination.  This may result in our incurring a net
operating  loss  that  will  increase  continuously  until we can  consummate  a
business  combination with a profitable business  opportunity.  We cannot assure
you that we can  identify a  suitable  business  opportunity  and  consummate  a
business combination.

THERE  IS  COMPETITION  FOR  THOSE  PRIVATE  COMPANIES  SUITABLE  FOR  A  MERGER
TRANSACTION OF THE TYPE CONTEMPLATED BY MANAGEMENT.

         We are in a highly  competitive  market for a small  number of business
opportunities  which could reduce the  likelihood of  consummating  a successful
business combination. We will be an insignificant participant in the business of
seeking mergers with,  joint ventures with and acquisitions of small private and
public  entities.  A large number of  established  and  well-financed  entities,
including  small  public  companies  and venture  capital  firms,  are active in
mergers and  acquisitions of companies that may be desirable  target  candidates
for  us.  Nearly  all  these  entities  have  significantly   greater  financial
resources,   technical  expertise  and  managerial   capabilities  than  we  do;
consequently,  we will be at a competitive  disadvantage in identifying possible
business opportunities and successfully completing a business combination. These
competitive   factors  may  reduce  the  likelihood  of  our   identifying   and
consummating a successful business combination.

FUTURE  SUCCESS IS HIGHLY  DEPENDENT ON THE ABILITY OF  MANAGEMENT TO LOCATE AND
ATTRACT A SUITABLE ACQUISITION.

         The  nature  of our  operations  is highly  speculative  and there is a
consequent risk of loss of your investment. The success of our plan of operation
will  depend  to a great  extent  on the  operations,  financial  condition  and
management of an identified business  opportunity.  We cannot assure you that we
will be successful in locating candidates with established  operating histories.
In the event we complete a business  combination  with a privately held company,
the success of our operations may be dependent upon  management of the successor
firm or venture partner firm and numerous other factors beyond our control.


                                       4
<PAGE>

MANAGEMENT  INTENDS TO DEVOTE ONLY A LIMITED  AMOUNT OF TIME TO SEEKING A TARGET
COMPANY  WHICH  MAY  ADVERSELY   IMPACT  OUR  ABILITY  TO  IDENTIFY  A  SUITABLE
ACQUISITION CANDIDATE AND CONSUMMATE A BUSINESS COMBINATION.

         While seeking a business combination,  management  anticipates devoting
no more than a few hours per month to the Company's  affairs.  Our officers have
not entered into written  employment  agreements with us and are not expected to
do so in the foreseeable  future.  This limited  commitment may adversely impact
our ability to identify and consummate a successful business combination.


THE TIME AND COST OF  PREPARING A PRIVATE  COMPANY TO BECOME A PUBLIC  REPORTING
COMPANY  MAY  PRECLUDE  US FROM  ENTERING  INTO AND  CONSUMMATING  A  MERGER  OR
ACQUISITION WITH THE MOST ATTRACTIVE PRIVATE COMPANIES.

         Target  companies  that fail to comply with SEC reporting  requirements
may  delay or  preclude  business  acquisitions.  Sections  13 and  15(d) of the
Exchange Act require  reporting  companies to provide certain  information about
significant  acquisitions,  including  certified  financial  statements  for the
company acquired,  covering one, two, or three years,  depending on the relative
size of the  acquisition.  The time and additional costs that may be incurred by
some target  entities to prepare these  statements  may  significantly  delay or
essentially  preclude   consummation  of  an  acquisition.   Otherwise  suitable
acquisition  prospects  that do not have or are  unable to obtain  the  required
audited statements may be inappropriate for acquisition so long as the reporting
requirements of the Exchange Act are applicable.

THE  COMPANY  MAY BE  SUBJECT  TO  FURTHER  GOVERNMENT  REGULATION  WHICH  WOULD
ADVERSELY AFFECT OUR OPERATIONS.

         Although  we will be subject to the  reporting  requirements  under the
Exchange Act, management believes we will not be subject to regulation under the
Investment Company Act of 1940, as amended (the "Investment Company Act"), since
we will not be engaged in the business of investing or trading in securities. If
we  engage  in  business  combinations  which  result  in  our  holding  passive
investment interests in a number of entities,  we could be subject to regulation
under the Investment  Company Act. If so, we would be required to register as an
investment  company and could be expected to incur significant  registration and
compliance costs. We have obtained no formal  determination  from the Securities
and Exchange  Commission as to our status under the Investment  Company Act and,
consequently,  violation  of the  Investment  Company  Act could  subject  us to
material adverse consequences.

ANY  POTENTIAL  ACQUISITION  OR MERGER WITH A FOREIGN  COMPANY MAY SUBJECT US TO
ADDITIONAL RISKS.

         If we enter into a business combination with a foreign concern, we will
be  subject  to risks  inherent  in  business  operations  outside of the United
States.  These risks include,  for example,  currency  fluctuations,  regulatory
problems,  punitive tariffs, unstable local tax policies, trade embargoes, risks
related to shipment of raw materials and finished goods across national  borders
and cultural and language differences. Foreign economies may differ favorably or
unfavorably from the United States economy in growth of gross national  product,
rate of inflation,  market  development,  rate of savings,  capital  investment,
resource self-sufficiency balance of payments positions, and in other respect.


                                       5
<PAGE>

THERE IS CURRENTLY NO TRADING MARKET FOR OUR COMMON STOCK.

         Outstanding shares of our common stock cannot be offered, sold, pledged
or otherwise  transferred unless subsequently  registered pursuant to, or exempt
from registration under, the Securities Act of 1933, as amended (the "Securities
Act") and any other applicable  federal or state securities laws or regulations.
These restrictions will limit the ability of our stockholders to liquidate their
investment.  Further,  shares  of our  common  stock  cannot  be sold  under the
exemptions from  registration  provided by Rule 144 under or Section 4(1) of the
Securities  Act, in accordance  with the letter from Richard K. Wulff,  Chief of
the Office of Small Business Policy of the Securities and Exchange  Commission's
Division of Corporation  Finance,  to Ken Worm of NASD  Regulation,  Inc., dated
January 21, 2000.

OUR BUSINESS WILL HAVE NO REVENUES  UNLESS AND UNTIL WE MERGE WITH OR ACQUIRE AN
OPERATING BUSINESS.

         We are a  development  stage  company  and  have had no  revenues  from
operations.  We may not realize any  revenues  unless and until we  successfully
merge with or acquire an operating business.

THE COMPANY INTENDS TO ISSUE MORE SHARES IN A MERGER OR ACQUISITION,  WHICH WILL
RESULT IN SUBSTANTIAL DILUTION.

         Our certificate of  incorporation  authorizes the issuance of a maximum
of  75,000,000  shares of common  stock and a maximum  of  10,000,000  shares of
preferred  stock.  Any merger or  acquisition  effected  by us may result in the
issuance of additional securities without stockholder approval and may result in
substantial  dilution  in the  percentage  of our common  stock held by our then
existing  stockholders.  Moreover, the common stock issued in any such merger or
acquisition  transaction may be valued on an arbitrary or non-arm's-length basis
by our  management,  resulting in an additional  reduction in the  percentage of
common stock held by our then existing stockholders.  Our Board of Directors has
the power to issue any or all of such  authorized  but unissued  shares  without
stockholder  approval.  To the extent that additional  shares of common stock or
preferred  stock  are  issued  in  connection  with a  business  combination  or
otherwise,  dilution to the  interests  of our  stockholders  will occur and the
rights of the holders of common stock might be materially adversely affected

OUR  STOCKHOLDERS MAY ENGAGE IN A TRANSACTION TO CAUSE THE COMPANY TO REPURCHASE
THEIR SHARES OF COMMON STOCK.

         In order to provide an interest in the  Company to a third  party,  our
stockholders may choose to cause the Company to sell Company securities to third
parties,  with the  proceeds  of such sale  being  utilized  by the  Company  to
repurchase shares of common stock held by the stockholders.  As a result of such
transaction,  our management,  principal stockholders and Board of Directors may
change.


                                       6
<PAGE>

THE COMPANY HAS CONDUCTED  LIMITED  MARKET  RESEARCH OF BUSINESS  OPPORTUNITIES,
WHICH MAY AFFECT OUR ABILITY TO IDENTIFY A BUSINESS TO MERGE WITH OR ACQUIRE.

         The  Company  has  conducted   limited   market   research   concerning
prospective business opportunities. Therefore, we have no assurances that market
demand  exists  for a merger or  acquisition  as  contemplated  by us. It may be
expected that any such target business or transaction  will present such a level
of  risk  that  conventional  private  or  public  offerings  of  securities  or
conventional bank financing will not be available. There is no assurance that we
will be able to  acquire  a  business  opportunity  on  terms  favorable  to us.
Decisions  as  to  which   business   opportunity  to  participate  in  will  be
unilaterally made by our management,  which may act without the consent, vote or
approval of our stockholders.

BECAUSE  WE MAY SEEK TO  COMPLETE  A  BUSINESS  COMBINATION  THROUGH A  "REVERSE
MERGER",  FOLLOWING  SUCH A  TRANSACTION  WE MAY  NOT BE  ABLE  TO  ATTRACT  THE
ATTENTION OF MAJOR BROKERAGE FIRMS.

         Additional  risks  may  exist  since we will  assist a  privately  held
business to become public  through a "reverse  merger."  Securities  analysts of
major brokerage firms may not provide  coverage of our Company since there is no
incentive to brokerage  firms to recommend the purchase of our common stock.  No
assurance can be given that  brokerage  firms will want to conduct any secondary
offerings on behalf of our post-merger company in the future.

WE CANNOT  ASSURE YOU THAT  FOLLOWING A BUSINESS  COMBINATION  WITH AN OPERATING
BUSINESS,  OUR  COMMON  STOCK  WILL BE LISTED ON NASDAQ OR ANY OTHER  SECURITIES
EXCHANGE.

         Following a business combination, we may seek the listing of our common
stock on NASDAQ or the American Stock  Exchange.  However,  we cannot assure you
that following such a transaction,  we will be able to meet the initial  listing
standards  of either of those or any other  stock  exchange,  or that we will be
able to  maintain a listing of our common  stock on either of those or any other
stock exchange. After completing a business combination,  until our common stock
is listed on the NASDAQ or another  stock  exchange,  we expect  that our common
stock  would  be  eligible  to  trade  on  the  OTC  Bulletin   Board,   another
over-the-counter   quotation   system,  or  on  the  "pink  sheets,"  where  our
stockholders  may find it more difficult to dispose of shares or obtain accurate
quotations as to the market value of our common stock. In addition,  we would be
subject to an SEC rule that, if it failed to meet the criteria set forth in such
rule,   imposes  various  practice   requirements  on  broker-dealers  who  sell
securities governed by the rule to persons other than established  customers and
accredited  investors.  Consequently,  such rule may deter  broker-dealers  from
recommending  or  selling  our  common  stock,  which  may  further  affect  its
liquidity.  This would also make it more  difficult  for us to raise  additional
capital following a business combination.

THERE IS NO PUBLIC MARKET FOR OUR COMMON STOCK,  NOR HAVE WE EVER PAID DIVIDENDS
ON OUR COMMON STOCK.

         There is no public  trading  market  for our  common  stock and none is
expected  to  develop in the  foreseeable  future  unless and until the  Company
completes a business  combination  with an operating  business and such business
files a registration statement under the Securities Act.  Additionally,  we have
never paid dividends on our common stock and do not presently  intend to pay any
dividends in the foreseeable  future. We anticipate that any funds available for
payment of  dividends  will be  re-invested  into the  Company  to  further  its
business strategy.


                                       7
<PAGE>

AUTHORIZATION OF PREFERRED STOCK.

         Our  Certificate  of  Incorporation  authorizes  the  issuance of up to
10,000,000 shares of preferred stock with  designations,  rights and preferences
determined from time to time by its Board of Directors.  Accordingly,  our Board
of Directors is empowered,  without  stockholder  approval,  to issue  preferred
stock with  dividend,  liquidation,  conversion,  voting,  or other rights which
could  adversely  affect the voting  power or other rights of the holders of the
common stock.  In the event of issuance,  the preferred stock could be utilized,
under certain circumstances, as a method of discouraging, delaying or preventing
a change in control of the  Company.  Although we have no present  intention  to
issue any shares of our authorized  preferred  stock,  there can be no assurance
that we will not do so in the future.


ITEM 2. DESCRIPTION OF PROPERTY

         The  Company's  principal  offices  are  located  at 47 School  Avenue,
Chatham,  New Jersey  which are owned by an  affiliate  of Kirk  Warshaw,  chief
financial  officer  and  secretary  of the  Company.  The Company  occupies  its
principal  offices on a month to month basis for no rent.  The Company  does not
own or intend  to invest in any real  property.  The  Company  currently  has no
policy with respect to  investments  or  interests  in real estate,  real estate
mortgages or securities of, or interests in, persons  primarily  engaged in real
estate activities.


ITEM 3. LEGAL PROCEEDINGS.

         The  Company is not party to any legal  proceedings  nor is it aware of
any  investigation,  claim or demand  made on the  Company  that may  reasonably
result in any legal proceedings.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

         None.

                                     PART II

ITEM 5. MARKET FOR COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND SMALL BUSINESS
ISSUER PURCHASES OF EQUITY SECURITIES.

(a) MARKET INFORMATION.  The Company's common stock is not trading on any public
trading market or stock exchange.

(b) HOLDERS.  As of March 27, 2008 there were three record  holders of 2,500,000
shares of the Company's common stock.

(c) DIVIDEND POLICY

         The Company has not  declared or paid any cash  dividends on its common
stock and does not intend to declare or pay any cash dividend in the foreseeable
future. The payment of dividends,  if any, is within the discretion of the Board
of  Directors  and will depend on the  Company's  earnings,  if any, its capital
requirements  and  financial  condition  and such other  factors as the Board of
Directors may consider.


                                       8
<PAGE>

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.

PLAN OF OPERATION

         Since the  Company's  inception in February  2005, it has not conducted
any active operations except for its efforts to locate a suitable acquisition or
merger  candidate and comply with regulatory  requirements.  No revenue has been
generated  by the Company  since  inception  and it is unlikely the Company will
have any revenues  unless it is able to consummate or effect an acquisition  of,
or merger with, an operating company, of which there can be no assurance.

         The Company's  plan of operation for the next twelve months shall be to
locate a suitable acquisition or merger candidate.  The Company is not currently
engaged in any business  activities that provide cash flow. The Company believes
that its cash requirements for the next twelve months will be paid with money in
its treasury. If additional amounts are needed, the Company believes that it can
satisfy  such   requirement  from  additional  loans  or  investments  from  its
stockholders,  management or other  investors when needed.  Although the Company
anticipates that its cash-on-hand would be able to satisfy its cash requirements
for at least the next twelve  months,  the Company can provide no assurance that
it will be able to do so or that if  additional  amounts are needed that it will
be able to obtain such amounts from its stock stockholders,  management or other
investors when needed.

EQUIPMENT AND EMPLOYEES

         As of December 31, 2007,  we had no operating  business,  no equipment,
and no  employees.  We do not intend to develop our own  operating  business but
instead plan to merge with another operating company.

ARISTON MERGER

         On December 12, 2006,  we entered into an Agreement  and Plan of Merger
(the  "Ariston  Merger   Agreement")   with  Ariston   Acquisition   Corp.  (our
wholly-owned  subsidiary  incorporated  on November  30,  2006,  in the State of
Delaware)  (the "Ariston  Merger  Sub"),  and Ariston  Pharmaceuticals,  Inc., a
Delaware corporation  ("Ariston") pursuant to which the Ariston Merger Sub would
merge with and into Ariston and Ariston would become a  wholly-owned  subsidiary
and continue implementing its business plan and operations following the closing
(the "Ariston Merger").

         The closing of the Ariston  Merger was  subject to the  fulfillment  by
Ariston of specified  conditions prior to January 31, 2007. On January 31, 2007,
the  conditions to closing the Ariston  Merger were not satisfied by Ariston and
the Ariston Merger  Agreement was terminated  thereafter with no further effect.
Subsequently, on February 9, 2007, the name of the Ariston Acquisition Corp. was
changed to "R&R Sub III, Inc."


PR PHARMACEUTICALS MERGER

         On June 19, 2007,  we entered into an Agreement and Plan of Merger (the
"PRP Merger Agreement") with PRP Merger Sub, Inc. (a wholly-owned  subsidiary of
ours  incorporated  in the State of  Delaware)  (the "PRP Merger  Sub"),  and PR
Pharmaceuticals, Inc., a Delaware corporation ("PRP"), pursuant to which the PRP
Merger Sub, upon the consummation of the


                                       9
<PAGE>

Merger  (as  hereinafter  defined),  will  merge  with and into PRP and PRP will
become our wholly owned  subsidiary  (the "PRP Merger").  The closing of the PRP
Merger was subject to the fulfillment of specified conditions.

         Subsequently,  PRP  Merger  Agreement  was  terminated  with no further
effect as of October 31, 2007.

RESULTS OF OPERATIONS

         The Company had operating expenses of $32,315 and $29,550 for the years
ended December 31, 2007 and 2006, respectively. These expenses consist primarily
of the legal,  accounting,  general  administrative  and filing related expenses
incurred to prepare and file with the SEC the reports required of the Company by
the Exchange Act and are of a continuing and recurring nature.

LIQUIDITY AND CAPITAL RESOURCES

         We do not have any  revenues  from any  operations  absent a merger  or
other  combination with an operating  company and no assurance can be given that
such a merger  or other  combination  will  occur or that we can  engage  in any
public or  private  sales of our  equity  or debt  securities  to raise  working
capital.  During  the  year  ended  December  31,  2007,  $25,000  of  cash  was
contributed to the Company from an affiliated company that is also a stockholder
of the  Company.  On December  31, 2007 the Company had $17,152 of cash on hand.
However,  the Company  also had Total  Current  Liabilities  of $60,006 of which
$19,622  were  accrued   expenses.   The  remainder  of  the  Company's  current
liabilities  is comprised of a related  party loan in the amount of $40,384.  We
are dependent upon future loans from our present  stockholders or management and
there can be no assurances that our present stockholders or management will make
any loans to us or on acceptable terms.

         Our present material  commitments are  professional and  administrative
fees and expenses  associated  with the  preparation of its filings with the SEC
and other regulatory requirements.  In the event that we engage in any merger or
other combination with an operating  company,  we will have additional  material
commitments.  Although from time to time, we may be engaged in discussions  with
operating companies  regarding a merger or other combination,  no assurances can
be made that we will engage in any business merger or other business combination
with an operating company within the next twelve months.

                                       10

<PAGE>

ITEM 7.  FINANCIAL STATEMENTS.


                   R&R ACQUISITION III, INC. AND SUBSIDIARIES
                          (A Development Stage Company)

                          INDEX TO FINANCIAL STATEMENTS






<TABLE>
<CAPTION>
                                                                                                               PAGE
                                                                                                               ----

<S>                                                                                                        <C>   <C>
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM                                                          12


FINANCIAL STATEMENTS

  Consolidated Balance Sheet as of December 31, 2007                                                             13

  Consolidated Statements of Operations for the years ended December 31, 2007
     and December 31, 2006 and for the cumulative period from February 14, 2005
     (Date of Inception) to December 31, 2007                                                                    14

  Consolidated Statements of Changes in Stockholders' Deficiency for the period from
     February 14, 2005 (Date of Inception) to December 31, 2007                                                  15

  Consolidated Statements of Cash Flows for the years ended December 31, 2007
     and December 31, 2006 and for the cumulative period from February 14, 2005
     (Date of Inception) to December 31, 2007                                                                    16


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS                                                                 17 to 19
</TABLE>


                                       11
<PAGE>


             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


To the Board of Directors and Stockholders
R&R Acquisition III, Inc. and Subsidiaries

We have audited the accompanying  consolidated  balance sheet of R&R Acquisition
III, Inc. and  Subsidiaries (a development  stage company) (the "Company") as of
December 31, 2007 and the related consolidated statements of operations, changes
in stockholders' deficiency and cash flows for the years ended December 31, 2007
and  2006,  and for the  cumulative  period  from  February  14,  2005  (Date of
Inception) to December 31, 2007. These consolidated financial statements are the
responsibility of the Company's management.  Our responsibility is to express an
opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements  are free of material  misstatement.  The Company is not  required to
have,  nor were we engaged to perform,  an audit of its  internal  control  over
financial reporting.  Our audit included  consideration of internal control over
financial  reporting  as  a  basis  for  designing  audit  procedures  that  are
appropriate  in the  circumstances,  but not for the  purpose of  expressing  an
opinion on the  effectiveness  of the Company's  internal control over financial
reporting.  Accordingly,  we express  no such  opinion.  An audit also  includes
examining,  on a test basis,  evidence supporting the amounts and disclosures in
the  financial   statements,   assessing  the  accounting  principles  used  and
significant  estimates  made by  management,  as well as evaluating  the overall
financial  statement  presentation.   We  believe  that  our  audits  provide  a
reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly, in all material  respects,  the consolidated  financial  position of R&R
Acquisition  III, Inc. and  Subsidiaries  (a  development  stage  company) as of
December 31, 2007, and the  consolidated  results of their  operations and their
cash  flows  for the  years  ended  December  31,  2007  and  2006,  and for the
cumulative  period from  February 14, 2005 (Date of  Inception)  to December 31,
2007 in conformity with accounting  principles  generally accepted in the United
States of America.



/s/ Marcum & Kliegman LLP

New York, New York
March 27, 2008



                                       12
<PAGE>



                           R&R ACQUISITION III, INC. AND SUBSIDIARIES
                                 (A Development Stage Company)
                           CONSOLIDATED BALANCE SHEET
                                       December 31, 2007


<TABLE>
<S>                                                                                            <C>
                                             ASSETS

Current Assets
     Cash (TOTAL ASSETS)                                                                       $ 17,152
                                                                                               ========

                            LIABILITIES AND STOCKHOLDERS' DEFICIENCY

Current Liabilities
     Accrued expenses                                                                          $ 19,622
     Loan payable - related party                                                                40,384
                                                                                               --------
        TOTAL CURRENT LIABILITIES
                                                                                               $ 60,006
                                                                                               --------



STOCKHOLDERS' DEFICIENCY
     Preferred stock, $.0001 par value; 10,000,000
        shares authorized, none issued and outstanding                                               $-
     Common stock, $.0001 par value; 75,000,000
        shares authorized, 2,500,000 issued and outstanding                                         250
     Additional paid-in capital                                                                  49,800
     Deficit accumulated during the development stage                                           (92,904)
                                                                                               --------
        TOTAL STOCKHOLDERS' DEFICIENCY                                                          (42,854)
                                                                                               --------
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIENCY                                                 $ 17,152
                                                                                               ========
</TABLE>


        The accompanying notes are an integral part of these consolidated
                             financial statements.


                                       13
<PAGE>


                   R&R ACQUISITION III, INC. AND SUBSIDIARIES
                          (A Development Stage Company)
                      CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                                                              For the cumulative period from
                                                        For the Years Ended December 31,             February 14, 2005
                                                                                                    (Date of Inception)
                                                     2007                   2006                   to December 31, 2007
                                            -------------------    ---------------------    ------------------------------
<S>                                             <C>                    <C>                            <C>
Expenses
     Professional fees                          $    29,556            $    26,000                    $    74,056
     Formation and other costs                        2,759                  3,550                         18,848
                                                -----------            -----------                    -----------
        Net Loss                                $   (32,315)           $   (29,550)                   $   (92,904)
                                                ===========            ===========                    ===========

Weighted average number of common shares
outstanding - basic and diluted                   2,500,000              2,500,000
                                                ===========            ===========
     Net loss per common share - basic
     and diluted                                $     (0.01)           $     (0.01)
                                                ===========            ===========
</TABLE>

        The accompanying notes are an integral part of these consolidated
                             financial statements.


                                       14
<PAGE>



                   R&R ACQUISITION III, INC. AND SUBSIDIARIES
                          (A Development Stage Company)
          CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' DEFICIENCY
 For the Period from February 14, 2005 (Date of Inception) to December 31, 2007

<TABLE>
<CAPTION>

                                 Preferred Stock-        Common Stock-
                                     Par value             Par value                       Deficit
                                     of $.0001             of $.0001                     Accumulated
                                     per share             per share         Additional   During the      Common         Total
                                ------------------    --------------------     Paid-in    Development      Stock      Stockholders'
                                Shares      Amount      Shares      Amount     Capital       Stage       Subscribed    Deficiency
                                ------      ------    ----------    -------  ----------  ------------    ----------   ------------
<S>                             <C>         <C>       <C>           <C>        <C>        <C>            <C>            <C>
Common shares issued               -        $  -      2,000,000     $   200    $      -   $        -     $         -    $      200
   (February 14, 2005 $0.0001
   per share)

Contributed capital,
   February 14, 2005               -           -              -           -      24,800             -              -        24,800

Issuance of common stock for
subscription (October 31, 2005
$0.0001 per share)                 -           -        500,000          50           -             -            (50)            -

Net loss                                       -            -             -           -       (31,039)             -       (31,039)
                                 -------------------------------------------------------------------------------------------------

Balance at December 31, 2005       -           -      2,500,000         250      24,800       (31,039)           (50)       (6,039)

Proceeds received from
subscriber of common stock                     -              -           -           -             -             50            50

Net loss                           -           -              -           -           -       (29,550)             -       (29,550)
                                 -------------------------------------------------------------------------------------------------

Balance at December 31, 2006       -           -      2,500,000         250      24,800       (60,589)             -       (35,539)

Contributed capital,
March 30, 2007
and November 27, 2007              -           -              -           -      25,000             -              -        25,000

Net loss                           -           -              -           -           -       (32,315)             -       (32,315)
                                 -------------------------------------------------------------------------------------------------
Balance at December 31, 2007       -        $  -      2,500,000     $   250    $ 49,800    $  (92,904)       $     -    $  (42,854)
                                 =================================================================================================

</TABLE>

              The accompanying notes are an integral part of these
                             financial statements.


                                       15
<PAGE>

                   R&R ACQUISITION III, INC. AND SUBSIDIARIES
                          (A Development Stage Company)
                      CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                                                     For the cumulative period from
                                                              For the Years Ended December 31,             February 14, 2005
                                                                                                           (Date of Inception)
                                                                 2007                 2006                to December 31, 2007
                                                            ---------------      --------------      ------------------------------

<S>                                                              <C>                <C>                        <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss                                                         $(32,315)          $(29,550)                  $(92,904)
Changes in operating assets and liabilities
                    Increase (Decrease) in accrued expenses         7,123             (3,000)                    19,622
                                                                 --------           --------                   --------
NET CASH USED IN OPERATING ACTIVITIES                             (25,192)           (32,550)                   (73,282)
                                                                 --------           --------                   --------

CASH FLOWS FROM FINANCING ACTIVITIES
                    Proceeds received from subscriber of
                    common stock                                        -                 50                        250
                    Contributed capital                            25,000                  -                     49,800
                    Proceeds from related party loan                    -             24,883                     40,384
                                                                 --------           --------                   --------
NET CASH PROVIDED BY FINANCING ACTIVITIES                          25,000             24,933                     90,434
                                                                 --------           --------                   --------

NET (DECREASE) INCREASE IN CASH                                      (192)            (7,617)                    17,152

CASH AT BEGINNING OF PERIOD                                        17,344             24,961                          -
                                                                 --------           --------                   --------
CASH AT END OF PERIOD                                            $ 17,152           $ 17,344                   $ 17,152
                                                                 ========           ========                   ========

SUPPLEMENTAL DISCLOSURE OF CASH FLOWS
INFORMATION
                    Interest paid                                $      -           $      -                   $      -
                                                                 ========           ========                   ========
                    Income taxes                                 $      -           $      -                   $      -
                                                                 ========           ========                   ========
NON-CASH FINANCING ACTIVITIES
    Common stock subscribed                                      $      -           $      -                   $     50
                                                                 --------           --------                   --------
</TABLE>


        The accompanying notes are an integral part of these consolidated
                              financial statements.


                                       16
<PAGE>


                   R&R ACQUISITION III, INC. AND SUBSIDIARIES
                          (A Development Stage Company)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 1 - ORGANIZATION, BUSINESS AND OPERATIONS

The consolidated  financial  statements  include the accounts of R&R Acquisition
III, Inc. ("R&R Acquisition) and its wholly-owned subsidiaries R&R Sub III, Inc.
("R&R Sub") (formerly Ariston  Acquisition Corp.) and PRB Merger Sub, Inc. ("PRP
Merger  Sub")  (collectively,   the  "Company").  All  significant  intercompany
balances and transactions have been eliminated. R&R Acquisition was incorporated
in Delaware with the objective to acquire, or merge with, an operating business.
As of December 31, 2007, the Company had not commenced any active operations.

The Company was organized as a vehicle to investigate and, if such investigation
warrants,  acquire a target company or business seeking the perceived advantages
of being a publicly  held  corporation  and, to a lesser  extent that desires to
employ the Company's funds in its business.

The Company's  plan of operation for the next twelve months shall be to locate a
suitable  acquisition or merger candidate.  The Company is not currently engaged
in any business activities that provide cash flow. The Company believes that its
cash  requirements  for the next  twelve  months  will be paid with money in its
treasury.  If additional  amounts are needed,  the Company  believes that it can
satisfy  such   requirement  from  additional  loans  or  investments  from  its
stockholders,  management or other  investors when needed.  Although the Company
anticipates that its cash-on-hand would be able to satisfy its cash requirements
for at least the next twelve  months,  the Company can provide no assurance that
it will be able to do so or that if  additional  amounts are needed that it will
be able to obtain such amounts from its stock stockholders,  management or other
investors when needed

ARISTON MERGER

On December  12, 2006,  R&R  Acquisition  entered into an Agreement  and Plan of
Merger (the  "Ariston  Merger  Agreement")  with Ariston  Acquisition  Corp.  (a
wholly-owned  subsidiary  incorporated  on November  30,  2006,  in the State of
Delaware)  (the "Ariston  Merger  Sub"),  and Ariston  Pharmaceuticals,  Inc., a
Delaware corporation  ("Ariston") pursuant to which the Ariston Merger Sub would
merge with and into Ariston and Ariston would become a  wholly-owned  subsidiary
and continue implementing its business plan and operations following the closing
(the "Ariston Merger").

The closing of the Ariston  Merger was subject to the  fulfillment by Ariston of
specified  conditions  prior to January  31,  2007.  On January  31,  2007,  the
conditions  to closing the Ariston  Merger were not satisfied by Ariston and the
Ariston  Merger  Agreement was  terminated  with no further  effect  thereafter.
Subsequently,  on  February  9,  2007,  the name of the  Ariston  Merger Sub was
changed to "R&R Sub III, Inc."


PR PHARMACEUTICALS MERGER

On June 19, 2007, R&R  Acquisition  entered into an Agreement and Plan of Merger
(the  "PRP  Merger  Agreement")  with  PRP  Merger  Sub,  Inc.  (a  wholly-owned
subsidiary incorporated in the State of Delaware) (the "PRP Merger Sub"), and PR
Pharmaceuticals, Inc., a Delaware corporation ("PRP"), pursuant to which the PRP
Merger Sub, upon the consummation of the Merger (as hereinafter  defined),  will
merge with and into PRP and PRP will become a wholly owned  subsidiary (the "PRP
Merger").  The  closing  of the PRP Merger was  subject  to the  fulfillment  of
specified conditions.

Subsequently, PRP Merger Agreement was terminated as of October 31, 2007 with no
further effect..

The Company, based on proposed business activities,  is a "blank check" company.
The Securities and Exchange  Commission defines such a company as "a development
stage company" that has no specific  business plan or purpose,  or has indicated
that  its  business  plan  is to  engage  in a  merger  or  acquisition  with an
unidentified  company or  companies,  or other  entity or person;  and is issued
`penny stock,' as defined in Rule 3a 51-1 under the  Securities  Exchange Act of
1934. Many states have enacted statutes, rules and regulations limiting the sale
of  securities  of "blank check"  companies in their  respective  jurisdictions.
Management does not intend to undertake any efforts to cause a market to develop
in its securities, either debt or equity, until the Company concludes a business
combination.


                                       17
<PAGE>


                   R&R ACQUISITION III, INC. AND SUBSIDIARIES
                          (A Development Stage Company)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

USE OF ESTIMATES

The  preparation of the  consolidated  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 reported  amounts of
revenue and expenses  during the reporting  period.  Actual results could differ
from those estimates.

DEVELOPMENT STAGE COMPANY

The Company has not generated any revenues to date; accordingly,  the Company is
considered a development  stage  enterprise  as defined in Financial  Accounting
Standards  Board  No.  7,  "Accounting  and  Reporting  for  Development   Stage
Companies."  The  Company is  subject  to a number of risks  similar to those of
other companies in an early stage of development.


CASH AND CASH EQUIVALENTS

For  purposes  of the  statement  of  cash  flows,  the  Company  considers  all
short-term  investments with an original  maturity of three months or less to be
cash equivalents. The Company had no cash equivalents as of December 31, 2007.

INCOME TAXES

The Company accounts for income taxes using the liability method, which requires
the   determination  of  deferred  tax  assets  and  liabilities  based  on  the
differences  between the financial and tax bases of assets and liabilities using
enacted tax rates in effect for the year in which  differences  are  expected to
reverse. Deferred tax assets are adjusted by a valuation allowance, if, based on
the weight of available  evidence,  it is more likely than not that some portion
or all of the deferred tax assets will not be realized.

At December  31, 2007,  the Company has a net  operating  loss carry  forward of
approximately $82,000 which will expire as follows:


                             Net Operating Loss

                     EXPIRES                     AMOUNT
                     -------                     ------
                      2025                       19,000
                      2026                       30,000
                      2027                       33,000
                                                -------
                                                $82,000
                                                -------


Based on the fact that the Company has not generated  revenues since  inception,
the  deferred  tax  asset of  approximately  $32,000  has been  offset by a full
valuation  allowance.  The effective tax rate of 41% before giving effect to the
valuation  allowance  differs from the statutory rate of 34%  principally due to
state income  taxes.  The valuation  allowance  increased  approximately  $8,000
during the year ended December 31, 2007.

LOSS PER SHARE

Basic and diluted net loss per share is computed by dividing the net loss by the
weighted-average number of shares of common stock outstanding during the period.
The Company did not have common stock equivalents  outstanding  during the years
ended  December 31 2007 and 2006 and for the period from February 14, 2005 (Date
of Inception) to December 31, 2007.


                                       18
<PAGE>


                   R&R ACQUISITION III, INC. AND SUBSIDIARIES
                          (A Development Stage Company)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 3 - LOAN PAYABLE - RELATED PARTY

The  Company  has a loan  payable  of  $40,384  to an  affiliate.  The  loan  is
non-interest bearing and is payable on demand. The loan is uncollateralized.


NOTE 4 - COMMON STOCK

On February 14, 2005 the Company sold  2,000,000  shares of its common stock for
$200. The common stock was sold to an accredited related party investor pursuant
to a Private  Placement  Offering at par value. The stockholder also contributed
an additional  amount of $ 24,800. On October 31, 2005, the Company sold 500,000
shares of its common stock for $ 50. The common stock was sold to two accredited
related party investors pursuant to a Private Placement Offering at par value.

An accredited  related  party  investor  contributed  $15,000 and $10,000 to the
Company on March 30, 2007 and November 27, 2007, respectively..

NOTE 5 - PREFERRED STOCK

The Company is authorized  to issue  10,000,000  shares of preferred  stock with
such designations,  voting and other rights and preferences as may be determined
from time to time by the Board of Directors.


NOTE 6 - NEW ACCOUNTING STANDARDS

Management  does not believe that any recently  issued,  but not yet  effective,
accounting standards,  if currently adopted, would have a material effect on the
accompanying consolidated financial statements.


NOTE 7 - COMMITMENTS AND CONTINGENCIES

OFFICE SPACE
The Company  utilizes the office space and equipment of its officer and director
at no cost on a month to month basis.  Management  estimates  such amounts to be
immaterial.


                                       19
<PAGE>


ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.

         None.

ITEM 8A(T). CONTROLS AND PROCEDURES.

       (A)   EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

Our  management,  with the  participation  of our president and chief  financial
officer,  carried out an  evaluation  of the  effectiveness  of our  "disclosure
controls and procedures" (as defined in the Securities Exchange Act of 1934 (the
"Exchange  Act") Rules  13a-15(e)  and  15-d-15(e))  as of the end of the period
covered by this report (the "Evaluation Date"). Based upon that evaluation,  the
president and chief financial  officer concluded that as of the Evaluation Date,
our disclosure  controls and procedures are effective to ensure that information
required to be  disclosed  by us in the reports that we file or submit under the
Exchange Act (i) is recorded,  processed,  summarized  and reported,  within the
time periods  specified in the SEC's rules and forms and (ii) is accumulated and
communicated  to our  management,  including our  president and chief  financial
officer, as appropriate to allow timely decisions regarding required disclosure.

Our management,  including our president and chief financial  officer,  does not
expect that our disclosure controls and procedures or our internal controls will
prevent all errors 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.  Further,  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 R&R Acquisition III, Inc.

       (B) MANAGEMENT'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

Our management is responsible for establishing and maintaining adequate internal
control  over  financial  reporting  (as  defined  in Rule  13a-15(f)  under the
Exchange Act). Our management assessed the effectiveness of our internal control
over financial reporting as of December 31, 2007. In making this assessment, our
management   used  the  criteria  set  forth  by  the  Committee  of  Sponsoring
Organizations  of  the  Treadway   Commission  in  Internal   Control-Integrated
Framework.  Our  management  has concluded  that,  as of December 31, 2007,  our
internal control over financial  reporting is effective based on these criteria.
This  annual  report does not include an  attestation  report of our  registered
public  accounting  firm regarding  internal  control over financial  reporting.
Management's  report was not subject to  attestation  by our  registered  public
accounting firm pursuant to temporary rules of the SEC that permit us to provide
only management's report in this annual report.

       (C)   CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

There were no changes in our internal  controls over  financial  reporting  that
occurred during the period covered by this report that has materially  affected,
or is  reasonably  likely  to  materially  affect,  our  internal  control  over
financial reporting.

ITEM 8B. OTHER INFORMATION.

Effective as of October 31, 2007,  the PRP Merger  Agreement was  terminated and
thereinafter having no further force or effect.


                                       20
<PAGE>

                                    PART III

ITEM 9. DIRECTORS,  EXECUTIVE OFFICERS, PROMOTERS, CONTROL PERSONS AND CORPORATE
        GOVERNANCE; COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT.

         The following table sets forth information  concerning our officers and
sole director as of March 27, 2008:

NAME                    AGE   TITLE
----                   -----  ------
Arnold P. Kling         49    President and sole director
Kirk M. Warshaw         49    Chief financial officer and secretary

         ARNOLD P. KLING.  Mr. Kling has served as a director and our  president
since November,  2005. Mr. Kling is currently a Managing  Director of GH Venture
Partners,  LLC, a private equity and merchant banking boutique for which he also
served as a Managing  Director and General  Counsel from 1995 to 1999. From 1999
through  August 2005, Mr. Kling was the president of Adelphia  Holdings,  LLC, a
merchant-banking  firm,  as well  as the  managing  member  of  several  private
investment  funds.  From  1993 to 1995 he was a  senior  executive  and  General
Counsel  of  Buckeye  Communications,   Inc.,  a  Nasdaq  listed  licensing  and
multimedia  company.  From 1990 through  1993,  Mr.  Kling was an associate  and
partner in the  corporate  and  financial  services  department  of  Tannenbaum,
Helpern,  Syracuse &  Hirschtritt  LLP, a mid-size New York law firm.  Mr. Kling
received a Bachelor of Science degree from New York University in  International
Business in 1980 and a Juris Doctor degree from Benjamin  Cardozo  School of Law
in 1983.  Mr. Kling  currently  serves as a director and president of Twin Lakes
Delaware,  Inc.,  R&R  Acquisition  V, Inc.,  R&R  Acquisition,  VI,  Inc.,  R&R
Acquisition,  VII, Inc., R&R  Acquisition,  VIII, Inc. R&R Acquisition IX, Inc.,
R&R  Acquisition  X, Inc.,  Rodman  International  Enterprises  I, Ltd.,  Rodman
International Enterprise II, Ltd., and Rodman International Enterprise III, Ltd.
(each  a  publicly  reporting,   non-trading  company),  and  24Holdings,   Inc.
(OTCBB:TWFH) and Newtown Lane Marketing, Incorporated (OTCBB:NWLM).

         KIRK M. WARSHAW.  Mr. Warshaw has served as our chief financial officer
and secretary,  since  November,  2005. Mr. Warshaw is a financial  professional
who,  since 1990,  has provided  clients in a multitude of different  industries
with advice on accounting,  corporate  finance,  and general  business  matters.
Prior to  starting  his own  consulting  firm,  from  1983 to 1990,  he held the
various titles of controller,  chief  financial  officer,  president,  and chief
executive officer at three separate financial  institutions in New Jersey.  From
1980 through 1983, Mr. Warshaw was a Senior  Accountant at the public accounting
firm of  Deloitte,  Haskins & Sells.  Mr.  Warshaw is a 1980  graduate of Lehigh
University and has been a CPA in New Jersey since 1982. Mr. Warshaw is currently
the chief financial officer and director of 24Holdings,  Inc. (OTCBB:TWFH),  the
chief financial  officer of Twin Lakes Delaware,  Inc., R&R Acquisition V, Inc.,
R&R Acquisition,  VI, Inc., R&R Acquisition,  VII, Inc., R&R Acquisition,  VIII,
Inc., R&R Acquisition IX, Inc., R&R  Acquisition X, Inc.,  Rodman  International
Enterprises  I, Ltd.,  Rodman  International  Enterprise  II,  Ltd.,  and Rodman
International  Enterprise  III,  Ltd.  (each a publicly  reporting,  non-trading
company),  the chief financial  officer of Newtown Lane Marketing,  Incorporated
(OTCBB:NWLM), and a Director of 24Holdings, Inc. (OTCBB:TWFH), and a director of
two privately owned entities.

         Mr. Kling and Mr. Warshaw are not required to commit their full time to
our business  affairs and they will not devote a  substantial  amount of time to
our business affairs.


                                       21
<PAGE>

COMPENSATION AND AUDIT COMMITTEES

         As we only have one board member and given our limited  operations,  we
do not have separate or independent audit or compensation committees.  Our Board
of Directors has determined that it does not have an "audit committee  financial
expert,"  as that term is  defined  in Item  407(d)(5)  of  Regulation  S-B.  In
addition,  we have not  adopted any  procedures  by which our  stockholders  may
recommend nominees to our Board of Directors.

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

         Section  16(a) of the Exchange Act requires our directors and executive
officers  and persons who  beneficially  own more than ten percent of our common
stock  (collectively,  the "Reporting Persons") to report their ownership of and
transactions  in our common stock to the SEC.  Copies of these  reports are also
required to be supplied  to us. To our  knowledge,  during the fiscal year ended
December 31, 2007 the Reporting  Persons  complied with all  applicable  Section
16(a) reporting requirements.

CODE OF ETHICS

         We have not adopted a Code of Ethics given our limited  operations.  We
expect  that our Board of  Directors  following  a merger  or other  acquisition
transaction will adopt a Code of Ethics.

ITEM 10. EXECUTIVE COMPENSATION.

         Arnold Kling and Kirk Warshaw are our sole officers and Arnold Kling is
our sole director.  Neither receives any regular compensation for their services
rendered  on our  behalf.  Neither  Mr.  Kling  nor  Mr.  Warshaw  received  any
compensation  during the year ended December 31, 2007. No officer or director is
required  to make  any  specific  amount  or  percentage  of his  business  time
available to us.

         While  we  do  not  presently   anticipate  engaging  the  services  of
professional  firms that  specialize  in finding  business  acquisitions  on any
formal basis,  we may engage such firms in the future,  in which event we may be
required to pay a finder's fee or other compensation. In no event, however, will
we pay a finder's fee or  commission to any of our officers and directors or any
entity  with which an  officer or  director  is  affiliated.  We do not have any
incentive or stock option plan in effect.


DIRECTOR COMPENSATION

         We do not currently pay any cash fees to our  directors,  nor do we pay
directors' expenses in attending board meetings.

EMPLOYMENT AGREEMENTS

         The Company is not a party to any employment agreements.


                                       22
<PAGE>

ITEM 11.  SECURITY  OWNERSHIP OF CERTAIN  BENEFICIAL  OWNERS AND  MANAGEMENT AND
RELATED STOCKHOLDER MATTERS.

         The  following  tables set forth  certain  information  as of March 27,
2008,  regarding (i) each person known by the Company to be the beneficial owner
of more than 5% of the outstanding  shares of the Company's  common stock,  (ii)
each  director and  executive  officer of the Company and (iii) all officers and
directors as a group.

<TABLE>
<CAPTION>
                                                    AMOUNT AND NATURE OF
                NAME AND ADDRESS (1)                BENEFICIAL OWNERSHIP        PERCENTAGE OF CLASS
                --------------------                --------------------        -------------------
<S>                                                   <C>                                 <C>
Arnold P. Kling (2)                                   400,000                             16%
712 Fifth Avenue, 11th Floor
New York, New York 10019

Kirk Warshaw (3)                                      100,000                             4%
47 School Avenue
Chatham, New Jersey 07928

R&R Investments III, LLC                              2,000,000                           80%
1270 Avenue of Americas, 16th Floor
New York, New York 10020

All Directors and Officers as a Group                 500,000                             20%
(2 individuals)
</TABLE>
----------------------------------------
     (1) Unless otherwise indicated, the company has been advised that all
     individuals or entities listed have the sole power to vote and dispose of
     the number of shares set forth opposite their names. For purposes of
     computing the number and percentage of shares beneficially owned by a
     security holder, any shares which such person has the right to acquire
     within 60 days from March 27, 2008 are deemed to be outstanding, but those
     shares are not deemed to be outstanding for the purpose of computing the
     percentage ownership of any other security holder.
     (2) Mr. Kling is the president and sole director of the Company.
     (3) Mr. Warshaw is the secretary and chief financial officer of the
     Company.

         We currently do not maintain any equity compensation plans.

ITEM  12.  CERTAIN   RELATIONSHIPS  AND  RELATED   TRANSACTIONS,   AND  DIRECTOR
INDEPENDENCE.

Our sole director is Arnold Kling. He is not independent as such term is defined
by a national securities exchange or an inter-dealer quotation system. During
the fiscal year ended December 31, 2007, $25,000 of cash was contributed to us
by the parent company of R&R Investments III, LLC.


                                       23
<PAGE>



ITEM 13. EXHIBITS.

Exhibit           Description
-------           -----------
    *3.1          Certificate of Incorporation
    *3.2          Amendment to Certificate of Incorporation
    *3.3          By-laws
    31.1          Certification of the Company's principal executive officer
                  pursuant to Section 302 of the Sarbanes-Oxley Act of 2002,
                  with respect to the registrant's Annual Report on Form 10-KSB
                  for the year ended December 31, 2007
    31.2          Certification of the Company's principal financial officer
                  pursuant to Section 302 of the Sarbanes-Oxley Act of 2002,
                  with respect to the registrant's Annual Report on Form 10-KSB
                  for the year ended December 31, 2007
    32.1          Certification of the Company's principal executive officer
                  pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
                  Section 906 of the Sarbanes Oxley Act of 2002.
    32.2          Certification of the Company's principal financial officer
                  pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
                  Section 906 of the Sarbanes Oxley Act of 2002.
----------------------
*        Filed as an exhibit to the Company's registration statement on Form
         10-SB, as filed with the Securities and Exchange Commission on January
         19, 2006, and incorporated herein by this reference.




ITEM 14.   PRINCIPAL ACCOUNTANT FEES AND SERVICES

         For the years ended December 31, 2007 and December 31, 2006, our audit
and financial statement review fees from Marcum & Kliegman LLP, our independent
accountants, were as follows:

2007 FEES                                                              AMOUNT
---------                                                              ------

Audit Fees                                                            $18,000
Audit-Related Fees                                                          -
Tax Fees                                                                    -
All Other Fees                                                              -

2006 FEES
---------

Audit Fees                                                            $14,000
Audit-Related Fees                                                          -
Tax Fees                                                                    -
All Other Fees                                                              -

PRE-APPROVAL POLICY

         We do not currently have a standing audit committee. The above services
were approved by our Board of Directors.


                                       24
<PAGE>



                                   SIGNATURES

         In accordance with Section 13 or 15(d) of the Exchange Act of 1934, the
registrant has caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.

                                                      R&R ACQUISITION III, INC.


Dated: March 27, 2008                                By:  /S/ ARNOLD P. KLING
                                                          -------------------
                                                     Arnold P. Kling
                                                     President



         In accordance  with the Exchange Act, this report has been signed below
by the following  persons on behalf of the  registrant and in the capacities and
on the dates indicated.

Date: March  27, 2008


                                    By: /S/ ARNOLD P. KLING
                                    -----------------------
                                    Arnold P. Kling, President and Sole Director
                                    (Principal Executive Officer)



Date: March 27, 2008


                                    By: /S/ KIRK M. WARSHAW
                                    -----------------------
                                    Kirk M. Warshaw, Chief Financial Officer
                                    (Principal Financial and Accounting Officer)












                                       25