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

                                   FORM 10-KSB

[X]    ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
       ACT OF 1934

                    For the fiscal year ended: June 30, 2003
                                               -------------

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

                For the transition period from ________to________

                        Commission file number: 001-16703
                                                ---------

                              NOVA BIOGENETICS INC.
                 ----------------------------------------------
                 (Name of Small Business Issuer in its Charter)

            Delaware                                    04-3656563
 -------------------------------           ------------------------------------
 (State or other jurisdiction of           (I.R.S. Employer Identification No.)
 Incorporation or Organization)

        8601 Dunwoody Place, Suite 338, Atlanta, Georgia      30350
        ------------------------------------------------    ----------
            (Address of principal executive offices)        (Zip Code)

Issuer's telephone number (770) 650-6508

Securities registered under Section 12(b) of the Exchange Act:     None

 Title of each class                  Name of each exchange on which registered
 -------------------                  -----------------------------------------
        None                                       Not Applicable

Securities registered under Section 12(g) of the Exchange Act:

                                  Common Stock
                                 --------------
                                 Title of Class


                                 --------------
                                 Title of Class

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 in response to Item 405 of
Regulation S-B is not contained in this form, and no disclosure will be
contained, to the best of the 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]

<PAGE>

State issuer's revenues for its most recent fiscal year. $129,034 for the 12
months ended June 30, 2003.

State the aggregate market value of the voting and non-voting common equity held
by non-affiliates computed by reference to the price at which the common equity
was sold, or the average bid and asked price of such common equity, as of a
specified date within the past 60 days. The aggregate market value of the voting
stock held by non-affiliates computed at the closing price of Healthcare
Network's common stock on October 31, 2003 is approximately $152,000.


                   ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
                           DURING THE PAST FIVE YEARS

Check whether the issuer has filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court. Yes________ No ____X___

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date. As of October 31, 2003, 5,538,407
shares of common stock are issued and outstanding.


                       DOCUMENTS INCORPORATED BY REFERENCE

If the following documents are incorporated by reference, briefly describe them
and identify the part of the Form 10-KSB into which the document is
incorporated: (1) any annual report to security holders; (2) any proxy or
information statement; and (3) any prospectus filed pursuant to Rule 424(b) of
the Securities Act of 1933 ("Securities Act"). Not Applicable.

Transitional Small Business Disclosure Form: Yes ____  No_____
















         When used in this Annual Report, the terms "Nova BioGenetics Inc.,"
"the Company," "we," and "us" refers to Nova BioGenetics Inc., a Delaware
corporation.

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<PAGE>

CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING INFORMATION

This report contains forward-looking statements. These statements
consist of any statement other than a recitation of historical fact and can be
identified by the use of forward-looking terminology such as "may," "expect",
"anticipate," estimate" or "continue" or the negative or other variations of
these words or comparable terminology. The reader is cautioned that all
forward-looking statements are necessarily speculative and there are certain
risks and uncertainties that could cause actual events or results to differ
materially from those referred to in any forward-looking statements. We do not
have a policy of updating forward-looking statements and thus it should not be
assumed that silence over time means that actual events are bearing out as we
estimated in any forward-looking statements.


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<PAGE>
                                     PART I

ITEM 1.           DESCRIPTION OF BUSINESS.

General

Nova Biogenetics is a biopharmaceuticals company headquartered in Atlanta,
Georgia that is engaged in the discovery, development, and commercialization of
new therapeutic agents that treat life-threatening infectious diseases. Nova
Biogenetics' pipeline is based on proprietary patented technology used as a
broad base for applications with existing antibiotic compounds. Attaching the
proprietary patented technology to antibiotic compounds can extend the
antimicrobial spectrum of antibiotics as well as, facilitate the antimicrobial
action of existing antibiotics.

In particular, Nova Biogenetics' mission is to provide solutions to the major
therapeutic dilemma of antimicrobial (i.e., bacteria, fungi or viruses)
resistance to antibiotics that are currently available in the worldwide
marketplace.

Nova Biogenetics is using its proprietary technology to the development a suite
of new antibiotics and antibiotic derivatives products. Nova Biogenetics'
antibiotic product suite is an "Antibiotic Resistance Technology," otherwise
referred to as "ART".

In addition, Nova's products have demonstrated synergistic potential when
conjugated to existing patented antimicrobials. These new chemical compounds can
be used against targeted organisms creating a unique brand of antibiotic product
formulations.

Product Differentiation/Competitive Advantage

Nova's broad line of specialized antibiotic products acts by disrupting the cell
wall of bacteria and / or fungi. This action kills the targeted organisms.
Presently, many generic antibiotic formulations act by diffusing into the
targeted organism/cells and providing an environment for slowing cellular
activity providing a state of stasis (cells are not actually killed). Nova's
compounds have significant potential to actually kill the targeted organism,
significantly enhancing existing generic antibiotic medications.

In addition, Nova possess the competitive advantage of providing a product
platform that can create longevity in the drugs that it produces by delivering
antibiotics that are less susceptible to adaptation or mutation. Finally, the
"ART" platform is based upon existing technology that Nova, through its Joint
Venture partner, has already received patents and EPA approvals for industrial
applications. Much has been learned about the "ART" platform adding to the
volume of microbiologic information available, thus shortening the timeline for
development and minimizing the research associated with creating a viable core
platform to work from.

Product Research & Development Pipeline

                                      -4-
<PAGE>

Nova Biogenetics views bacterial resistance as a major hurdle in effective
therapeutic interventions for a significant number of infectious diseases. This
is ever apparent in the clinical practice, where physicians and other healthcare
providers are constantly challenged by the number of new antibiotics being
offered by pharmaceutical manufacturers, while at the same time, traditional
antibiotic therapies have been limited. In both cases, bacterial resistance and
the broad spectrum of use are identified as the reasons for the introduction of
the new and improved products.

Currently, Nova Biogenetics is taking steps to file patents to secure the
intellectual property of the compounds and effective molecules that Nova will
utilize in its pipeline. To date, current research and existing regulatory
approvals have been secured by Nova Biogenetics pursuant to the JV. These data
will be used as part of the foundation for existing and future development of
its unique line of antibiotic products.

The Market for Antibacterial Products

The worldwide sales of prescription antibiotics exceed $23 billion
(Biotechnology Industry Association). Antibiotics represent the second largest
therapeutic category in terms of pharmaceutical sales. While there are more than
100 different antibiotics from more than 30 different classes approved for use
in humans, a select few antibiotics and classes garner the majority of use. Most
of the leading products are broad spectrum, with only a few reserved for
targeted or restricted use. While the overall market continues to grow at a rate
of 6.5% annually, as antibiotics are increasingly used in combination to combat
resistant bacteria, a few new classes of antibiotics have been introduced during
the past twenty years.

Explanation of Antibiotic Resistance
(Source: United States Food and Drug Administration)

Disease-causing microbes that have become resistant to drug therapy are an
increasing public health problem. Tuberculosis, gonorrhea, malaria, and
childhood ear infections are just a few of the diseases that have become hard to
treat with antibiotic drugs. Part of the problem is that bacteria and other
microorganisms that cause infections are remarkably resilient and can develop
ways to survive drugs meant to kill or weaken them. This antibiotic resistance,
also known as antimicrobial resistance or drug resistance, is due largely to the
increasing use of antibiotics. Other facts:

Though food-producing animals are given antibiotic drugs for important
therapeutic, disease prevention or production reasons, these drugs have the
downside of potentially causing microbes to become resistant to drugs used to
treat human illness, ultimately making some human sicknesses harder to treat.

About 70 percent of bacteria that cause infections in hospitals are resistant to
at least one of the drugs most commonly used to treat infections.

Some organisms are resistant to all approved antibiotics and must be treated
with experimental and potentially toxic drugs.

                                      -5-
<PAGE>

Some research has shown that antibiotics are given to patients more often than
guidelines set by federal and other healthcare organizations recommend. For
example, patients sometimes ask their doctors for antibiotics for a cold, cough,
or the flu, all of which are viral and don't respond to antibiotics. Also,
patients who are prescribed antibiotics but don't take the full dosing regimen
can contribute to resistance.

Unless antibiotic resistance problems are detected as they emerge, and actions
are taken to contain them, the world could be faced with previously treatable
diseases that have again become untreatable, as in the days before antibiotics
were developed.

Nova Biogenetics Pharmaceutical Development Strategy

Nova Biogenetics' solution to emerging antibiotic resistance in microorganisms
will use the application of its proprietary technology to develop a suite of new
antibiotics and / or antibiotic derivatives. Nova Biogenetics' antibiotic
product suite will fall under "Antibiotic Resistance Technology," otherwise
referred to as "ART". The Nova Biogenetics' research and development strategy is
targeted at providing short-term (i.e., 24 months), intermediate-term (i.e.,
36-48 months) and long-term solutions (i.e., >60 months).

Nova's proprietary technology has demonstrated that it is not susceptible to
microbial adaptation (i.e., antibiotic resistance) in laboratory tests designed
specifically for determining antibiotic resistance. This outcome is directly
linked to the mechanism with which this technology affects microbial growth. The
mechanism is best described as "electrocution" of actively growing
microorganisms. Based on this knowledge and the availability of a vast number of
proven "generic" antimicrobials, Nova will identify a series of "novel" target
molecules with antiviral, antibacterial or antifungal functionality. In essence,
the target molecules will function in a manner similar to targeted chemotherapy.
The generic drug component of the molecule will be used to target the
microorganism and act as a delivery device for the proprietary Nova technology,
which will "kill" the microorganism.

Investment funding will be used to complete the following research activities:

Computational analysis will be utilized to determine the most economic synthesis
strategy for the target molecules and to determine potential toxicity of the
target molecules. These steps will significantly reduce drug development costs
by eliminating target compounds with high toxicity and complex synthesis
requirements. Target molecules will be synthesized and subjected to laboratory
testing to validate toxicity and antimicrobial efficacy (pre-clinical
investigations). Target molecules generated in this fashion should be "novel".
As such, Nova will seek to obtain patents on the novel target molecules that
demonstrate appropriate toxicity and antimicrobial efficacy.
Phase 1 through Phase 3 Clinical Trials will be conducted. Nova may seek joint
venture partnerships to develop drug through clinical trials.

                                      -6-
<PAGE>

Antibiotic Resistance Technology (ART)

The widespread and uncontrolled use of antibiotics, both for human consumption,
agriculture and animal feed, has encouraged the development of drug resistance
in a variety of pathogenic microorganisms. These microorganisms employ
resistance mechanisms, which include the modification of the antibiotic
structure, mutagenesis of key amino acids in the macromolecular targets of
specific chemotherapeutics, or drug efflux from the cell, among others. These
three main mechanisms have been identified in resistance profiles for systems
involved in protein biosynthesis, nucleic acid replication, and bacterial cell
wall generation.

Most antibiotics presently in human use are natural products manufactured by
different species of bacteria or fungi to be employed in their own survival --
for example, to kill other microbes in times of overpopulation. In a natural
environment, such as the soil, bacteria exchange genetic information (such as
resistance genes) with great facility and lack of species specificity, thus
allowing molecular determinants of resistance to be passed on to other microbes
with great ease. Such resistance-development methodologies fall into three main
categories: (i) inactivation of the antibiotic by modification of its active
chemical moiety; (ii) specific modification of the macromolecular target, i.e.,
by mutagenesis of key residues, and (iii) promotion of antibiotic efflux from
the cell [2]. Today, the emergence of bacterial strains, which display
resistance to a variety of drugs (multiple drug resistant; MDR), is the major
cause of failure of treatment of infections worldwide. Methicillin-resistant
Staphylococcus aureus (MRSA) strains already require vancomycin as the last
resort for treatment, and Streptococcus pneumoniae strains, which no longer
respond to vancomycin, have already been identified. Multi-drug resistant
Mycobaterium tuberculosis is another example of an emerging infectious disease
with world-wide significance.

Nova Biogenetics' solution to emerging antibiotic resistance in microorganisms
will use the application of its proprietary technology to develop a suite of new
antibiotics and / or antibiotic derivatives. Nova Biogenetics' antibiotic
product suite will fall under "Antibiotic Resistance Technology," otherwise
referred to as "ART". The Nova Biogenetics' research and development strategy is
targeted at providing short-term (i.e., 24 months), intermediate-term (i.e.,
36-48 months) and long-term solutions (i.e., >60 months). The following is a
summary of potential drug targets and the rationale for choosing them.

Target Research Drugs

A. Topical Treatments. Topical drug candidates represent the best option for
short-term product development. Topical drug candidates fall into three major
categories: 1) antiviral (Acyclovir), 2) antibacterial (bacitracin, clindamycin,
erythromycin, metranidazole, mupirsoin, neomycin, and polymyxin B), and 3)
antifungal (clotrimazole, econazole, miconazole, nystatin, tolnaftate). Topical
drugs are the most attractive because they will require the least amount of Food
and Drug Administration (FDA) scrutiny.

1. Antiviral

ZOVIRAX is the brand name for acyclovir, a synthetic nucleoside analogue active
against herpes viruses. ZOVIRAX Ointment 5% is a formulation for topical
administration. Each gram of ZOVIRAX Ointment 5% contains 50 mg of acyclovir in
a polyethylene glycol (PEG) base. Acyclovir is a synthetic purine nucleoside
analogue with in vitro and in vivo inhibitory activity

                                      -7-
<PAGE>

against herpes simplex virus types 1 (HSV-1), 2 (HSV-2), and varicella-zoster
virus (VZV). The inhibitory activity of acyclovir is highly selective due to its
affinity for the enzyme thymidine kinase (TK) encoded by HSV and VZV. This viral
enzyme converts acyclovir into acyclovir monophosphate, a nucleotide analogue.
The monophosphate is further converted into diphosphate by cellular guanylate
kinase and into triphosphate by a number of cellularenzymes. In vitro, acyclovir
triphosphate stops replication of herpes viral DNA. This is accomplished in 3
ways: 1) competitive inhibition of viral DNA polymerase, 2) incorporation into
and termination of the growing viral DNA chain, and 3) inactivation of the viral
DNA polymerase. The greater antiviral activity of acyclovir against HSV compared
to VZV is due to its more efficient phosphorylation by the viral TK.

 Actions Required                                                       Timeline
 ----------------                                                       --------
 1. Identify  FDA approvals ........................................... Q3: 2003
 2. Prepare and validate chemical formulation with acyclovir .......... Q1: 2003
 3. In vitro drug screening trials and interpretations ................ Q1: 2003
 4. Pre-clinical development .......................................... Q2: 2003
 5. Phase I clinical trials (safety) .................................. Q1: 2004
 6. Phase II clinical trials (safety and efficacy) .................... Q2: 2004
 7. Phase III clinical trials (confirmation of treatment, side-effects) Q4: 2004
 8. Phase IV clinical trials (post-market long-term usage and effects)  Q3: 2005

2. Antifungal

Antifungal topical medications do not fall into any single class of drugs.
Instead each has a different type of antifungal mechanism. The different drugs
in each category are used to treat different fungi. Topical drugs are divided
into over-the-counter (OTC) and prescription medications. This is also a good
target group due to antibacterial activity of Nova Biogenetics ART. Secondary
bacterial infections may also be problematic in the treatment of primary fungal
dermatomycoses. Additionally, we can narrow the list of candidates by choosing
drugs that interact with the fungal cell wall. The ART works in a similar
manner, which should increase the probability of synergistic drug actions.

Topical OTC Antifungal Medications

The following list of antifungal agents represent potential target molecules for
conjugation to Nova's proprietary technology. These target molecules will be
evaluated using high through put computational molecular modeling to identify
high consequence molecules.
Clioquinol (Vioform(R)). Clioquinol is used to treat inflammatory conditions of
the skin, such as eczema (dry skin) and athlete's foot. This medication may
stain fabric, skin, or hair. Clotrimazole (Lotrimin(R) AF, Mycelex(R) OTC,
prescription-strength Desenex(R)). Clotrimazole is used to treat vaginal and
oral candidiasis, athlete's foot, jock itch, and ringworm of the face, arms and
shoulders (not ringworm of the scalp). It is available as either a solution or
cream, lozenge, topical solution and vaginal suppository.

Miconazole (Micatin(R)). Miconazole is available as an ointment, cream, powder,
vaginal suppository, spray, liquid, or solution. It is used to treat athlete's
foot; jock itch; and ringworm of

                                      -8-
<PAGE>

the face, arms and shoulders. Miconazole should provide symptomatic relief
within 2-3 days. However, when treating athlete's foot, treatment is continued
for at least 2 to 4 weeks to ensure a complete cure.

Tolnaftate (Aftate(R), Tinactin(R)). Tolnaftate is available as an aerosol
powder or solution, cream, powder, gel, or topical solution. It is used to treat
athlete's foot and other superficial fungal infections of the skin.

Prescription Topical Antifungal Medications

Ciclopirox (Loprox(R)). Ciclopriox is available as a cream or lotion. It is used
to treat a variety of fungal infections including athlete's foot, jock itch, and
cutaneous candidiasis. Ciclopriox is also available as a nail lacquer for
treating fungal infections of the nails and nail beds. It may take 4-6 months to
see improvement in the nails.

Ketoconazole (Nizoral(R)). Ketoconazole is available as a prescription tablet,
cream or shampoo. A 1% shampoo is also available over-the-counter. The cream is
used for the treatment of ringworm, jock itch, and athlete's foot. The shampoo
is used to reduce scaling due to dandruff. Treatment for ringworm, jock itch and
athlete's foot is usually 2-6 weeks. Treatment for dandruff is 4 weeks, and then
on an as-needed basis.

Miconazole (Mycostatin(R), Nystop(R)). Miconazole is available as an ointment,
cream, powder, spray, liquid, or solution. It is used to treat athlete's foot;
jock itch; and ringworm of the face, arms and shoulders.

Naftifine (Naftin(R)). Naftifine is available as a cream or as a gel. It is used
to treat athlete's foot, jock itch, and generalized fungal skin infections.
Complete the full course of therapy to prevent recurrent infections. Naftfine is
available by prescription only.

Nystatin (Nystop(R), Mycostatin(R)). Nystatin is available as a cream, ointment
or powder. It is used to treat a variety of fungal infections. In particular, it
is used to treat candidal infections, such as thrush, esophageal candidiasis,
and cutaneous candidiasis. It is virtually nontoxic and nonsensatizing.
Symptomatic relief should occur within 1-3 days. However, you should finish the
full course of therapy to ensure that the infection is completely cleared up.
Nystatin is available by prescription only.

Oxiconazole (Oxistat(R)). Oxiconazole is available as a cream or a lotion. Both
are used to treat athlete's foot, jock itch, and ringworm in adults and
children. The cream can also be used to treat tinea versicolor, which is a
chronic, generalized fungal skin infection. Wash hands after applying the
medication to help prevent accidental application to other areas. Oxiconazole is
available by prescription only.
Selenium Sulfide (Selsun(R), Exsel(R)). Selenium sulfide is available as a
lotion or shampoo. It is used to treat dandruff, seborrheic dermatitis, ringworm
of the scalp, and tinea versicolor (a generalized chronic fungal skin
infection). This medication is available by prescription only.

                                      -9-
<PAGE>

Terbinafine (Lamisil(R)). Terbinafine is available as a cream or pump-spray
solution. It is used to treat a variety of ringworm infections, as well as
athlete's foot, jock itch, and candidal skin infections. Terbinfine is available
by prescription only.

OTC Vaginal Antifungal Medications

Miconazole (Monistat(R) 3, Monistat-Derm(R)). Miconazole is available as an OTC
suppository or cream. It is used to treat vaginal fungal infections, including
vaginal candidiasis. Terconazole (Terazol(R)). Terconazole is an antifungal
cream or suppository intended for intravaginal use only. It is used to treat
vaginal fungal infections, including vaginal candidasis. It is generally
prescribed as a 3-day or 7-day course of treatment.

 Actions Required                                                       Timeline
 ----------------                                                       --------
 1. Identify  FDA approvals ........................................... Q3: 2003
 2. Identify antifungal candidate drugs (prescription v. OTC) ......... Q3: 2003
 3. Prepare and validate chemical formulation for three drugs ......... Q1: 2004
 4. In vitro drug screening trials and interpretations ................ Q1: 2004
 5. Pre-clinical development .......................................... Q1: 2004
 6. Phase I clinical trials (safety) .................................. Q2: 2004
 7. Phase II clinical trials (safety and efficacy) .................... Q4: 2004
 8. Phase III clinical trials (confirmation of treatment, side-effects) Q1: 2005

3. Antibacterials

The ideal antibacterial or antimicrobial compound displays a selective toxicity.
This means that it is harmful to the microbe (the bacteria, fungi or virus)
without being harmful to the host (you). In reality, many antimicrobials have a
relative toxicity. Antimicrobial is a broader category that includes antifungal,
antiviral, antiprotozoal or antibacterial compounds. Antibacterials specifically
act against bacterial cells. The actual mechanism of antibacterial compounds is
not always known. In general terms, most of these drugs act by altering or
inhibiting one of the following cellular structures/processes: a) cell wall
synthesis, b) permeability of the cell membrane, c) protein synthesis, and d)
nucleic acid synthesis. Our focus is not restricted. This phase of testing will
help identify, which antibacterial mechanisms are the most synergistic with ART.
The primary market is OTC topical antibacterial treatments.

Target drug candidates include: bacitracin, clindamycin, erythromycin,
metranidazole, mupirosin, neomycin and polymyxin B.

 Actions Required                                                       Timeline
 ----------------                                                       --------
 1. Identify  FDA approvals ........................................... Q4: 2003
 2. Identify antibacterial candidate drugs (OTC) ...................... Q4: 2003
 3. Prepare and validate chemical formulation for three drugs ......... Q4: 2003
 4. In vitro drug screening trials and interpretations ................ Q1: 2004
 5. Pre-clinical development .......................................... Q1: 2004
 6. Phase I clinical trials (safety) .................................. Q2: 2004
 7. Phase II clinical trials (safety and efficacy) .................... Q3: 2004
 8. Phase III clinical trials (confirmation of treatment, side-effects) Q1: 2005

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B. Oral Treatments. Oral treatments will require significant research and
development. Consequently, oral treatments are better candidates for
intermediate to long-term development. The FDA requirements for oral treatments
are also much more stringent. These products will require considerable toxicity
and bioavailablity testing. There are three principal targets for antibacterial
drugs 1) cell wall synthesis, 2) DNA / RNA sysnthesis, and 3) protein synthesis.
The ART works is primarily directed toward cell wall synthesis. Consequently,
the initial research and development will focus on drugs that interact with cell
walls, which should increase the probability of synergistic drug actions.

The following is a brief description of interaction between select antibiotics
and the cell wall. The bacterial cytoplasm is separated from the external
environment by a cytoplasmic membrane; in addition, bacteria possess a crucial
structure surrounding the entire cell: the peptidoglycan. This three-dimensional
cross-linked mesh protects the cell from modifications in osmotic pressure and
plays key roles in cellular shape determination and daughter cell formation
during the division process. Disruption of the peptidoglycan structure engenders
osmotic fragility and possibly cell lysis, underlining the essential nature of
its function. Therefore, it is not surprising that a vast number of naturally
occurring antibiotics are in fact targeted towards enzymes or substrates
involved in peptidoglycan biosynthesis and cell wall stabilization. The
widespread use of such molecules and their novel analogs, including vast
application as additives in animal feed, has promoted the development of
resistance patterns with dire effects observed for vancomycin and Beta-lactams.

Target drug candidates include: Penicillins (G, V, Amoxicillin, Ampicillin,
Nafcillin, Ticarcillin), Cephalosporins (Cephalexin, Cefazolin, Cefaclor,
Loracarbef, Ceftriaxone, Cefotaxime), Vancomycin, and Isoniazid.

 Actions Required                                                       Timeline
 ----------------                                                       --------
 1. Identify  FDA approvals ........................................... Q4: 2003
 2. Identify antibacterial candidate drugs (prescription) ............. Q3: 2003
 3. Prepare and validate chemical formulation for three drugs ......... Q3: 2003
 4. In vitro drug screening trials and interpretations ................ Q1: 2005
 5. Pre-clinical development .......................................... Q1: 2005
 6. Phase I clinical trials (safety) .................................. Q3: 2005
 7. Phase II clinical trials (safety and efficacy) .................... Q1: 2006
 8. Phase III clinical trials (confirmation of treatment, side-effects) Q1: 2007

PATENTS

Our policy is to pursue patents and other endeavors to protect our technology,
inventions and improvements that are commercially important to the development
of our business. Also, we rely on trade secrets that may be important to the
development of our business.

Our antibiotic patent portfolio currently consists of three (3) U.S. granted
patents and four (4) pending U.S. patent applications as well as two (2) foreign
patents issued and twenty-five (25)

                                      -11-
<PAGE>

foreign patents pending. All of these existing and pending patent applications
were acquired in the JV with International BioChemical Industries, Inc. F/K/A
BioShield Technologies, Inc. in accordance with the Joint Venture Agreement. A
copy of the JV agreement is included as Exhibit A. These patents will expire
from 2018 to 2021. Currently, our existing patents cover 473 different
compounds. New patent applications, if and when awarded, typically have a 20
year effective term. Accordingly, we will file patent claims directed to the
compounds themselves, in addition to attempting to obtain patent claims directed
to the method of treatment of infectious diseases with these drugs.

1. United States Patent Number 6,80,587

Abstract: The composition formed by mixing an organosilane, optionally having a
nonhydrolizable organic group, but having one or more hydroxyloble groups, with
a polyol containing at least two hydroxyl groups, wherein at least any two of
the hydroxyl groups are separated by no more than two intervening atoms.
Water-stabilized organosilane compounds. A water stable composition made from
the polyol and organosilane or compound and water. A method of making a siloxane
in the presence of a stabilizer.

2. United States Patent Number 6,113,815

Abstract: The composition formed by mixing an organosilane with an ether.
Water-stabilized organosilane compounds. A water stable composition made from
the ether and organosilane composition and water. A treated substrate having
adhered thereto the product, compound, or composition of this invention. A
method of antimicrobially treating a food article. A method of antimicrobially
coating a fluid container. A method of antimicrobially coating a latex medical
article.

3. United States Patent Number 5,954,869

Abstract: The composition formed by mixing an organosilane, optionally having a
nonhydrolizable organic group, but having one or more hydroxylable groups, with
a polyol containing at least two hydroxyl groups, wherein at least any two of
the hydroxyl groups are separated by no more than two intervening atoms.
Water-stabilized organosilane compounds. A water stable composition made from
the polyol and organosilane or compound and water. A method of antimicrobially
treating a food article. A method of antimicrobially coating a fluid container.
A method of antimicrobially coating a latex medical article. A method of making
a siloxane in the presence of a stabilizer.

US Patents Pending:

There are currently three U.S. Patents pending.

Foreign Patents Pending:

There are currently patents pending in Brazil, Israel, Mexico, Argentina, Canada
and the EC.

                                      -12-
<PAGE>

Foreign Patents Issued:

 Docket #     Region         Serial #    Description
 --------     ------         --------    -----------
 BST-99NZ     New Zealand    329397      Water-Stabilized Organosilane Compounds
 BST-100NZ    New Zealand    330379      Water-Stabilized Organosilane Compounds

INDUSTRY

According to the Center for Disease Control (CDC), more than two million
patients in the U.S. each year contract an infection as a result of exposure
while receiving healthcare in a hospital. S. AUREUS is among the most common
causes of these hospital-acquired infections and is reportedly associated with a
death rate of 10% to 25% because of its capacity to cause serious complications.
S. AUREUS can spread from the blood (bacteremia), to the bones (osteomyelitis),
or the inner lining of the heart and its valves (endocarditis), or cause
abscesses in internal organs such as the lungs and kidneys. Most at risk for
these infections are surgical patients, trauma or burn victims, newborns whose
immune systems are not yet developed and people with such chronic illnesses as
diabetes, cancer, lung diseases or kidney diseases. People whose immune systems
are suppressed due to disease, drugs or radiation therapy also are more
susceptible to these bacterial infections.

Based on a 1995 study, the Lewin Group, an independent consulting group,
published data on the incidence, deaths and direct medical costs of S. AUREUS
infections in hospitalized patients in the New York City metropolitan area. The
report found that in 1995 the total direct medical costs incurred as a result of
S. AUREUS infections was estimated at $32,100 per patient. S. AUREUS-associated
hospitalizations resulted in more than twice the length of hospitalization stay,
twice the deaths and twice the medical costs compared to an average hospital
stay. Methicillin-resistant and methicillin-sensitive infections had similar
direct medical costs, but resistant infections caused more deaths (21% versus
8%). These infections are difficult to treat because the bacteria that cause
them are highly virulent and are resistant to many currently available
antimicrobial drugs. Overall, 70% of the bacteria causing Gram-positive
infections are resistant to at least one of the drugs most commonly used to
treat these infections. Although the contribution of antibiotic resistance to
the outcome of such infections is unclear, hospital-acquired infections of the
bloodstream may represent the eighth leading cause of death in the U.S. The rise
of antibiotic resistance has markedly curtailed options for treating these
infections. The first penicillin-resistant strains of S. AUREUS were identified
in 1944, and by the late 1950's, approximately half of S. AUREUS infections were
of this type. Methicillin-resistant strains were identified in 1961, just one
year after the introduction of this antibiotic. The CDC currently estimates that
in large, urban U.S. hospitals, up to 55% of S. AUREUS infections are resistant
to methicillin. In 1997, the first S. AUREUS strains with notably reduced
sensitivity to vancomycin (so called, vancomycin intermediate sensitivity S.
AUREUS - VISA strains) and teicoplanin were discovered. VISA strains have been
isolated in 23 states within the U.S. and have contributed to the death of
patients in the U.S., Europe and Japan.

The Biotechnology Industry

(Source: Ernst & Young LLP, Annual Biotechnology Industry Reports 1993 - 2001.)

                                      -13-
<PAGE>

More than 250 million people worldwide have been helped by the more than 117
biotechnology drug products and vaccines approved by the U.S. Food and Drug
Administration (FDA). Of the biotech medicines on the market, 75 percent were
approved in the last six years.

There are more than 350 biotech drug products and vaccines currently in clinical
trials targeting more than 200 diseases, including various cancers, Alzheimer's
disease, heart disease, diabetes, multiple sclerosis, AIDS and arthritis.

Biotechnology is responsible for hundreds of medical diagnostic tests that keep
the blood supply safe from the AIDS virus and detect other conditions early
enough to be successfully treated. Home pregnancy tests are also biotechnology
diagnostic products.

Consumers are already enjoying biotechnology foods such as papaya, soybeans and
corn. Hundreds of biopesticides and other agricultural products are also being
used to improve our food supply and to reduce our dependence on conventional
chemical pesticides.

Environmental biotechnology products make it possible to clean up hazardous
waste more efficiently by harnessing pollution-eating microbes without the use
of caustic chemicals.

Industrial biotechnology applications have led to cleaner processes that produce
less waste and use less energy and water in such industrial sectors as
chemicals, pulp and paper, textiles, food, energy, and metals and minerals. For
example, most laundry detergents produced in the United States contain
biotechnology-engineered enzymes.

DNA fingerprinting, a biotech process, has dramatically improved criminal
investigation and forensic medicine, as well as afforded significant advances in
anthropology and wildlife management.

There are 1,273 biotechnology companies in the United States, of which 300 are
publicly held.

Market capitalization, the amount of money invested in the U.S. biotechnology
industry, increased 156 percent in one year, soaring from $137.9 billion in 1999
to $353.5 billion in 2000.

The biotechnology industry more than doubled in size since 1993, with revenues
increasing from $8 billion in 1993 to $22.3 billion in 2000.

The U.S. biotechnology industry currently employs 150,800 people; that's more
than all the people employed by the toy and sporting goods industries.

Biotechnology is one of the most research-intensive industries in the world. The
U.S. biotech industry spent $10.7 billion on research and development in 2000.

The top five biotech companies spent an average of $89,400 per employee on R&D
in 2000. This compares with an average of $37,200 per employee spent by the top
pharmaceutical companies.

                                      -14-
<PAGE>

The biotech industry is regulated by the Food and Drug Administration (FDA), the
Environmental Protection Agency (EPA) and the Department of Agriculture (USDA).

Development of Biopharmaceutical Products
(Source: Biotechnology Industry Organization)

Biopharmaceutical products, vaccines, etc are classified as "biological
products" under FDA regulations. The steps required before a biological product
may be marketed in the U.S. generally include pre-clinical studies and the
filing of an initial new drug ("IND") application with the FDA, which must be
accepted by the FDA before human clinical studies may commence. The initial
human clinical evaluation, called a Phase I trial, generally involves
administration of a product to a small number of normal healthy volunteers to
test for safety. Phase II trials involve administration of a product to a
limited number of patients with a particular disease to determine dosage and
safety, as well as provide indications of efficacy. Phase III trials examine the
efficacy and safety of a product in an expanded patient population at
geographically dispersed clinical sites. Phase IV trials monitor for adverse
effects and are undertaken post-licensure as additional large-scale, long-term
studies of morbidity and mortality. The FDA reviews the clinical plans and the
results of trials and can discontinue the trials at any time if there are
significant safety issues. Biological products, once approved, have no provision
allowing competitors to market generic versions. Each biological product must
undergo the entire development process in order to be approved. The results of
all trials are submitted in the form of a BLA/New Drug Application ("NDA") for
approval to commence commercial sales. For BLA/NDA approval, the FDA requires,
among other things, that the prospective manufacturer's methods conform to the
agency's cGMP regulations, which must be followed at all times and that the
prospective manufacturer submit three conformance lots in support of the
application. In complying with standards set forth in these regulations,
manufacturers must continue to expend time, money and effort in the area of
production and quality control to ensure full regulatory compliance. The
approval process is affected by several factors, including the severity of the
disease, the availability of alternative treatments, and the risks and benefits
demonstrated in clinical trials. The FDA also may require post-marketing
surveillance to monitor potential adverse effects of the product. The regulatory
process can be modified by Congress or the FDA in specific situations.

Target Selection, Screening and Testing

Target Selection. We focus on infectious diseases representing large and growing
market opportunities with significant unmet medical needs. The selection of a
particular therapeutic target relative to those infectious diseases takes into
consideration the experience and expertise of our scientific management team and
the likelihood that our proprietary compound library will yield biologically
active drug molecules. The final selection is based on the probability of being
able to generate a robust medicinal chemistry SAR analysis to assist lead
optimization and secure relevant intellectual property rights.

Screening and Lead Optimization: We believe that our efficiency in selecting a
lead chemical structure from our focused library distinguishes us from our
competitors. Our ability to discover multiple compounds with antibiotic
activity, as exemplified by our drug candidates, enhances early progress toward
lead optimization.

                                      -15-
<PAGE>

The initial testing and proof of concept is accomplished through the use of
directed but diverse cell-based and biochemical assays. Cell-based assays are
used to analyze a drug candidate's activity in an environment similar to the
environment within which the drug will interact in the infected host. These
cell-based assays also help us to assess the cytotoxicity of drug candidates and
the ability to penetrate host cell walls or membranes. This information,
together with information our scientists gather on the metabolic profile of a
compound, is highly valuable both when selection among lead candidates is
necessary and also in later stages of development. Secondary assays of normal
host cell functions are also used early in the discovery process to identify
unwanted toxicities.

The conventional high-throughput screening employed at most major pharmaceutical
companies typically relies upon the ability to screen millions of diverse
synthetic compounds against purified enzymes in in-vitro biochemical assays.
These screening efforts require tremendous technology and manpower resources,
yet have led to the development of relatively few antibiotic products that are
currently approved. Problems encountered with this approach include very low
overall hit rates and considerable effort to eliminate the false hits caused by
impurities, chemically active compounds or irrelevant mechanisms of inhibition.
The hits that emerge from in vitro screens are often not "drug-like" molecules
for a variety of reasons, including an inability to permeate cells and
instability. Converting these hits into molecules that are more drug-like in
character is often difficult. We believe our screening and lead optimization
processes are more streamlined than those of many of our competitors.

Pharmacology and Pre-clinical Development: Once we have identified lead
compounds, they are tested using in vitro and in vivo pharmacological studies
and in vivo animal models of antibiotic efficacy. Using in vitro studies, our
scientists are able to ascertain the relevance of intracellular activation,
metabolism and protein binding. The in vivo pharmacokinetic studies identify the
percentage of oral bioavailability and whole body metabolism of the compound.
The animal model provides data on the efficacy of the compound and firmly
establishes a proof of concept in a biologically relevant system.

Operations to Date

Since our inception we have recruited key staff in the areas of management,
clinical research and development, and investment banking. Management has
completed restructuring of the Board of Directors and has restructured the focus
of the business model to include development of our Biocides and
Biopharmaceutical divisions. We have completed the reverse merger of Nova
Biogenetics, Incorporated from Healthcare Network Solutions and are moving
forward with both private placement and secondary offering strategies to achieve
the required funding for future development of our two divisions. We have
completed all joint venture agreements necessary with regards to chemical
compound patents and EPA registrations.

MARKET COMPETITION

Our industry is highly competitive and subject to rapid technological change.
Significant competitive factors in our industry include:

                                      -16-
<PAGE>

product effectiveness;
safety;
timing and scope of regulatory approvals;
price of products;
availability of supply;
patent protection; and
sales and marketing capabilities

Many of the companies competing against us have total resources substantially
greater than our own. In addition, many of our competitors have significantly
greater experience in testing pharmaceutical and other therapeutic products,
obtaining FDA and other regulatory approvals of products for use in health care
and marketing and selling those products. Accordingly, our competitors may
succeed more rapidly than we will in obtaining FDA approval for products and
achieving widespread market acceptance. If we obtain necessary regulatory
approvals and commence significant commercial sales of our products, we will
also be competing with respect to manufacturing efficiency and marketing
capabilities, areas in which we have limited or no experience.

We believe that the quality and breadth of our technology, the skill of our
employees, our ability to recruit and retain skilled employees, our aggressive
program of seeking patent protection for our discoveries and our research and
development capabilities are competitive strengths. However, many pharmaceutical
and biopharmaceutical companies have significantly larger intellectual property
portfolios than we do, more substantial capital resources than we have, and
greater capabilities and experience than we do in pre-clinical and clinical
development, sales, marketing, manufacturing and regulatory affairs. Any drug
candidates that we successfully develop will compete with existing therapies and
therapies that are likely to become available in the future.

Many organizations, including large pharmaceutical and biopharmaceutical
companies as well as academic and research organizations and government
agencies, are pursuing novel drug therapies that target the same viral diseases.
Some of the principal pharmaceutical companies with which we expect to compete
directly include Boehringer Ingelheim, Bristol-Myers Squibb Co., F. Hoffman La
Roche Holdings Ltd., GlaxoSmithKline plc, Johnson & Johnson, Merck and Co.,
Pfizer Inc and Schering-Keyes Corp. Some of the principal biopharmaceutical
companies with which we expect to compete directly include Achillion
Pharmaceuticals, Inc., Chiron Corp., Human Genome Sciences, Inc., InterMune,
Inc., Gilead Sciences, Inc., Ribapharm Inc., Triangle Pharmaceuticals, Inc.,
Trimeris, Inc. and Vertex Pharmaceuticals Incorporated. Many of these companies
and organizations, either alone or with their collaborative partners, have
substantially greater financial, technical and human resources than we currently
have or will have in the foreseeable future.

We believe that a significant number of drugs are currently under development
and will become available in the future. We anticipate that we will face intense
and increasing competition as new products enter the market and advanced
technologies become available. Our competitors' products may be more effective,
or more effectively marketed and sold, than any product we may commercialize.
Competitive products may render our product obsolete or non-competitive before
we can recover the expenses of developing and commercializing any of our drug
candidates.

                                      -17-
<PAGE>

We are also aware that the development of a cure or new treatment methods for
the diseases we are targeting could render our products non-competitive or
obsolete.

Regulation

FDA Requirements for Drug Compounds: The research, testing, manufacture and
marketing of drug products are extensively regulated by numerous governmental
authorities in the United States and other countries. In the United States,
drugs are subject to rigorous regulation by the FDA. The Federal Food, Drug and
Cosmetic Act, and other federal and state statutes and regulations govern, among
other things, the research, development, testing, manufacture, storage, record
keeping, labeling, promotion and marketing and distribution of pharmaceutical
products. If we fail to comply with applicable regulatory requirements, we may
be subject to a variety of administrative or judicially imposed sanctions.

The steps ordinarily required before a new pharmaceutical product may be
marketed in the United States include pre-clinical laboratory tests, animal
tests and formulation studies, the submission to the FDA of an investigational
new drug application, or IND, which must become effective before clinical
testing may commence in the United States, and adequate and well-controlled
clinical trials to establish the safety and effectiveness of the drug for each
indication for which it is being tested. Pre-clinical tests include laboratory
evaluation of product chemistry and formulation, as well as in vitro and animal
trials to assess the potential safety and efficacy of the drug candidate.

The conduct of the pre-clinical tests and formulation of compounds for testing
must comply with federal regulations and requirements. The results of
pre-clinical testing are submitted to the FDA as part of the IND to justify the
administration of the drug candidate to human subjects in the proposed clinical
trial. A 30-day waiting period after the filing of each IND is required prior to
the commencement of clinical testing in humans. If the FDA has not commented on
or questioned the IND within this 30-day period, the proposed clinical trial may
begin. If the FDA has comments or questions, the questions must be answered to
the satisfaction of the FDA before initial clinical testing can begin. In
addition, the FDA may, at any time, impose a clinical hold on ongoing clinical
trials. If the FDA imposes a clinical hold, clinical trials cannot commence or
recommence without FDA authorization and then only under terms authorized by the
FDA. In some instances, the IND process can result in substantial delay and
expense. Clinical trials involve the administration of the drug candidate to
healthy volunteers or patients under the supervision of a qualified principal
investigator. Clinical trials must be conducted in compliance with federal
regulations and requirements, under protocols detailing the objectives of the
trial, the parameters to be used in monitoring safety and the effectiveness
criteria to be evaluated. Each protocol must be submitted to the FDA as part of
the IND.

Both, the study protocol and informed consent information for patients in
clinical trials must be approved by the institutional review board at each
institution where the trials will be conducted. Clinical trials to support new
drug applications for marketing approval are typically conducted in three
sequential phases, but the phases may overlap. In Phase I, the initial
introduction of the drug candidate into healthy human subjects or patients, the
drug candidate is tested to assess metabolism, pharmacokinetics and
pharmacological actions and safety, including side effects associated with
increasing doses. Phase II usually involves trials in a limited patient
population, to

                                      -18-
<PAGE>

determine dosage tolerance and optimum dosage, identify possible adverse effects
and safety risks, and provide preliminary support for the efficacy of the drug
candidate in the indication being studied. If a drug candidate is found to be
effective and to have an acceptable safety profile in Phase II evaluations,
Phase III trials are undertaken to further evaluate clinical efficacy and to
further test for safety within an expanded patient population at geographically
dispersed clinical trial sites. There can be no assurance that Phase I, Phase II
or Phase III testing of our drug candidates will be completed successfully
within any specified time period, if at all. After completion of the required
clinical testing, generally a new drug application, or NDA, is prepared and
submitted to the FDA.
FDA approval of the NDA is required before marketing of the product may begin in
the United States. The NDA must include the results of extensive clinical and
pre-clinical testing and the compilation of data relating to the product's
chemistry, pharmacology, manufacture, safety and effectiveness. The cost of the
NDA is substantial, both in terms of studies required to generate and compile
the requisite data, as well as the mandatory user fees submitted with the
application. The FDA has 60 days from its receipt of the NDA to determine
whether the application will be accepted for filing based on the agency's
threshold determination that the NDA is sufficiently complete to permit
substantive review. Once the submission is accepted for filing, the FDA begins
an in-depth review of the NDA. Under federal law, the FDA has 180 days in which
to review the application and respond to the applicant. The review process is
often significantly extended by FDA requests for additional information or
clarification regarding information already provided in the submission.

The FDA typically will refer the application to the appropriate advisory
committee, typically a panel of clinicians and statisticians, for review,
evaluation and a recommendation as to whether the application should be
approved. The FDA is not bound by the recommendation of an advisory committee.
If FDA evaluations of the NDA and the manufacturing facilities are favorable,
the FDA may issue an approval letter, or, in some cases, an approvable letter
followed by an approval letter. Approvable letters usually contain a number of
conditions that must be met in order to secure final approval of the NDA. When
and if those conditions have been met to the FDA's satisfaction, the FDA will
issue an approval letter. The approval letter authorizes commercial marketing of
the drug for specific indications. As a condition of NDA approval, the FDA may
require post-marketing testing and surveillance to monitor the drug's safety or
efficacy, or impose other conditions.

Once granted, product approvals may be withdrawn if compliance with regulatory
standards is not maintained or problems occur following initial marketing. If
the FDA's evaluation of the NDA submission or manufacturing facilities is not
favorable, the FDA may refuse to approve the NDA or may issue a not approvable
letter. The not approvable letter outlines the deficiencies in the submission
and often requires additional testing or information. The FDA ultimately may
decide that the application does not satisfy the regulatory criteria for
approval.

Foreign Regulation of Drug Compounds Approval: A drug candidate must meet the
comparable regulatory authorities standards necessary in foreign countries prior
to the commencement of marketing of the drug candidate in those countries,
whether or not FDA approval has been obtained. The approval procedure varies
among countries and can involve additional testing. The

                                      -19-
<PAGE>

time required may differ from that required for FDA approval. In the European
Union, or EU, investigational products are subject to extensive regulatory
requirements.

As in the United States, the marketing of medicinal products has for many years
been subject to the granting of marketing authorizations by relevant regulatory
agencies. In the EU, approval of new chemical compounds can at present be
obtained only through one of two processes: Mutual Recognition Procedure. An
applicant submits an application in one EU member state, known as the reference
member state. Once the reference member state has granted the marketing
authorization, the applicant may choose to submit applications in other
concerned member states, requesting them to mutually recognize the marketing
authorization already granted. Under this mutual recognition process,
authorities in other concerned member states have 55 days to raise objections,
which must then be resolved by discussions among the concerned member states,
the reference member state and the applicant within 90 days of the commencement
of the mutual recognition procedure. If any disagreement remains, all
considerations by authorities in the concerned member states are suspended and
the disagreement is resolved through an arbitration process. The mutual
recognition process results in separate national marketing authorizations in the
reference member state and each concerned member state. Centralized Procedure.
This procedure is currently mandatory for products developed by means of a
biotechnological process and optional for new active substances and other
"innovative medicinal products with novel characteristics." Under this
procedure, an application is submitted to the European Agency for the Evaluation
of Medical Products.

Two EU member states are appointed to conduct an initial evaluation of each
application, the so-called Rapporteur and Co-Rapporteur countries. These
countries each prepare an assessment report, which are then used as the basis of
a scientific opinion of the Committee on Proprietary Medical Products, or CPMP.
If this opinion is favorable, it is sent to the European Commission, which
drafts a decision. After consulting with the member states, the European
Commission adopts a decision and grants a marketing authorization, which is
valid throughout the EU and confers the same rights and obligations in each of
the member states as a marketing authorization granted by that member state.

Nova envisages that marketing applications for its drug candidates will be
submitted via the centralized procedure. Several other European countries
outside of the EU, for example in the Eastern European region, accept EU review
and approval as a basis for their own national approval. Until recently,
submissions to regulatory authorities in Asia for marketing authorization have
been primarily based on using prior approvals in either the United States or the
EU in addition to small, locally conducted studies. More and more companies are
now performing key Phase III clinical trials in several of the major Asian
countries such as Japan, China, Taiwan and South Korea. Local clinical trial
applications, equivalent to INDs, are expected to be filed in several Asian
countries including those listed above to permit the conduct of such key
clinical trials in those regions.

Marketing applications similar to the United States NDA will be submitted to the
appropriate regulatory authorities upon completion of all clinical trials.
Marketing Applications Format As part of the ten-plus years of International
Conference on Harmonization, or ICH, standardization initiatives spearheaded by
the United States, EU and Japan, future marketing applications in these regions
will be submitted as a core global dossier known as the Common Technical
Document, or

                                      -20-
<PAGE>

CTD. The CTD will be the required submission format starting in summer 2003 and
beyond. Electronic CTDs, or e-CTD, are currently being piloted and are
anticipated to be required from that time point. Non-ICH regions such as Eastern
and Central Europe, Latin America and China have indicated that the CTD will be
an acceptable submission format.

Hazardous Materials

Our research and development processes involve the controlled use of hazardous
materials, chemicals and radioactive materials and produce waste products. We
are subject to federal, state and local laws and regulations governing the use,
manufacture, storage, handling and disposing of hazardous materials and waste
products. We do not expect the cost of complying with these laws and regulations
to be material.

INTELLECTUAL PROPERTY

To protect our proprietary rights, we rely generally on confidentiality
agreements with employees and third parties, and agreements with Consultants and
vendors, although we have not signed such agreements in every case. These steps
may be inadequate to deter misappropriation of our proprietary information. We
may be unable to detect the unauthorized use of, or take appropriate steps to
enforce, our intellectual property rights.

EMPLOYEES

We have seven full-time employees, two of whom are engaged in administrative,
billing, research and client service activities, and two of whom, are in the
antimicrobial sales. Additionally, from time to time we engage consultants and
part-time contract employees on an as and when needed basis.

RISK FACTORS

An investment in our common stock involves a significant degree of risk. You
should not invest in our common stock unless you can afford to lose your entire
investment. You should consider carefully the following risk factors and other
information in this Annual Report before deciding to invest in our common stock.

We have only a limited operating history and have not operated profitably since
commencement of operations.

Our operations have never been profitable. We have incurred net losses since
inception through June 30, 2003 of $ 294,158, and it is expected that we will
continue to incur operating losses in the future. In fiscal 2003, we generated
revenues of $129,034 and had a net loss of $294,158. As of June 30, 2003, we had
a working capital deficit of $848,209. There is no assurance that we will
operate profitably in the future.

Our independent auditors have added an explanatory paragraph to their audit
opinion, issued in connection with our financial statements, which states that
our ability to continue as a going

                                      -21-
<PAGE>

concern is uncertain due to our continued operating losses, the excess of our
liabilities over our assets and uncertain conditions we face in our day-to-day
operations. Our financial statements do not include any adjustments that might
result from the outcome of this uncertainty.

Our future revenues are unpredictable.

As a result of our limited operating history and the highly competitive market
in which we compete, we are unable to accurately forecast our revenues. Revenues
and operating results generally depend on the volume of, timing of and ability
to fulfill services, and competitive conditions, which are difficult to
forecast. We may be unable to adjust spending in a timely manner to compensate
for any unexpected revenue shortfall. Accordingly, any significant shortfall in
revenues in relation to our planned expenditures would have an immediate adverse
effect on our business, prospects, financial condition and results of
operations.

We will need to raise additional funds to provide sufficient working capital to
continue our operations. If we are unable to raise additional capital, our
results of operations will be materially adversely affected.

As described above, the report of our independent auditors for fiscal 2003
contains a qualification as to our ability to continue as a going concern. We
will need to raise additional capital or our ability to continue our operations,
implement our business strategy and to generate any significant revenues will be
adversely affected. The amount of additional capital we require is based upon a
number of factors, including the level of our continuing revenues and costs
associated with the marketing of our services. Even if we raise additional
capital, we cannot guarantee you that we will ever generate any significant
revenues or report profitable operations. In addition, our business plan may
change or unforeseen events may occur which require us to raise additional
funds.

We do not presently have any agreements or understanding with third parties
which will enable us to raise additional capital. Given our relatively small
size, history of losses and overall weakness in the capital markets, we are
unsure as to our ability to raise additional working capital. Even if we locate
a source willing to invest in our company, additional funds may not be available
on terms acceptable to us or when we need such funds. The unavailability of
additional funds when needed is likely to have a material adverse effect on us.
If adequate funds are not available to satisfy short-term or long-term
requirements, our management will be required to consider a variety of other
options including curtailing the development and growth of the services we
propose to offer, as well as other cost cutting actions, including suspending
all or a portion of our activities.

If we raise additional capital through the issuance of debt, this will result in
increased interest expense. If we raise additional funds through the issuance of
equity or convertible debt securities, the percentage ownership of Nova
BioGenetics Inc held by existing shareholders will be reduced and those
shareholders may experience significant dilution. In addition, new securities
may contain certain rights, preferences or privileges that are senior to those
of our common stock. There can be no assurance that acceptable financing can be
obtained on suitable terms, if at all. Our inability to raise the additional
funds need will have a material adverse affect on our results of operations in
future periods.

                                      -22-
<PAGE>

Fluctuations in our operating results may adversely affect our stock price and
Purchasers of our shares of common stock may lose all or a portion of their
investment.

Historically, there has been volatility in the market price for our common
stock. Our quarterly operating results, changes in general conditions in the
economy, the financial markets or the marketing industry, or other developments
affecting us or our competitors, could cause the market price of our common
stock to fluctuate substantially. We expect to experience significant
fluctuations in our future quarterly operating results due to a variety of
factors. Factors that may adversely affect our quarterly operating results
include:

      -  the announcement or introduction of new services and products by us and
         our competitors;

      -  our ability to retain existing clients and attract new clients at a
         steady rate, and maintain client satisfaction

      -  the amount and timing of operating costs and capital expenditures
         relating to expansion of our business and operations;

      -  increased government regulation; and

      -  general economic conditions and economic conditions specific to the
         healthcare industry.

As a result of these factors, in one or more future quarters, our operating
results may fall below the expectations of securities analysts and investors. In
this event, the market price of our common stock would likely be materially
adversely affected. In addition, the stock market in general and the market
prices for healthcare related companies in particular, have experienced extreme
volatility that often has been unrelated to the operating performance of those
companies. These broad market and industry fluctuations may adversely affect the
price of our common stock, regardless of our operating performance.

If we lose our key personnel or are unable to attract and retain additional
personnel, our ability to compete would be harmed.

We are highly dependent on our management, in particular Dr. Cecil Smith, our
CEO. We are parties to employment agreements with these individuals, if for any
reason we should be deprived of their services our business would be adversely
affected until we could find a suitable replacement.

In addition, in order to pursue our product development, marketing and
commercialization plans, we will need to hire additional qualified personnel
with expertise in sales and marketing, and finance. Attracting and retaining
qualified personnel will be critical to our success, and competition for
qualified personnel is intense. We may not be able to attract and retain
personnel on acceptable terms given the competition for such personnel among

                                      -23-
<PAGE>

technology and healthcare companies, and universities. Our inability to attract
and retain qualified personnel could harm our business and our ability to
compete.

We do not intend to pay dividends.

We have never paid any dividends on our common stock and it is unlikely that we
will pay any dividends in the foreseeable future due to our anticipated
substantial cash requirements for future operations. We anticipate using any
proceeds of investments in us and any earnings received from operations for the
marketing, development and expansion of our proposed business, for operating
capital and for corporate development and expansion activities.

Our common stock is regulated as a "penny stock" by the Securities and Exchange
Commission.

We are subject to additional regulation by the Securities and Exchange
Commission under its rules regulating broker-dealer practices in connection with
transactions in "penny stocks." This type of regulation may reduce the level of
trading activity or your ability to sell the common stock. Penny stocks
generally are equity securities with a price of less than $5.00 that are not
registered on certain national securities exchanges or quoted on the Nasdaq
Stock Market. The penny stock rules require a broker-dealer, prior to a
transaction in a regulated penny stock, to deliver a standardized risk
disclosure document that provides information about penny stocks and the nature
and level of risks in the penny stock market. The broker-dealer must also
provide information concerning his compensation for the penny stock purchase,
current prices of the penny stock, and a special written determination that the
penny stock is a suitable investment for the purchaser.

The market for our common stock is poorly developed. Purchasers of our
securities should anticipate a thin and volatile market. Investors that purchase
our common stock may not be able to sell their securities.

Our common stock is currently quoted on the OTCBB. There are many days when our
common stock does not trade at all. The spread between the quoted bid and ask
prices is usually great. As a result of the thinly traded nature of our common
stock and lack of market support by brokers or dealers, purchasers of our shares
may have great difficulty in liquidating their investments.

ITEM 2.  DESCRIPTION OF PROPERTY.

We are located in the Northridge 400 Office Park at 8601 Dunwoody Place, Suite
338 in Atlanta, Georgia. The office contains approximately 3200 square feet and
is currently under a five year lease through May 2008.

ITEM 3.  LEGAL PROCEEDINGS.

We are not a party to any pending legal proceedings.

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

None

                                      -24-
<PAGE>
                                     PART II

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

Our common stock is quoted on the OTCBB from November 2001 until it was approved
for quotation on the OTCBB on January 4, 2002 under the symbol HNWS. The
reported high and low sale prices for the common stock are shown below for the
periods indicated. The prices reflect inter-dealer prices, without retail
mark-up, markdown or commissions, and may not always represent actual
transactions.

                                                     High     Low
                                                     ----     ---

            November 2001 to December 31, 2001 .    $ 0.01   $ 0.00
            January 1, 2002 to March 31, 2002 ..    $ 0.25   $ 0.05
            April 1, 2002 to June 30, 2002 .....    $ 0.22   $ 0.015
            July 1, 2002 to September 30, 2002 .    $ 0.16   $ 0.09
            October 1, 2002 to December 31, 2002    $ 0.09   $ 0.04
            January 1, 2003 to March 31, 2003 ..    $ 0.16   $ 0.02
            April 1, 2003 to June 30, 2003 .....    $ 0.92   $ 0.09


Dividend Policy

We have never paid cash dividends on our common stock. We intend to keep future
earnings, if any, to finance the expansion of our business. We do not anticipate
that any cash dividends will be paid in the foreseeable future.

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

GENERAL

THE FOLLOWING DISCUSSION AND ANALYSIS OF OUR FINANCIAL CONDITION AND RESULTS OF
OPERATIONS SHOULD BE READ IN CONJUNCTION WITH THE FINANCIAL STATEMENTS AND
THERELATED NOTES INCLUDED IN THIS form 10-KSB. THIS QUARTERLY REPORT OF FORM
10-KSB CONTAINS FORWARD-LOOKING STATEMENTS BASED UPON CURRENT EXPECTATIONS THAT
INVOLVE RISKS AND UNCERTAINTIES, SUCH AS OUR PLANS, OBJECTIVES, EXPECTATIONS AND
INTENTIONS.THESE FORWARD-LOOKING STATEMENTS INCLUDE ALL STATEMENTS THAT ARE NOT
STATEMENTS OF HISTORICAL FACT. YOU CAN IDENTIFY THESE STATEMENTS BY OUR USE OF
WORDS SUCH AS "MAY," "EXPECT," "BELIEVE," "ANTICIPATE," "INTEND,
"COULD,""ESTIMATE," CONTINUE," `PLANS," OR THEIR NEGATIVES OR COGNATES. SOME OF
THESE STATEMENTS INCLUDE DISCUSSIONS

                                      -25-
<PAGE>

REGARDING OUR FUTURE BUSINESS STRATEGY AND OUR ABILITY TO GENERATE REVENUE,
INCOME AND CASH FLOW. WE WISH TO CAUTION THE READER THAT ALL FORWARD-LOOKING
STATEMENTS CONTAINED IN THIS FORM 10-KSB ARE ONLY ESTIMATES AND PREDICTIONS. OUR
ACTUAL RESULTS COULD DIFFER MATERIALLY FROM THOSE ANTICIPATED AS A RESULT OF
RISKS FACING US OR ACTUAL EVENTS DIFFERING FROM ASSUMPTIONS UNDERLYING SUCH
FORWARD-LOOKING STATEMENTS. SOME FACTORS THAT COULD AFFECT OUR RESULTS INCLUDE
THOSE THAT WE DISCUSS IN THIS SECTION AS WELL AS ELSEWHERE IN THIS FORM 10-QSB.
READERS ARE CAUTIONED NOT TO PLACE UNDUE RELIANCE ON ANY FORWARD-LOOKING
STATEMENTS CONTAINED IN THIS PROSPECTUS. WE WILL NOT UPDATE THESE
FORWARD-LOOKING STATEMENTS UNLESS THE SECURITIES LAWS AND REGULATIONS REQUIRE US
TO DO SO.

As previously reported, in December 2002, Healthcare Network Solutions, Inc.
("HNS" or the "Company") entered into an Agreement and Plan of Reorganization
and Stock Purchase Agreement with Nova Biogenetics, Inc. ("Nova"), Timothy C.
Moses and the Shareholders of Nova. In addition, Sharon Allred, the principal
executive officer and a principal shareholder of the Company, was also a party
to that Agreement. As reported, on March 7, 2003, Ms. Allred along with another
director of the Company, Sondra McGinnis, resigned in all capacities with HNS
leaving Dr. Kevin Smith as the sole director of HNS.

Confronted with the recognition that HNS would not be in a position to
effectively conduct ongoing operations associated with the provision of
non-medical services to physicians, the Company entered into a revised Agreement
with the same parties, except that Ms. Allred was not a party to the Agreement.
Under the revised Agreement, HNS agreed to issue 31,253,904 of its common shares
in exchange for all of the shares of Nova. In addition, Sharon Allred was
assigned the right to collect certain receivables of HNS, and agreed to return
to the capital of HNS 1,500,000 common shares. In addition, Dr. Kevin Smith and
Timothy Moses each agreed to contribute back to the capital of HNS 900,000
common shares of HNS.

The Agreement closed on March 19, 2003. The parties have five business days for
completion of normal closing procedures relevant to the issuance of the stock
and return or exchange of common shares of HNS and Nova. The number of common
shares of HNS issued to the shareholders of Nova was based on arms length
negotiations between remaining management of HNS and management of Nova.

The following discussion and analysis should be read in conjunction with the
financial statements and notes appearing elsewhere in this report.

We were incorporated under the laws of the State of Delaware on April 23, 2001.
Through December 2001, we were a 52% owned subsidiary of BioShield Technologies,
Inc. (OTCBB- BSTI), with BSTI having acted as incorporator and having initially
been our sole shareholder. During December 2001, 3,646,579 of our common stock
owned by BSTI (which represented approximating 24% of all issued and outstanding
shares) were spun-off to BSTI's shareholders on a one for 10 basis with BSTI
retaining 4,453,421 shares (or approximately 28% of all then issued and
outstanding shares).

                                      -26-
<PAGE>

Nova Biogenetics' solution to emerging antibiotic resistance in microorganisms
will use the application of its proprietary technology to develop a suite of new
antibiotics and / or antibiotic derivatives. Nova Biogenetics' antibiotic
product suite will fall under "Antibiotic Resistance Technology," otherwise
referred to as "ART". The Nova Biogenetics' research and development strategy is
targeted at providing short-term (i.e., 24 months), intermediate-term (i.e.,
36-48 months) and long-term solutions (i.e., >60 months).

Nova's proprietary technology has demonstrated that it is not susceptible to
microbial adaptation (i.e., antibiotic resistance) in laboratory tests designed
specifically for determining antibiotic resistance. This outcome is directly
linked to the mechanism with which this technology affects microbial growth. The
mechanism is best described as "electrocution" of actively growing
microorganisms. Based on this knowledge and the availability of a vast number of
proven "generic" antimicrobials, Nova will identify a series of "novel" target
molecules with antiviral, antibacterial or antifungal functionality. In essence,
the target molecules will function in a manner similar to targeted chemotherapy.
The generic drug component of the molecule will be used to target the
microorganism and act as a delivery device for the proprietary Nova technology,
which will "kill" the microorganism.

FISCAL YEAR ENDED JUNE 30, 2003

GENERAL

         The following discussion and analysis should be read in conjunction
with the financial statements and notes appearing elsewhere in this report.

         We were incorporated under the laws of the State of Delaware on April
23, 2001. Through December 2001, we were a 52% owned subsidiary of BioShield
Technologies, Inc. (OTCBB- BSTI), with BSTI having acted as incorporator and
having initially been our sole shareholder. During December 2001, 3,646,579 of
our common stock owned by BSTI (which represented approximating 24% of all
issued and outstanding shares) were spun-off to BSTI's shareholders on a one for
10 basis with BSTI retaining 4,453,421 shares (or approximately 28% of all then
issued and outstanding shares).

         The company is involved in the widespread and uncontrolled use of
antibiotics, both for human consumption and animal feed, has encouraged the
development of drug resistance in a variety of pathogenic microorganisms. These
microorganisms employ resistance mechanisms, which include the modification of
the antibiotic structure, mutagenesis of key amino acids in the macromolecular
targets of specific chemotherapeutics, or drug efflux from the cell, among
others. These three main mechanisms have been identified in resistance profiles
for systems involved in protein biosynthesis, nucleic acid replication, and
bacterial cell wall generation.

         Most antibiotics presently in human use are natural products
manufactured by different species of bacteria or fungi to be employed in their
own survival for example, to kill other microbes in times of overpopulation.
In a natural environment, such as the soil, bacteria exchange genetic
information (such as resistance genes) with great facility and lack of species
specificity, thus allowing molecular determinants of resistance to be passed on
to other microbes with great

                                      -27-
<PAGE>

ease. Such resistance-development methodologies fall into three main categories:
(i) inactivation of the antibiotic by modification of its active chemical
moiety; (ii) specific modification of the macromolecular target, i.e., by
mutagenesis of key residues, and (iii) promotion of antibiotic efflux from the
cell [2]. Today, the emergence of bacterial strains, which display resistance to
a variety of drugs (multiple drug resistant; MDR), is the major cause of failure
of treatment of infections worldwide. Methicillin-resistant STAPHYLOCOCCUS
AUREUS (MRSA) strains already require vancomycin as the last resort for
treatment, and STREPTOCOCCUS PNEUMONIAE strains, which no longer respond to
vancomycin, have already been identified. Multi-drug resistant MYCOBATERIUM
TUBERCULOSIS is another example of an emerging infectious disease with
world-wide significance.

NOVA BIOGENETICS PHARMACEUTICAL DEVELOPMENT STRATEGY

         Nova Biogenetics' solution to emerging antibiotic resistance in
microorganisms will use the application of its proprietary technology to develop
a suite of new antibiotics and / or antibiotic derivatives. Nova Biogenetics'
antibiotic product suite will fall under "Antibiotic Resistance Technology,"
otherwise referred to as "ART". The Nova Biogenetics' research and development
strategy is targeted at providing short-term (i.e., 24 months),
intermediate-term (i.e., 36-48 months) and long-term solutions (i.e., >60
months).

         Nova's proprietary technology has demonstrated that it is not
susceptible to microbial adaptation (i.e., antibiotic resistance) in laboratory
tests designed specifically for determining antibiotic resistance. This outcome
is directly linked to the mechanism with which this technology affects microbial
growth. The mechanism is best described as "electrocution" of actively growing
microorganisms. Based on this knowledge and the availability of a vast number of
proven "generic" antimicrobials, Nova will identify a series of "novel" target
molecules with antiviral, antibacterial or antifungal functionality. In essence,
the target molecules will function in a manner similar to targeted chemotherapy.
The generic drug component of the molecule will be used to target the
microorganism and act as a delivery device for the proprietary Nova technology,
which will "kill" the microorganism.

FISCAL YEAR ENDED JUNE 30, 2003

         Revenues are generated from one of our two business units. The Company
is broken down into two divisions: Bio-pharmaceuticals and Antimicrobials/
Biocides. Revenues for the fiscal year ended June 30, 2003 were solely from the
Antimicrobial/Biocides division and were $129,034. We are continuing with our
marketing efforts and believe that our revenues for fiscal 2004 will exceed
those of fiscal 2003.

         Cost of sales, which includes contract manufacturing, were $52,533 and
other expenses were $354,503 including R&D, Salaries, Professional Fees and
General and Administration for the fiscal year ended June 30, 2003.

         Salaries were $224,999 for the fiscal year ended June 30, 2003.
Salaries, which consist of salaried and hourly employees, include staff used
for, our technical development staff, marketing staff and office personnel and
bonuses.

                                      -28-
<PAGE>

         As a result of these factors, we reported a net loss of $(294,158) or
$(.01) per share for the fiscal year ended June 30, 2003.

LIQUIDITY AND CAPITAL RESOURCES

         At June 30, 2003, we had a stockholders' deficit of $841,114. Since our
inception, we have accumulated deficit of $ 294,158. Our operations and growth
have been funded from third parties involved in a private placement amounting to
approximately $85,000 and advances by our majority shareholder of $50,000. These
funds were used for working capital and capital expenditures.

         Net cash used in operations during the fiscal year ended June 30, 2003
was $34,674 and was attributable to our loss from operations of $294,158 and
increases in assets of $13,909 offset by non-cash compensation and depreciation
of $1,080 and increases in accounts payable and accrued expenses of $272,433.

         Net cash provided by financing activities for the fiscal year ended
June 30, 2003 was $35,600. Our subsidiary, Nova Biogenetics, Inc., received net
proceeds from the sales of its common stock of $60,308. Additionally, we made
repayments on notes payable of $9,096 and repayments of advances from a related
party of $24,612.

         We may not have sufficient cash flow from operations to sufficiently
meet all of our cash requirements for the next 12 months absent additional
capital raising activities or growth of revenue sources. At this time, however,
we have no agreements or understandings with any third parities regarding
additional capital, and we cannot guarantee you that we will be successful in
obtaining capital upon terms acceptable to us, if at all. Our failure to secure
necessary financing could have a material adverse effect on our financial
condition and results of operations.

ITEM 7.  FINANCIAL STATEMENTS

The financial statements required by this report are included, commencing on
page F-1.

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

None







                                      -29-
<PAGE>
                                    PART III

ITEM 9.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

Our directors and executive officers are as follows. Our directors serve until
the next annual meeting of our stockholders and our officers hold their
positions at the pleasure of the board of directors, subject to the terms of
their employment agreements which are described elsewhere herein There is no
arrangement or understanding between our directors and officers and any other
person pursuant to which any director or officer was or is to be selected as a
director or officer.

         Name                      Age          Position Held
         ----                      ---          -------------
         Dr. Cecil Smith           50           Chief Executive Officer
         Jerry Smith               60           President
         Todd Smith                36           Secretary/Treasurer, Director
         Timothy C. Moses          47           Director

CHIEF EXECUTIVE OFFICER / INTERIM CHAIRMAN OF THE BOARD: Dr. Cecil Smith has an
extensive background in biohazard science, microbiology, clinical trials and
laboratory research. In 1983 he received his Doctorate of Public Health -
Biohazard Science and Laboratory Practice from the University of North Carolina,
received his Master of Public Health in 1980, and received his Master of
Science, Microbiology in 1977 from North Dakota State University.

Dr. Smith is an esteemed professional having several accreditations and has
achieved many accomplishments as outlined below: Master of Science,
Microbiology, North Dakota State University , Post-doctoral fellowship in
infectious diseases, St. Jude Children's Research Hospital Farleigh S. Dickinson
Fellow, recombinant DNA risk assessment studies, National Institutes of Health
Assistant Vice President, Environmental Health and Safety, The Ohio State
University The Ohio State University Distinguished Staff Award. The Ohio State
University Business and Administration Pioneer Award Adjunct Professor, School
of Public Health, Division of Environmental Sciences, The Ohio State University
Member American Biological Safety Association, Publications Committee Member
Ohio Public Employees Risk Reduction Advisory Committee Public Health
Laboratories Director, The Tennessee Department of Health and Environment.
Twenty years plus experience in public health, infectious diseases, risk
analysis, biohazard control, occupational health and safety and environmental
compliance Pioneered the development of state-of-the-art technology for
microbial contamination control in a variety of settings including: healthcare
facilities, the biotechnology industry and the disaster restoration/indoor
environment arena National/International consulting experience. Member of The
American Public Health Association and The American Biological Safety
Association Member of the OSHA Advisory and Implementation Committees. Published
in peer-reviewed Professional Journals Presented numerous technical papers to
Professional Associations.

                                      -30-
<PAGE>

PRESIDENT: Director of Business Development Mr. Smith has extensive experience
in the pharmaceutical industry serving over thirty four (34+) at Pharmacia,
Pharmacia-Upjohn and its predecessors and joins the Company on July 1, 2003 as
President. He has held positions in sales, marketing, field research, and
management. He received his Bachelor of Science in Biology and Chemistry from
Arkansas State University. Mr. Smith has been recognized for his many
achievements and accomplishments, Bachelor of Science, Biology and Chemistry,
Arkansas State University, Multiple recipient of The Upjohn Academy, Nominee for
The W.E. Upjohn Award, Multiple recipient of Outstanding Employee Award,
Advisory Board Committee Member, Georgia Academy of Family Physicians, Advisory
Board Committee Member, Alabama Academy of Family Physicians, Member Alliance
for Continuing Medical Education, Over thirty years of experience in the
pharmaceutical industry, Conducted numerous medical presentations, Involved in
numerous research studies with major medical institutions.

MR. TODD SMITH   SECRETARY / TREASURER
Mr. Smith has served as a financial advisor and investment banker for the past
thirteen years. Mr. Smith graduated from Auburn University with a bachelor's
degree in finance. Prior to joining Nova Biogenetics Mr. Smith held positions in
the brokerage community most recently as Vice President at Morgan Stanley Dean
Witter. In his thirteen years of brokerage experience Mr. Smith received many
awards of excellence from a variety of institutional investment firms including
AIM, Invesco, ING, and Equitable among others. Mr. Smith participated in over
twenty initial public offerings. Mr. Smith joins Nova Biogenetics as director of
investor relations and serves as Secretary/Treasurer and Chief Accounting
Officer.

The role of CEO and President will be to further advance the Company's vision of
becoming an industry leader as an innovative biopharmaceutical company and to
further develop strategic relationships and partnerships with larger
internationally known pharmaceutical companies.

CHIEF SCIENTIST: Dr. Cecil Smith is currently serving in this capacity. This
position is currently open. However, the Company is outsourcing its scientific
research to Universities and independent testing and research facilities at this
time. The Company is currently searching and interviewing qualified candidates
to fill this position who will be hired in conjunction with our initial round of
financing. The role of chief scientist will be crucial in advancing the research
and development efforts of the Company in a managed and focused manor that
yields the highest results in line with our budgeting and the potential of our
product base.

GENERAL MANAGER: Ms. Kimberely Casperson is currently acting as General Manager.

Compliance with Section 16(a) of the Exchange Act

Based solely upon a review of Forms 3 and 4 and amendments thereto furnished to
us under Rule 16a-3(d) of the Securities Exchange Act of 1934 ("Exchange Act")
during the fiscal year ended June 30, 2003, we are not aware of any person that
failed to file on a timely basis, as disclosed in the aforementioned Forms,
reports required by Section 16(a) of the Exchange Act during the fiscal year
ended June 20, 2003.

                                      -31-
<PAGE>

ITEM 10. EXECUTIVE COMPENSATION

Summary Compensation Table

The table below sets forth information relating to the compensation paid by us
during the past two fiscal years to: (i) the President and Chief Executive
Officer; and (ii) each other executive officer who earned more than $100,000
during Fiscal 2002 and 2001 (the "Named Executive Officers").
<TABLE>
<CAPTION>
                                          Annual Compensation                        Long Term Compensation
                              ----------------------------------------------    ---------------------------------
                                                                   Other        Restricted    Securities
                                                                   Annual           Stock     Underlying
 Name and Principal           Fiscal     Salary       Bonus     Compensation      Awards       Options       All
 Position Compensation        Year         ($)         ($)          ($)             ($)        SAR (#)      Other
 -------------------------    ------    --------    --------    ------------    ----------    ----------    -----
<S>                            <C>      <C>         <C>            <C>           <C>            <C>          <C>
 Sharon Allred-Former-CEO      2002     $150,000    $ 47,500       $  -0-        $150,000       400,000      -0-
 Mr. Jerry Smith-President     2003     $  -0-      $  -0-         $  -0-        $  -0-           -0-        -0-
 Dr. Cecil Smith-CEO           2003     $  -0-      $  -0-         $  -0-        $  -0-           -0-        -0-
 *  Mr. Tim Moses              2003     $125,000    $  -0-         $  -0-        $  -0-           -0-        -0-
</TABLE>
_________
* Mr. Moses is currently accruing his salary, and has not received any payroll
  from the company

Employment Agreements

EMPLOYMENT AGREEMENT made and entered into effective as of March 19, 2003 by and
between Nova BioGenetics, Inc (the "Company") and Mr. Timothy . During the
Employment Term, the Company shall pay the Executive an annual base salary of
Two Hundred and Fifty Thousand[ $250,000] (the "Base Salary"),beginning from the
effective date of this contract, at the annual rate of no less than the rate of
base salary in effect as of the Effective Date. Base Salary shall be payable in
regular installments in accordance with the Company's usual payroll practices.
The Management Compensation Committee of the Board (the "Compensation
Committee") shall review the Base Salary for the purpose of increasing it in
accordance with its normal review procedures.

Option / Sar Grants In Last Fiscal Year

None

Stock Option Plan

Pursuant to August 2001 Board of Directors approval and subsequent stockholder
approval, we adopted our 2001 Non-Statutory Stock Option Plan ("Plan") whereby
we reserved for issuance up to 9,000,000 shares of our common stock. In November
2001 we filed a registration statement on Form S-8 registering the shares of
common stock issuable upon the exercise of options granted under the Plan. At
September 30, 2003 there are options to acquire 1,382,000 shares of our common
stock at exercise price of $0.05 per share.

The principal terms of the Plan are summarized below but it is not intended to
be a complete description thereof and such summary is qualified in its entirety
by the actual text of the Plan.

                                      -32-

<PAGE>

The purpose of the Plan is to provide our directors, officers and employees of,
consultants, attorneys and advisors with additional incentives by increasing
their ownership interest in our company. Directors, officers and other employees
of our company are eligible to participate in the Plan. The Plan provides for
the issuance of non-incentive options (NSOs) only, which are not intended to
qualify as "incentive stock options" within the meaning of Section 422 of the
Internal Revenue Code, as amended. Our Board of Directors or a Compensation
Committee (once established) administers the Plan with the discretion generally
to determine the terms of any option grant, including the number of option
shares, exercise price, term, vesting schedule and the post-termination exercise
period. Notwithstanding this discretion (i) the term of any option may not
exceed 10 years and (ii) an option will terminate as follows: (a) if such
termination is on account of termination of employment for any reason other than
death, without cause, such options shall terminate one year thereafter; (b) if
such termination is on account of death, such options shall terminate 15 months
thereafter; and (c) if such termination is for cause (as determined by the Board
of Directors and/or Compensation Committee), such options shall terminate
immediately. Unless otherwise determined by the Board of Directors or
Compensation Committee, the exercise price per share of common stock subject to
an option shall be equal to no less than 10% of the fair market value of the
common stock on the date such option is granted. No NSO shall be assignable or
otherwise transferable except by will or the laws of descent and distribution or
except as permitted in accordance with SEC Release No.33-7646 as effective April
7, 1999.

The Plan may be amended, altered, suspended, discontinued or terminated by the
Board of Directors without further stockholder approval, unless such approval is
required by law or regulation or under the rules of the stock exchange or
automated quotation system on which the common stock is then listed or quoted.
Thus, stockholder approval will not necessarily be required for amendments which
might increase the cost of the Plan or broaden eligibility except that no
amendment or alteration to the Plan shall be made without the approval of
stockholders which would (a) increase the total number of shares reserved for
the purposes of the Plan or decrease the NSO price (except as provided in
paragraph 9 of the Plan) or change the classes of persons eligible to
participate in the Plan or (b) extend the NSO period or (c) materially increase
the benefits accruing to Plan participants or (d) materially modify Plan
participation eligibility requirements or (e) extend the expiration date of the
Plan. Unless otherwise indicated the Plan will remain in effect until terminated
by the Board of Directors.

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

The following table provides certain information regarding our common stock
beneficially owned as of June 30, 2003 by: (1) each person who is known by us to
own beneficially 5% or more of our common stock; (2) each of our executive
officers and directors; and (3) all of our executive officers and directors as a
group. In accordance with SEC rules, options or warrants not exercisable within
60 days of this report are not considered part of the holder's beneficial
ownership. As of June 30, 2003, there were 50,000,000 shares of common stock
outstanding. Unless otherwise stated, the address for the beneficial shareholder
is 8601 Dunwoody Place, Suite 338, Atlanta, Georgia 30350

                                      -33-
<PAGE>

Pre-Reverse
                                            Number of Shares
          Name and Address                  of Common Stock
        of Beneficial Owners               Beneficially Owned      Percentage(%)
        --------------------               ------------------      -------------
L.B. Steele ..............................     1,800,000
Gary B. Wolff ............................       890,000
JT Tucker, Inc. ..........................       890,000
M 5 Trust Fund I .........................    21,054,904
Jerry Smith ..............................        89,000
Cecil Smith ..............................        89,000
M5 Trust Fund II .........................       585,000
Shelley Moses ............................       890,000
International BioChemical Industries, Inc.     4,425,000
Sharon Allred ............................       250,000
Sharon Allred ............................       250,000
Sharon Allred ............................       250,000
Sharon Allred ............................       250,000
Sharon Allred ............................       250,000
Sharon Allred ............................       250,000
Sharon Allred ............................       300,000
BioShield Technologies, Inc. .............     4,453,284

All executive officers and directors as a group (four persons)

(2) Timothy C. Moses holdings are beneficially owned by M5 Trust Fund I

(3) Dr. Kevin Smith holdings are beneficially owned by Domus Trust Fund, his
    wife Rodothea Smith, and others.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

We were formed in April, 2001. In connection with our formation, BSTI purchased
at par value 8,100,000 shares of our common stock. Thereafter and prior to June
30, 2001 an aggregate of 7,400,000 shares of our common stock were issued at par
value to the following persons and/or firms for a consideration of par value per
share:

               Name            Number of Shares
               ----            ----------------
         Sharon Allred ........    1,800,000
         Domus Trust Fund......    1,800,000
         M5 Trust Fund ........    1,800,000
         John LLC .............    1,400,000
         Gary B. Wolff ........      600,000


                                      -34-
<PAGE>

Through June 2001, BSTI made a capital contribution to us in the sum of $13,190.
During fiscal 2002, it made a capital contribution to us of $85,000.

ITEM 13. EXHIBITS, LISTS AND REPORTS ON FORM 8-K

(a) Exhibits

         3.1      Registrant's Certificate of Incorporation (1)

         3.2      Registrant's Amended and Restated By-Laws (1)

         10.1     2001 Non Statutory Stock Option Plan (2)

         10.2     Employment Agreement between the Registrant and Dr. Cecil
                  Smith (1)

         10.3     Employment Agreement between the Registrant and Jerry Smith
                  (1)

         10.4     Employment Agreement between the Registrant and Todd Smith (1)

         10.5     Employment Agreement between the Registrant and Timothy C.
                  Moses (1)

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

         31.2     Certification of Principle Financial Officer Pursuant to
                  Section 302 of the Sarbanes-Oxley Act of 2002

         32.1     Certification of Chief Executive Officer Pursuant to Section
                  906 of the Sarbanes-Oxley Act of 2002

         32.2     Certification of Principle Financial Officer Pursuant to
                  Section 906 of the Sarbanes-Oxley Act of 2002

         ---------

         (1)      Incorporated herein by reference to the comparable exhibits
                  filed with Registrant's Form 10-SB as filed on September 27,
                  2002.

         (2)      Incorporated herein by reference to the comparable exhibits
                  filed with Registrant's Form S-8 as filed on November 30,
                  2002.

(b) Reports on 8-K

         None

ITEM 14. CONTROLS AND PROCEDURES


ITEM 15. PRINCIPAL ACCOUNTANT FEES AND SERVICES


                                      -35-
<PAGE>
                                   SIGNATURES

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

/s/ Dr. Cecil Smith
-------------------
By: Dr. Cecil Smith
    Chairman

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 Signatures Dates



By: /s/ Dr. Cecil Smith                 November 17, 2003
    ---------------
    Dr. Cecil Smith
    Chief Executive Officer and
    Executive Director


By: /s/ Jerry Smith                     November 17, 2003
    ---------------
    Jerry Smith, President
    Director


By: /s/ Todd Smith                      November 17, 2003
    --------------
    Secretary / Treasurer


By: /s/ Kevin F. Smith                  November 17, 2003
    ------------------
    Kevin F. Smith
    Director


By: /s/ Tim Moses                       November 17, 2003
    -------------
    Tim Moses
    Director


                                      -36-
<PAGE>
                             NOVA BIOGENETICS, INC.
                  (Formerly Healthcare Network Solutions, Inc.)
                          INDEX TO FINANCIAL STATEMENTS



                                                                        PAGE NO.
                                                                        --------

Report of Independent Auditors'..............................................F-2

Balance Sheet - June 30, 2003................................................F-3

Statement of Operations - For the year ended June 30, 2003...................F-4

Statements of Stockholders' Deficit - For the years ended
         June 30, 2003 and 2002..............................................F-5

Statements of Cash Flows - For the year June 30, 2003........................F-6

Notes to Financial Statements........................................F-7 to F-19























                                       F-1
<PAGE>
                         REPORT OF INDEPENDENT AUDITORS'


To the Board of Directors and Stockholders' of
Nova Biogenetics, Inc.

         We have audited the accompanying balance sheet of Nova Biogenetics,
Inc. (formerly Healthcare Network Solutions, Inc.) as of June 30, 2003 and the
related statement of operations, stockholders' deficit and cash flows for the
fiscal year ended June 30, 2003. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audit.

         We conducted our audit in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.

         In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Nova Biogenetics,
Inc. (formerly Healthcare Network Solutions, Inc.) as of June 30, 2003 and the
results of its operations and its cash flows for the fiscal year ended June 30,
2003 in conformity with accounting principles generally accepted in the United
States of America.

         The accompanying financial statements have been prepared assuming that
the Company will continue as a going concern. As discussed in Note 2 to the
financial statements, the Company has experienced losses and negative cash flows
since its inception and has an accumulated deficit. The Company is dependent on
continued financing from investors to sustain its activities and there is no
assurance that such financing will be available. These factors raise substantial
doubt about the Company's ability to continue as a going concern. Management's
plans in regard to these matters are also described in Note 2. The financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.

                                        Sherb & Co., LLP
                                        Certified Public Accountants

New York, New York
November 14, 2003

                                       F-2
<PAGE>
                             NOVA BIOGENETICS, INC.
                  (Formerly Healthcare Network Solutions, Inc.)
                                  BALANCE SHEET
                                 June 30, 2003

                                     ASSETS

Current assets:
   Cash ............................................................  $   2,046
   Accounts receivable, net of allowance for doubtful accounts
     of $21,588 ....................................................     34,450
   Other current assets ............................................        134
                                                                      ---------

           Total current assets ....................................     36,630

Property and equipment (net of accumulated depreciation of $180) ...      3,620

Other assets .......................................................      3,475
                                                                      ---------

           Total assets ............................................  $  43,725
                                                                      =========

                      LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities:
   Notes payable ...................................................  $ 490,904
   Accounts payable and accrued expenses ...........................    321,720
   Due to related party ............................................     72,215
                                                                      ---------

           Total current liabilities ...............................    884,839
                                                                      ---------

Stockholders' deficit:
   Common stock ($0.0001 par value; 50,000,000 authorized shares;
       50,000,000 shares issued and outstanding) ...................      5,000
   Additional paid-in capital ......................................     70,538
   Accumulated deficit .............................................   (916,652)
                                                                      ---------

           Total stockholders' deficit .............................   (841,114)
                                                                      ---------

           Total liabilities and stockholders' deficit .............  $  43,725
                                                                      =========

                 See accompanying notes to financial statements.

                                       F-3
<PAGE>
                             NOVA BIOGENETICS, INC.
                  (Formerly Healthcare Network Solutions, Inc.)
                             STATEMENT OF OPERATIONS
                            YEAR ENDED JUNE 30, 2003


SALES ......................................................       $    129,034

COST OF SALES ..............................................             52,533
                                                                   ------------

GROSS PROFIT ...............................................             76,501
                                                                   ------------

OPERATING EXPENSES:
    Salaries ...............................................            224,999
    Professional fees ......................................             12,650
    Research and development ...............................             29,206
    Other selling, general and administrative ..............             87,648
                                                                   ------------

        Total Operating Expenses ...........................            354,503
                                                                   ------------

LOSS FROM OPERATIONS .......................................           (278,002)

OTHER EXPENSES:
   Interest expense ........................................            (16,156)
                                                                   ------------

NET LOSS ...................................................       $   (294,158)
                                                                   ============

BASIC AND DILUTED:
      Net Loss Per Common Share ............................       $      (0.01)
                                                                   ============

      Weighted Common Shares Outstanding ...................         50,000,000
                                                                   ============



             See accompanying notes to financial statements.

                                   F-4
<PAGE>
<TABLE>
                                            NOVA BIOGENETICS, INC.
                                 (Formerly Healthcare Network Solutions, Inc.)
                                 STATEMENT OF CHANGES IN STOCKHODERS' DEFICIT
                                  FOR THE YEARS ENDED JUNE 30, 2003 AND 2002
<CAPTION>
                              Common Stock          Additional
                        -----------------------      Paid-In      Accumulated      Deferred
                           Shares       Amount       Capital        Deficit       Compensation       Total
                        -----------     -------     ---------     -----------     -----------     -----------
<S>                      <C>            <C>         <C>           <C>             <C>             <C>
Balance,
  July 1, 2001 .....     15,500,000     $ 1,550     $  13,190     $   (25,660)    $         -     $   (10,920)

Capital Contribution              -           -        85,000               -               -          85,000

Shares issued for
  debt .............      1,500,000         150       149,850               -               -         150,000

Exercise of stock
  options ..........      4,946,810         495       245,058               -               -         245,553

Common stock options
  and warrants
  granted ..........              -           -       229,675               -         (34,931)        194,744

Common stock issued
  for services .....         40,000           4         3,996               -               -           4,000

Additional shares
  issued in
  connection with
  spin-off .........         59,252           6            (6)              -               -               -

Net loss for the
  year ended
  June 30, 2002 ....              -           -             -      (1,019,402)              -      (1,019,402)
                        -----------     -------     ---------     -----------     -----------     -----------

Balance,
  June 30, 2002 ....     22,046,062       2,205       726,763      (1,045,062)        (34,931)       (351,025)

Recapitalization in
  connection with
  reverse
  acquisition ......     31,253,938       3,125      (726,763)        422,568          34,931        (266,139)

Cancelation of
  former directors
  and officers
  shares ...........     (3,300,000)       (330)          330               -               -

Issuance of options
  for services by
  subsidiary prior
  to reverse
  acquisition ......              -           -           900               -               -             900

Sale of subsidiary's
  common stock prior
  to reverse
  acquisition ......              -           -        69,308               -               -          69,308

Net loss for the
  year ended
  June 30, 2003 ....              -           -             -        (294,158)              -        (294,158)
                        -----------     -------     ---------     -----------     -----------     -----------

Balance,
  June 30, 2003 ....     50,000,000     $ 5,000     $  70,538     $  (916,652)    $         -     $  (841,114)
                        ===========     =======     =========     ===========     ===========     ===========

                                See accompanying notes to financial statements.

                                                      F-5
</TABLE>
<PAGE>
                             NOVA BIOGENETICS, INC.
                  (Formerly Healthcare Network Solutions, Inc.)
                            STATEMENTS OF CASH FLOWS
                        FOR THE YEAR ENDED JUNE 30, 2003


Cash flows from operating activities:
  Net loss .......................................................    $(294,158)
  Adjustments to reconcile net loss to net cash
  used in operating activities:
    Issuance of options for services rendered of subsidiary
         prior ot reverse acquisition ............................          900
    Depreciation .................................................          180

   (Increase) decrease in:
    Accounts receivable ..........................................      (10,420)
    Due from related party .......................................         (134)
    Other assets .................................................       (3,475)

   Increase in:
    Accounts payable and accrued expenses ........................      272,433
                                                                      ---------

Net cash used in operating activities ............................      (34,674)
                                                                      ---------

Cash flows from investing activities:
    Cash from acquisition ........................................        1,120
                                                                      ---------

Net cash provided by investing activities ........................        1,120
                                                                      ---------

Cash flows from financing activities:
    Due to related party .........................................      (24,612)
    Repayments of notes payable ..................................       (9,096)
    Proceeds from sale of Nova Biogenetics common stock ..........      106,250
    Offering costs associated with the sale of
        Nova Biogentics common stock .............................      (36,942)
                                                                      ---------

Net cash provided by financing activities ........................       35,600
                                                                      ---------

Net increase in cash .............................................        2,046

Cash at beginning of period ......................................            -
                                                                      ---------

Cash at end of period ............................................    $   2,046
                                                                      =========

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

Cash paid during the period for:
  Interest .......................................................    $       -
                                                                      =========
  Income Taxes ...................................................    $       -
                                                                      =========

NON-CASH INVESTING AND FINANCING ACTIVITIES:
  Conversion of related party debt into common shares ............    $ 275,000
                                                                      =========
  Forgiveness of accrued liabilities and related party debt
   in connection with reverse acquisition ........................    $ 114,541
                                                                      =========
  Issuance of note payable for joint venture agreement ...........    $ 500,000
                                                                      =========
  Acquisition of capital assets for related party debt ...........    $   3,800
                                                                      =========

                     See accompanying notes to financial statements.

                                           F-6
<PAGE>
                             NOVA BIOGENETICS, INC.
                  (Formerly Healthcare Network Solutions, Inc.)
                         (NOTES TO FINANCIAL STATEMENTS
                                  JUNE 30, 2003

NOTE 1 - NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NATURE OF BUSINESS

Healthcare Network Solutions, Inc. (the "Company") was incorporated under the
laws of the State of Delaware on April 23, 2001. Through November 2001, the
Company was a 52% owned subsidiary of BioShield Technologies, Inc., (OTCBB-
BTSI); BSTI having acted as incorporator and having initially been the sole
shareholder of the Company. During December 2001, 3,646,579 of the Company's
shares owned by BSTI (approximating 24% of all then issued and outstanding
shares) were spun-off to BTSI's shareholders on a one for ten basis with BTSI
retaining 4,453,421 shares (approximately 28% of all then issued and outstanding
shares).

On March 19, 2003, Nova Biogenetics, Inc. ("Nova") was acquired by Healthcare
Network Solutions, Inc. ("HNS"), for 31,253,938 shares of HNS stock (the
"Exchange"). The Exchange was completed pursuant to the Agreement and Plan of
Reorganization between Nova and HNS. The Exchange has been accounted for as a
reverse acquisition under the purchase method for business combinations.
Accordingly, the combination of the two companies is recorded as a
recapitalization of Nova, pursuant to which Nova is treated as the continuing
entity. On July 11, 2003, the Company merged its two entities into a single
corporation under the name Nova Biogenetics, Inc.

Nova was incorporated in the State of Delaware on July 22, 2002. Nova is a
biopharmaceuticals company headquartered in Atlanta, Georgia that is engaged in
the discovery, development, and commercialization of new therapeutic agents that
treat life-threatening infectious diseases. Nova Biogenetics' pipeline is based
on proprietary patented technology used as a broad base for applications with
existing antibiotic compounds. Attaching the proprietary patented technology to
antibiotic compounds can extend the antimicrobial spectrum of antibiotics as
well as, facilitate the antimicrobial action of existing antibiotics. The
statement of operations and cash flows includes the results of Nova from July
22, 2002 (inception) through June 30, 2003.

PRINCIPLES OF CONSOLIDATION

The accompanying consolidated financial statements include the accounts of Nova
Biogenetics, Inc. (formerly Healthcare Network Solutions, Inc.) and its
wholly-owned subsidiary, Nova Biogenetics, Inc. All material intercompany
transactions and balances have been eliminated.

CASH AND CASH EQUIVALENTS

The Company considers all highly liquid investments purchased with an original
maturity of three months or less to be cash equivalents.

                                       F-7
<PAGE>
                             NOVA BIOGENETICS, INC.
                  (Formerly Healthcare Network Solutions, Inc.)
                          NOTES TO FINANCIAL STATEMENTS
                                  JUNE 30, 2003

NOTE 1 - NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
         (CONTINUED)

PROPERTY AND EQUIPMENT

Property and equipment is recorded at cost and is comprised primarily of
computer and office equipment. The Company uses the straight-line method of
depreciation. Depreciation is provided based upon useful lives of the respective
assets, which generally have lives of three to five years. Maintenance and
repairs are charged to expense as incurred.

REVENUE RECOGNITION

Revenues from product sales are recognized upon the later of shipment or final
acceptance.

USE OF ESTIMATES

The preparation of financial statements in conformity with generally accepted
accounting principles 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 reporting amounts of revenues and expenses during the reported period.
Actual results could differ from those estimates.

RESEARCH AND DEVELOPMENT

Research and development costs are expensed as incurred.

STOCK BASED COMPENSATION

Statement of Financial Accounting Standards No. 123, "Accounting for Stock-Based
Compensation" ("SFAS 123"), encourages, but does not require, companies to
record compensation cost for stock-based employee compensation plans at fair
value. The Company has chosen to account for stock-based compensation using the
intrinsic value method prescribed in Accounting Principles Board Opinion No. 25,
"Accounting for Stock Issued to Employees", and related interpretations.
Accordingly, compensation cost for stock options is measured as the excess, if
any, of the estimated fair market value of the Company's stock at the date of
the grant over the amount an employee must pay to acquire the stock. The Company
has adopted the "disclosure only" alternative described in SFAS 123 and SFAS 148
(See New Accounting Pronouncements), which require pro forma disclosures of net
income and earnings per share as if the fair value method of accounting had been
applied.

FAIR VALUE OF FINANCIAL INSTRUMENTS

The carrying amounts reported in the balance sheet for cash, accounts
receivable, loans payable, accounts payable, and accrued expenses approximate
fair value based on the short-term maturity of these instruments.

                                       F-8
<PAGE>
                             NOVA BIOGENETICS, INC.
                  (Formerly Healthcare Network Solutions, Inc.)
                    NOTES TO FINANCIAL STATEMENTS (Continued)
                                  JUNE 30, 2003

NOTE 1 - NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
         (Continued)

LOSS PER COMMON SHARE

Basic loss per common share is computed by dividing the net loss attributable to
common stockholders by the weighted average number of shares of common stock
outstanding during the period. Diluted loss per common share is computed by
dividing the net loss attributable to common stockholders by the sum of the
weighted average number of common shares outstanding plus shares derived from
other potentially dilutive securities such as potentially dilutive securities
including "in-the-money" stock options and warrants. During fiscal 2003,
potentially dilutive shares were excluded from the diluted loss per common share
computation as their effect was antidilutive.

INCOME TAXES

Deferred taxes are provided on an asset and liability method for temporary
differences and operating loss and tax credit carryforwards. Temporary
differences are the differences between the reported amounts of assets and
liabilities and their tax bases. Deferred tax assets are reduced by a valuation
allowance when, in the opinion of management, it is more likely than not that
some portion or all of the deferred tax assets will not be realized. Deferred
tax assets and liabilities are adjusted for the effects of changes in tax laws
and rates on the date of enactment.

RECENT ACCOUNTING PRONOUNCEMENTS

In June 2002, the FASB issued SFAS No. 146, "Accounting for Costs Associated
with Exit or Disposal Activities." This statement addresses financial accounting
and reporting for costs associated with exit or disposal activities and
nullifies Emerging Issues Task Force ("EITF") Issue No. 94-3, "Liability
Recognition for Certain Employee Termination Benefits and Other Costs to Exit an
Activity (including Certain Costs Incurred in a Restructuring)." SFAS No. 146 is
effective for exit or disposal activities initiated after December 31, 2002. The
Company does not expect the application of the provisions of SFAS No. 146 to
have an impact on its financial position, results of operations or cash flows.

In December 2002, the FASB issued SFAS No. 148, "Accounting for Stock-Based
Compensation--Transition and Disclosure." This statement amends SFAS No. 123, to
provide alternative methods of transition for a voluntary change to the fair
value based method of accounting for stock-based employee compensation. In
addition, this statement amends the disclosure requirements of SFAS No. 123 to
require prominent disclosures in both annual and interim financial statements
about the method of accounting for stock-based employee compensation and the
effect of the method used on reported results. The Company has adopted the
disclosure provisions in the accompanying financial statements as discussed in
Note 12.

                                       F-9
<PAGE>
                             NOVA BIOGENETICS, INC.
                  (Formerly Healthcare Network Solutions, Inc.)
                    NOTES TO FINANCIAL STATEMENTS (Continued)
                                  JUNE 30, 2003

NOTE 1 - NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
         (Continued)

In November 2002, the FASB issued FASB Interpretation ("FIN") No. 45,
"Guarantor's Accounting and Disclosure Requirements for Guarantees, Including
Indirect Guarantees of Indebtedness of Others." FIN No. 45 requires the
recognition of a liability for certain guarantee obligations issued or modified
after December 31, 2002. FIN No. 45 also clarifies disclosure requirements to be
made by a guarantor of certain guarantees. The disclosure provisions of FIN No.
45 are effective for fiscal years ending after December 15, 2002. The Company
has adopted the disclosure provisions of FIN No. 45 as of February 28, 2003. The
Company does not expect the adoption of FIN No. 45 to have a material impact on
its financial position, results of operations or cash flows.

In January 2003, the FASB issued FIN No. 46, "Consolidation of Variable Interest
Entities, an Interpretation of ARB No. 51." FIN No. 46 requires certain variable
interest entities to be consolidated by the primary beneficiary of the entity if
the equity investors in the entity do not have the characteristics of a
controlling financial interest or do not have sufficient equity at risk for the
entity to finance its activities without additional subordinated financial
support from other parties. FIN No. 46 is effective for all new variable
interest entities created or acquired after January 31, 2003. For variable
interest entities created or acquired prior to February 1, 2003, the provisions
of FIN No. 46 must be applied for the first interim or annual period beginning
after June 15, 2003. The Company is currently analyzing the existing guidance
and reviewing any developments with regard to the proposed FASB Staff Positions
issued on the implementation of FIN No. 46 which are currently subject to public
comment. Therefore, the Company cannot determine whether there will be an impact
on its financial position, results of operations, or cash flows at this time.

In January 2003, the FASB issued EITF Issue No. 02-16, "Accounting by a Customer
(including a Reseller) for Certain Consideration Received from a Vendor." This
EITF addresses the accounting by a vendor for consideration (vendor allowances)
given to a customer, including a reseller of the vendor's products, and the
accounting by a reseller for cash consideration received from a vendor. It is
effective for certain arrangements entered into after November 21, 2002, and for
all new arrangements, including modifications to existing arrangements, entered
into after December 31, 2002. The Company adopted the provisions of the EITF in
the fourth quarter of fiscal 2003 and, as the Company's policies were already
consistent with those of EITF 02-16, the adoption of this standard did not have
a material impact on the Company's financial position, results of operations or
cash flows.

                                      F-10
<PAGE>
                             NOVA BIOGENETICS, INC.
                  (Formerly Healthcare Network Solutions, Inc.)
                    NOTES TO FINANCIAL STATEMENTS (Continued)
                                  JUNE 30, 2003

NOTE 1 - NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
         (Continued)

In April 2003, the FASB issued SFAS Statement No. 149, "Amendment of Statement
133 on Derivative Instruments and Hedging Activities," which amends and
clarifies financial accounting and reporting for derivative instruments,
including certain derivative instruments embedded in other contracts
(collectively referred to as derivatives) and for hedging activities under FASB
Statement No. 133, Accounting for Derivative instruments and Hedging Activities.
This Statement is effective for contracts entered into or modified after June
30, 2003, except for certain hedging relationships designated after June 30,
2003. Most provisions of this Statement should be applied prospectively. The
Company does not expect the adoption of SFAS No. 149 to have a material impact
on its financial statements.

In May 2003, the FASB issued SFAS Statement No. 150, "Accounting for Certain
Financial Instruments with Characteristics of both Liabilities and Equity." This
Statement establishes standards for how an issuer classifies and measures
certain financial instruments with characteristics of both liabilities and
equity. It requires that an issuer classify a financial instrument that is
within its scope as a liability (or an asset in some circumstances). This
statement is effective for financial instruments entered into or modified after
May 31, 2003, and otherwise is effective at the beginning of the first interim
period beginning after June 15, 2003, except for mandatory redeemable financial
instruments of nonpublic entities, if applicable. It is to be implemented by
reporting the cumulative effect of a change in an accounting principle for
financial instruments created before the issuance date of the Statement and
still existing at the beginning of the interim period of adoption. The Company
does not expect the adoption of SFAS No. 150 to have a material impact on its
financial statements.

NOTE 2 - GOING CONCERN

The accompanying financial statements have been prepared assuming the Company
will continue as a going concern. At June 30, 2003, the Company has a negative
working capital of $848,209, a stockholders' deficit of $841,114. There is
substantial doubt that it will be able to continue as a going concern without
additional funding. Management intends to continue to seek additional financing
to fund its operations although there can be no assurances that any such
financing will be available. The financial statements do not include any
adjustments that might be necessary should the Company be unable to continue as
a going concern.

                                      F-11
<PAGE>
                             NOVA BIOGENETICS, INC.
                  (Formerly Healthcare Network Solutions, Inc.)
                    NOTES TO FINANCIAL STATEMENTS (Continued)
                                  JUNE 30, 2003

NOTE 3 - PROPERTY AND EQUIPMENT

Fixed assets as of June 30, 2003 consisted of the following:

                                      Estimated
                                        Life
Office equipment                       5 Years      $3,800
Less: accumulated depreciation                        (180)
                                                    ------
                                                    $3,620
                                                    ======

Depreciation expense for the fiscal year ended June 30, 2003 was $180.

NOTE 4 - LICENSE

On January 27, 2003, Nova Biogenetics, Inc. ("Nova") purchased and received
assignment from International Biochemical Industries, Inc. ("IBCL"), IBCL's
entire rights, title and interest to certain identifiable intellectual property
as well as to applications therefrom and all patents and extensions thereof.

The purchase price was 500,000 shares of Nova's stock and $500,000. This amount
is secured by a $500,000 promissory note bearing interest at 6% per annum due
June 30, 2003. Additionally, Nova will pay 5% of all gross sales of the product
sold by using the intellectual property. The balance of this note as of June 30,
2003 is $490,904 and is past maturity.

IBCL is a company whose president and shareholder is the parent of the children
who are principal owners of Nova. Accordingly, the accounting for the agreement
and intellectual property was accounted for at IBCL's historical basis for such
assets which was $0.

The corresponding shares and notes for such assets have been recorded as a
distribution.

NOTE 5 - NOTES PAYABLE

In January 2002, the Company borrowed $275,000 from third parties under various
loan agreements. Interest accrues from the date of the note and is payable
annually on the unpaid principal at the rate per annum of 10%. Any overdue
payment of principal on these notes bears interest at fifteen percent (15%) per
annum until paid. The entire outstanding principal balance, together with all
unpaid accrued interest was due in April 2002. These notes were discharged
through the issuance of shares of the Company's subsidiary, Nova Biogenetics,
Inc. which were subsequently exchanged for shares of the Company's common stock
in the Exchange on March 18, 2003.

                                      F-12
<PAGE>
                             NOVA BIOGENETICS, INC.
                  (Formerly Healthcare Network Solutions, Inc.)
                    NOTES TO FINANCIAL STATEMENTS (Continued)
                                  JUNE 30, 2003

NOTE 6 - DUE TO RELATED PARTY

As of June 30, 2003, Company has non-interest bearing loans payable to IBCL in
the amount of $72,215. This amount includes accrued interest on the $500,000
loan related to the license agreement, such accrued interest is $8,585 as of
June 30, 2003.

NOTE 7 - STOCKHOLDERS' DEFICIT

COMMON STOCK

The Company is authorized to issue 50,000,000 shares all of which are common
stock, par value $.0001 without cumulative voting rights and without any
preemptive rights.

In connection with a loan payable, the Company issued 40,000 shares of the
Company's common stock. These shares were valued at fair market value of $.10
per share and charged to operations.

In connection with BSTI's spin-off of the Company's common stock to its
shareholders, the Company issued an additional 59,252 shares of common stock.

In March 2002, the Company issued 1,500,000 shares to an officer of the Company
for debt amounting to $150,000 in connection with a signing bonus.

In March 2002, the Company issued 1,000,000 common shares in connection with the
exercise of previously issued stock options. Since the Company did not receive
any cash for the exercise of these options, the Company recorded consulting
expense of $50,000 based on the exercise price of the stock options granted
($0.05 per share).

In May and June 2002, the Company issued 696,810 common shares in connection
with the exercise of stock options to four employees/officers for payment of
past wages and for services rendered amounting to $25,617 and $7,436,
respectively. The Company valued the shares at the fair market value or $0.05
per share.

In June 2002, the Company issued an aggregate of 200,000 shares of its common
stock upon the exercise of the equivalent number of options at $0.05 per share
equally to an officer and to a director of the Company. Since the Company did
not receive any cash for the exercise of these options, the Company recorded
non-cash compensation expense of $10,000 based on the exercise price of the
stock options granted ($0.05 per share).

In May 2002, in connection with the exercise of stock options, the Company
issued 3,050,000 shares to consultants for services rendered. Since the Company
did not receive any cash for the exercise of these options, the Company recorded
consulting expense of $152,600 based on the exercise price of the stock options
granted ($0.05 per share).

                                      F-13
<PAGE>
                             NOVA BIOGENETICS, INC.
                  (Formerly Healthcare Network Solutions, Inc.)
                    NOTES TO FINANCIAL STATEMENTS (Continued)
                                  JUNE 30, 2003

NOTE 7 - STOCKHOLDERS' DEFICIT (CONTINUED)

During fiscal year ended June 30, 2003, but prior to the exchange, the Company's
subsidiary sold shares of its common stock and raised gross proceeds of
$106,250. Offering costs associated with this sale of common stock were $36,942
for net proceeds of $69,308. These amounts have been reclassified to additional
paid-in capital as part of the Exchange.

In connection with its reverse acquisition completed on March 18, 2003, the
Company issued 31,253,938 shares of its common stock to the shareholders of Nova
for all the outstanding shares of Nova. In connection with this acquisition
certain former officers and directors of the Company agreed to cancel all there
outstanding shares totaling 3,300,000 shares of the Company's common stock.

STOCK OPTIONS

Pursuant to August 2001 Board of Directors approval and subsequent stockholder
approval, the Company adopted it's 2001 Non-Statutory Stock Option Plan (the
"Plan") whereby it reserved for issuance up to 9,000,000 shares of its common
stock. The Company filed a Registration Statement on Form S-8 so to register
those 9,000,000 shares of common stock underlying the aforesaid options.

The Company accounts for stock options issued to employees in accordance with
the provisions of Accounting Principles Board ("APB") Opinion No. 25,
"Accounting for Stock Issued to Employees," and related interpretations. As
such, compensation cost is measured on the date of grant as the excess of the
current market price of the underlying stock over the exercise price.

In fiscal year ended June 30, 2002, the fair value of each option granted to
consultants was estimated on the date of grant using the Black-Scholes
option-pricing model with the following weighted-average assumptions dividend
yield of -0- percent; expected volatility ranging from 0% - 260%; risk-free
interest rate of 5.00 percent and an expected holding periods of 2 to 5 years.

On September 1, 2001, pursuant to the Plan, the Company issued 1,200,000 stock
options to certain current members of its management team as well as 400,000
stock options to an attorney whom it considers to be important to its current
proposed business activities, with all options exercisable at $0.05 per share
for a period of five years until August 31, 2006. During June 2002, an officer
and a director of the Company exercised stock options for an aggregate of
200,000 shares of common stock. The Company valued stock options granted to the
attorney using the Black-Scholes option-pricing model and recorded consulting
expense of $4,000.

                                      F-14
<PAGE>
                             NOVA BIOGENETICS, INC.
                  (Formerly Healthcare Network Solutions, Inc.)
                    NOTES TO FINANCIAL STATEMENTS (Continued)
                                  JUNE 30, 2003

NOTE 7 - STOCKHOLDERS' DEFICIT (CONTINUED)

On November 29, 2001, pursuant to the Plan, the Company issued 2,000,000 stock
options pursuant to terms and conditions of a consulting agreement dated
November 29, 2001, with 1,000,000 options exercisable at $0.05 per share and
1,000,000 options exercisable at $1.00 per share for a period of five years
until November 28, 2006. The fair value of each option grant was estimated on
the date of grant using the Black-Scholes option-pricing model. In connection
with these options, the Company recorded consulting expense of $10,100. During
March 2002, the consultant exercised stock options for 1,000,000 shares of
common stock.

On December 1, 2001, pursuant to the Plan, the Company issued 200,000 stock
options to a consultant for accounting services, with all options exercisable at
$0.05 per share for a period of five years until November 30, 2006. The fair
value of the option grant to the consultant was estimated on the date of grant
using the Black-Scholes option-pricing model. In connection with these options,
the company recorded consulting expense of $2,000.

On December 17, 2001, the Company issued 100,000 warrants to a consultant for
investor relation services, with all warrants exercisable at $1.00 per share for
a period of three years until December 16, 2004. The fair value of the warrant
grant to the consultant was estimated on the date of grant using the
Black-Scholes option-pricing model. In connection with these warrants, the
Company recorded consulting expense of $1,000.

On March 29, 2002, pursuant to the Plan, the Company granted 100,000 stock
options to a director of the Company for services rendered. These options were
granted with an exercise price of $.05 and expire on March 29, 2007. In
connection with these stock options, the Company recorded consulting expense of
$10,000 on the date of grant, which is the excess of the current market price of
the underlying stock over the exercise price.

On March 29, 2002, the Company entered into 12-month consulting agreements and,
pursuant to the Plan, granted an aggregate of 75,000 stock options to
consultants for business development and marketing services. These options were
granted with an exercise price of $.05 and expire on March 29, 2004.
Additionally, on March 29, 2002, the Company entered into a 12-month consulting
agreement and, pursuant to the Plan, granted 200,000 stock options to a
consultant for business development and marketing services. These options were
granted with an exercise price of $.15 and expire on March 29, 2004.
Additionally, on March 29, 2002, the Company entered into a 12-month consulting
agreement and, pursuant to the Plan, granted 50,000 stock options to a
consultant for business development and marketing services. These options were
granted with an exercise price of $.05 and expire on March 29, 2007. The fair
value of each option grant was estimated on the date of grant using the
Black-Scholes option-pricing model. In connection with these options, the
Company recorded deferred compensation expense of $46,575, which is being
amortized into consulting expense over the term of the respective consulting
agreement.

                                      F-15
<PAGE>
                             NOVA BIOGENETICS, INC.
                  (Formerly Healthcare Network Solutions, Inc.)
                    NOTES TO FINANCIAL STATEMENTS (Continued)
                                  JUNE 30, 2003

NOTE 7 - STOCKHOLDERS' DEFICIT (CONTINUED)

During May 2002, pursuant to the Plan, the Company granted and immediately
exercised stock options for 3,050,000 shares of common stock to consultants for
services rendered. The fair value of each option grant was estimated on the date
of grant using the Black-Scholes option-pricing model. In connection with these
options, the Company recorded consulting expense of $150,000.

During fiscal 2002, pursuant to the Plan, , the Company granted 1,478,810 stock
options to certain employees whom it considers to be important to its current
proposed business activities, with all options exercisable at $0.05 per share
for a period of five years until December 16, 2006.
As of June 30, 2002, employees have exercised stock options for 696,810 shares
of common stock.

Prior to the reverse acquisition, the Company's subsidiary issued 18,000 options
to purchase shares of the subsidiary's common stock exercisable at $0.05 per
share. The subsidiary recognized noncash consulting expense of $900, such
options were converted into shares of the Company's common stock as part of the
exchange on March 18, 2003.

NOTE 7 - STOCKHOLDERS' DEFICIT (CONTINUED)

A summary of outstanding options and warrants at June 30, 2003 are as follows:

                                  Shares
                                Underlying    Range of     Remaining    Average
                                 Options/     Exercise    Contractual   Exercise
                                 Warrants      Price         Life        Price
                                ----------   ----------   -----------   --------
Outstanding at June 30, 2001 ..          -   $    -            -         $ -
Granted .......................  8,853,810    0.05-1.00     2-5 yrs       0.17
Expired .......................          -        -            -           -
Exercised ..................... (4,946,810)   0.00-0.05        -          0.05
                                ----------   ----------   -----------   --------
Outstanding at June 30, 2002 ..  3,907,000   $0.05-1.00    2-5 years     $0.32
Granted .......................          -        -            -           -
Canceled ...................... (2,525,000)  $0.05-1.00    1-4 years      0.41
Exercised .....................          -        -            -           -
                                ----------   ----------   -----------   --------
Outstanding at June 30, 2003 ..  1,382,000   $   0.05      1-5 years     $0.05


                                      F-16
<PAGE>
                             NOVA BIOGENETICS, INC.
                  (Formerly Healthcare Network Solutions, Inc.)
                    NOTES TO FINANCIAL STATEMENTS (Continued)
                                  JUNE 30, 2003

NOTE 7 - STOCKHOLDERS' DEFICIT (CONTINUED)

The following table summarizes the Company's stock options outstanding at June
30, 2003:

                          Options outstanding             Options exercisable
                   ----------------------------------    ---------------------
                                Weighted     Weighted                 Weighted
                                 average     average                  average
    Range of                    remaining    exercise                 exercise
 exercise price     Number        life        price       Number       price
 --------------    ---------    ---------    --------    ---------    --------
     $ 0.05        1,382,000       2.78       $ 0.05     1,382,000     $0.05
                   =========                             =========

NOTE 8 - INCOME TAXES

As of June 30, 2003, the Company has available unused federal net operating loss
("NOL") carryovers of approximately $294,000 that may be applied against future
taxable income and expire through 2023. As result of net losses, since
inception, the Company has fully reserved the tax benefits of these operating
losses because the likelihood of realization of the tax benefits cannot be
determined.

         Deferred tax asset:
          Net operating loss carryforward ..........  $ 100,000
          Valuation allowance ......................   (100,000)
                                                      ---------
         Net deferred tax asset ....................  $       -
                                                      =========

The table below summarizes the differences between the Company's effective tax
rate and the statutory federal rate as follows for fiscal 2002:

         Statutory federal rate ....................     (34.0%)
         Net operating loss not utilized ...........      34.0%
                                                      ---------
         Effective tax rate ........................          -
                                                      =========

NOTE 9 - COMMITMENTS

A) Employment Agreement

On March 19, 2003, the Company entered into an employment agreement with its
former CEO, this officer is still employed by the Company under the same terms
of this agreement. The agreement is for five years with a base salary of
$250,000. Additionally, this executive is entitled to a guaranteed bonus of 100%
of the preceding year's salary over the term of the agreement, payable at the
discretion of the Company's compensation committee. As of June 30, 2003, the
Company has accrued bonus's payable to this officer of approximately $136,000.

                                      F-17
<PAGE>
                             NOVA BIOGENETICS, INC.
                  (Formerly Healthcare Network Solutions, Inc.)
                    NOTES TO FINANCIAL STATEMENTS (Continued)
                                  JUNE 30, 2003

NOTE 9 - COMMITMENTS (continued)

B) Lease

On June 1, 2003, the Company entered into a five-year operating lease for office
space in Atlanta, Georgia. Monthly rent during the first year of the agreement
is $2,082. Additionally, the Company paid a security deposit of $3,475.

  The future minimum lease payments are as follows:

         June 30, 2004 .............  $  24,984
                  2005 .............     25,734
                  2006 .............     26,514
                  2007 .............     27,295
                  2008 .............     28,107
                                      ---------
                                      $ 132,634
                                      =========

Rent expense for the year ended June 30, 2003 was $2,242.

NOTE 10 - SUBSEQUENT EVENTS

In July 2003, the Company enacted a 1-for-8.9 reverse common stock split which
is subject to the approval of the Company's shareholders.

On July 11, 2003, the Company entered into an employment agreement with its
Chief Executive Officer. The term of this agreement is for five years. The base
salary under this agreement is $126,000 annually subject to review by the
Company's compensation committee. The executive is also entitled to a bonus of
at least 100% of the preceding year's salary throughout the term of this
agreement. Additionally, the executive is guaranteed a minimum of $250,000 for
basic research to be conducted at Ohio State University. Also, the executive
shall receive 5% of the first biopharmaceutical sales and 2.5% of the second
sale made by the Company, and he shall receive 5% of the first licensing
agreement with a biopharmaceutical company. Finally, this executive shall be
issued 500,000 shares of the Company's common stock.

On July 11, 2003, the Company entered into a five year employment agreement with
its President. The base salary is to be determined at a future date; however,
this executive shall receive 2% of all Joint Partner Relationship monies
received from such partners, if any. Additionally, this executive shall receive
250,000 shares of the Company's common stock.

                                      F-18
<PAGE>
                             NOVA BIOGENETICS, INC.
                  (Formerly Healthcare Network Solutions, Inc.)
                    NOTES TO FINANCIAL STATEMENTS (Continued)
                                  JUNE 30, 2003

NOTE 10 - SUBSEQUENT EVENTS (continued)

On September 1, 2003, the Company entered into a five year employment agreement
with its Director of Investment and Investor Relations. The agreement calls for
the individual to receive 11% of all capital raised by this individual and 3
1/2% in warrants on the monies raised. Additionally, this individual is to be
granted 200,000 shares of the Company's common stock which shall be released to
this individual in 20,000 share blocks for every $100,000 in capital the
individual raises on behalf of the Company.

In October 1, 2003, with the approval of the Company's board of directors, the
Company authorized the issuance of 1,494,000 common shares to its officers,
directors and employees.









                                      F-19