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**UNITED      STATES**

**SECURITIES      AND EXCHANGE COMMISSION**

**Washington,      D.C. 20549**

| x | Quarterly                  Report Pursuant to Section 13 or 15(d) of the Securities Exchange                  Act of                  1934 for the Quarterly Period ended September 30, 2006;                  or |
|---|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| o | Transition                  Report Pursuant to Section 13 or 15(d) of the Securities Exchange                  Act of                  1934 for the transition period from ________ to                  ________ |
|---|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**THE      MEDICAL EXCHANGE INC.**

| **NEVADA**(State                or other jurisdiction of incorporation                or organization) | **71-0915825**(I.R.S.                Employer Identification No.) |
|--------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------|

**17      State Street**

**New      York, New York 10004**

**212-269-4051**
** **

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**THE        MEDICAL EXCHANGE INC.**

| **ASSETS**                                                                             |   | September                  30,2006 |   | June                  30, 2006 |     |
|----------------------------------------------------------------------------------------|--------|------------------------------------|--------|--------------------------------|----------|
|                                                                                   |   |                               |   |                           |     |
| Current                                                                                |   |                               |   |                           |     |
| Cash                                                                                   | $      | 387                                |   | $                              | 9,422    |   |
|                                                                                   |   |                               |   |                           |     |   |
| Deferred                  acquisition costs                                            |   | 9,000                              |   |                           | 9,000    |   |
|                                                                                   |   |                               |   |                           |     |   |
|                                                                                   | $      | 9,387                              |   | $                              | 18,422   |   |
|                                                                                   |   |                               |   |                           |     |   |
|  **LIABILITIES**                                                                  |
|                                                                                   |   |                               |   |                           |     |   |
| Current                                                                                |   |                               |   |                           |     |   |
| Accounts                  payable and accrued liabilities                              | $      | 13,731                             |   | $                              | 19,466   |   |
| Loan                  payable                                                          |   | 4,396                              |   |                           | 4,396    |   |
|                                                                                   |   |                               |   |                           |     |   |
|                                                                                   |   | 18,127                             |   |                           | 23,862   |   |
|                                                                                   |   |                               |   |                           |     |   |
|  **STOCKHOLDERS’                  DEFICIENCY**                              |
|                                                                                   |   |                               |   |                           |     |   |
| Capital                  stock - Note 4                                                |   |                               |   |                           |     |   |
| Authorized:                                                                            |   |                               |   |                           |     |   |
| 25,000,000                  common                  shares, par value $0.001 per share |   |                               |   |                           |
| Issued                  and outstanding:                                               |   |                               |   |                           |     |   |
| 10,200,000                  common                  shares (June 30, 2006: 10,150,000) |   | 10,200                             |   |                           | 10,150   |   |
| Additional                  paid-in capital                                            |   | 144,731                            |   |                           | 144,281  |   |
| Share                  subscriptions receivable                                        |   | (37,000                            | )      |                           | (36,500  | ) |
| Accumulated                  other comprehensive loss                                  |   | (331                               | )      |                           | (331     | ) |
| Deficit                  accumulated during the development stage                      |   | (126,340                           | )      |                           | (123,040 | ) |
|                                                                                   |   |                               |   |                           |     |   |
|                                                                                   |   | (8,740                             | )      |                           | (5,440   | ) |
|                                                                                   |   |                               |   |                           |     |   |
|                                                                                   | $      | 9,387                              |   | $                              | 18,422   |   |
|                                                                                   |   |                               |   |                           |     |   |

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**THE        MEDICAL EXCHANGE INC.**

|                                                           |   |                                |       |                           |   | January                  23,   |   |
|----------------------------------------------------------------|--------|-------------------------------------|------------|--------------------------------|--------|--------------------------------|--------|
|                                                           |   |                                |       |                           |   | 2004                  (Date of |   |
|                                                           |   | Three                  months ended |       | Inception)                  to |   |
|                                                           |   | September                  30,      |       | September                  30, |   |
|                                                           |   | 2006                                |       | 2005                           |   | 2006                           |   |
|                                                           |   |                                |       |                           |   |                           |   |
| Expenses                                                       |   |                                |       |                           |   |                           |   |
| Accounting                  and audit fees                     |   | $                                   | 3,300      |                           | $      | 500                            |   | $ | 33,443 |   |
| Bank                  charges and interest                     |   |                                | -          |                           |   | 57                             |   |   | 563 |   |
| Legal                  fees                                    |   |                                | -          |                           |   | 4,220                          |   |   | 71,295 |   |
| Registration                  and filing fees                  |   |                                | -          |                           |   | 1,200                          |   |   | 16,611 |   |
| Website                  design and maintenance                |   |                                | -          |                           |   | -                              |   |   | 2,928 |   |
|                                                           |   |                                |       |                           |   |                           |   |   |   |   |
| Net                  loss for the period before other item     |   |                                | (3,300     | )                              |   | (5,977                         | )      |   | (124,840 | ) |
|                                                           |   |                                |       |                           |   |                           |   |   |   |   |
| Other                  item                                    |   |                                |       |                           |   |                           |   |   |   |   |
| Write-off                  of advance receivable               |   |                                | -          |                           |   | -                              |   |   | (1,500 | ) |
|                                                           |   |                                |       |                           |   |                           |   |   |   |   |
| Net                  loss for the period                       |   |                                | (3,300     | )                              |   | (5,977                         | )      |   | (126,340 | ) |
|                                                           |   |                                |       |                           |   |                           |   |   |   |   |
| Other                  comprehensive loss                      |   |                                |       |                           |   |                           |   |   |   |   |
| Foreign                  currency translation adjustment       |   |                                | -          |                           |   | (9                             | )      |   | (331 | ) |
|                                                           |   |                                |       |                           |   |                           |   |   |   |   |
| Comprehensive                  loss for the period             |   | $                                   | (3,300     | )                              | $      | (5,986                         | )      | $ | (126,671 | ) |
|                                                           |   |                                |       |                           |   |                           |   |   |   |   |
| Basic                  and diluted loss per share              |   | $                                   | (0.00      | )                              | $      | (0.00                          | )      |   |   |   |
|                                                           |   |                                |       |                           |   |                           |   |   |   |   |
| Weighted                  average number of shares outstanding |   |                                | 10,200,000 |                           |   | 2,112,500                      |   |   |   |   |
|                                                           |   |                                |       |                           |   |                           |   |   |   |   |

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**THE        MEDICAL EXCHANGE INC.**

|                                                                                 |   |                               |       |            |   |             |   |               |    | Deficit                     |   |        |   |
|--------------------------------------------------------------------------------------|--------|-------------------------------|------------|------------|--------|-------------|--------|---------------|---------|-----------------------------|--------|-------------|--------|
|                                                                                 |   |                               |       |            |   | Accumulated |   |               |    | Accumulated                 |   |        |   |
|                                                                                 |   | Common                  Stock |       | Additional |   | Other       |   | Common        |    | During                  the |   |        |   |
|                                                                                 |   | Number                  of    |       |            |   | Paid-in     |   | Comprehensive |    | Stock                       |   | Development |   |   |   |
|                                                                                 |   | Shares                        |       | Amount     |   | Capital     |   | Loss          |    | Subscriptions               |   | Stage       |   | Total |   |
|                                                                                 |   |                          |       |       |   |        |   |          |    |                        |   |        |   |   |   |
| Balance,                  January 23, 2004 (Date                  of Inception) |   |                          | -          |       | $      | -           |   | $             | -       |                        | $      | -           |   | $ | - |   | $ | - |   | $ | - |   |
| Common                  stock issued for cash-                  at $0.02 per share   |   |                          | 2,112,500  |       |   | 2,113       |   |          | 40,137  |                        |   | -           |   |   | - |   |   | - |   |   | 42,250 |   |
| Foreign                  currency translation adjustment                             |   |                          | -          |       |   | -           |   |          | -       |                        |   | (154        | )      |   | - |   |   | - |   |   | (154 | ) |
| Net                  loss for the period                                             |   |                          | -          |       |   | -           |   |          | -       |                        |   | -           |   |   | - |   |   | (6,893 | ) |   | (6,893 | ) |
|                                                                                 |   |                          |       |       |   |        |   |          |    |                        |   |        |   |   |   |   |   |   |   |   |   |   |
| Balance,                  June 30, 2004                                              |   |                          | 2,112,500  |       |   | 2,113       |   |          | 40,137  |                        |   | (154        | )      |   | - |   |   | (6,893 | ) |   | 35,203 |   |
| Foreign                  currency translation adjustment                             |   |                          | -          |       |   | -           |   |          | -       |                        |   | (44         | )      |   | - |   |   | - |   |   | (44 | ) |
| Net                  loss for the year                                               |   |                          | -          |       |   | -           |   |          | -       |                        |   | -           |   |   | - |   |   | (57,251 | ) |   | (57,251 | ) |
|                                                                                 |   |                          |       |       |   |        |   |          |    |                        |   |        |   |   |   |   |   |   |   |   |   |   |
| Balance,                  June 30, 2005                                              |   |                          | 2,112,500  |       |   | 2,113       |   |          | 40,137  |                        |   | (198        | )      |   | - |   |   | (64,144 | ) |   | (22,092 | ) |
| Common                  stock issued for cash-                  at $0.01 per share   |   |                          | 8,037,500  |       |   | 8,037       |   |          | 72,338  |                        |   | -           |   |   | - |   |   | - |   |   | 80,375 |   |
| Common                  stock subscriptions                                          |   |                          | -          |       |   | -           |   |          | -       |                        |   | -           |   |   | (36,500 | ) |   | - |   |   | (36,500 | ) |
| Director’s                  forgiveness of debt                                |   |                          | -          |       |   | -           |   |          | 31,806  |                        |   | -           |   |   | - |   |   | - |   |   | 31,806 |   |
| Foreign                  currency translation adjustment                             |   |                          | -          |       |   | -           |   |          | -       |                        |   | (133        | )      |   | - |   |   | - |   |   | (133 | ) |
| Net                  loss for the year                                               |   |                          | -          |       |   | -           |   |          | -       |                        |   | -           |   |   | - |   |   | (58,896 | ) |   | (58,896 | ) |
|                                                                                 |   |                          |       |       |   |        |   |          |    |                        |   |        |   |   |   |   |   |   |   |   |   |   |
| Balance,                  June 30, 2006                                              |   |                          | 10,150,000 |       |   | 10,150      |   |          | 144,281 |                        |   | (331        | )      |   | (36,500 | ) |   | (123,040 | ) |   | (5,440 | ) |
|                                                                                 |   |                          |       |       |   |        |   |          |    |                        |   |        |   |   |   |   |   |   |   |   |   |   |

----

**THE        MEDICAL EXCHANGE INC.**

|                                                                               |   |                          |       |       |   |        |   |          |    | Deficit                     |   |        |   |
|------------------------------------------------------------------------------------|--------|-------------------------------|------------|------------|--------|-------------|--------|---------------|---------|-----------------------------|--------|-------------|--------|
|                                                                               |   |                          |       |       |   | Accumulated |   |          |    | Accumulated                 |   |        |   |
|                                                                               |   | Common                  Stock |       | Additional |   | Other       |   | Common        |    | During                  the |   |        |   |
|                                                                               |   | Number                  of    |       |       |   | Paid-in     |   | Comprehensive |    | Stock                       |   | Development |   |   |   |
|                                                                               |   | Shares                        |       | Amount     |   | Capital     |   | Loss          |    | Subscriptions               |   | Stage       |   | Total |   |
|                                                                               |   |                          |       |       |   |        |   |          |    |                        |   |        |   |   |   |
| Balance,                  June 30, 2006                                            |   |                          | 10,150,000 |       |   | 10,150      |   |          | 144,281 |                        |   | (331        | )      |   | (36,500 | ) |   | (123,040 | ) |   | (5,440 | ) |
| Common                  stock issued for cash-                  at $0.02 per share |   |                          | 50,000     |       |   | 50          |   |          | 450     |                        |   | -           |   |   | (500 | ) |   | - |   |   | - |   |
| Net                  loss for the period                                           |   |                          | -          |       |   | -           |   |          | -       |                        |   | -           |   |   | - |   |   | (3,300 | ) |   | (3,300 | ) |
|                                                                               |   |                          |       |       |   |        |   |          |    |                        |   |        |   |   |   |   |   |   |   |   |   |   |
| Balance,                  September 30, 2006                                       |   |                          | 10,200,000 |       | $      | 10,200      |   | $             | 144,731 |                        | $      | (331        | )      | $ | (37,000 | ) | $ | (126,340 | ) | $ | (8,740 | ) |
|                                                                               |   |                          |       |       |   |        |   |          |    |                        |   |        |   |   |   |   |   |   |   |   |   |   |

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**THE        MEDICAL EXCHANGE INC.**

|                                                                                                               |   |                                |   |                           |   | January                  23,   |   |
|--------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------|--------|--------------------------------|--------|--------------------------------|--------|
|                                                                                                               |   |                                |   |                           |   | 2004                  (Date of |   |
|                                                                                                               |   | Three                  months ended |   | Inception)                  to |   |
|                                                                                                               |   | September                  30,      |   | September                  30, |   |
|                                                                                                               |   | 2006                                |   | 2005                           |   | 2006                           |   |
|                                                                                                               |   |                                |   |                           |   |                           |   |
| Cash                  Flows from Operating Activities                                                              |   |                                |   |                           |   |                           |   |
| Net                  loss for the period                                                                           |   | $                                   | (3,300 | )                              | $      | (5,977                         | )      | $ | (126,340 | ) |
| Adjustments                  to reconcile net loss to net cash used                  by operating activities: |   |                                |   |                           |   |                           |   |   |   |   |
| Accounts                  payable and accrued liabilities                                                          |   |                                | (5,735 | )                              |   | (2,767                         | )      |   | 13,731 |   |
|                                                                                                               |   |                                |   |                           |   |                           |   |   |   |   |
| Net                  cash used in operating activities                                                             |   |                                | (9,035 | )                              |   | (8,744                         | )      |   | (112,609 | ) |
|                                                                                                               |   |                                |   |                           |   |                           |   |   |   |   |
| Cash                  Flows from Investing Activity                                                                |   |                                |   |                           |   |                           |   |   |   |   |
| Deferred                  acquisition costs                                                                        |   |                                | -      |                           |   | -                              |   |   | (9,000 | ) |
|                                                                                                               |   |                                |   |                           |   |                           |   |   |   |   |
| Net                  cash used in investing activity                                                               |   |                                | -      |                           |   | -                              |   |   | (9,000 | ) |
|                                                                                                               |   |                                |   |                           |   |                           |   |   |   |   |
| Cash                  Flows from Financing Activities                                                              |   |                                |   |                           |   |                           |   |   |   |   |
| Bank                  indebtedness                                                                                 |   |                                | -      |                           |   | 6                              |   |   | - |   |
| Issuance                  of common shares                                                                         |   |                                | 500    |                           |   | -                              |   |   | 123,125 |   |
| Share                  subscriptions receivable                                                                    |   |                                | (500   | )                              |   | -                              |   |   | (37,000 | ) |
| Loan                  payable                                                                                      |   |                                | -      |                           |   | -                              |   |   | 4,396 |   |
| Increase                  in due to related party                                                                  |   |                                | -      |                           |   | 7,484                          |   |   | 31,806 |   |
|                                                                                                               |   |                                |   |                           |   |                           |   |   |   |   |
| Net                  cash provided by financing activities                                                         |   |                                | -      |                           |   | 7,490                          |   |   | 122,327 |   |
|                                                                                                               |   |                                |   |                           |   |                           |   |   |   |   |
| Effect                  of foreign currency translation on cash                                                    |   |                                | -      |                           |   | (9                             | )      |   | (331 | ) |
|                                                                                                               |   |                                |   |                           |   |                           |   |   |   |   |
| Increase                  (decrease) in cash during the period                                                     |   |                                | (9,035 | )                              |   | (1,263                         | )      |   | 387 |   |
|                                                                                                               |   |                                |   |                           |   |                           |   |   |   |   |
| Cash,                  beginning of period                                                                         |   |                                | 9,422  |                           |   | 1,263                          |   |   | - |   |
|                                                                                                               |   |                                |   |                           |   |                           |   |   |   |   |
| Cash,                  end of period                                                                               |   | $                                   | 387    |                           | $      | -                              |   | $ | 387 |   |
|                                                                                                               |   |                                |   |                           |   |                           |   |   |   |   |
|                                                                                                               |   |                                |   |                           |   |                           |   |   |   |   |
|                                                                                                               |   |                                |   |                           |   |                           |   |   |   |   |
|                                                                                                               |   |                                |   |                           |   |                           |   |   |   |   |

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**THE        MEDICAL EXCHANGE INC.**

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

**RESULTS        OF OPERATIONS**

*From        July 1, 2006 to September 30, 2006*

**PLAN        OF OPERATION**

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**LIQUIDITY        AND CAPITAL RESOURCES**

**ITEM        3. CONTROLS AND PROCEDURES**

**PART        II - OTHER INFORMATION**

**ITEM        1. LEGAL PROCEEDINGS.**

**ITEM        2. CHANGES IN SECURITIES AND USE OF PROCEEDS.**

**SALES        OF UNREGISTERED SECURITIES**

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**ITEM        3. DEFAULTS UPON SENIOR SECURITIES.**

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

**ITEM        5. OTHER INFORMATION.**

**ITEM        6. EXHIBITS**

| 31 | Certification                    of Acting Chief Executive Officer |
|----|--------------------------------------------------------------------|
| 32 | Section                    1350 Certification                      |

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**SIGNATURES**

| DATE:                  NOVEMBER 14, 2006 | **THE                MEDICAL EXCHANGE INC.** /s/                MICHAEL GOLDBERG*                                         *MICHAEL                GOLDBERGACTING                CHIEF EXECUTIVE OFFICER(PRINCIPALEXECUTIVE                OFFICER AND PRINCIPAL FINANCIALAND                ACCOUNTING OFFICER) |
|------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|